2:00PM Water Cooler 3/17/2016

By Lambert Strether of Corrente.

Readers, this may be a little light because yesterday, too, was a travel day for me, and I got in late.


“The Potential Impact of the Transatlantic Trade and Investment Partnership (TTIP) on public health” (PDF) [Epidemiologia & Prevenzione]. Italian academic paper, in English:

The TTIP’s Investor to State Dispute Settlement (ISDS) arbitration system, a mechanism that allows transnational companies (TNCs) to sue governments when a policy or law reduces the value of their investment, is likely to generate a negative impact on regulations aimed at increasing access to healthcare, and reducing tobacco, alco – hol consumption, and diet-related diseases. The Sanitary and Phytosanitary Standards (SPS) of the TTIP is ex – pected to weaken regulations in the food and agricultural sectors especially in the EU, with potentially negative effects on food safety and foodborne diseases. Finally, the ISDS is likely to infringe the ability of governments to tackle environmental problems such as climate change deemed to be the most important global health threat of the century.

“On Trade, Angry Voters Have a Point” [Eduardo Porter, New York Times]. Classic headline. And here’s the lead: “Were the experts wrong about the benefits of trade for the American economy?”

What seems most striking is that the angry working class — dismissed so often as myopic, unable to understand the economic trade-offs presented by trade — appears to have understood what the experts are only belatedly finding to be true: The benefits from trade to the American economy may not always justify its costs.

So I guess credentials aren’t all that important, then? Or perhaps important for reasons other than the people who trust the experts might expect?



“”Throwing money at the problem” may actually work in education” [Washington Center for Equitable Growth]. “While we still need to make progress as far as disparities between individual students, this research makes a compelling and evidence-based case for school finance reform on a federal level. Rather than ‘throwing money at the problem,’ no-strings-attached funds may actually make a difference for the country’s most disadvantaged school districts”

From the Clinton email trove:

Crazed, ignorant, bloodthirsty elites. Remember that Tanden is one of those extreme liberals that populate HillaryLand.


“US election 2016: Who’s funding Trump, Sanders and the rest?” [BBC]. “Nearly three-quarters of Senator Sanders’ donations have been under $200. His campaign said the average donation in 2015 was $27.16. Only 17% of donations to rival Hillary Clinton are under $200.” Not a word from Dem establishment on Sanders funding model. They prefer their own.

The Voters

The youth movement the Dem establishment wants either to strangle or sheepdog (or both):

Trump Panic

Sheepdogging: “I’m with Hillary in November: Listen up, fellow Bernie supporters — you must get behind Clinton to stop Donald Trump” [Salon]. Show of hands: Who thinks opposing Trump — and Trumpism — would be more effective within Clinton campaign, as opposed to an organization independent of the Clinton campaign?”

“Senate Minority Leader Harry Reid accused House and Senate GOP leaders of ‘moral cowardice’ Thursday for not disavowing GOP front-runner Donald Trump” [Roll Call]. Well, so much for Merrick Garland.

“The question is whether he will escalate his rhetoric and what actions his suggestions may incite” [Wall Street Journal, “Behind Donald Trump’s Warning of ‘Riots’ at the GOP Convention”]. Turning the coin over, though: What’s the appropriate response to a convention stolen by elites? Party unity?

The Trail

“Stamina – Trump’s Lingistic Kill Shot for Clinton (Master Persuader Series)” [Scott Adams]. I don’t like Adams’ politics much, so but and he’s really good on Trump’s rhetoric.

” “We anticipate, in the weeks and months to come, that we will steadily, consistently and successfully erode [Clinton’s] current advantage in pledged delegates when we get through June 7,” Weaver said, referring to the day that the final six states, including California, vote” [Seven Days].

Just in case Sanders people think Clinton wants their votes:

In realpolitik terms, if more Republicans defect over Trump than Sanders voters defect over Clinton, it makes perfect sense for Clinton to heave Sanders and his voters over the side. Which she appears to be doing.

Clinton Email Hairball

“Given the NSA’s refusal to give Clinton what she wanted, the secretary apparently decided to continue to use her personal e-mail server for State Department business, while her staff was fully aware of the security risks associated with using her BlackBerry.” [Ars Technica]. I’m actually just a little sympathetic to Clinton, here, since the alternative to the BlackBerry that the NSA offered Clinton was a device running Windows CE. Interesting read.

Stats Watch

Philadelphia Fed Business Outlook Survey, March 2016: “The Philly Fed’s general conditions index has emerged from a long negative run with a much stronger-than-expected March reading” [Econoday]. “Importantly, strength is confirmed by new orders which literally surged to plus 15.7 from minus 5.3 in February. Contraction in unfilled orders is now only marginal at minus 1.9 which is another good sign. This report confirms similar strength in Tuesday’s Empire State report” (which is noisy, let us remember). But: “This is a very noisy index which readers should be reminded is sentiment based. The Philly Fed historically is one of the more negative of all the Fed manufacturing surveys but has been more positive then the others recently” [Econintersect]. And but: “I am generally not a big fan of these regional factory indicators, as there are so darn many of them and their correlations with the national ISM measure are spotty” [Amherst Pierpont Securities, Across the Curve]. “Nonetheless, the Fed’s factory output data, released yesterday, showed back-to-back gains, the ISM composite crept higher in February (still below 50), and durable goods orders in January rebounded after weak November and December results. So, the evidence is piling up that the manufacturing sector’s worst days are probably behind it, and the regional gauges this week are downright hopeful. I doubt that we will see much growth in the factory sector in 2016, but it may very well cease to be an outright drag, as the most intense period of dollar appreciation is now more than 18 months in the past, so that the headwinds from the strong dollar are probably beginning to fade.”

Leading Indicators, February 2016: “The index of leading economic indicators inched 0.1 percent higher in February following declines of 0.2 and 0.3 percent in the prior two months” [Econoday]. “The yield spread, reflecting [***cough*** manipulation ***cough***] accommodative monetary policy, remains a central strength as do unemployment claims, which have been trending at historic lows. Factory readings, which were strong in January, fell back in February. This report has been soft and is pointing to no more than moderate economic growth over the next six months.” However: “[K]nowing the current values is no assurance that a recession is or is not imminent as there is no track record of real time performance” [Econintersect].

Jobless Claims, week of March 12, 2016: “The labor market is steady and solid based on jobless claims data where initial claims came in at 265,000, up 7,000 in the March 12th week but still near record lows” [Econoday]. “There are no special factors in today’s report, one that underscores the Federal Reserve’s confidence in the strength of the labor market.” And: “Claim levels are at 40 year lows (with the normal range around 350,000 weekly initial unemployment claims of levels seen historically during times of economic expansion” [Econintersect].

JOLTS, January 2016: “In a mixed report, job openings surged in January to 5.541 million from, however, a sharply downward revised 5.281 million in December (5.607 million initially reported)” [Econoday]. “The quits rate, which jumped in December, fell back a sharp 2 tenths to 2.0 percent and points to less confidence among workers to shift jobs.” But: “The BLS Job Openings and Labor Turnover Survey (JOLTS) can be used as a predictor of future jobs growth, and the predictive elements show that the year-over-year growth rate of unadjusted private non-farm job openings improved from last month. The growth rate trends marginally improved in the 3 month averages, but the 2015 year-to-date averages continue to decline” [Econintersect].

Bloomberg Consumer Comfort Index, week of March 13, 2016: “The consumer comfort index rose a solid 5 tenth to 44.3 in the March 13 week, back up above the 44 reading where it has hovered for most of the year” [Econoday]. “[T]he report reaffirms that consumer confidence is stable, continuing to benefit from the strength of the labor market, and underscores the Federal Reserve’s view that consumer confidence remains intact.”

Commodities: “There is mystery at the heart of the oversupplied global oil market: missing barrels of crude. Last year, there were 800,000 barrels of oil a day unaccounted for….” [Wall Street Journal: “Crude Mystery: Where Did 800,000 Barrels of Oil Go?”]. “Some analysts say the barrels may be in China. Others believe the barrels were created by flawed accounting and they don’t actually exist. If they don’t exist, then the oversupply that has driven crude prices to decade lows could be much smaller than estimated and prices could rebound faster.”

The Fed: “Why the Fed should allow wages to rise” [CBS]. I like that headline. It states, quite openly, that the purpose of the Fed is class warfare.

Today’s Fear & Greed Index: 77, Greed (previous close: 75, Greed) [CNN]. One week ago: 71 (Greed). (0 is Extreme Fear; 100 is Extreme Greed). Last updated Mar 17 at 12:21pm. So, off the time and heading toward the 80s. Sentiment improves…


“New research shows that overuse of antibiotics by children is to blame for bugs becoming drug-resistant for up to six months at a time in cases of urinary tract infections (UTI) caused by E coli” [Guardian].

Black Injustice Tipping Point

“Black Americans were disproportionately targeted in the ‘war on drugs.’ Now state laws and steep regulatory costs have left them far more likely to be shut out of America’s profitable marijuana boom” [Buzzfeed]. “For most jobs, experience will help you get ahead. In the marijuana industry, it’s not that simple. Yes, investors and state governments are eager to hire and license people with expertise in how to cultivate, cure, trim, and process cannabis. But it can’t be someone who got caught. Which for the most part means it can’t be someone who is black.”

“The Times-Picayune review of hundreds of pages of court documents has discovered that the roughly 2,000 eligible victims of lead poisoning in the city’s public housing developments received, on average, no more than $17,000. Meanwhile, three lawyers appointed by the court to help administer the settlement fund were paid, in total, almost $2 million, with one of them making almost half a million dollars for four months of work” [Times-Picayune]. “Kinard’s children didn’t receive a dime. Their medical records had been lost during Hurricane Katrina.” And: “U.S. Investigating Elevated Blood Lead Levels in New York’s Public Housing” [New York Times]. Great.

Imperial Collapse Watch

“More than 12 punished for mistaken Afghan hospital attack” [AP]. As we’ve seen, our military lacks operational competence.

Class Warfare

“Automating the Professions: Utopian Pipe Dream or Dystopian Nightmare?” [Los Angeles Review of Books]. A useful survey of the literature.

“Jobs Involving Routine Tasks Aren’t Growing” [St Louis Fed].

U.S. labor markets are undergoing important long-run changes. These include:

  • The decline of middle-skill occupations, such as manufacturing and production occupations
  • The growth in both high- and low-skill occupations, such as managers and professional occupations on one end, and assisting or caring for others on the other.

Economists have coined the term “job polarization” for this process.1 As has been argued in the economic literature, the most likely drivers of job polarization are automation and offshoring, as both these forces lower the demand for middle-skill occupations relative to the rest.

Note lack of agency. And I love the distinction, further down in the paper, between “cognitive” (Acela-riding) and “manual” (fixing your plumbing).

“Lee Sedol used about 20 Watts of power to operate. By contrast, AlphaGo runs on a whopping 1920 CPUs and another 280 GPUs for an estimated power consumption of approximately 1 MW (200 W per CPU and 200 W per GPU). That’s 50,000 times as much power as the amount of power that Lee Sedol’s brain uses” [Jacques Mattheij]. “So now the interesting question (to me at least) is: How long before a computer will beat the human Go world champion using no more power than the human.”

“How Google’s AI Auto-Magically Answers Your Emails” [Wired]. “Potential responses are meant to get better over time by learning from the replies users select” In other words, humans will train their replacements for free.

“Although the top 0.1% is a small group—it includes about 160,000 families with net assets above $20 million in 2012—carefully measuring its wealth is important for several reasons. First, questions of morality aside, economies tend to function at less than optimal levels when an increasing share of national wealth goes to an increasingly small amount of the population (especially when that group has the highest propensity to save). Second, the increasing fraying of the social contract has led to a profound political polarization, manifesting itself through the rise of nationalist/neo-fascist parties and political figures” [Emmanuel Saez, Social Europe]. There are not very many of the Shing….

News of the Wired

“Crowdfunding for the Public Good Is Evil” [Wired]. “Once we start privatizing what was once squarely public, governments will all too eagerly push those expenses off their ledgers. The effect snowballs, and crowdfunding becomes an excuse to leave more and more basic services up to the crowd. Roads, health care, education: These are not the kinds of things that go viral and raise $2 million in less than a week.”

“How a Ragtag Gang of Retirees Pulled Off the Biggest Jewel Heist in British History” [Vanity Fair].

“French Cafés Are Charging Extra for Rude Behavior” [Grub Street].

* * *

Readers, feel free to contact me with (a) links, and even better (b) sources I should curate regularly, and (c) to find out how to send me images of plants. Vegetables are fine! Fungi are deemed to be honorary plants! See the previous Water Cooler (with plant) here. And here’s today’s plant (pq):

Late December Fisher Pond 3

“Late December, Fisher Pond.”

Readers, I’m starting to run a little short on plants. In Maine, of course, it’s mud season, with everything concealed by the snow now out in the open. As ugly as a bad psychoanalysis… So either the last snows or the budding trees or the first garden would be nice…. Or anything, from you guys in the tropics…

* * *

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About Lambert Strether

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


  1. diptherio

    The growth in both high- and low-skill occupations, such as managers and professional occupations on one end, and assisting or caring for others on the other.

    I assume that managers professionals are the “low-skill occupations,” since caring for others is most definitely not “low-skill”.

    1. washunate

      Agreed. It’s pretty funny when the serious people define high skills and low skills such that the cushy, high paid jobs conveniently happen to be the high skill ones.

      I would love to see an economist or hospital administrator making six figures do home healthcare assisting or daycare work for a few weeks.

      1. NoOne

        I’m pretty sure that they are referring to the “home care for elderly parents” program that pays children or other relatives of the elderly to stay home and care for the senior’s needs, including housekeeping and laundry services. One becomes eligible to participate after a one-day training seminar. Not exactly CNA preparation there.

        1. diptherio

          No, the study is referring in broad terms to care work.

          They mistake low-wage jobs for low-skill ones.

        2. washunate

          Are you saying that taking care of the elderly is easy work that people love to do? Economists just can’t wait to get home from work so they can do their real passion of housekeeping and laundry?

          I assumed diptherio was talking more broadly about the neoliberal misuse of the term skill to stand in as a value judgment justifying wage differentials that have no actual justification in the difficulty of the work involved. I would gently push back against your characterization that high skill and low skill is defined by academic credentials; credentialing, too, is often used as justification rather than a legitimate reason. Certainly there is some level of importance to academic training, but not nearly as much as is hyped. Hard work often does not require extended formal training; that doesn’t mean it isn’t hard work.

          For example, using BLS data, there are 799,000 home health aides who earn mean annualized compensation of $22,400. There are 85,000 post-secondary business school teachers who make mean annualized compensation of $88,700. Now does being a college professor take a little more skill and formal education than being a home health aide? Sure. But the gap in their compensation levels is enormous, far beyond what can be explained by skills and credentials. Same thing for, say, the 16,000 post-secondary law teachers who make an annualized mean compensation of $126,300. That does involve a more advanced skill level than being a daycare worker. But not nearly enough to explain the enormous compensation gap, where the 583,000 child care workers in the US make only $21,700.

          Even within fields where we might be most amenable to the importance of skill, such as healthcare professionals, there are enormous differences. For example, we have over 310,000 medical and health services managers making $103,700 and 168,000 post-secondary health specialties teachers making $113,000. Yet the 109,000 mental health and substance abuse workers we have make $45,800, the 120,000 mental health counselors make $44,000, and the 104,000 rehabilitation counselors make $37,900.


          1. Rhondda

            I thank you for that fact-filled, chewy and delicious comment, washunate.

            Perhaps that’s where “the missing inflation” is.

            1. washunate

              Thanks, I appreciate the comment. I’m fascinated personally by how much data is out there about the way things work, yet establishment economics almost never talks about these kinds of issues in concrete detail.

          2. Rhondda

            I thought you might find this interesting.

            What’s Behind the Rise in Income Inequality? Technology or Class Struggle? by Matt Vidal at Counterpunch

            “Human capital theory suggests the rise in low-wage jobs would be driven by a rise in low-skill jobs. However, in a recent academic paper I found that from 1960 to 2005, there was a 15 percent decrease in the low-skill job share of total employment. In short, compared with previous decades, the contemporary American economy has a lower proportion of low-skill jobs yet a higher proportion of low-wage jobs. What gives?…”

          3. MikeNY

            Well, that certainly makes clear our society’s value judgments, doesn’t it?

            Rapaciousness, litigiousness, calculation = “high value”
            Emotional intelligence and compassion = “low value”

      1. MyLessThanPrimeBeef

        Also, a lot of low skill jobs requires skills even our smartest Ph.D.s don’t possess.

        Bee keeping is not simple, for example.

        Or to not kill your (vegetable) plants.

    2. Kurt Sperry

      Skill in this context is just a euphemism for credential, and credentialism is often just a gatekeeping entry barrier designed to protect privileged social status. The fact that most putatively high skilled workers wouldn’t possess the necessary skills to do putatively low skilled jobs can thus be blithely ignored. Credentials and no skills are far better than no credentials and skills; the credentialed person is thus living within a carefully built walled garden safe from wider competition on a meritocratic basis.

      One need only travel in both credentialed and uncredentialed social strata to quickly see there are roughly equal intelligence distributions between the groups–at the same time lots of really stupid people with impressive degrees and lots of brilliant deep thinking people who may not even have finished their secondary educations.

      1. MyLessThanPrimeBeef

        A successful seller (or a buyer) at a flea market can know more about psychology than a lot of psychologists, for example.

        1. pretzelattack

          i believe that, and probably a lot more lower wage jobs, waitrons and other people that depend on tips for a living for one example.

      2. Rhondda

        The roofer and I had a conversation the other day that really saddened me. We were talking life and families and how we got where we are. He described himself as a “loser” for ending up being a roofer. What rot. Truly.

        Being a tradesman or tradeswoman — or a caregiver or homemaker, or… when did we stop valuing these things? Respect and proper economic valuation for these things will return. It has to.

        1. MyLessThanPrimeBeef

          More education is not the answer.

          Some people will get 3 degrees and then just marries a hedge fund guy.

          And we look down on roofers…to the point some think themselves ‘losers.’

        2. Mark Alexander

          I’ve done some roofing and house-building, and roofing requires quite a bit of skill to do it right (I never had to do anything really complicated, fortunately). It’s also physically demanding and dangerous. It’s definitely not something for “losers”.

        3. LifelongLib

          I program computers for a living, but once had occasion to volunteer on a building project (for a monastery). I was floored by the intellectual skill required for construction jobs. Certainly the same degree of intellect as needed for computers, and of course much harder physically. Yet computer programmers are often considered super-intelligent, and construction workers as simpletons. Go figure…

          1. RMO

            Having done both types of work (and found out my brain did not seem to like writing code – I never felt a sense of satisfaction when I got a program to run just a feeling of “Ah… the pain has stopped… for now) I have to agree with you.

            In my opinion, every job that needs to be done (and isn’t actually evil or destructive) should be a source of both a living wage (at minimum) and a source of pride for the person that does it. I find it particularly infuriating that someone who works as a janitor or maid for example can be portrayed as a “loser” whereas the people who made out like bandits while cratering the world economy are considered demigods.

    3. sid_finster

      As a member of the feline-american community, I have often wondered about what is a “low-skilled” job.

      I am in reasonably good physical shape and my job is considered “high-skilled” by everyone other than quantum physicists and those folks who design computer circuits, but if I had to take up subsistence farming, I’d starve to death.

      If I had to take up burger flipping, I’d be fired.

      1. RWood

        Fear not! If the best meal you could hope for and available was at UmBugger, i bet you could flippum, maybe a pretty warm, well-lit and somewhat safer place would edge your skills, too…’course, those premises might be off, too…hmmmmm

    4. Christopher Fay

      I’d say that a Mass. real estate lawyer is a no-skill white collar job. What’s the difficulty in tracking a mortgage title in a public database? That’s a skill equivalent to a finding a book in a public library card catalog. And a Mass. tax lawyer is a semi-skill white collar job. We have the most Byzantine tax rules through out human misery, the difficulty is taking that stuff seriously.

  2. Jim Haygood

    Nobody scourges the Yellenites like the inimitable David Stockman:

    Listening to even a small portion of Simple Janet’s incoherent babble makes very clear that the nation’s central bank is well and truly impaled on its own petard.

    By Yellen’s own bumbling admission, the inhabitants of the Keynesian puzzle palace—-into which the Eccles Building has long since morphed—–can’t see their way to much of anything. They couldn’t even decide if the risks to the outlook are balanced to the upside or downside. And that roundhouse kind of judgment isn’t even remotely measurable or exacting; it requires nothing more than a binary grunt.

    As a practical matter, the joint has lapsed into a state of mental entropy——apparently under the risible assumption that they have abolished the business cycle and have limitless time to normalize.


    ‘Binary grunt’ — mu waa ha ha. More likely it was a random brain fart, David.

    1. tony

      The Fed is not doing Keynesian policy, it can’t, and David Stockman obviously has no idea what Keynesianism is. It’s hard to tell what he means though, he is such a terrible communicator. Or maybe he just uses florid language to hide his ignorance.

      1. Skippy

        Meh…. AET is a mental disorder where everything is black and white… if it works for a short bit its their fame and if not its the ev’bal Keynesian. Not that they took the time to understand the difference between bastardized American neo-new Keynesian and the old school across the pond.

        Skippy…. sorta like Baseball is not just an adaption of cricket or NFL football just an extension of Rugby thingy….

    2. MyLessThanPrimeBeef

      This election should not be just about Wall Street, but about the Fed as well.

      Maybe I haven’t followed it closely enough, but the latter seems to be invisible to all the candidates.

      1. Higgs Boson

        Not defending Bernanke, but he did tell “the Fed will do whatever Congress tells it to do.” The Fed is a creature of Congress. It was created by legislation, its mission and scope of its authority have been amended by legislation, and Congress can end its existence any time by legislation.

        If Congress collectively abrogated its supervisory responsibility, whose fault is that? They could shorten the leash but have chosen not to.

        1. MyLessThanPrimeBeef

          I don’t know how Congress could stop the Fed from lowering rates to near zero.

          Per Wikipedia, “The U.S. Congress established three key objectives for monetary policy in the Federal Reserve Act: maximizing employment, stabilizing prices, and moderating long-term interest rates.”

          “Leave the details to us expert economists.”

          And when the Executive branch, together with the Legislative, spends too much on the military, instead of on domestic programs, so that there is no money to stimulate the economy, lowering rates to near zero – to replace fiscal response with a monetary one – just compounds the problems (not maximizing employment, but destablilizing prices…asset prices). So, that’s not a valid justification for ZIRP. And besides, Congress did not ask the Fed for its ultra easy monetary policy. In fact, “…lawmakers in both parties, who have criticized its ultra-easy monetary policy and for being too close to the big banks that it regulates.”

        2. Christopher Fay

          And Congress is controlled by the Wall St pole of the Wall St Wash DC axis. It’s a cumbersome way to manager our corruption, but it puts a democratic sheen on the sleaze ball

    3. Llewelyn Moss

      Let’s see… they’ve been printing money and handing it out in wheelbarrels to banksters for 8 years. And have had ZIRP for virtually that long. Then they raise the rate to 0.25% and the patient goes into convulsions. And everyone is talking recession. Now I only play an economist on the Internets, but in technical terms I’d say they Screwed The Pooch. :-)

      1. jrs

        Pretty much. They are probably gambling that raising rates right now won’t cause a real recession and they need to raise rates to have any leeway to raise them come a real recession. It will come eventually, it’s not necessarily now, even if things haven’t been great for the 99s in quite awhile (that has causes well beyond the business cycle).

      2. Lambert Strether Post author

        I think the outcome of throwing a huge mountain of free money at Silicon Valley (i.e., QE), intended or not, will be a reconfiguration of the labor market to bring crapification* to previously unheard of levels and dimensions. That’s what AirBnB, Uber, self-driving cars, “advances” in AI, and so on, are all about.

        Synonyms for crapification are “disruption,” “innovation,” and so forth. Ditto “valuation.”

    4. MikeNY

      Mrs Magoo got slapped up good by Mr Market.

      She’s sorry, and says it was really her fault. She provoked him.

    5. ewmayer

      My only problem with Stockman’s latest epistle is his mixed ‘hoist’ metaphor … you see a ‘petard’ (from the French ‘to ‘break wind’, appropriately enough – cue Monty Python ‘I fart in your general direction’ taunting) is a crude bomb, basically an old-fashioned IED of the kind used to breach stone walls, reinforced doors and such. Thus having such a device blow up in one’s own face is indeed connotative of having a scheme of one’s own design go awry, but while one can thus be ‘hoist on’ or ‘hoist by’ one’s own petard, impalement on one is rather unlikely. Cue schlock-thrillerist Dan Brown’s (in)famous ‘battening down the hatches in the trenches’.

  3. Cavax

    Nothing in the AP report explains why the “accidental” shelling continued for more than half an hour after the military had been notified by MSF. And “malfunctioning targeting sensors” reeks of “the dog ate my homework”. (Do gunships really have less reliable telemetry than the average iPhone? Do they not have backups for critical systems?)

    And there will be no criminal penalties of any sort. Color me unimpressed.

    1. Aleric

      I thought I had been paying attention to the situation in Afghanistan but the admission in the last paragraphs made me gasp – it wasn’t a Taliban offensive – it was a jailbreak raid that stumbled into taking over the city when our locals fled. It may explain the panic that led to the hospital bombing.

  4. jrs

    Why shouldn’t Trump voters riot if the nomination is given to someone else if he has the most votes? On the other hand why shouldn’t minority groups that feel threatened riot if Trump is given the nomination? Because of the tyranny of the white majority? (whites are still the majority in this country but whether Trump supporters are a majority of anything in anyone’s guess)

    Why shouldn’t the cities burn either way I guess. It’s going to be a long hot summer. Except that I’m not so convinced it solves much really or ever has.

    1. tony

      Minority groups should not riot because it would be strategically a bad idea. Trump’s supporters could use the threat of rioting to support Trump and use power to bend the Repulican party to their will. Minority riots would destroy their own neighbourhood wealth and would scare whites into supporting the strongman. They won’t vote for a Republican anyway, and the police would shoot them before letting them harass white middle class so the minorities have no bargaining power in this case.

      Riots in minority areas have no negative effect on the Republican decision makers.

    2. MyLessThanPrimeBeef

      Let’s hope and pray they don’t come to that.

      And I don’t see how Trump nets more votes talking like that.

    3. Kurt Sperry

      Watching racist meathead Chicago cops beating on racist meathead Trump rioters on TV in the wake of having their candidate screwed out of the nomination would elicit *complicated* emotions in me. Schadenfreude would be somewhere in the mix I’m afraid.

      1. Lambert Strether Post author

        That won’t happen, because the meathead cops would stand down (and let’s hope that police unions don’t come out explicitly in favor of Trump).

        More likely “the left” goes to Cleveland and that happens. Interestingly, the Democrat convention in Philly is exactly one week later (July 25-28).

        I think that if the establishment Democrats think they can set up a fake protest in Cleveland, they’re sorely mistaken. The two forces that have shown any independent motivation in that regard are #BlackLivesMatter and the Sanders campaign. At street level, it’s hard to see either of them taking direction well from some DNC drone. Somebody will climb a fence or rip up a poster and that will be that. Or, to put that another way, if you want real protest at a convention, you’ve got to figure out how to bust out of, or evade, the free speech zones. And beat the StingRays. Hard to see the DNC wanting that. (Though I can see them smuggling a protester onto the floor and getting them interviewed on “live” (i.e. dead) TV.)

  5. DakotabornKansan

    Clinton sycophant/careerist Neera Tanden. [one of those extreme liberals that populate HillaryLand; et al., crazed, ignorant, bloodthirsty elites]

    Down with Clinton? Down with the Democratic Party? Down with Duopoly?

    The lethal embrace of the corporate shill Democratic Party:

    “A thousand influences constantly press a working man down into a passive role. He does not act, he is acted upon. He feels himself the slave of mysterious authority and has a firm conviction that ‘they’ will never allow him to do this, that, and the other. Once when I was hop-picking I asked the sweated pickers (they earn something under sixpence an hour) why they did not form a union. I was told immediately that ‘they’ would never allow it. Who were ‘they’? I asked. Nobody seemed to know, but evidently ‘they’ were omnipotent.” – George Orwell, The Road to Wigan Pier

    1. Ellora

      I think this (great!) quotation from Orwell lays out one reason why Trump appears to be mobilizing a certain segment of the American working class more effectively than Sanders. Consider the implications of Trump’s self-positioning as the Great White Hope vis-a-vis Sanders’ call for a political revolution: the first requires zero agency on the part of the beaten-down while the latter asserts that nothing but a full exercise of agency will do. We humans are never more vulnerable to magical solutions than when we feel most powerless.

      Side-note: Just looked up the pub. date of TRTWP: 1937. The more things change, etc…

      1. sleepy

        Trump can mobilize the white working class because he demonizes minorities. That is what innoculates him against charges of being a lefty. In the US it seems that support for working class issues works particularly well as long as the proponent also has a component of bigotry. Some are deserving because of trade policies, etc., while others are just lazy.

        Sanders and Trump supporters should be natural allies, but the old divide and conquer strategy still works. As well, it’s supported by Hilary and her identity politics.

        1. participant-observer-observed

          HRC & DT’s media minions are in bed together with their “look over at Donald” strategy, which has worked remarkably well to pull any spotlight off of Sen Sanders, and too many voters fell into the trap completely.

          They ignore that Sen Sanders is only one representative of millions of citizens, but it doesn’t matter to them, because it keeps power in the hands of the oligarchs, whether it is tweedle dee or tweedle dum.

          Those who are on to the scam are given a massive media blackout censorship. But we do now know we exist in the many millions.

          Long live the grass roots organizers! Ready for a new SDP party, America?

  6. craazyman

    Do not be fooled by false appearances — the collapse of the global equity markets is continuing exactly as forecast in the post here from several weeks ago. If you stand on your head, global equity markets have lost an additional 9% since they topped out in early February. They have even fallen back to where they were in November.

    The prescience is not only astonishing, it actually helps your yoga training. The head stand is a rather difficult pose. It’s fortunate you can make money standing on your head!

    1. Jim Haygood

      Never mind stocks; today April crude closed at $40.15.

      It takes me back to Spring 2004, when crude first crept above 40 dollars — a record high, at the time.

      Something is wrong with this picture, I said to myself. Four years later, it wasn’t at $40, but $140.

      Have a sip of black gold. There’s never been a better time to purchase a fine V-12 automobile, and a pair of good English shoes to work the pedals.

      1. MyLessThanPrimeBeef

        It does make driving to see a doctor you can’t afford more expensive now, I guess.

        “Should I move to Denmark, where everyone is a cyclist?”

    2. Carl

      Yes, headstand is difficult, but I’ve never made money doing it, oh wait, I teach yoga, so maybe so.

    3. craazyboy

      My bank interest is still the same whether I stand upright or on my head. That’s really weird.

      But I keep thinking the Camembert Asteroid is still on the way and we’ll have a soft landing, whichever way is up.

  7. grayslady

    Dear Mr “Benedict Arnold” Illing:

    In response to your article in Salon Magazine, I just made my first (modest) contribution to Bernie’s campaign last night.

    Yours sincerely,

    “John Paul Jones” grayslady

    1. TedWa

      Congrats grayslady, I thank you, Bernie thanks you and the more sane and progressive American public thanks you.

    1. NoOne

      They could also use Hillary’s barking routine when they ask her what senior citizens’ are supposed to eat after she goes after their Social Security in 2017.

  8. jefemt

    800K bbls of oil missing… US used an average of 19.4 million bbls PER DAY in 2015… majority of which was imported.
    800K is a rounding or accounting error— spit in the ocean.
    Makes you wonder how much royalty / mineral owners are getting screwed by O & G accounting? Actually, I don’t wonder all that much…

    1. Lambert Strether Post author

      Cheerfully rounding .8 up to 1, I don’t think 1/19 of anything is a rounding error. I mean, imagine if your physical oil tank was leaking that much in the winter. And if there’s that error, how many others are there?

    1. rich

      More DNC Shadiness – Debbie Wasserman Schultz is Blocking Primary Challenger from Accessing Voter Data
      Liberty Blitzkrieg readers will be intimately familiar with the shenanigans of Democratic National Committee (DNC) head Debbie Wasserman Schultz. This so-called leader has spent much of the last year rigging the Democratic primary for Hillary Clinton in various ways, which have not gone unnoticed by an increasing number of progressives and liberals. From limited and awkwardly timed debates, to blocking access to voter data and a defense of the undemocratic superdelegate system, the behavior of Wasserman Schultz is mind-boggling in its shadiness.

      Indeed, Wasserman Schultz is such a monumental fraud, she’s now facing a serious primary challenger in the person of Tim Canova. I touched on this unexpected battle earlier this year in the post, The DNC is “Feeling the Bern” – Debbie Wasserman Schultz Faces Serious Primary Challenge:


      The party of Dismiss, Negate, Corrupt!

    2. steelhead23

      What a fop! Obama is so fearful of a Trump presidency that he is using that fear to generate money for Shrill in private, with Wall Street, while publicly claiming neutrality? For shame. Reminds me of all that Nazi loot that accidentally landed in neutral Swiss bank vaults. I doubt Sanders reads blogs, but here is what I suggest if Clinton wins the nomination as appears likely. Give all of your campaign funds to Jill Stein. Ideologically, she is much closer to you than Clinton. Join her on the ticket if she wants you. Yeah, go ahead and break that promise you gave Wasserman-Schultz. She’s a liar and a cheat. There is no honor in honoring promises to such individuals and institutions.

      1. Lambert Strether Post author

        As an experienced designer of weaponized snark, I deprecate Shrillary, for these reasons: (a) It’s about personal characteristics and not systemic issues, (b) this particular personal characteristic tends to be deployed in a sexist manner, and (c) it doesn’t nail the target with a characteristic unique to them.

        Shillary, now, also in wide use, works fine for me; emphasizes the shameless and open money-grubbing so distinctive of the Clinton; cash for roping the marks into the tent.

        $hillary might be even better, but it’s harder to type.

    3. MsExPat

      Maybe it’s time for Sanders to take the gloves off re: Obama. It seems like he would have little to lose and a lot to gain.

  9. Kim Kaufman

    “In realpolitik terms, if more Republicans defect over Trump than Sanders voters defect over Clinton, it makes perfect sense for Clinton to heave Sanders and his voters over the side. Which she appears to be doing.”

    I think there have been defections of Dems to vote for either Trump or Kasich in Ohio and Massachusettes. Don’t have any links right now but I think that’s what I’ve seen.

    1. Carla

      I ran into neighbors (awfully nice couple) at the polls who told me they were planning to ask for Republican ballots and vote for Kasich. The woman said, “I’m just so embarrassed, though, to ask for a Republican ballot. Don’t know if I can actually do it.” They were Bernie supporters, but “Stop Trump” voters.

  10. washunate

    In realpolitik terms, if more Republicans defect over Trump than Sanders voters defect over Clinton, it makes perfect sense for Clinton to heave Sanders and his voters over the side. Which she appears to be doing.

    Well said Lambert. I think part of the calculation is that Clinton doesn’t have a choice. She’s the Republican candidate in all but name. The demographics that support Sanders – younger and more liberal in particular – don’t support Clinton anyway. I don’t think they would describe it as being heaved over the side so much as that they jumped ship voluntarily!

    1. James Levy

      My question is: what web of interests and individuals does Trump represent? The idea that he is a “lone wolf” is cute but unconvincing. People don’t get to where he is by being lone wolves. They have partners, collaborators, bankers, brokers, friends, associates, and enablers. And when you get to Washington, you need friends to get things done. And Trump will be desperate for “wins” if he gets the big chair. This means either foreign policy adventures or forming alliances with entrenched domestic interests. Which interests will be favorable to cutting deals with Trump, and what will be their price for such deals? These are questions that need looking into, fast.

      1. subgenius

        …well, if the other option is hellary, it would probably be in everybody’s best interest!

      2. neo-realist

        Well Jeff Sessions did come out and endorse him, a straight up right wing republican. Trump is using him for foreign policy advice. Maybe Trump has cut a deal, certainly not the last one with the GOP establishment, for some foreign policy adventures?

        1. local to Oakland

          I find Trump’s potential use of internal power within the US frightening. But his rhetoric so far suggests a realist approach to foreign policy. If it were realized, that would be a refreshing change from the last fifteen years.

          1. Lambert Strether Post author

            I insist: Trump’s a dealmaker. But in an election, there’s no counter-party. Ergo, there’s no deal to be had.

            So whatever he says is in aid of getting into a position to make deals in future. But we have no idea what the deals will be. We can infer, from his constituencies, but we don’t know.

  11. Carla

    Re: TPP —


    I posted the following comment:

    Neither “expert” addresses the elephant lurking in these so-called trade agreements: the ability of multinational corporations to challenge, subvert and contravene national laws and regulations using a private, opaque system of arbitration embedded in the Investor State Dispute Settlement (ISDS) provisions of NAFTA, TPP, TTIP and TISA.

    Using the NAFTA’s ISDS, TransCanada is suing the US over President Obama’s rejection of the Keystone XL pipeline [I included a link to Reuters coverage but will omit here to avoid triggering moderation]

    Philip-Morris Intnl is suing the tiny country of Uruguay over that nation’s health regulations regarding cigarette smoking.

    These are not trade agreements. They are world-government-by- multinational-corporation agreements. They are profoundly anti-democratic and pose a mortal threat to liberty and self-determination everywhere.

  12. Buck Eschaton

    Wouldn’t it be easier if the Republicans would just ditch Trump and nominate Hillary Clinton too?

    1. James Levy

      Objectively and ideologically, she’s a standard 1980s Republican. But we’ve got Republican Senator after Republican Senator denouncing Obama’s Milquetoast Establishmentarian Supreme Court nominee as a “liberal”. For the duopoly charade to continue, Clinton must be denounced as a bomb-throwing “radical feminist” and “liberal” so that millions who have been brainwashed on this twaddle can nod their assent. Trump of course will run the country as a business-oriented friend of “free market capitalism” but might go off the reservation with some nationalistic show-boating and even that is anathema to TPTB. No deviation from the duopoly narrative is acceptable to those who own this country.

    2. NoOne

      While we are at it, why not dump the presidency thing all together and make the Clintons our official royal family? Princess Chelsea would be next in line then Charlotte, Dutchess of (New) York.

      1. voteforno6

        I don’t know if Chelsea would want it. That would mean actually having to work for a living.

        1. RP

          Seriously. What’s the point of marrying a connected hedge fund guy if you’re expected to actually do anything?

    3. hreik

      Wouldn’t it be easier if the Republicans would just ditch Trump and nominate Hillary Clinton too?

      Yes, she is the Republican Ego: Herr Drumpf is the Republican id and Senor Cruz is the Republican Superego.

    4. RP

      Nixon in a pantsuit vs Casino Mussolini.

      While the Dems throw Henry Wallace 2.0 overboard.

      Hell of a republic we got here, folks.

  13. voteforno6

    RE: Clinton’s Email Hairball

    The most benign reading of that story don’t make Clinton look all that good. I really feel for her tech support – she and her aides must have been a real pain to deal with.

    1. Arizona Slim

      She is indeed a real PITA to deal with. Ron Kessler goes into great detail about this in his books about the Secret Service.

      Suffice it to say that Hillary is not a nice person, and an assignment to her detail is regarded as a form of punishment. And Bill is no better.

      1. pretzelattack

        they vacation with the kissingers, both i think have credited the reagans at some point, hillary embraces bush, cackles about qaddafi’s gory execution–i have no trouble at all believing they aren’t nice people.

    2. grayslady

      There’s a two-hour video over at Judicial Watch that includes a panel of individuals involved in the FOIA lawsuits. During the presentations, two of the attorneys speculate on the direction the lawsuits will take, what is likely to happen to Clinton (one lawyer describes the fallout as likely to be subject to a “courtesy” redefinition of the crime–in other words, a two-tier justice system), and numerous other issues. Worth a view, IMO.

      1. voteforno6

        That’s the likeliest outcome, I think. If someone much lower on the food chain pulled this kind of stunt, two things would happen: loss of job, and loss of security clearance (which would be a big deal). It’s the way it works in government.

  14. Matthew Saroff

    You know, the sentiments expressed by Tanden are literally identical to those expressed by Cheney, Rumsfeld, Wolfowitz, and Pearle.

  15. Carla

    Lambert — tried to send you a message in the Correntewire contact form, but it says “You did not pass game.” There was no game. Have plant pictures for you, but need an actual email address.

  16. rich

    FBI raids NY haredi yeshivas and their tech vendors in fraud probe

    By Julie WienerMarch 17, 2016 11:53am

    NEW YORK (JTA) — The FBI raided haredi Orthodox yeshivas and technology vendors that serve them in Brooklyn and in New York’s Rockland County, but declined to state publicly the details of the investigations.

    In a large operation Wednesday afternoon, dozens of FBI agents, search warrants in hand, entered multiple yeshivas and vendors’ offices in Rockland County, demanding they account for technology purchases for which they billed the federal government, according to The Journal News. Agents were seen walking out with boxes of documents and computer hard drives.

    The raids in Rockland are believed to be part of a larger investigation of fraud in the federal government’s E-rate program, which funds the purchase of technology equipment and Internet service by schools and libraries.

    More than 300 agents and officers were involved in Wednesday’s raid, authorities said, adding that no arrests had been made and none were expected that day.

    The 2013 Jewish Week report found that haredi Orthodox schools that publicly eschew the Internet were awarded millions of dollars for tech equipment and Internet wiring.

    In 2011, for example, Jewish schools — the vast majority of them haredi Orthodox — were awarded 22 percent of the E-rate funds in New York State, even though they enroll only 4 percent of the state’s students.

    That year, of the $30 million approved for E-rate purchases at almost 300 New York Jewish schools participating in the program, nearly $9 million went to 10 schools — all but one Hasidic. Those schools, among them United Talmudical Academy in Williamsburg, which was reportedly raided Wednesday, were collectively awarded nearly $9 million in E-rate-funded services.

    In the E-rate program, money does not go directly to schools but to the vendors, called “service providers,” who sell the tech equipment and services.

    Since its creation in 1998, the E-rate program, which is administered for the Federal Communication Commission by the Universal Service Administrative Company, has struggled with fraud.

    Two General Accounting Office reports have noted problems with the nonprofit’s “internal controls,” and several multi-million-dollar fraud cases involving the company have been exposed.


    E-z pickings?

  17. sd

    What is the significance of initial jobless claims vs total claims overall? Initial claims seems like a useless number unless specifically looking at labor seasonality. This has bothered me for some time but I am just getting around to asking.

    1. Jim Haygood

      Continued claims is a muddied series, because some initial claimants quickly find new work, while others (including some who just want to collect their full benefit without going back to work) don’t.

      Initial claims respond promptly to rising layoffs. Also, they ARE seasonally adjusted.


          1. Lambert Strether Post author

            Then again, if you want to look at how working people experience their lives in near real time, unadjusted is the way to go (unsurprisingly, given priorities).

            1. sd

              What is the significance of falling below the long-term trend as this seems counter-intuitive in the new world of sharing or gig economy.

              Because of the extreme volatility of the non-adjusted weekly data, we can add a 52-week moving average to give a better sense of the secular trends. The chart below also has a linear regression through the data. We can see that this metric continues to fall below the long-term trend stretching back to 1968.

  18. ProNewerDeal

    the LO2E advocates’ favorite justification is “but consider the Supreme Court!”

    0bama is crapping on that notion with his pick of center-right Judge Merrick Garland.

    If H Clinton had a clue, she would “denounce & reject” or at least claim “deeply disappointed” with the Garland pick, & contrasts that she would pick a clear Progressive who is “litmus tested” & clearly anti-Citizens United, pro-Roe v Wade, someone like R Bader Ginsburg or H Clinton’s former fellow candidate Lawrence Lessig.

    Otherwise, this may be a typical conversation in November:

    Sanders primary voter (SV) “I am considering Dr. Jill Stein of the Green Party, as her policies are similar to Sanders, & actually slightly better”.

    H Clinton voter “you must vote for Hillary, for the Supreme Court! Even Prof. Noam Chomsky advocates LO2E voting!”

    SV “H Clinton sux on the Supreme Court, she is likely to nominate center-right judges like 0bama did with Garland. I am reminded of that line from that Talib Kweli song ‘You try to vote participate in the Government, but these MF Democrats are acting like Republicans’. Jill Stein 2016, #ImWithHer !”

    I doubt H Clinton will publicly disapprove of the Garland nomination. If NC is correct, evidence shows H Clinton would rather attract anti-Trump Mint RawMoney-voter type Rs, than obtain Sanders voters.

    1. marym

      Clinton supports a constitutional restriction on abortion.

      Again, I am where I have been, which is that if there’s a way to structure some kind of constitutional restriction that take into account the life of the mother and her health, then I’m open to that. But I have yet to see the Republicans willing to actually do that, and that would be an area, where if they included health, you could see constitutional action.


      If Team Blue plans to promote an allegedly LO2E Democrat in the general election, they should first make sure the actually less evil candidate in the primaries wins the nomination.

  19. ballard

    “Whence the possibility of an ideological analysis of Disneyland (L. Marin did it very well in Utopiques, jeux d’espace [Utopias, play of space]): digest of the American way of life, panegyric of American values, idealized transposition of a contradictory reality. Certainly. But this masks something else and this “ideological” blanket functions as a cover for a simulation of the third order: Disneyland exists in order to hide that it is the “real” country, all of “real” America that is Disneyland (a bit like prisons are there to hide that it is the social in its entirety, in its banal omnipresence, that is carceral). Disneyland is presented as imaginary in order to make us believe that the rest is real, whereas all of Los Angeles and the America that surrounds it are no longer real, but belong to the hyperreal order and to the order of simulation. It is no longer a question of a false representation of reality (ideology) but of concealing the fact that the real is no longer real, and thus of saving the reality principle.”

    ― Jean Baudrillard, Simulacra and Simulation


  20. Chris

    Re: “Crowdfunding for the Public Good Is Evil” [Wired].

    About 200 years ago, the great Swiss educator Johann Heinrich Pestalozzi had this to say:

    “Charity is the drowning of justice in the craphole of mercy” (“Wohltätigkeit ist das Ersäufen des Rechts im Mistloch der Gnade”)

  21. ewmayer

    o Re. Another Way of Looking at Lee Sedol vs AlphaGo | Jacques Mattheij — Sure, but can the human mine bitcoins in his spare time? Uh-huh – I didn’t think so.

    o Re. French Cafés Are Charging Extra for Rude Behavior | Grub Street — Charging extra for their staff to be rude to customers, or vice versa? I hope it’s the latter … visiting France simply wouldn’t be the same without a proper snubbing-by-the-waiters, but it simply wouldn’t convey genuineness if they charged for it.

  22. Foy

    Good to see a Scott Adams’ post on Trump getting a run Lambert! Like you have much time for Adam’s politics either, but I’ve been reading his series since early Sept and his analysis has been remarkable. A whole lot of things that didn’t make sense about Trump actions/behavior suddenly start making some sense when viewed through Adam’s glasses.

    Trump’s linguistic kill shots stick like glue. Often I guess you could call them a zero day kill shot, eg a term that hasn’t been used in that context before, so they stand out. Usually very visual and because of that you don’t forget them when you see the subject next time eg ‘Sweaty Marco, you don’t want a guy who sweats easily negotiating with Putin’. If you’re an undecided voter and you’ve heard that then every time you saw Rubio sweat after that, that thought would pop into your head, you can’t unsee or unhear it, it becomes part of your subconscious. The stamina question is bound to grow with Clinton now.

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