Revenge of the Beta Males
Posted: September 15, 2009 Filed under: Bailout Blues, Equity Markets, Global Financial Crisis, president teleprompter jesus, The Bonus Class, The Media SUCKS, U.S. Economy | Tags: Journalism Beta Males, K Street Beta Males, Media Misinformants Comments Off on Revenge of the Beta Males
There’s only a few places in the real world where Beta Males get to whoop it up and extract their revenge on the Alphas that shoved them around during their model-building, star wars loving, well-spent but unhappy youths. Those places would be on Wall Street, what passes for journalism these days, and Washington D.C.. It’s occurred to me that these places contain Beta Males that are natural allies. Since none of these folks ever got to sit at the kewl kids lunch tables in high school, they’ve built their special lunchrooms where no one else can venture without getting hall monitor passes from the former high school hall monitors. It’s also probably why we’ve now built an economy that no longer builds anything useful but gets increasing amounts of money from mathematical gambles and laws that favor insiders. It’s the only area where the Beta Males can dominate. If you can’t play football, at least you can bet on the game, win big, and eventually buy yourself a former cheerleader.
I went out in search of some evidence that we might rein in the market malpractice on Wall Street, and instead found that we’re just as likely to be setting up another financial crisis as not. Maybe I should throw up my hands and follow the lead of George Soros. I should start a hedge fund that bets on the stupidity of Wall Street aligned with the duplicity and complicity of politicians and journalistic misinformants. That way I could buy my own island and avoid the next financial crisis.
It seems bringing translucency to the market (a goal in a true market economy) would only benefit those on the outside looking in and we can’t have that. It might bring the rest of the world back to the lunchroom tables. We continue to have Republicans blocking everything because of their incessant worship of the idols of false capitalism. How can so few understand so little and gum up the works for so many? This quote appalled me.
“The president has offered a reform proposal that would grant broad new authorities to government bureaucrats while intruding in private markets and restricting personal choice,” said Spencer Bachus of Alabama, the senior Republican on the House Financial Services Committee. “The obvious lesson of the events of September 2008 is that we need smarter regulation, not more regulation, not more government bureaucracy, and not more incentives to engage in harmful business practices.”
This is a man truly devoid of intellect and any sense of how a competitive market functions. Removing frictions like information asymmetry, huge single powerful players, or moral hazards makes markets work beautifully. Civilization has regulated its financial markets since Hammurabi for very obvious reasons. How can you come up with real political discourse when the opposition is so obviously factually handicapped?
Speechification Alert
Posted: September 12, 2009 Filed under: Bailout Blues, Equity Markets, Global Financial Crisis, president teleprompter jesus, The Bonus Class, The Great Recession, The Media SUCKS, U.S. Economy | Tags: Barney Frank, L shaped recession, Stagnant economy, zombie banks Comments Off on Speechification Alert
Who stole the Cookies from the Cookie jar?Great illustration in today's New York Times: Banker's and the taxpayer cookie jar
Well, it’s my turn to listen to a Obama Speech. Those speeches usually have the same dizzying effect on me that tennis matches do. Instead of watching balls go back and forth rhythmically while lulling me to sleep, I get to watch the head of the President. Teleprompter Right, 1,2,3 to Teleprompter left, 2, 3 …
So the speech is on bank reform which is something I’ve been on about for months now. It’s the anniversary of Lehman’s demise. Stories abound on the Grey Lady today including this call by Dr. Tyler Cowen of George Mason University. He’s a little libertarian for my taste on policy–even managing a h/t to Ayn Rand and Atlas Shrugged–but he gets it all in a way that only an economist could.
But we are now injecting politics ever more deeply into the American economy, whether it be in finance or in sectors like health care. Not only have we failed to learn from our mistakes, but also we’re repeating them on an ever-larger scale.
Lately the surviving major banks have reported brisk profits, yet in large part this reflects astute politicking and lobbying rather than commercial skill. Much of the competition was cleaned out by bank failures and consolidation, so giants like Goldman Sachs and JPMorgan had an easier time getting back to profits. The Federal Reserve has been lending to banks at near-zero interest rates while paying higher interest on the reserves the banks hold at the Fed. “Too big to fail” policies mean that the large banks can raise money more cheaply because everyone knows they are safe counterparties.
President Dwight D. Eisenhower warned of the birth of a military-industrial complex. Today we have a financial-regulatory complex, and it has meant a consolidation of power and privilege. We’ve created a class of politically protected “too big to fail” institutions, and the current proposals for regulatory reform further cement this notion. Even more worrying, with so many explicit and implicit financial guarantees, we are courting a bigger financial crisis the next time something major goes wrong.
We should stop using political favors as a means of managing an economic sector. Unfortunately, though, recent experience with health care reform shows we are moving in the opposite direction and not heeding the basic lessons of the financial crisis. Finance and health care are two separate issues, of course, but in both cases we’re making the common mistake of digging in durable political protections for special interest groups.
I have to admit that I’ve written about similar concerns, however, I can tell Cowen and I may differ on how to correct the situation. That’s typically true of most economists. We agree on the root causes because of our grounding in shared theory but argue which policy might be best based on our political bent. I continue to argue for the role of government as rule setter and referee. However, I really do prefer independent bureaucrats in the position of auditor and enforcer. Congress, however, still has to write the law. This action, to date, has been missing.
So, MarketWatch has provided a pre-speechification programme so that we can get our score card ready. The speech is supposed to “rekindle” interest in regulatory restructuring. I’m not sure we need restructuring so much as we need laws that recognize the systematic problems we’ve developed in financial markets since quants have turned asset pricing into a physics exercise, financial innovations have become exotic, and the entire set up is now one big cartel waiting to pounce on the unsuspecting business sector and consumer. We now have a small number of banks capable of funding the really big capital undertakings and who knows what priorities or friends they’ll choose to fund over positive net present value projects? This should be enough to send any capitalist running for government regulation. Also, get ready for lack of services and fees that would make a loan shark blush. This should make any advocate for the little guy scream for the same. Today, I am the jade dakini. It’s happening in Europe but I doubt it will happen here.
So, what is Obama said to be inkling tomorrow that will be undoubtedly be sacrificed to the demons of political expediency down the road?
Losing Ground
Posted: September 1, 2009 Filed under: president teleprompter jesus, Team Obama, Voter Ignorance | Tags: polls, Presidential Job Approval, Rasmussen Comments Off on Losing Ground
Whatever AxelRahm and POTUS are doing, it’s not working. CNN reports that the majority of registered independents in the country now disapprove of how President Obama is doing his job.
A majority of independent voters disapprove of how Barack Obama’s handling his job as president, according to a new national poll.
Fifty-three percent of independents questioned in a CNN/Opinion Research Corporation survey released Tuesday say they disapprove of how Obama’s handling his duties in the White House, with 43 percent in approval. That result marks the first time in a CNN poll that a majority of independents give the president’s performance a thumbs-down.
The issues that appear to be responsible for the downward momentum include health care, the economy, the budget deficit, and taxes. Majority support is still holding for national security (terrorism) and foreign affairs which are being managed by the still popular SOS Hillary Clinton. It would seem the most obvious downer numbers should come from the health care fight, but other issues also weigh in.
Is the fight over health care responsible for the downturn in Obama’s numbers?
“Yes, in part, but his standing on some other issues has taken an even bigger tumble,” adds Holland. “Among all Americans, his rating on health care has dropped 13 points since March. Compare that to his 16 point drop on the deficit and 17 point dip on taxes and it looks like there is growing discontent with Obama’s overall domestic agenda — not just his health care policy.”
According to the poll, Obama’s approval rating on how he is handling the war in Afghanistan also fell 18 points since March.
Another interesting poll was released by Rasmussen today where Republican Voters Say their GOP Reps in Congress are still out of touch. However, it appears out of touch means too liberal for their tastes.
Seventy-four percent (74%) of Republican voters say their party’s representatives in Congress have lost touch with GOP voters nationwide over the past several years. The latest Rasmussen Reports national telephone survey finds that just 18% of GOP voters believe their elected officials have done a good job representing the base.
Most Republican voters (55%) say that the average Republican in Congress is more liberal than the average Republican voter. Twenty-four percent (24%) say the average Republican in Congress holds views about the same as the average Republican voter while just 17% think the Congressional Republicans are more conservative than GOP voters.
The Administration shouldn’t expect Republican voters to cooperate much as eighty-four percent (84%) of them believe it is more important to stand for what their party believes in rather than trying to work with President Barack Obama. Only 14% favor bipartisan cooperation with the President.
Overall, 45% of voters say they at least somewhat approve of the President’s performance. That’s down a point from yesterday and the lowest level of total approval yet measured for Obama. Fifty-three percent (53%) now disapprove. See recent demographic highlights from the tracking polls.
In addition to our daily tracking, Rasmussen Reports has released a month-by-month review of the President’s Approval ratings. This allows a longer-term look at trends. In August, President Obama’s full-month ratings fell below 50% for the first time.
I wouldn’t want to be an incumbent in this atmosphere. These are some ugly, ugly numbers. I’m guessing the Dems are on their way to losing the senate and possibly the house if this keeps up.
You can talk about this or consider this an open thread. Have a good evening!
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Borrowing a turn of Phrase …
Posted: August 23, 2009 Filed under: just because, president teleprompter jesus, Team Obama, Voter Ignorance | Tags: Marc Ambinder, Paul Krugman, Racist meme, trust Comments Off on Borrowing a turn of Phrase …Paul Krugman’s Saturday blog post takes a defensive tone with Marc Ambinder who once called Krugman and a group 
of other liberal thinkers “reflexively anti-Bush”. Krugman expected a better apology from Ambinder after it was confirmed by former Bush Homeland Security Secretary Tom Ridge that the White House did, in fact, play politics with the Code Orange terrorist warnings. Evidently, there was an email between the two and Krugman felt the exchange wanting. Here’s his rationale.
But I’d like to return to one point: even after retracting his statement about people who correctly surmised that terror warnings were political being motivated by “gut hatred” of Bush, he left in the bit about being “reflexively anti-Bush”. I continue to find it really sad that people still say things like this.
Bear in mind that by the time the terror alert controversy arose in 2004, we had already seen two tax cuts sold on massively, easily documented false pretenses; a war launched with constant innuendo about a Saddam-Osama link that was clearly false, and with claims about WMDs that were clearly shaky from the beginning and had proved to be entirely without foundation. We’d also seen vast, well-documented dishonesty and politicization on environmental policy. Oh, and Abu Ghraib was already public knowledge.
Given all that, it made complete sense to distrust anything the Bush administration said. That wasn’t reflexive, it was rational.
I’d like to borrow the example and phrase because some of us around here are perpetually called “reflexively anti-Obama” or, of course, called racist because it’s a much more pejorative and personally damaging label. This is simply because we see similar patterns of behavior in Barrack Obama and his administration. Notice that Krugman has a laundry list right there in that second paragraph of things that made him rationally distrust anything the Bush administration said. I personally have my own laundry list of things that makes me rationally distrust anything the Obama administration says. It starts (but does not end) with the pledge to vote against FISA.
Paradise Squandered
Posted: August 20, 2009 Filed under: Global Financial Crisis, Health care reform, Hillary Clinton: Her Campaign for All of Us, president teleprompter jesus, Surreality | Tags: Democratic majority, Gallup poll, Obama approval, The Cook Report Comments Off on Paradise Squandered
I guess the old adage is true. A year is a long time in politics. Less than 18 months ago I held out hope that we would see a solid democratic majority for some time and that there would be a democratic President with a democratic agenda moving the country forward and away from the Bush Cheney nightmare. I expected that we would have no more warrantless wiretapping. I believed we would be discussing an energy policy that included more options that drill, baby drill. I thought a women’s uterus would no longer be considered an object of state interest. I figured that we’d see the end to talk about protecting traditional marriage, whatever the heck that ever was to start out with but basically we’d no longer exclude gay couples from a civil institution and gay soldiers from openly serving in our military.
I thought our future seemed bright.
I thought perhaps we could have a defense department budget that resembled the levels of other democratic countries and that we would have a health care plan that resembled the rest of the developed world. I especially felt hopeful, when I watched the first democratic debate, that one of those folks would be in charge of America again. It was only a matter of which one. Little did I know then, the one I discounted as not really knowing a thing by the time the second debate was over is the one we got. My basic thought about Obama was Vice President material.
Now, our national nightmare continues and The Cook Political Report has just dropped the other shoe. The Cook Political Report has a very good reputation for handicapping elections.
Gallup’s three-night moving average tracking poll, President Obama’s job approval rating in both their August 16-18 and August 17-19 averages was just 51 percent, the lowest level of his presidency. The latter sampling showed his disapproval up to 42 percent, matching his all-time low hit in the August 15-17 tracking poll. The 51% job approval rating is identical to two other polls released in recent days conducted by NBC News and the Pew Research Center. Today’s regression-based trend estimate computed by our friends at Pollster.com from all major national surveys show an approval rating of 50.7 percent and disapproval of 43.7 percent.
These data confirm anecdotal evidence, and our own view, that the situation this summer has slipped completely out of control for President Obama and Congressional Democrats. Today, The Cook Political Report’s Congressional election model, based on individual races, is pointing toward a net Democratic loss of between six and 12 seats, but our sense, factoring in macro-political dynamics is that this is far too low.
Many veteran Congressional election watchers, including Democratic ones, report an eerie sense of déjà vu, with a consensus forming that the chances of Democratic losses going higher than 20 seats is just as good as the chances of Democratic losses going lower than 20 seats. A new Gallup poll that shows Congress’ job disapproval at 70 percent among independents should provide little solace to Democrats. In the same poll, Congressional approval among independents is at 22 percent, with 31 percent approving overall, and 62 percent disapproving.
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