As the financial media obsess over data like this morning’s payroll numbers, it’s interesting to observe trends in the direction and degree of “surprises” about the data.
Here is the Citigroup Economic Surprise Index for the US:
Cheney just loves 911 gifts and festivities, but he wants us to remember what it’s really all about.
“Sometimes, in all the hustle and bustle of the season, it’s easy to forget the true meaning of Sept. 11,” Cheney said. “Sept. 11 is not about fancy 9/11 parades, or big 9/11 office parties. In fact, it’s not even just about two buildings crumbling to the ground and leaving thousands of innocent people dead.”
“No,” Cheney continued. “No, 9/11 is about the warm feeling you get when you help an elderly woman cross the street and then whisper to her that the terrorists can strike at any moment. 9/11 is about the satisfaction of telling people to do things and then them doing it—not because they want to, but because they are afraid to do otherwise. 9/11 is about removing Saddam Hussein from power. But most of all, 9/11 is about love.”
Cheney said he plans to spend a quiet Sept. 11 at home this year, during which he will exchange gifts with loved ones and watch his taped VHS footage of the old 9/11 TV specials while he smiles and laughs.
“I have a feeling this is going to be the best Sept. 11 ever,” Cheney said with a grin. “I just dread the day I have to tell my kids that 9/11 isn’t real.”
I’ve lived on both continents, and poor people in the US have what middle-class europeans do, but they eat more and on average are far dumber. What this video makes clear is that most of their fundamental problems do not arise from a lack of purchasing power.
We are talking about the proper handling of guns and human cages, so any less than a presumption of innocence is reckless.
Regular readers know that I despise everything that DSK stands for politically – he’s a member of the French Socialist Party and has orchestrated a series of sovereign bailouts while head of the IMF. I am nonetheless disgusted with the public discourse around his case.
There is no presumption of innocence, as if accusers of sex crimes never turn out to be liars. Typical of this attitude is mayor Bloomberg’s quip, “if you don’t want to do the ‘perp walk’, don’t do the crime.”
There are any number of possibilities for what really happened in that hotel suite, but only one seems to be seriously considered in the US press: that this plump, 5’7″, 62-year-old overpowered a 5’11”, 32-year-old African woman with such force or martial efficiency as to not leave either of them significantly bruised and scratched. The story seems to be that she was so intimidated by his strength that she went along and performed oral sex without harming him. Maybe I just lack DSK’s skill, but my wife is 5’10”, and I’m a young and fit 6′, and I’d end up in the emergency room if I tried something like this! I bet Diallo could have beaten DSK to a pulp if she’d wanted. How can feminists have such a low regard for women that they assume they would all just comply with demands from random, unarmed old men?
The above is a possibility, but without evidence it is no more, if not less probable than that he offered her money or favors in exchange for sex but she found him to be a “rutting chimpanzee” and abusive jerk, spurring her to cry rape in revenge. He had stayed in the hotel at least 6 times in the last year, so maybe this wasn’t even their first encounter but a spat – we just don’t know. Of course, we can’t discount conspiracy, as if such things never happen in politics. Such a set-up would of course be likely to take advantage of the man’s known vices. All she would have to do is flirt with him, and the old horndog would come on to her. Easy to cry rape in exchange for a few hundred grand, and easy to keep silent when sufficiently intimidated.
In my perusal of the French discourse on this subject (via the Google Translate Chrome plugin), I find it much more deliberative than the US take on the affair. Is it possible that Americans are even more politically correct than the French, at least when it comes to sex? It also may be that the French are cooly cynical about the workings of power, having tossed out several governments in the last two centuries. A poll on Wednesday showed that 57% thought DSK is the victim of some kind of set-up. It is perfectly respectable to question such things as the official versions of current and historical events (certain German activities in WWII notwithstanding – that may land you in prison). They are also much better dinner companions and conversationalists than most Americans, and don’t observe the same taboos.
The Great White Defendant refers to these rare cases where prosecutors get to target a member of the privileged class, and as a consequence of their guilt from having put away so many poor people, they pursue him like Ahab after the white whale. Of course, journalists love these cases because they fit their own preconceptions of oppressors and oppressed, and the media attention makes prosecutors stars and helps their political careers. The last such major case was the prosecution of several white Duke lacrosse players on the word of a black stripper who turned out to have made the whole thing up. The lead prosecutor in that case ended up being convicted of contempt and disbarred for his criminal disregard of the truth. Nifong served one day in jail, and neither the accuser nor the currupt police have been prosecuted for their actions. BTW, the accuser, Crystal Mangum, is facing a first degree murder charge for the stabbing of her boyfriend last month, but the New York Times is strangely silent on that story.
I hope Tom Wolfe is watching this case closely (and I suspect he is, as he lives in NYC) and gives us a write-up or two by the time it’s over. No matter what actually happened and what verdict is reached (jurors are selected for gullibility, so the verdict will not necessarily reflect the truth), the affair may refect poorly on journalism and the court system.
The rigor with which journalists and prosecutors pursue the truth is critical for a civilized society, since the legal system has a monopoly on the use of force. The burden of proof is on the accuser, whether a policeman or alleged victim. We are talking about the proper handling of guns and iron cages, so any less than a presumption of innocence is reckless.
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Here’s the Bonfire of the Vanities on Amazon
I strongly recommend it (and not the movie with Hanks & Willis), along with everything Wolfe has written – he’s the best novelist/journalist of our time.
Just when you thought your respect for economics PhDs couldn’t get any lower, a professor at the top-ranked University of Chicago, Casey Mulligan, is making the case in the New York Times that there was no bubble in housing:
Adjusted for inflation, residential property values were still higher at the end of 2009 than 10 years ago. This fact raises the possibility that at least part of the housing boom was an efficient response to market fundamentals.
Inflation-adjusted housing prices and housing construction boomed from 2000 to 2006 and crashed thereafter. Commentators ranging fromPresident Obama to Federal Reserve Chairman Ben S. Bernanke have described that cycle as a “bubble,” by which they mean that, at least in hindsight, the housing price boom was divorced from market fundamentals.
But maybe there was a good, rational reason for housing prices to increase over the last decade.
Let’s consider first what it means to believe that the spike in prices since the late 1990s was unwarranted — the so-called “bubble theory.”
According to the bubble theory, for a while the market was overcome with exuberance, meaning that people were paying much more for housing than changes in incomes, demographics, technology and other basic factors would suggest.
Now that the bubble is behind us, people today should be no more willing to pay to own a house than they were in the late 1990s. (It’s true that population has grown since the 1990s, but population growth is nothing new and should not by itself increase real housing prices. Don’t forget that greater population also means more people available to do construction work.)
Yet, the professor points out, house prices are still well above 1990s levels:
Ok, so his basic point is that because housing prices haven’t yet declined to 1990s levels, there was no bubble. He doesn’t consider the obvious alternative: maybe prices don’t move in straight lines and that the sideways action in 2009 was the result of an $8000 tax credit and general upswing in market optimism (as seen in stocks and commodities).
Maybe, just maybe, as in Japan after 1989 and the US after 1929, housing prices will decline in a herky-jerky fashion for many years after the peak.
Mama, don’t let your babies grow up to be economists. They’ll never stay smart and they’re always confused.
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In other bizarre housing news via patrick.net, some real California estate foreclosure prevention scammers were tied up and tortured after they ripped off another team of real estate rip-off artists.
If you can stand it, here is the Bloomberg Radio interview with everyone’s favorite Goldman “strategist.”
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Reuters
Canada’s National Post published this footnote to the Climategate story. It should come as no surprise to frequent users of Wikipedia, where it is wise to remain skeptical when reading about anything remotely political.
The highly variable record of global temperatures prior to the industrial revolution has always been a thorn in the side of the alarmists, who have tried to present a clear narrative: the earth was in perfect balance before humans started burning so much fossil fuel, but since the late 1800s carbon dioxide has been driving temperatures to new heights, where there be dragons.
Said Briffa, one of their chief practitioners: “I know there is pressure to present a nice tidy story as regards ‘apparent unprecedented warming in a thousand years or more in the proxy data’ but in reality the situation is not quite so simple. … I believe that the recent warmth was probably matched about 1,000 years ago.”
In the end, Briffa and other members of the band overcame their doubts and settled on their dogma. With the help of the United Nations Intergovernmental Panel on Climate Change, the highest climate change authority of all, they published what became the icon of their movement — the hockey stick graph. This icon showed temperatures in the last 1,000 years to have been stable — no Medieval Warm Period, not even the Little Ice Age of a few centuries ago.
But the UN’s official verdict that the Medieval Warm Period had not existed did not erase the countless schoolbooks, encyclopedias, and other scholarly sources that claimed it had. Rewriting those would take decades, time that the band members didn’t have if they were to save the globe from warming.
But then came Wikipedia, the one-stop-shop for official versions:
All told, (William Michael) Connolley created or rewrote 5,428 unique Wikipedia articles. His control over Wikipedia was greater still, however, through the role he obtained at Wikipedia as a website administrator, which allowed him to act with virtual impunity. When Connolley didn’t like the subject of a certain article, he removed it — more than 500 articles of various descriptions disappeared at his hand. When he disapproved of the arguments that others were making, he often had them barred — over 2,000 Wikipedia contributors who ran afoul of him found themselves blocked from making further contributions. Acolytes whose writing conformed to Connolley’s global warming views, in contrast, were rewarded with Wikipedia’s blessings. In these ways, Connolley turned Wikipedia into the missionary wing of the global warming movement.
The Medieval Warm Period disappeared, as did criticism of the global warming orthodoxy. With the release of the Climategate Emails, the disappearing trick has been exposed. The glorious Medieval Warm Period will remain in the history books, perhaps with an asterisk to describe how a band of zealots once tried to make it disappear.
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Yes, this is a financial blog, but this is a financial issue. The global warming crowd would burden society’s producers and feed the parasite class with heavy new taxes and regulations. Goldman Sachs has a 10% equity stake in the Chicago Climate Exchange (Al Gore and Hank Paulson’s Generation Investment Management owns another 10%) and hopes to capture transaction fees from what its chairman Richard Sandor claims could be a 20 trillion dollar market.
This is coming from a dyed-in-the-wool conservationist. I spent three years among the greenies getting an advanced degree in environmental science, so I saw their group-think up close. I can say that almost to a person, they are socialists and True Believers in government. I’d trust an oil man over a climate professor any day. The CO2 issue is politicized science at its worst, and distracts from real problems such as toxic pollution (including the depleted uranium, lead, and high explosive residue that the US military spreads with liberty), topsoil erosion, overbuilding and overfishing.
Bloomberg’s Tom “Tuxedo & Bowtie” Keene recently provided a 10-minute forum for Abby Joseph Cohen, Senior Investment Strategist at Goldman, to drone on about how the “recession is ending right now,” “consumer growth will be increasing,” and how she expects “profit growth,” etc, etc.
There was no mention of Ms. Cohen’s 1600+ call for the S&P made in early 2008, nor of course her continuous bottom calling in the wake of the dot-com bubble that she helped promote. No mention of P/E ratios, dividend yields, book values, debt loads, nothing. Just an opportunity for her to lecture the audience about the importance of longer term investment horizons. Mr. Keene even asked for questions from the audience and surely ignored a few from skeptics: we just love to have you on the show, he said, but “boy do we get the hate mail.” You don’t say! Why GS still keeps this dog in the house is beyond me.
Now, I know all you Prechter skeptics out there will come out and say I’m using a double standard, but that is not the case. This Goldman “strategist” offers her advice explicitly to retail investors, and continually urges them to buy the stock market, no matter what. She has never said anything else. Mr. Prechter’s services are intended for more sophisticated speculators and institutions, and he has shied away from offering advice to amateurs, other than admonishing them to stay in “the safest cash equivalents” ever since the bubble got rolling. Taking this advice would have saved most people lot of money and heartache over the last 10 years (admittedly, overeager shorts included).
Furthermore, when you read Prechter, you always learn something. Market history, valuations, and the mechanics of money and credit are explained with facts and figures. You can judge them for yourself. Cohen can’t be bothered to mention a single number, other than her expectations for 3% GDP growth. This interview, meant for everyday people driving to work in the morning, reflects absolutely reprehensible behavior from both Goldman and Bloomberg.
Sovereign Speculator 