Remarkable

It wasn't the car wreck I was hoping for; in fact, it was quite interesting. After watching Palin for 1.5 hours I came away thinking "cheerleader" - she's an excellent cheerleader for McCain. Hopefully she'll never end up in the Oval because cheer leaders do not good leaders make. She was extremely well coached and she, for the most part, stayed dead-on script. I can't help but wonder if she's capable of thinking on her own. I'm guessing not.

I must say I was shocked by Senator Biden. Where the hell did he come from? If he had performed like that during primary season he might have made it to the convention. The Senator's performance has made me feel a tad better about the Democrats. The VEEP position, however, is pretty much an empty space. Unless something happens to the President, the VEEP is just marking time. They have no real role, no real job. So Biden's brilliant performance helps Obama but it doesn't really matter in the end.

The Chicago Tribune asks, "Who won the VP debate?" and gives a very good summation of the debate itself. I think the answer is that the Democrats won - but I don't think the Republicans lost. I think the Democrats will win the election in November. I'm hoping they'll have a plan, an idea, a clue on how to fix this country after the last eight years.

I'm not holding my breath.

VEEP Debate

I don't normally watch the VEEP debates but this debate should be, at the very least, funny.

CSI is pre-empted anyway.

Palin vs. Biden: Pitfalls galore

Between Sarah Palin, with her repeated missteps in a series of interviews with CBS anchor Katie Couric over the last week, and gaffe-prone Joe Biden, who also has made for some Maalox moments for Barack Obama’s campaign recently, the two running mates have set the stage for what may be the most anticipated vice presidential debate in history.

With all their potential for pitfalls and insta-classic moments, the pair has made the build up to the showdown, to take place here Thursday night at Washington University, feel more like a NASCAR race than a serious political forum: the audience may be tuning in as much in anticipation of cringe-inducing pile-ups as they are to watch the typical parry-and-thrust of debate.

I don't know about anyone else, but that's exactly why I'm tuning in. Goodness knows we won't learn anything. I have some lovely wine to enjoy, some knitting to do and, as the temperatures have dropped in the great North East, cats who need to snuggle up against me on the couch.

“Voters aren't tuning in for a vice presidential food fight,” said Biden spokesman David Wade. “This debate is about two very different philosophies of where to take the country.”

It's exactly what people want to see. I'm betting Caribou Barbie can whoop Biden's ass without breaking a sweat or putting a single hair out of place. I've believed for years that if presidential candidates would just do one mud wrestling match voter turn out on election day would probably hit 75%.

As difficult as it may seem given her recent public performances, aides to Biden are casting Governor Palin as a knife-fighter who shredded debate foes in Alaska.

"I think Governor Palin will do well. She's good with the proverbial knife and she can deliver a prepared one-liner and quick jab very effectively. She's a former broadcast journalist who excels on television, and she's a career politician who climbed the ladder by out-debating political legends in Alaska," said Biden spokesman David Wade.

"There's a reason they call her barracuda," added another Obama aide, taking the expectation-setting to an even higher level.

Hm. Maybe we should just go all out panem et circenses in this country, starting with this election. The jackass with the highest ratings wins.

BTW: If a monkey and Superman had a knife fight on the Moon, who would win?

Huffington Post

Rich Man's Panic

Investors should expect the Dow Jones Industrial Average to fall below 10,000 points, as the current credit crisis is a repeat of the 'Rich Man's Panic' of 1907, Tom Hougaard, chief market strategist from City Index, told CNBC.

A bit of forgotten financial history:

"We've been here before … About one hundred years ago we had an identical credit crunch," Hougaard said, adding that the Dow lost nearly 50 percent in over two years due to the 1907 crisis, which indicates further downside yet to come for today's markets.

The 'Rich Man's Panic' was caused by a severe lack of liquidity as banks pulled back lending and led to numerous bank runs and eventually the creation of the Federal Reserve in 1913.

"It's most likely to get worse before it's going to get better … I don't think we're really seeing this capitulation just yet, but we're close," Hougaard said, adding that the S&P 500 could take out the low of the 2002 bear market, which was 944.

I think this is acutally worse than the 1907 panic, even though there are more safty measure in place now than at that time. And I don't see any J.P. Morgan's looming on the horizon...

See also: 5 Lessons About What Happened To The Economy You Didn't Learn From CNBC.

It just gets better and better

WaMu becomes biggest bank to fail in US history.

As the debate over a $700 billion bank bailout rages on in Washington, one of the nation's largest banks — Washington Mutual Inc. — has collapsed under the weight of its enormous bad bets on the mortgage market. The Federal Deposit Insurance Corp. seized WaMu on Thursday, and then sold the thrift's banking assets to JPMorgan Chase & Co. for $1.9 billion.

Seattle-based WaMu, which was founded in 1889, is the largest bank to fail by far in the country's history. Its $307 billion in assets eclipse the $40 billion of Continental Illinois National Bank, which failed in 1984, and the $32 billion of IndyMac, which the government seized in July.

One positive is that the sale of WaMu's assets to JPMorgan Chase prevents the thrift's collapse from depleting the FDIC's insurance fund. But that detail is likely to give only marginal solace to Americans facing tighter lending and watching their stock portfolios plunge in the wake of the nation's most momentous financial crisis since the Great Depression.

Bailout Talks to Resume After Impasse:

In the Roosevelt Room after the session, the Treasury secretary, Henry M. Paulson Jr., literally bent down on one knee as he pleaded with Ms. Pelosi not to “blow it up” by withdrawing her party’s support for the package over what Ms. Pelosi derided as a Republican betrayal.

“I didn’t know you were Catholic,” Ms. Pelosi said, a wry reference to Mr. Paulson’s kneeling, according to someone who observed the exchange. She went on: “It’s not me blowing this up, it’s the Republicans.”

Mr. Paulson sighed. “I know. I know.”

Hm. Didn't know Pelosi was the Pope.

At the White House, Mr. Bush was holding fast to the approach that Mr. Paulson has championed.

“In case there’s any confusion,” Mr. Fratto, the deputy press secretary, wrote in an e-mail message. “The president supports the core of Secretary Paulson’s plan.”

Which doesn't fill me with the warm and fuzzies. I'm not sure this plan is anything more than a band-aide on a gaping wound. However, something must be done and fast (and a chat with Sweden couldn't hurt). WaMu managed to survive a week until buyout, but there are others out there that won't. Chase most likely can't come to the rescue of any other banks and I'm not sure any other banks can either. International intervention is desperately needed - but if I were Canada, China, Japan I'm not sure I'd be willing to risk my nation's assets in the US right now.

~ ~ ~

As if the Financial Tsunami weren't enough, New England is getting hammered with a nor'easter and probably a tropical storm. When it rains, it pours.

Inspiration

"If money isn't loosened up, this sucker could go down,"

Brilliant. This was at the meeting that nearly, may still, implode the bailout plan:

Democrats accused Boehner of acting on behalf of GOP presidential candidate Sen. John McCain in trying to disrupt a developing consensus. The new proposal also displeased White House officials, including Treasury Secretary Henry M. Paulson Jr., who chased after Democrats leaving the meeting and -- half-jokingly -- dropped to one knee and pleaded with them not to "blow up" the $700 billion deal, according to people present at the meeting.

Before the meeting broke up, President Bush had issued a stark warning about the impact on the nation's economy if the measure did not pass. "If money isn't loosened up, this sucker could go down," Bush said, according to one person in the room.

Did you watch the Palin interviews? My sweet lord... Alaska voted for this woman? From the LA Times:

Her third nationally televised interview, with CBS anchor Katie Couric, found Palin rambling, marginally responsive and even more adrift than during her network debut with ABC’s Charles Gibson.

In a 40-minute session with Couric that aired Wednesday and Thursday nights, the Alaska governor defended her puzzling claim that geographic proximity makes her some sort of expert on Russia; went nearly blank when queried about McCain's achievements as a big-business regulator; agreed America "may find itself" on the road to another Great Depression; and, promoting a troop surge in Afghanistan, casually suggested that it "will lead us to victory there, as it has proven to have done in Iraq."

What the hell planet does this woman live on?

"That's why I say I, like every American I'm speaking with, we're ill about this position that we have been put in . . ." Palin began, before meandering off in fruitless pursuit of coherence.

But I'll let the governor speak for herself:

" . . . where it is the taxpayers looking to bail out. But ultimately, what the bailout does is help those who are concerned about the healthcare reform that is needed to help shore up our economy. Um, helping, oh -- it's got to be all about job creation too. Shoring up our economy, and putting it back on the right track. So healthcare reform and reducing taxes and reining in spending has got to accompany tax reductions, and tax relief for Americans, and trade, we've got to see trade as opportunity, not as a competitive, um, scary thing, but 1 in 5 jobs being created in the trade sector today. We've got to look at that as more opportunity. All of those things under the umbrella of job creation. This bailout is a part of that."

I bet republicans are wondering if McCain is a closet Democrat. The whole interview was hysterically funny... but not in a good way. What the hell is McCain thinking in picking this Hockey Mom? No offense to Hocky Mom's across the US, but... hello? Is there a brain there? What the hell does this woman do as Governor of Alaska?

Palin at least kept her answers shorter during a Q&A with reporters Thursday morning, her first such session since McCain unleashed her on the national scene four weeks ago.

Although she didn't really answer two of the four questions, many Americans won't hold that against her. They see someone who understands what it's like in a small town.

Common sense has its value, and commentaries like this one, suggesting Palin's shortcomings, will only confirm to her fans that she is not a pet of the media elite. But it seems only sensible to wonder whether charm and pluck will be enough the next time Putin rears his head.

Yeah... well... Small Town America ain't that stupid.

Or, are they? Hell, they voted for the Moron currently in charge.

It seems I'm back to "we're screwed" again.

Will the Japanese come to our rescue again?

Back from the dead, Tokyo banks buy into Wall Street

Once considered too naive and cautious for the high-risk, high-return world of investment banking, cash-rich Japanese firms are once again aggressively pushing abroad.

"The balance of power in the global financial industry has changed dramatically over the past one to two weeks," said Shinichi Ina, banking analyst at Credit Suisse in Tokyo.

"I don't think anyone imagined a few months ago that Mitsubishi would be making Morgan Stanley into a group firm. I don't think they could have imagined it themselves."

~ ~ ~

Not that anyone listened...

Buffett's "time bomb" goes off on Wall Street

On Main Street, insurance protects people from the effects of catastrophes.

But on Wall Street, specialized insurance known as a credit default swaps are turning a bad situation into a catastrophe.

When historians write about the current crisis, much of the blame will go to the slump in the housing and mortgage markets, which triggered the losses, layoffs and liquidations sweeping the financial industry.

But credit default swaps -- complex derivatives originally designed to protect banks from deadbeat borrowers -- are adding to the turmoil.

"This was supposedly a way to hedge risk," says Ellen Brown, the author of the book "Web of Debt."

"I'm sure their predictive models were right as far as the risk of the things they were insuring against. But what they didn't factor in was the risk that the sellers of this protection wouldn't pay ... That's what we're seeing now."

Brown is hardly alone in her criticism of the derivatives. Five years ago, billionaire investor Warren Buffett called them a "time bomb" and "financial weapons of mass destruction" and directed the insurance arm of his Berkshire Hathaway Inc., to exit the business.

It's a fascinating, slighly complex, article which gives some details on the massive shell game played by Wall Street and the Federal Government just in the past couple of years.

~ ~ ~

Someone in China has been reading my mind:

China paper urges new currency order after "financial tsunami"

Financial Tsunami. That's what I keep think of this as, as well as The Perfect (Fiscal) Storm.

Hi, my name is Laura and I'm a big geek.

Threatened by a "financial tsunami," the world must consider building a financial order no longer dependent on the United States, a leading Chinese state newspaper said on Wednesday.

The commentary in the overseas edition of the People's Daily said the collapse of Lehman Brothers Holdings Inc., "may augur an even larger impending global 'financial tsunami'."

The article goes on to state:

China is a major buyer of U.S. Treasury bonds, and through its sovereign wealth fund it has taken stakes in two large U.S. financial institutions.

In July 2005, China revalued the yuan and freed it from a dollar peg to float within managed bands. But the yuan and China's trade remains tightly linked to the fortunes of the dollar.

The commentary suggested China must brace for grave economic fallout and look to alternatives, saying the crisis brings to mind the Great Depression of the 1930s.

"Lehman Brothers announced bankruptcy will not only have a domino effect on the global financial world, it will bring a shock to the world economy," the front-page comment stated.

It's not just a US problem - it's global. We need the rest of the world to help out the US, but after eight years of the Bush administrations horrendous foreign policy I don't see the rest of the world flocking to our side to help out. I can't say that I blame them, but it would be in their best interests to help the US.

I hope the rest of the world sees it that way as well.

"We must all hang together, or assuredly we shall all hang separately."
Benjamin Franklin

By the way...

Juan Cole is brilliant today. Go read: Informed Comment, A Nation of Masochists.

And in the wake of the greatest and most sustained act of systematic plunder since the Mongol hordes appropriated to themselves the riches of everyplace in Asia from Beijing to Isfahan, the reaction of the supine and slave-like American voting public is to scratch their heads and have a hard time deciding if they would like more of the same.

I know I won't be voting republican in November, but I'm still not happy with Obama.

Past is Prologue

Read about former President Herbert Hoover and the Great Depression.

~ ~ ~

How to Save the Financial System

As I write this article, I am seeing proposals by some to create a new Resolution Trust Corp., as we did in the 1990s to clean up the S&L problems. The RTC managed and sold assets from S&Ls that had already failed. It was run by the FDIC, just like the FDIC. We needed to create the RTC in the 1990s only because we could not comingle the assets from failed banks with those of failed thrifts, because we had two separate deposit insurance funds absorbing the respective losses from bank and thrift failures.

I can't imagine why we would want to create another government bureaucracy to handle the assets from bank failures. What we need to do urgently is stop the failures, and an RTC won't do that.

Again, we must take three immediate steps to prevent a further rash of financial failures and taxpayer bailouts. First, the SEC must suspend Fair Value Accounting and require that assets be marked to their true economic value. Second, the SEC needs to immediately clamp down on abusive practices by short sellers. It has taken a first step in reinstituting the prohibition against "naked selling." Finally, the bank regulators need to acknowledge that the Basel II capital rules represent a serious policy mistake and repeal the rules before they do real damage.

We are almost out of time if we hope to eradicate the cancer in our financial system.

Mr. Isaac, chairman of the Federal Deposit Insurance Corp. from 1981-1985, is chairman of the Washington financial services consulting firm The Secura Group, an LECG company.

Last major investment banks change status

Bush, Congress exchange views on relief bill

The mortgage buck stops where?

Americans need to hear a full-throated debate by lawmakers about the range of players in this mortgage maelstrom who either lied, took on too much debt, or failed to check creditworthiness as these loans were issued and then sold up the financial food chain to the point where it has become nearly impossible to determine their value.

They also need to hear about the government's role in encouraging a housing bubble – and that will mean Congress needs to look at itself. No longer should federal support for owning a home be based on the false premise that housing prices will always go up or that taxpayers are the final backstop for mortgage holders.

I was thinking of posting a sign

here, stating that United States was up for bidding

FOR SALE: ONE COUNTRY, BADLY USED, AVAILABLE NOW! CHEAP!!

but then spotted this piece in the LA Times:

Hey U.S., welcome to the Third World!

We thus want to acknowledge the progress you have made in your evolution from economic superpower to economic basket case. Normally, such a process might take 100 years or more. With your oscillation between free-market extremism and nationalization of private companies, however, you have successfully achieved, in a few short years, many of the key hallmarks of Third World economies.

Your policies of irresponsible government deregulation in critical sectors allowed you to rapidly develop an energy crisis, a housing crisis, a credit crisis and a financial market crisis, all at once, and accompanied (and partly caused) by impressive levels of corruption and speculation. Meanwhile, those of your political leaders charged with oversight were either napping or in bed with corporate lobbyists.

I wonder if there is some kind of an award... like the Nobel... for countries who tank fastest. Darwin award wouldn't do... no one has died from this stupidity. Yet. There is the Ig Noble but I think we deserve something better than that.

In any event, I think the US has won, by a land-slide. Seven years, plus a pointless war, is all it took. Seven short years. Of course the underpinnings of this disaster have been there for decades:

Take John McCain, your Republican presidential nominee, whose senior staff includes half a dozen prominent former lobbyists. As he recently put it, "I was chairman of the [Senate] Commerce Committee that oversights every part of the economy." No question about it: Your leaders' failure to notice the damage done by irresponsible deregulation was indeed an oversight of epic proportions.

Please, by all means possible, vote for Mr. Magoo in November. Let's just complete the hat-trick of the past two elections and keep putting greed-mongering, hate-filled useless politicans in office, mkay?? Thankx!

Not that the junior Senator from Illinois is a much better choice come November. At the very least he didn't help lead this country into damnation. No... he's just spent everyday since the last election tryin' to get elected this November. "First do no harm". Well, he did that, at least.

Admittedly, your transition to Third World status is far from over, and it won't be painless. At first, for instance, you may find it hard to get used to the shantytowns that will replace the exurban sprawl of McMansions that helped fuel the real estate speculation bubble. But in time, such shantytowns will simply become part of the landscape. Similarly, as unemployment rates continue to rise, you will initially struggle to find a use for the expanding pool of angry, jobless young men. But you will gradually realize that you can recruit them to fight in a ceaseless round of armed conflicts, a solution that has been utilized by many other Third World states before you. Indeed, with your wars in Iraq and Afghanistan, you are off to an excellent start.

Believe it or not, I actually have more hope than Ms. Brooks. I remember the 1970's recession. I remember when Japan practically bought the United States at fire-sale prices in that decade and how hated they were for doing it. I remember being in New York City in it's darkest hours and no, not 9/11, but the early 1970's recession hit NYC really hard. I remember the S&L meltdown of the 1980's; it was bad for most everyone, but we survived it. The problem is we learned nothing from these experiences.

We have short-term memories in the United States. It looks like it's The End Of Times, but it really isn't. It's bad... really, really bad, but we've been here before and we'll be here again. That's what happens when a people have short-term memory problems - they make the same mistakes over and over again.

Like Yogi said, it's deja vu all over again. Maybe this time the Arabs will buy us out.

~ ~ ~

One of my favorite websites: Improbable Research. Enjoy.

Just when you think America couldn't get any worse

we get Caribou Barbie as VEEP nom to run with Mr. Magoo.

Like Obama and Biden wasn't weird enough.

Is it too late to move to Canada?

Ostrich, meet sand

Financial Crisis Is Absent From Agendas of Parties, Candidates

Many Democrats shy away from tackling the credit crisis because of the party's historical support for Fannie and Freddie. The Republicans, for their part, are reluctant to draw attention to a crisis that occurred on their watch. The subprime meltdown isn't the only item missing from the parties' agendas. The list also includes the Democrats' failure to set out a strategy for countering Russia's assertiveness and the Republicans' silence on income inequality.

I LOVE Schumer's condescending quote:

Senator Charles Schumer, a New York Democrat, said conventions aren't the place to discuss detailed plans for dealing with the markets.

``The conventions are aimed at the average voter,'' he said Aug. 25 in Denver. ``You don't go into Quinlan's bar and ask them what to do about the'' Securities and Exchange Commission.

Of course his job is secure for four more years and then he can retire on his huge pension.

My second favorite quote is:

``We feel like we've taken a big step to stabilize the situation,'' said Senator Tom Carper of Delaware, a Democrat on the Banking Committee.

Seriously? Oy! Senator, you've done jack-all to "stabilize the situation".

``We are in the midst of the worst financial crisis since World War II,'' Stanley Fisher, governor of the Bank of Israel and a former IMF official, told central bankers in Jackson Hole, Wyoming, on Aug. 23.

Not that anyone inside the United States is listening. It's an election year and no politican will listen to, let alone accept, the truth about anything. As the article mentions towards the end, this situation is very similar to the 1930's.

History repeats itself people. I don't think either McCain or Obama have what it takes to deal with what is to come.

We're not telling you how to vote

but...

Wal-Mart warning managers of labor bill

Wal-Mart Stores Inc said on Friday it has held meetings with U.S. store managers warning them of issues that could arise if Democrats win power and pass a law that would make it easier for workers to unionize, but stressed it was not telling workers how to vote.

No, of course not.

Silly Season 2008

So Hillary and John won in New Hampshire.

Big. Freakin'. Deal.

The press is acting like it's election day - it's only one caucus and one primary down folks. Chill, please.

All day yesterday the political press is burying Hil in Iowa and proclaiming Obama as God's Second (and favorite) Child.

I've been sick of political theatre since Pelosi took impeachment off the table but it is now nearly impossible to avoid the insanity.

And it's only January. May the Great Cosmic Muffin have mercy on what's left of my soul.

I don't even want to address Bushies trip to Israel. With his BFF Condie. Don't they look cute together?

~ ~ ~

Heart-breaking and horrifying news out of Alabama: Man tells cops he tossed four children off Ala. bridge

"Lam Luong, 37, will face four counts of capital murder, prosecutors say. "That's as bad as it gets under Alabama law," District Attorney John Tyson Jr. tells the Press-Register.

Lt. Richard Cayton of the Mobile County Sheriff's Office tells the paper that searchers on boats and helicopters haven't found any signs of the children, who ranged in age from 4 months to 3 years old."

Apparently it was an act of revenge against his wife but so far no reason is given as to what he was getting even with her for. Whatever it was, it couldn't have been bad enough for this. No doubt there will be a diminished capacity plea, eventually.

~ ~ ~

From the Who Gives A Shit File, we have a story on Worst Dressed Of the Year.

Victoria Beckham, in case you're wondering.

In a huge act of charity Mr. Blackwell left Britney Spears off the list this year. The man should get a humanitarian award for that.

Frankly I find his stupid list incredibly mean-spirited most of the time - and utterly pointless. Who the hell cares what he thinks?

Winter has finally arrived.

We're not having any snow but it's gotten quite frigid in these parts. It's a normal January day for a change.

So Senator Clinton is 'In'. Who the heck isn't in the race for 2008? Just me and my cats?

The Idiot in Chief is going to talk to the Nation tomorrow night. Do I watch? I might have to get a perscription for tranks first. It's already out there that he's planning a tax increase. He's really gotten into pissing off the Republicans, hasn't he?

The death toll in Iraq is out of control -- the deficit in the US is out of control -- his approval rating is in the low 30's. According to an article in the Washington Post, only 26 percent of Americans polled believe the country is headed in the right direction; 71 percent believe the country is seriously off track -- the worst ratings in more than a decade.

So, what's he going to talk about? He's spent two weeks trying to rally public opinion in favor of his troop increase in Iraq and that hasn't worked. Is he going to talk about how he's made the country safer since 9/11? 55 percent of Americans already believe that he has not made the country safer. His waving the bloody flag of 9/11 yet again isn't going to help that. So, what's left? He's going to ask Congress to renew the No Child Left Behind law... because that's been such an amazing success. He's also going to discuss balancing the budget in five years - that must be the comdedy relief section.

Bit 'o trivia - the only President less popular than Bush on the eve of the State of the Union address was Richard Nixon, eight months before he resigned.

I'm not a happy camper today.

I listened to Bush's speech last night. He threatened Iran and then we invaded the Iranian embassy in Iraq, in effect making good on this threat.

He's pursuing global war, in my opinion. I have zero faith in the Congress stopping him. He has issued over 700 signing statements to legislation passed by Congress which were sent to him to be signed, effectively changing the intent of Congress without anyone stopping him. He has stated that the Constitution is "just a goddamn piece of paper", proving, in my opinion, that he feels he may do whatever he damn well pleases. He will just sign us off into global war and Congress will do nothing.

See Informed Comment.



In other news, the other Senator from Connecticut, Christopher Dodd, has filed to run for President in 2008.

Dodd is chairman of the Senate Banking Committee and a member of the Senate Foreign Relations Committee. He was a Peace Corps volunteer in the Dominican Republic during the 1960s. He is a leading voice in the Senate on Latin American issues. He is also known for his work on health care and children's issues.

He is also an idiot. And yet, he could barbeque kittens and roll little old ladies for their Bingo money and this freakin' State would still send him to the Senate. The only good thing about Dodd is he isn't Lieberman.