Reading this story on the return to Galveston for many residents, it occurred to me that we really have not heard much about what is going on down there. How many were lost? Will they rebuild?
What exactly is going on down there?
by John Cole| 32 Comments
This post is in: Domestic Politics
Reading this story on the return to Galveston for many residents, it occurred to me that we really have not heard much about what is going on down there. How many were lost? Will they rebuild?
What exactly is going on down there?
by John Cole| 26 Comments
This post is in: Domestic Politics
The election almost seems to be a distraction from the financial meldtown right now.
This post is in: Domestic Politics
CNBC has been informative tonight. Right now Larry Kudlow is yelling about reinstating the uptick rule, something I had never heard of before. Apparently, part of the problem on the market today was short-sellers driving down the price of shares of good companies like Goldman, hoping the treasury will come in and “rescue” them, further deflating the vlaue of the stock and rewarding the short-sellers more.
It even has a name- “bear raiding.” What a mess.
*** Update ***
The Bush legacy:
Pressure is building on the pristine “AAA” rating of the United States after a federal bailout of American International Group Inc, the chairman of Standard & Poor’s sovereign ratings committee said on Wednesday.
The $85 billion bailout of AIG on Tuesday by the U.S. Federal Reserve “has weakened the fiscal profile of the United States,” S&P’s John Chambers told Reuters in an interview.
“Lack of a pro-active stance could have resulted in further financial stress and put pressure on the U.S. triple-A rating,” Chambers said. “There’s no God-given gift of a ‘AAA’ rating, and the U.S. has to earn it like everyone else.”
Whee.
by John Cole| 64 Comments
This post is in: Election 2008, Republican Stupidity, Assholes, Clown Shoes, Did You Know John McCain Was A POW?, Republican Crime Syndicate - aka the Bush Admin.
By popular request, Tweety tearing into that insufferable prick Eric Cantor:
I forgot who described Cantor as someone who looks like the proprietor of the jerk store, but he reminds me of that jackass in Die Hard.
My favorite thing is when Cantor says, at about 7 minutes in, it is time to stop the finger-pointing and fix things. Why is it that every time Republicans screw something up horribly, they run around saying it is not time to point fingers and lay blame. According to them, no one should every be responsible for anything. They tried this shit in the aftermath of Hurricane Katrina, and I remember, because I was defending Bush and company in the immediate aftermath of Katrina until it became clear that they had in fact made a total hash of it.
This post is in: Domestic Politics
In between working and trying to get software to work on a laptop that just refuses to cooperate, I am still trying to figure out what happened to AIG. Considering my knowledge of margin calls is limited to overplaying my hand in a few games of Railroad Tycoon II- Platinum several years back, what I gather is the following.
AIG had a large hand in insuring all the bad debt that was packaged and repackaged and sold all over the world. That bad debt was all the sub-prime loans mixed in with good loans, and no one has the first clue who holds what. What we do know, though (I think) is that AIG was the glue holding everything together. As long as AIG was still around insuring all the stuff that we don’t know is there, things were ok.
However, when the shit hit the fan over the weekend, people began to get very nervous about what exactly AIG is insuring, as no one still knows who is holding what and what the what actually is. Thus, it became very expensive in short order for AIG to continue to insure the unknown. Thus, they had to come up with huge amounts of cash to show that they could still back all the things they claim they can, even though they have no idea what they have. Add to this mess, the liquidity problem, in that banks no longer feel comfortable lending money.
Is this right? There are a ton of terms out there that I simply do not understand in either theory or practice, but I am trying to stumble through the basics here. Please use English when commenting.
by John Cole| 38 Comments
This post is in: Domestic Politics
I wish I could tell you more about what this meant, but I really don’t understand fully why AIG is different from Lehman and why one is allowed to fail and the other is not and why it was a big deal to rescue Chrysler 1ith 1 billion dollars but nothing to rescue AIG with 85 billion and why they can do it without a peep from Congress.
I guess the real goal in business these days is to get big enough and do enough stupid things that everyone is relying on the bad loans you are holding, and then you are deemed to big to fail. I guess the main question I have is if we keep saying these things are too big to fail, why don’t we break them up?
Also, my gut tells me this is not over. I am betting the market will go up in the short term, and we will roll along blindly and in a few months something else will happen that will trigger a similar crisis, this time with someone else. Not sure when this will end, but it will probably have to start with the housing market bottoming out. At least that is what I think from listening to and reading all the financial folks the last couple of weeks.
This column seems to ask the right questions.
by John Cole| 19 Comments
This post is in: Election 2008, Lies, Damned Lies, and Sarah Palin, Did You Know John McCain Was A POW?
GOP vice presidential candidate Sarah Palin is effectively turning over questions about her record as Alaska’s governor to John McCain’s political campaign, part of an ambitious Republican strategy to limit any embarrassing disclosures and carefully shape her image for voters in the rest of the country.
Republican efforts include dispatching a former top U.S. terrorism prosecutor from New York, Ed O’Callaghan, to assist Palin’s personal lawyer working to derail or delay a pending ethics investigation in Alaska. The probe, known as “Troopergate,” is examining whether the governor abused her power by trying to remove her former brother-in-law as a state trooper.
O’Callaghan is just part of a cadre of high-powered operatives patrolling Alaska as reporters and Democrats scrutinize every detail of Palin’s tenure in government, plus her family and friends. One strategy: Carefully coordinate any information that’s released. The McCain campaign is demanding that it becomes the de facto source for answers about the operations of Alaska’s government during the past 20 months.
She still has not had a press conference or any contact with the media.
*** Update ***
I should read my own damned website. Michael covered this earlier.