Paul Krugman

Since the New York Times (NYT) has placed a limit on the number of free website visits per month (10), I have reduced my viewing down to Paul Krugman's political columns and David Pogue's technology columns.  Who's got time for much else anyway?  Well, maybe Maureen Dowd's column or Gail Collins or maybe even David Brooks.  

I, like probably the vast majority of Americans, choose not to pay for the NYT at this time.  Maybe in the future....

Here's a succinct little snip from Paul's May 17 column:

Apocalypse Very Soon

snip: The story so far: When the euro came into existence, there was a great wave of optimism in Europe — and that, it turned out, was the worst thing that could have happened. Money poured into Spain and other nations, which were now seen as safe investments; this flood of capital fueled huge housing bubbles and huge trade deficits. Then, with the financial crisis of 2008, the flood dried up, causing severe slumps in the very nations that had boomed before.

At that point, Europe’s lack of political union became a severe liability. Florida and Spain both had housing bubbles, but when Florida’s bubble burst, retirees could still count on getting their Social Security and Medicare checks from Washington. Spain receives no comparable support. So the burst bubble turned into a fiscal crisis, too.

Europe’s answer has been austerity: savage spending cuts in an attempt to reassure bond markets. Yet as any sensible economist could have told you (and we did, we did), these cuts deepened the depression in Europe’s troubled economies, which both further undermined investor confidence and led to growing political instability.

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Who's dumb?

So, the banking regulators don't look so dumb anymore.  Jamie Dimon is the one looking dumb.  And so what do we expect to happen if there is little or no penalty exacted upon the wild speculators who got us into the Great Recession in the first place?  Damn near collapse of the banking system worldwide.

An interesting connection....back in the mythical magical '50's - that time that the Republicans and all nostalgics seem to pine for - Americans were gainfully employed making decent, middle-class wages, women could stay home and take care of the kids, and things were booming.  Oh, and the highest tax rate was 91%!  

Nowadays, the top tax rate is much much lower, millions of Americans have been thrown out of work in favor of dirt-cheap labor overseas, both husband and wife have to work just to try to make ends meet, and corporations are revealing mega-profits.  

Hmmm....

...then, higher middle-class wages, good jobs, high tax rates, reasonable corporate profits and stability....

...now, low middle-class wages, maybe a job, low tax rates, low corporate tax rates, huge gaps between "rich" and "poor" and seemingly endless turmoil and instability.  

The current economic system does not appear to be very healthy.

Sidetracked again ...  this anonymously authored column was recently published on the HITC (Here Is The City) website.  (London city, that is)

Regulators Don't Look Much Like Idiots Now

'Given the JP Morgan news, the recent derivatives Trader: 'The Trouble Is, Regulators Are Idiots article appears to be the victim of unfortunate timing.

Having been a derivatives trader for over 10 years, I can, however, sympathize with many of the comments in the article. The point about derivatives is that they are synthetic and are extremely vulnerable to liquidity problems when things get tight. The more structured the derivative product is, the more vulnerable it is. Also the more structured it is, the harder it is to analyse, measure and control risk-wise. Besides, a lot of senior managers have little clue as what derivatives are and the language associated them, much less manage them.

The fundamental problem is that in the 1990s the derivatives market moved away from real markets of bonds, currencies, equities and commodities into the artificial world of mathematics and black boxes. What does a 22-year old coming out of University with a first class math or physics degree know about the dynamics of the market and market behavior ? Nothing, that's what.

Let's face the facts - over that last ten years things spiraled out of control. The black boxes got us all into a mess - but, trouble is, there are no black boxes to get us out of it!.

Yet banks still entrust billion dollar portfolios to young traders, and rewarded them excessively. Madness! Much the same criticism can be directed at the regulators. They tended to be a group of box-ticking bureaucratic accountants, who are more concerned about completing returns on time than understanding and determining risk.

Overall derivatives do actually have tremendous power and can be a force for good. The problem is that in the hands of technocrats, derivatives have drifted too far from their roots and have become ends in themselves. They have become toys for the 'rocket scientists', and the synthetic products they construct are built on shaky foundations.

And this is where we started - JP Morgan loses $2bn on a failed synthetic credit product and a flawed risk management system! It may not be too late to bring back Glass Stiegel. It maybe just the right time to break up the banks into more sensible sizes, and have reasonable capital adequacy requirements (whatever they maybe!).

'Big' in banking is turning out to be a very bad and a very dangerous thing'.

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A patent on pot?

Why would the U.S. government, in the shape of the Health and Human Services Department, take out a patent on cannabinoids?  Hasn't the government consistently said that there is no known medical use for marijuana?  They have, and it's total bullshit.

U.S. Patent No. 6,630,507 B1.

Date of Patent: October 7, 2003.

Back in 1998, a group of scientists working for the U.S. Department of Health and Human Services applied for a patent on "Cannabinoids as Antioxidants and Neuroprotectants."  Cannabinoids are found in cannabis, aka marijuana, aka hemp.  The U.S. scientists found that "cannabinoids have been found to have antioxidant properties....this newfound property makes cannabinoids useful in the treatment and prophylaxis of a wide variety of oxidation associated diseases, such as ischemic, age-related, inflammatory and autoimmune diseases."

What's that?  Weed has antioxidant properties that could boost the immune system?  Wait, I thought it had no medicinal properties?!

The patent was issued in 2003.  Continuing from the text of the patent, "The cannabinoids are found to have particular application as neuroprotectants, for example in limiting neurological damage following ischemic insults, such as stroke and trauma, or in the treatment of neurodegenerative diseases, such as Alzheimer's disease, Parkinson's disease, and HIV dementia."

Come again?  It helps in the treatment of Alzheimer's and Parkinson's??!!

With the mounting evidence that hemp oil will help treat or outright cure some tumors and cancers, and the existing uses for glaucoma and nausea, adding the antioxidant properties and neuroprotectant qualities, and this herb appears to be one of the most useful natural substances ever discovered.  

The fact that weed is still illegal, and the mere growing of industrial hemp is still illegal is a travesty of the highest proportions.  If I didn't know better, I'd say there was a conspiracy to keep this herb down and out of the public eye.  

I don't know better.

A link to the patent is here.  It's time we stopped the prohibition.

 

Mitt's Mendacity

Recently I made a post about the multitude of lies coming out of Republican candidates for various office in the Texas primary of May 29.  But those lies pale in comparison to what regularly comes out of Mitt Romney's mouth.

The tragic thing is that, by and large, the "liberal" news media lets Romney get away with lying, over and over and over.  Thank goodness there are some in the media who try to keep track of all the lies.  It's hard, because there are so many.  So many in fact that the info below is VOLUME 19.

Who can trust a candidate who is chronically mendacious?  I've watched a lot of politics in my short time on planet Earth, but I have never seen anyone lie so often and brazenly as Mitt Romney.  Republicans must be sooooo proud. 

(There is a link after every Romney lie that refutes it.  If they are not working, they will be soon.  Come back tomorrow).

Chronicling Mitt's Mendacity, Vol. XIX
by Steve Benen

Campaigning in Iowa yesterday, President Obama reflected on some of Mitt Romney's recent speeches, including last week's remarks in Iowa. "I know Governor Romney came to Des Moines last week; warned about a 'prairie fire of debt,'" Obama said. "But he left out some facts. His speech was more like a cow pie of distortion. I don't know whose record he twisted the most -- mine or his."


It was a rhetorical point, of course, but when it comes to Romney's falsehoods, I'm not sure whose record he twists more, either. Maybe you can help me decide by taking a look at the 19th installment of my weekly series, chronicling Mitt's mendacity.

1. In an interview with Mark Halperin, Romney argued about President Obama, "Did he hold unemployment below 8%? It's been, what, 39 months now. That hasn't happened. He promised it would happen by virtue of his stimulus."

As Romney surely knows by now, that's simply not true.

2. In the same interview, Romney asked, "Are people happy with ... the level of foreclosures?"

Romney was trying to attack the administration, but he's on record supporting more foreclosures, making this, at a minimum, wildly misleading.

3. Romney added, in reference to the president, " Look at him right now. He just doesn't have a clue what to do to get this economy going. I do."

Actually, Obama's jobs agenda, unveiled in September, included specific policy proposals that Romney had previously endorsed. If the president "doesn't have a clue," then Romney doesn't have a clue.

4. Romney went on to say, "I actually lay out a plan to get us to a balanced budget within eight years."

That's plainly false. Romney says his plan "can't be scored," but independent budget analysts have found his agenda would make the deficit bigger, not smaller, and add trillions to the national debt.

5. Romney also argued, in the context of talking about budget savings, "I'm going to take action immediately by eliminating programs like Obamacare, which become more and more expensive down the road -- by eliminating them, we get to a balanced budget."

He's lying. In fact, this is the polar opposite of the truth -- Obamacare's savings become greater in future years, and killing the law makes it harder to balance the budget.

6. Romney said, in addressing likely budget cuts, " I'd like my grandkids to be able to watch PBS. But I'm not willing to borrow money from China."

The implication here is that U.S. debt is financed by the Chinese. This isn't true -- China only holds about 8% of the nation's debt.

7. On taxes, Romney argued, "I'm not looking to lower the tax burden paid by the highest-income Americans. That's a fundamental principle."

That's a fundamental falsehood. Romney's plan slashes taxes on the wealthy.

8. On a related note, he added, "I'm looking, if there's any break at all, the break will go to middle-income Americans that have been most hurt by the Obama economy."

In reality, it's the rich, not the middle class, that primarily benefits from Romney's tax plan.

9. In a speech in Washington, Romney insisted, "President Obama has decided to attack success."

The Romney campaign has never been able to point to a single credible example of Obama attacking success.

10. In the same speech, Romney added, "When the President took office ... he faced a spending crisis. It's only gotten worse."

There is no universe in which this is even close to being true.

11. In making the case against Obama's student-loan reforms, the Romney campaign said it intends to "reverse President Obama's nationalization of the student loan market."

This is demonstrably false -- the market wasn't nationalized. Since all kinds of private-sector banks still make all kinds of student loans, the argument doesn't even make sense.

12. Romney told Fox News that "it certainly sounds like" the president is, as Rush Limbaugh put it, "running against capitalism." Romney added, "There's no question but that he's attacking capitalism."

No sensible person could possibly believe this is true, and neither Romney nor his aides have ever provided an example of the president attacking capitalism. Obama routinely does the opposite.

13. Romney argued in an op-ed that Obama "signed into law a budget scheme that threatens to saddle the U.S. military with nearly $1 trillion in cuts over the next 10 years," which the president's own Defense Secretary criticized.

That's not even close to being accurate.

14. Referencing Noam Scheiber's book, The Escape Artists, Romney argued, "In this book, [White House officials] point out that they said the American people will forget how long the recovery took. So that means they went into this knowing that when they passed Obamacare, it was going to make life harder for the American people."

That's not really what the book says, and it's not what the president's team argued.

15. Romney boasted this week, in a rare reference to his one term as governor, "[W]e didn't just slow the rate of growth of our government, we actually cut it."

No, you didn't.

16. The Romney campaign also argued this week that Romney created "well in excess of 100,000" jobs as an executive at Bain Capital.

You've got to be kidding me.

Previous editions of Chronicling Mitt's Mendacity: Vol. I, II, III, IV, V, VI, VII, VIII, IX, X, XI, XII,XIII, XIV, XV, XVI, XVII, XVIII

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