How AIG fell apart is a good article giving an overview of Credit Default Swaps (CDSs) and the role they played in AIG’s struggle. CDS issues are a crisis that quite a few saw coming just a few months ago and one that was discussed here then, although AIG was thought be a special “safe” case among CDS issuers. Indeed it now seems that AIG’s particular problem was that it had failed to hedge the CDSs they issued with CDSs acquired from other institutions, presumably on the premise that they were insuring assets too safe to fail.
I should also have included there that the $85B bridge loan made to AIG might not be enough to save the insurer after all.
The hour approaches. The beast’s jaws gape, its tail quivers and then snap! Another minute has been devoured, and the hour strikes with the ominous clonk of a chain dropping into a coffin. The creature blinks twice in satisfaction.
“It is terrifying, it is meant to be,” said John Taylor, the creator and funder of an extraordinary new clock to be unveiled tomorrow by Stephen Hawking at Corpus Christi College in Cambridge. “Basically I view time as not on your side. He’ll eat up every minute of your life, and as soon as one has gone he’s salivating for the next. It’s not a bad thing to remind students of. I never felt like this until I woke up on my 70th birthday, and was stricken at the thought of how much I still wanted to do, and how little time remained.”
On Aug. 9 each year in the little Alaskan town of Kotzebue, the sun sets twice.
Due to a quirk of the town’s location and time zone, the sun goes down just after midnight on that day—and then again just before the following midnight.
“Sarah Palin says she has foreign policy experience because she can see Russia from her house. Hey Sarah, there millions of people in Michigan who can see Canada – but that doesn’t mean they have health care.”
One seat the Republicans won’t get is VT-AL. They didn’t bother to put up a candidate to oppose Rep. Peter Welch (D-VT) in their primary, but apparently some Republicans liked him, so they wrote in his name. Enough people did this so that he won the Republican nomination as well as the Democratic nomination and will oppose himself in November. Either way, he will win and lose.
In the golden age of piracy, they were almost to a man renegade slaver crews, who were frequently treated as badly as their “cargo.” Calico Jack’s “Whydda” was a converted slaver (which was sunk by a jealous Cape Cod witch, Goody Hallett, who called up a hurricane to scourge the lover what jilted her by destroying that which he loved the best, yarr. Thart was a’fore he took up wi’ them hussies Bonnie and Reed, ho-ho!)
A jolly life? P’raps, me buckos, p’raps, if a life of poverty upon Hispañola is not yer cup o’ tea, yar, an’ ye really want ta sticks it to them white-britches who brings barrel arter barrel o’ salt-beef from Engerlund to the Carr-a-bee, ta pretend thems proper Englishmen, when they haint but slave drivers wi’ a few acres of sugarcane… or worse, Carolina “gentlemen” wi’ swamps and rice ter sell. Ever wonder where Condi got her family name from? Yarr. ‘Tis true. Rice… Carolina Gold. A’fore cotton, and a’fore sugar, was rice. Tho, silver was first, yarr. Treasure ships from Peru make fine fat pickin’s, me hearties! Them papist Dons best looks after thems own, yarr, lest they be driven to poverty by more gold than Christendom can handle all at a go, doomed and damned by an’ inbred and infertile King…
So! Talks like a pirate! They were the poorest, toughest, smartest, ablest men o’ their age, all doomed an’ determined to die by the sword than submit to another man’s will, like Edward Teach, who needs must have his head hacked off ter make sure he war dead. Or cretins who found thems dead by th’ gallows, like Cap’n Kidd, who turned pirate out o’ incompetence and cowardice. Many a man, white an’ black, English and French and Dutch, flew th’ black to make a doubloon, dreamin’ o’ the Pirate Kingdom o’ Madagascar, where a man could live free ashore as he did at sea. They all died, some gallant, some cowardly, all dangerous and deadly threats to the colonial powers, who, for a while, ruled the world by cannon and cutlass.
Laugh at them at your most deadly peril.
A treasure trove of hundreds of new animal species and corals have been discovered by researchers off 2 islands on the Great Barrier Reef and a reef off northwestern Australia. Researchers encountered many strange, new and beautiful sea creatures including scores of amphipods, dozens of small crustacean species, parasitic isopods, soft corals and rare jellyfish, among others.
This may be my single favorite press release of the entire presidential campaign. McCain campaign spokesperson Brian Rogers issued this statement:
In his rush to score political points on economic disaster, we’ve heard that at his next event in New Mexico, Senator Obama is about to distort the facts and attack John McCain’s call for removing the Chairman of the SEC.
Rogers’ concern, obviously, is that Obama would point out that McCain told voters today he would “fire” the chairman of the SEC, when in reality, that’s outside the president’s authority — a fact McCain should have realized before tackling the subject.
Regardless, it’s more entertaining to realize that the McCain campaign is criticizing Obama for something he might say, before he says it, accusing Obama of “distorting” the facts, before he’s even spoken. In other words, the McCain campaign line is, “Obama might point out how McCain screwed up earlier, and if he does, he’s being totally unfair — because we say so.”
An Indian walks into a cafe with a shotgun in one hand pulling a male buffalo with the other. He says to the waiter, ‘Want coffee.’ The waiter says, ‘Sure, Chief. Coming right up.’ He gets the Indian a tall mug of coffee. The Indian drinks the coffee down in one gulp, turns and blasts the buffalo with the shotgun, causing parts of the animal to splatter everywhere and then just walks out. The next morning the Indian returns. He has his shotgun in one hand, pulling another male buffalo with the other. He walks up to the counter and says to the waiter, ‘Want coffee.’ The waiter says ‘Whoa, Tonto! We’re still cleaning up your mess from yesterday. What was all that about, anyway?’ The Indian smiles and proudly says, ‘Training for position in United States Congress: Come in, drink coffee, shoot the bull, leave mess for others to clean up, disappear for rest of day.’
The U.S. Securities and Exchange Commission intends to temporarily ban short-selling, The Wall Street Journal reported Thursday night. It’s unclear if the commission has approved the move, the Journal reported. SEC Chairman Christopher Cox, Federal Reserve Chairman Ben Bernanke and Treasury Secretary Henry Paulson were briefing congressional leaders Thursday night. The U.S. move would follow a similar action by U.K. regulators on Thursday.
Without the short sellers and the liquidity they add to the options markets with their put sales, the costs of hedging for those long on the market is going to skyrocket.
Satow interviews the above quoted former SEC director, and he spits out the blunt truth: The current excess leverage now unwinding was the result of a purposeful SEC exemption given to five firms.
You read that right — the events of the past year are not a mere accident, but are the results of a conscious and willful SEC decision to allow these firms to legally violate existing net capital rules that, in the past 30 years, had limited broker dealers debt-to-net capital ratio to 12-to-1.
Instead, the 2004 exemption — given only to 5 firms — allowed them to lever up 30 and even 40 to 1.
Who were the five that received this special exemption? You won’t be surprised to learn that they were Goldman,
Merrill, Lehman, Bear Stearns,and Morgan Stanley.
As Mr. Pickard points out that “The proof is in the pudding — three of the five broker-dealers have blown up.”
The same political faction which today is prancing around in full-throated fits of melodramatic hysteria and Victim mode (their absolute favorite state of being) over the sanctity of Sarah Palin’s privacy are the same ones who scoffed with indifference as it was revealed during the Bush era that the FBI systematically abused its Patriot Act powers to gather and store private information on thousands of innocent Americans; that Homeland Security officials illegally infiltrated and monitored peaceful, law-abiding left-wing groups devoted to peace activism, civil liberties and other political agendas disliked by the state; and that the telephone calls of journalists and lawyers have been illegally and repeatedly monitored.
And the same Surveillance State Worshipper leading today’s screeching — Michelle Malkin — spent the last several years deriding those who objected to the President’s illegal spying program as “privacy crusaders” and “constitutional absolutists” and “civil liberties absolutists”.
Shouldn’t these same people be standing up today and insisting that if Sarah Palin has done nothing wrong, then she should have nothing to hide? If Sarah Palin isn’t committing crimes or consorting with The Terrorists, then why would she care if we can monitor her emails? And if private companies such as Yahoo can access her emails — as they can — then she doesn’t really have any “privacy” anyway, so what’s the big deal if others read through her communications, too? Isn’t that the authoritarian idiocy that has been spewed since The Day That 9/11 Changed Everything — beginning with the Constitution — to justify vesting secret and unchecked surveillance powers in our Great and Good Leaders?
And then, even better, there is the righteous outrage over the fact that this hacker engaged in what they call [spat with whispered contempt] . . . . “illegal surveillance.” Why, whoever broke into Palin’s Yahoo account broke the law, and we all know that that can’t be tolerated!
Microsoft’s panicked reaction to these Seinfeld ads, yanking them from the air and severing ties with Seinfeld, isn’t because the ads were poorly received. And dropping these ads is a panicked reaction. Let’s not pretend it makes any sense that the Seinfeld spots were planned as a two-episode teaser all along. No one signs Jerry Seinfeld for $10 million in a much-heralded deal to make just two spots that only run for a grand total of two weeks. The most telling fact is that the firm that reached out to the media yesterday to explain that this sudden shift was supposedly the plan all along was not Crispin Porter, the advertising agency producing the campaign, but Waggener Edstrom, Microsoft’s PR firm. Advertising campaigns which are going according to plan do not need PR firms to assert such.
The reaction to the ads wasn’t bad, it was mixed (and/or baffled). But the spots were undeniably successful in one important regard: they were noticed and discussed. I suspect what sparked the panic is that the Seinfeld ads were too good, too accurate at capturing just what it is that Microsoft, as a company and brand, stands for: nothing.