Thursday, January 31, 2008

DANG! Harry Macklowe giving buildings back to lenders

From Wall Street Journal:

Troubled New York real estate titan Harry Macklowe has reached a tentative agreement with his lender to turn over effective control of seven Manhattan office buildings he triumphantly acquired less than a year ago for $7.2 billion, according to a people familiar with the matter.

Mr. Macklowe borrowed $5.8 billion from Deutsche Bank to acquire the buildings in a highly leveraged transaction during the height of the real estate frenzy early last year. The debt is scheduled to come due on Feb. 9. But with the real estate debt ...

ok Clayton Holdings,you are a better informant then Pussy on Sopranos

From the Wall Street Journal:

The New York attorney general's office, pursuing an investigation into whether Wall Street firms improperly packaged and sold mortgage securities, is latching onto a powerful regulatory tool: the 1921 Martin Act.

The state law, considered one of the most potent legal tools in the nation, spells out a broad definition of securities fraud without requiring that prosecutors prove intent to defraud. As a result, the act has become an influential hammer in recent years for New York state prosecutors in cracking down on securities manipulation, improper allocation of initial public offerings of stock and misleading stock research on Wall Street....

The development comes as the attorney general's office has gained the cooperation of Clayton Holdings Inc., a company that provides due diligence on pools of mortgages for Wall Street firms. At issue is whether the Wall Street firms failed to disclose adequately the warnings they received from Clayton and other due-diligence providers about "exceptions," or mortgages that didn't meet minimum lending standards.

Such disclosures could have prompted credit-ratings firms to judge certain mortgage-backed securities as riskier investments, making them more difficult to sell, these people said. The attorney general is examining, among other things, whether some Wall Street firms concealed information about the exceptions from the credit-rating concerns, these people said, in a bid to bolster ratings of mortgage securities and make them more attractive to buyers, such as pension funds, which often required AAA, or investment grade, ratings on potential investments in securities containing risky mortgages.

The attorney general's office has issued Martin Act subpoenas, which don't spell out whether matters are civil or criminal in nature, according to people familiar with the matter. So far, the recipients include financial firms Bear Stearns Cos., Deutsche Bank AG, Morgan Stanley, Merrill Lynch & Co., and Lehman Brothers Holdings Inc., possibly among others. Representatives of Bear, Deutsche, Morgan, and Lehman declined to comment on the investigation. A Merrill spokesman said, "We cooperate with regulators when they ask us to," but declined to elaborate....

With data provided by Clayton, Mr. Cuomo's office is seeking to gather more information on how Wall Street firms purchased home loans that had been singled out as "exception loans" -- that is, loans that didn't meet the originator's lending standards. Data from Clayton, for instance, indicates that in 2005 and 2006, years in which the mortgage-securitization business was going full throttle, some investment banks acting as underwriters were purchasing large numbers of loans that had been flagged as having exceptions, these people said.

In 2006, according to the data, as much as 30% of the pool of exception loans was purchased by some securities firms, these people said. One likely reason: Flawed loans could be purchased more cheaply than standard loans could be, lowering a firm's costs as it sought to compile enough mortgages for a new security.

2008 Presidential Election - graphic map of all political web sites, this is a must visit

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McCain - Powell Ticket in 2008????

interesting piece from


McCain doesn't have the nomination yet but if he gets it there's a compelling argument for him to pick Colin Powell as his veep. The conventional wisdom is that McCain will need to secure his right flank and select an undisputed conservative. But McCain could take a page from the Clinton-Gore campaign and choose amplification over diversification. In 1992, Clinton chose a moderate southerner from a neighboring state no less who was in his age cohort. Powell would buttress McCain's national security credentials and echo his political philosophy, although I suspect that Powell is probably to the left of McCain on abortion, taxes and the like. McCain and Powell are personally close and while it's not essential to choose someone you like and respect--JFK and LBJ come to mind--it's not a bad thing either and it has the air of authenticity which is supposed to be John McCain's claim to fame. If he were to pick someone who disagreed with him on campaign finance reform, a gay marriage amendment to the constitution and global warming it would be hard to mount the Straight Talk express in quite the same way.

Of course, Colin Powell isn't what he used to be. Like Tony Blair or Tom Friedman, he suffered from the Bush war in Iraq. Powell may have been appropriately skeptical about the war but he promoted it and didn't speak out publicly against it and so his elan isn't what it was the last time everyone talked about Powell as a veep.

Race, though, makes Powell a compelling choice. If Clinton gets the nomination, African American voters are going to feel disappointed at seeing someone of their race get so close and then be deprived of the nomination. Most will continue to vote for the Democratic nominee but some would go to McCain-Powell and others might just stay home. McCain-Powell would have a certain breakthrough quality that would easily match Clinton-Bayh or Clinton-Strickland. You could argue that an Hispanic gives McCain more of an edge, but the ranks of Republican Hispanics who are ready for the presidency seems thin. There's Florida Senator for former Housing and Urban Development Secretary Mel Martinez but I doubt whether a Cuban-American from Florida will hold much sway in Colorado, California, New Mexico, New Jersey and other states with large Hispanic populations.

I don't know if McCain will be the nominee although it certainly looks that way. I do think McCain-Powell would make it a very interesting race.

SRM Global Fund is Not as Big a Fan of Bottom Feeding as You and I Are, Moishe

We call it resolution to a financial crisis, they call it less than half book value.

Countrywide Holder Calls Bank of America Bid Too Low (Update2)

By David Mildenberg

Jan. 31 (Bloomberg) -- Bank of America Corp.'s offer of about $4 billion for Countrywide Financial Corp., the biggest U.S. home lender, is too low, according to one of the mortgage company's biggest stakeholders.

``The merger agreement does not provide sufficient value'' to shareholders of Calabasas, California-based Countrywide, according to a regulatory filing today by SRM Global Fund, a private investment firm based in the Cayman Islands. SRM, which controls a 5.2 percent stake, plans to vote against the merger and wants to contact the company and other shareholders.

SRM's filing may revive doubt that the takeover will be completed on the original terms. Investors have speculated Bank of America might demand an even lower price or walk away because of continued losses at Countrywide. The bank affirmed earlier this week that it will proceed with the purchase.

``The board of Countrywide and its advisers should fully explain to shareholders the reasons why they have agreed to recommend the transaction to shareholders at less than half of the company's book value,'' SRM said in a statement. ``The company is strong and will rapidly return to profit on a stand- alone basis.''

Google Universal Search - pretty pretty good

thanks to for this:

Google 2.0: Google Universal Search

Google is undertaking the most radical change to its search results ever, introducing a "Universal Search" system that will blend listings from its news, video, images, local and book search engines among those it gathers from crawling web pages.

The new system officially rolls out today for anyone using and searching in English. Not everyone will see it at first, but over the course of the next several days, Universal Search should be more, well, universal. A new navigational interface has also been unveiled for Google and is covered more in the companion piece to this article, Google's New Navigational Links: An Illustrated Guide.

The move potentially should be a huge boon for searchers, while search marketers who have paid attention to the importance of specialized or vertical search will see new opportunities. To fully explain the importance to both groups, I'm going to work step-by-step through the concept of vertical search engines, how they're often ignored by searchers and search marketers alike, then how Google is going to make this content more visible through Universal Search.

Follow up to previous story about SMS pizza ordering - For F sakes people, you wont die waiting for your pizza to come, be patient


I eat a lot of pizza, one might even call me a connoisseur of the pizza pie. I sample the (usually) circular dishes from a variety of restaurants on a regular basis. I’d say about half the time I choose the option to have my food delivered. During those forty minutes or so, I’m constantly wondering exactly when my pizza will get here. Well the fine folks at Domino’s Pizza have gone above and beyond to make sure you know where your pizza is, and what it’s doing.

If you’re sitting at home wondering if your pizza has even left the store yet, you can hop on the Domino’s website, plug in your phone number and get the details. The website will tell you which of the five phases (order placed, prep, bake, box and delivery) your pie is in, and even when exactly it left the store.

I’m curious whether or not this works on carry-out orders. Domino’s is the one place that I don’t (usually) get delivery from, as I can almost see their store from my house. Every now and then I’m just too lazy to drive two blocks to get my food.

Obama's Light at the End of the Tunnel?

This is potentially huge.

Another Rasmussen poll shows Barack Obama making up serious ground in a major Super Tuesday state. In California, Hillary Clinton has a bare lead of 43%, followed Obama at 40% and John Edwards with 9%.

If Obama were to pull off a win in the largest state in the country, it would completely change the dynamics of the campaign. And if Hillary were to come out on top, it could give her a large number of delegates to fend off Obama's advantages elsewhere.

CIA - Nice Move

CHANTILLY, Va., Jan. 30, 2008 -- The Central Intelligence Agency is expanded its newest campus, which was designed to be energy efficient and easy on the environment.

Construction is underway on the second office building, which will utilize many of the same green features as the northern Virginia campus' other office, visitor center and central plant.

The CIA campus was designed to be as green as possible from the top on down. The current office building's roof is covered in 22,000 square feet of vegetation. Green roofs lower the heating and cooling needs of buildings, reduce stormwater runoff and filter pollutants from the air and rainwater.

A number of water-saving initiatives, including low-flow water closets, efficient faucets and showerheads, and waterless urinals, have cut water use in the buildings by 40 percent.

By installing occupancy sensors, maximizing the use of daylight and tasklights as well as utilizing efficient electronics, the campus has reduced its energy use by 21 percent.

To try to lessen the impact of employee commuting, some parking spots are set aside for carpoolers or low emission and fuel efficient vehicles. Bike racks and public transportation are also available.

During construction, about 20 percent of the buildings were made up of recycled content, and more than half of the waste generated was diverted from going to a landfill.

Due to all the green building measures, the first office building earned a silver LEED rating from the U.S. Green Building Council, and the visitor center and central plant were each certified LEED gold.

Productive Autism? It's a Brave New World, People...

Need to finish that work project, and wish you had the mental intensity to do it? Just take a synapse-regulating inhibitor, induce temporary autism, and you'll want to ignore your friends and do nothing but number-crunching for days. Autism-inducers could become as popular as Provigil among the geek set by 2020. Last night, in fact, a group German researchers announced they'd perfected the method for inducing autism. (They can also cure it.)

Over the past year, researchers have demonstrated several times that they can turn mice autistic by messing with brain chemistry -- and then "cure" them using the same techniques. The discoveries could lead to a scenario similar to the one in Vernor Vinge's novel A Deepness in the Sky, where people are given a brain treatment called "focusing" that essentially turns them autistic and makes them obsessive, detail-oriented workers.

It might also lead to recreational autism, where people who want to take a break from having messy emotions about other people decide to unplug and enter a state where human relationships are no more important than inanimate objects.

Read about how scientists can induce autism [PNAS] and how they can cure it [BBC News].

Danny DeVito Demonstrates a Strong Pimp Hand

From the funniest show on TV, It's Always Sunny in Philadelphia.

McCain? Really?

Naughty, naughty, Saint McCain.

On the eve of the Florida Republican primary, Sen. John McCain launched a robo-call campaign attacking his rival Mitt Romney that some gay rights groups say amounts to gay baiting.

The call, which comes at the end of a hotly contested election that could very well determine the GOP nominee, reads as follows [emphasis added]:

"Mitt Romney thinks he can fool us. He supported abortion on demand, even allowed a law mandating taxpayer-funding for abortion. He says he changed his mind, but he still hasn't changed the law. He told gay organizers in Massachusetts he would be a stronger advocate for special rights than even Ted Kennedy. Now, it's something different."
In 1994, Romney did write a letter to the state's Log Cabin Club -- a gay Republican group -- promising to be a stronger advocate for gays than Kennedy. Romney was challenging Kennedy for his U.S. Senate seat.

But the timing of the robo-call -- launched the day before the all-important primary -- and the tone -- specifically the reference to "special rights" of homosexuals -- has raised concerns and suspicion.

"It's ironic that Sen. John McCain is using the same tactics that George Bush used against him in 2000; surreptitiously trying to exploit anti-gay prejudice for votes," said Human Rights Campaign President Joe Solmonese. "So much for John McCain being above that."

"I think this is definitely an attempt at gay baiting," added Jon Hoadley, executive director of the National Stonewall Democrats.

Wednesday, January 30, 2008

Morty and Moishe is the Number One Google Result for "Belichick Short Shorts"!! It's Another Celebration, Bitches!!!!

True story. I swear, just click on the link above for confirmation. I'd like to thank my mamele, and of course Moishe for the post, and oh, the list goes on ...

Fed - another 50 bps, it's a celebration bitches

WASHINGTON (AP) -- The Federal Reserve on Wednesday cut a key interest rate for the second time in just over a week, reducing the federal funds rate by a half point. It signaled that further rate cuts were possible.

The Fed action pushed the funds rate to 3 percent. It followed a three-fourths of a percentage point cut on Jan. 22, a day after financial markets around the world had plummeted on fears that the U.S. economy was heading into a recession. That decrease had been the biggest one-day move in more than two decades.

The half-point cut Wednesday followed news that the economy had slowed significantly in the final three months of last year with the gross domestic product expanding at a barely discernible pace of 0.6 percent, less than half what had been expected. The report came amid increased concern from several quarters about a possible recession.

Superbowl Betting - it's always best to be the house, regardless what this story says

Casinos Edgy
As Wagering
Tilts to Giants

This Sunday's Super Bowl might become the most heavily wagered one ever. And unless more bettors start taking the New England Patriots, it may be a costly one for casinos.

Super Bowl XLII may reach $100 million in legal betting in Las Vegas for the first time, experts say, a figure that is a fraction of the estimated $10 billion that will be wagered world-wide, according to R.J. Bell, president of the sports-gambling information site The combination of the Patriots' seeking a perfect record and the New York Giants representing the nation's largest city is causing heightened interest.

But too much of that interest, at least as far as Vegas is concerned, is in the underdog Giants. Sports books prefer an even amount of betting on both teams to mitigate risk, because they make an additional amount (called vigorish) on losing bets. Even a 60/40 split would be reasonable, said Jay Kornegay, executive director of the Race and Sports SuperBook at the Las Vegas Hilton. Too much money on one side, though, exposes them to significant losses if the public's team wins.

As of yesterday, 75% of the wagered money at the Hilton was on the Giants. "There's definitely concern," Mr. Kornegay said. "If you find any Patriots fans, make sure to send them our way."

The reason for the lack of belief in the 18-0 Patriots is the point spread, or the minimum margin New England must win by in order for its backers to collect. Initially, the Patriots were favored by 14 points last week -- and should have been favored by even more, some experts say. Sean Van Patten, an oddsmaker at Las Vegas Sports Consultants, says he would've made the line 15. "I still think in the back of my mind that the bad Eli Manning might show up," he says of the Giants' up-and-down quarterback.

But bettors found the 14-point spread overly generous, considering the Giants' current 10-game winning streak on the road and the Patriots' recent close calls, which include a three-point victory over the Giants Dec. 29. As money has flowed in on the Giants, the sports books have lowered the spread to 12 or 12½ to encourage betting on New England and to even up the action. They are hoping that the line eventually will rise back to 13 or beyond, because history has shown that casual bettors -- who typically bet in the final few days before the game -- overwhelmingly favor the favorite.

Despite its current predicament, Vegas doesn't expect a repeat of Super Bowl XIII in 1979, a disastrous event that casinos still refer to as Black Sunday. In the lead-up to that game, the Pittsburgh Steelers were initially favored over the Dallas Cowboys by as few as two points. Bettors flocked to the Steelers, causing the spread to rise as high as five. Then sentiment switched to Dallas, driving the spread back down. Pittsburgh wound up winning, 35-31, in a worst-case scenario for the sports books, because bettors on both sides, those who had the Steelers minus fewer than four or Dallas plus more than four, got paid.

"I'm glad I wasn't working here then," the Hilton's Mr. Kornegay said.

As for the general public, the office pool, illicit though it may be, is on the rise. Nearly 4 of 5 employees (79%) in 2007 said they have participated in an office pool of some kind, including football, college basketball and Oscar pools, up from 67% in 2006, according to career publisher Vault Inc. While some states have strict laws outlawing betting, authorities generally aren't interested unless someone is running a gambling operation for income.

"Office pools are technically illegal under the California penal code, but I'd qualify that by saying law enforcement isn't exactly hiding out behind office doors," said Gareth Lacy, a spokesman for the California Department of Justice.

One of the most common office pools, and one that requires no football knowledge, is the "box pool," in which participants are assigned numbered squares on a 10x10 grid. The 0-9 numbers across the top represent one team, and the 0-9 numbers down the side represent the other. The victor is the person who occupies the square that matches the last two digits of the game's score. So, for example, if the Patriots beat the Giants, 28-14, the square that aligns with "Patriots 8, Giants 4" is the winner. Many pools also anoint winners at the end of the first, second and third quarters.

And Bill Clinton Became a Punchline for His Semantics?

The Attorney General says "who am I to pass judgment on legality?" Oy vey, enough already.

WASHINGTON (CNN) -- Attorney General Michael Mukasey refused to legally define waterboarding as "torture" during Senate testimony Wednesday, although he acknowledged that if the interrogation technique were performed on him, he would personally "feel that it was."
During his first testimony since his November confirmation, Mukasey told the Senate Judiciary Committee that it wouldn't "be appropriate for me to pass definitive judgment on the technique's legality."

Russia = the wild west

Russia's most famous female bodyguard Anna Loginova has been killed after failing to prevent her own Porsche being carjacked.

The glamorous 29-year-old died from head injuries after clinging on to the door handle of the Cheyenne and being dragged along the street at high speed as the car screeched away....

Frankenfruit? How to Spot Genetically Modified Fruit in The Store

What's the probability your supermarket plums are genetically modified?
Wanna Try?
Look for the labels stuck on your fruits and veggies:

* A four-digit number means it's conventionally grown.
* A five-digit number beginning with 9 means it's organic.
* A five-digit number beginning with 8 means it's GM.

Carnival = lots of anonymous sexual enounters

The Brazilian city of Recife is to distribute morning-after pills to women during carnival after public prosecutors on Tuesday rejected a Catholic Church lawsuit claiming the initiative promoted sex and provided "abortions."

"The pill has no abortive effect, as the archdiocese claims, and its distribution is in no way an incentive to have sex," the prosecutor who made the decision, Ivana Botelho, told AFP.

On top of its legal defeat, the church has come under fire from the Brazilian government for attempting to sway public health policy.

"The (Recife) mayor's office is right and the church is wrong, again," Health Minister Jose Gomes Temporao said Sunday, as the issue was coming to a head.

"The morning-after pill is used with medical guidance and is a matter of public health, not religion," he said, adding that he believed the church was alienating youths with its stance.

The archiocese for Recife, one of the Brazilian cities most famous for its wild carnival celebrations alongside Rio de Janeiro and Salvador, on Monday lodged its suit with the public prosecutor's office.

It was seeking to block the distribution of the contraceptive during this year's pre-Lenten carnival, which begins on Friday and runs to Tuesday of next week.

The verdict allows Recife officials to go ahead and hand out the pills from stationary and mobile health posts which will also provide medical consultations.

The municipality says its aim is to "guarantee the sexual and reproductive rights of women who have been victims of sexual violence or who have had a failure of contraceptive methods."

Morning-after pills must be used within 72 hours of unprotected sexual intercourse. They work by blocking fertilization.

According to the newspaper Pernambuco, the archbishop at the center of the storm, Jose Cardoso Sobrinho, is not prepared to back down on the issue, and had threatened excommunication to any church-goers who use the pill.

From Thomas Barnett's Blog - very interesting - and a good sign

SPECIAL REPORT: “Boomtime in lands of oil and money: The rise in the oil price is driving investment growth,” by Roula Khalaf, Financial Times, 20 November 2007, p. 1.

ARTICLE: “The Construction Site Called Saudi Arabia,” by Jad Mouawad, New York Times, 20 January 2008, p. B1.

ARTICLE: “Who’s Afraid of Mideast Money?” by Emily Thornton and Stanley Reed, BusinessWeek, 21 January 2008, p. 042.

The first story is cited just for the numbers. The Gulf Co-operation Council Six (Saudi Arabia, Kuwait, UAE, Qatar, Oman and Bahrain) are expected to hit oil export earnings in the range of $400b this year and $450b next year.

Between 2005 and 2020, it’s estimated that GCC will bank $3 trillion. About half is expected to stay in region, a quarter goes to the wider region, and a quarter hits the global streets looking for returns through SWFs. Roughly $1t is slated for local investment, which is why the region starts to rival Asia for its construction crane demand. Indeed, a lot of Turks, Indians and Chinese are doing the construction in the region, so they fight over worker bodies too.

The second story profiles a gargantuan petrochem plant going up in Saudi Arabia that will link the economy to a wide variety of global production chains, like cells, TVs, and thousands of other products. This factory is but a blip in Saudi Arabia’s planned $500 billion in internal diversification investment. The House is building four massive “economic cities” that intend to create about 1.6 million jobs.

Aramco wants to become a bigger Exxon Mobil, a serious supplier of petrochem products as well as oil.

No more “idle mode” for the Saudi economy, and yes, that’s a good sign.

So should we be afraid of all this oil money?

Like just about anybody else hoping to get deeply plugged into the global economy, Saudi Arabia and the GCC are running desperate races against their own demographics and the inevitability that the advanced world must move past oil—for environmental reasons alone.

The oil producers are facing their last great swing at the ball. Failure is really not an option here.

Another interesting think piece (a real Morty term to use) - Moishe subscribes to this theory

Research shows that your brain function is both broadened and improved by “interdisciplinary exercise.” What does this mean? Be eccentric. Use your brain to think about lots of different things, even things that have nothing to do with one another. This builds new synapses, exercises existing ones, and simply makes you smarter.

OK, you’re thinking, but I’m founding a company. I don’t have time to think about anything other than cash flow and customer acquisition, much less take up new hobbies. But here’s one quick way to do become interdisciplinary: When you read, read stuff that has nothing to do with what your company does. (You can make time to read.)

Life Optimizer had a great post last week that explained three reasons why diversifying your reading is a shortcut to brains-building.

1. Avoid boredom
I don’t know about you, but reading the same topics again and again makes me bored. Even for topics I’m passionate about, I will be more refreshed if I also read other topics once in a while.

2. Arbitrage knowledge
The art of arbitrage is important for living smart, and diversifying your reading allows you to do knowledge arbitrage. Knowledge arbitrage means taking ideas from one field to be applied to another field. If you read only one or two topics, it’s difficult to do that.
3. Cross-pollinate ideas
Continuing the idea of arbitrage, not only can you borrow ideas from other fields, you can also combine ideas from different fields. Often it will give you “original” ideas since nobody has seen such combination before. Of course, you can only cross-pollinate idea if you have different kinds of idea to begin with, and that’s why you should diversify your reading.

It turns out this is a tried and true method, used by some of your business icons — like VC Michael Moritz and Apple founder Steve Jobs.

Last July,
the New York Times revealed what several hyper-successful business leaders read — and it ain’t business books.

For example, Moritz, the Sequoia VC who funded Google, Yahoo!, PayPal, and others, said:

“I try to vary my reading diet and ensure that I read more fiction than nonfiction,” Mr. Moritz said. “I rarely read business books, except for Andy Grove’s ‘Swimming Across,’ which has nothing to do with business but describes the emotional foundation of a remarkable man. I re-read from time to time T. E. Lawrence’s ‘Seven Pillars of Wisdom,’ an exquisite lyric of derring-do, the navigation of strange places and the imaginative ruses of a peculiar character. It has to be the best book ever written about leading people from atop a camel.”

The Times also reports that Apple founder Steve Jobs once had “an ‘inexhaustible interest’ in the books of William Blake — the mad visionary 18th-century mystic poet and artist.”

Interesting piece on future web ad models from Micro Persuasion - Good Stuff

During a recent exchange with one of my colleagues he posed a thought-provoking question that I hadn't quite pondered. "What new digital business models might take hold over the next four to five years," he asked.

This question should be on every marketing and media executive's mind. As we've seen, the Net is so disruptive that big ideas can come out of nowhere and reinvent advertising overnight - even in a recessionary climate. Google, for example, commercialized pay-per-click ads just after the dot-com crash in 2000.

Here are three models that might evolve over the next few years.

Advertiser-Supported Advertising: Brands are increasingly launching their own content platforms. Some, like Budweiser's BudTV, go it alone. Others partner with online media properties. P&G, for example, embedded Capessa inside Yahoo Health.

In the future some of the more successful marketer-sponsored content sites will accept advertising. The retail space is especially ripe here. Barnes & Noble's media site, in theory, could partially support itself by allowing publishers who they already co-market with to buy ads. Under such a scenario, transparency is critical.

Advertiser-Subsidized Devices: Content is a commodity. The barriers to entry are obliterated. Still, this means we all need to make choices - human attention doesn't scale. So how do you get consumers to choose your stuff? Simple. Use incentives.

Marketers will partner with consumer electronic companies to co-brand white-label gadgets. For example, a Gap-branded set-top box could come with exclusive video podcast subscriptions. Upstart device manufacturers that are looking to enter markets with entrenched players will be the first to dabble with this approach.

Just-in-Time Advertising: Digital advertising creative and planning, like any marketing discipline, follows an arc. It's planned, placed, measured and eventually evaluated, tweaked or tossed. However, in the digital world, brands need to be more nimble.

With the help of new technology, marketers will rely on "just-in-time" campaigns that adapt to conditions. Basically, this takes the Dell manufacturing model and applies it to advertising. Ad creative will morph based on certain triggers. This will include sales/ERP data, blog chatter/consumer feedback, weather/external conditions and more.

.6% GDP in the 4th Qtr, I am going to have to say thats not so good

Fed please give us at least 50 bps today, if not more.

WASHINGTON (AP) -- The economy nearly stalled in the fourth quarter with a growth rate of just 0.6 percent, capping its worst year since 2002.

The Commerce Department's report on the gross domestic product, released Wednesday, showed an economy that had deteriorated considerably during the October-to-December quarter as worsening problems in the housing market and harder-to-get credit made individuals and businesses more cautious in their spending. Fears of a recession have grown, even as inflation remained elevated....

Dave Chappelle Goes to Therapy

With the underrated, and understated Dr. Katz.

McCain? Really?

Matthew Yglesias:
Meanwhile, McCain, despite some admirable qualities, shares Bush's lunatic conception of America's role in the world, declined to endorse any climate change measures that might actually solve the problem, and has pledged fealty to Bush's irresponsible tax policy in a way that makes it impossible for him to do much of anything innovative on the domestic front. There's a big, clear choice facing the country between the party of war, tax cuts, and the destruction of the planet and the other party

Tuesday, January 29, 2008

Interesting way for freighters to cut down on fuel consumption - sky sails

Cast off for MV "Beluga SkySails"

The MV “Beluga SkySails” has started her maiden voyage according to plan. The world’s first multipurpose heavy lift project carrier that due to an innovative towing kite system is co-powered by wind energy, did cast off on Tuesday evening (22nd of January, 2008) at 8.18 pm from “Columbuskaje” in Bremerhaven. The port of destination for the first voyage over approximately 4400 sea miles in length is Guanta in Venezuela. MV “Beluga SkySails” ships components for a chipboard plant.

For crossing the Atlantic Ocean the vessel explores a traditional windjammer route south of the Azores, in order to catch the much expected sufficient eastern winds that allow for a frequent application of the towing kite. 15 days are the calculated transit time towards South America. During the night from Wednesday to Thursday the vessel reaches the level of English city Dover – shortly thereafter the 160 square meter large kite will be launched for commercial usage for the first time.

However, the sail has successfully flown at sky already. On early Tuesday morning, following the completed loading and lashing processes, the vessel new building left its port of registry Bremen heading downstream the River Weser for Bremerhaven. Later that morning, Captain Lutz Heldt undertook a final sea trial in the German Bight. Thereby, on position 53° 52,7’ North – 7° 47,7’ East the kite was released from the telescopic mast to rise up to heights of 330 yards where the winds are comparatively strong and steady.

145 yards long MV “Beluga SkySails” will cross the oceans more environmentally sound and more cost effective than common cargo vessels: By application of the innovative towing kite system the ship engine will be relieved and depending on wind conditions and used kite size the bunker consumption as well as the CO2-emissions can be reduced by ten to 20 percent. MV “Beluga SkySails” proves a pioneering spirit that creates innovations, which promote both economy and ecology. By Eva Luise Koehler, wife of Germany’s Federal President, the 10,000-tdw-vessel was christened on 15th of December, 2007, in Hamburg. Owner of this revolutionary ship and first user of “SkySails” is Bremen-based project and heavy lift carrier Beluga Shipping GmbH.

And Now to Cheer Moishe After My Kudlow Put Down - Some Optimistic Economic Posting

From Floyd Norris, the chief financial correspondent of The New York Times and The International Herald Tribune.

Is the housing recession nearing an end?

You wouldn’t know it from the new home sales numbers that came out today, which are unsurprisingly dreadful. But investors seem to believe that things are looking up, thanks to the combinantion of Fed rate cuts and an increase in the size of loans that can be sold to Fannie Mae and Freddie Mac. The economic stimulus package being considered in Congress would raise that limit to $730,000 from $417,000.

The S.&P. 1500 homebuilder index is up an astonishing 40 percent since it hit bottom Jan. 8, with all of the 15 stocks in the index up at least 11 percent. (The index is still 67 percent below its peak in 2005.)
1. Regionally, the northeast is the least important part of the country for new home sales, but it is also the strongest. There were 65,000 new homes sold in that region last year, up 3 percent from 2006. But the other three regions were all down at least 26 percent, with the west (California, there you go) off the most at 32%.
Stock prices are supposed to anticipate the economy. Let’s hope this forecast is accurate.

Oh Snap! Dude is Busting on Moishe's Boy, Kudlow


Mr. President, in your last State of the Union message tonight, I urge you to stay upbeat and optimistic.
America’s greatness is grounded on optimism and freedom. You have spoken loudly in support of these great themes. You have succeeded to a far-greater degree than the intellectual elites will ever admit.

Stay the course, Mr. President. Stay optimistic.

And the take down from The Cunning Realist:
The cult of Reagan that's developed during the past two decades, especially with ruddy-cheeked College Republican types, has served to conflate the policy successes solely with his personal charisma. But steadfastness without intellectual rigor is stubbornness, and principle without policy is incompetence. Does that not describe the past seven years?
Of course Kudlow is what he is, and everybody gets it (and I've heard from people who know him that he's a good guy). But the fact is he's the face of conservatism, particularly fiscal, for a lot of people. And this sort of ostrich/sand routine doesn't do anyone any good right now. 2005 or 2006, maybe. But reality's a bit more manifest these days.

If there are any éminences grises left in the conservative movement, maybe it's time to gently coax Larry into toning down his act a bit, or even suggest that he try something new. How about a ghostwriting gig for an updated version of Think and Grow Rich?

I Don'y Know Who, or What, A Diddy Wah is, but I'm Going to Send You to His Site

There, you will find a pretty good looking mix with some Blues, Reggae and New Orleans funk. Check out the playlist:

Screamin' Jay Hawkins - I Put A Spell On You
Irma Thomas - Break-A-Way
Andre Williams - Humpin', Bumpin' and Thumpin'
Eddie Bo - Hook and Sling Part I & Part II
Jean Knight - You Think You're Hot Stuff
Canned Heat - On The Road Again
Dennis The Fox - Piledriver
Joe Cocker and The Chris Stainton Band - Woman To Woman
The Marvels - Rock Steady
Prince Buster - Al Capone
Little Willie John - Fever

Morty, I'm not gonna touch this one, too easy. feel free to take a shot

FRANKFURT (Reuters) - German nudists will be able to start their holidays early by stripping off on the plane if they take up a new offer from an eastern German travel firm.

Travel agency said it would start taking bookings from Friday for a trial nudist day trip from the eastern German town of Erfurt to the popular Baltic Sea resort of Usedom, planned for July 5 and costing 499 euros ($735).

"It's expensive, I know," managing director Enrico Hess told Reuters by phone. "It's because the plane's very small. There's no real reason why a flight in which one flies naked should be more expensive than any other."

The 55 passengers will have to remain clothed until they board, and dress before disembarking, said Hess. The crew will remain clothed throughout the flight for safety reasons.

"I wish I could say we thought of it ourselves but the idea came from a customer," Hess told Reuters by phone. "It's an unusual gap in the market."

Naturism, or "free body culture" (FKK) as it is known in Germany, was banned by the Nazis but blossomed again after the Second World War, particularly in eastern Germany.

"There are FKK hotels where you can go into the restaurants and shops naked, for example," Hess said. "For FKK fans -- not that I'm one of them -- it's nothing unusual."

"I don't want people to get the wrong idea. It's not that we're starting a swinger club in mid-air or something like that," he added. "We're a perfectly normal holiday company."

Monday, January 28, 2008

Clayton Holdings Dropping Dimes like Huggy Bear

Jan. 27 (Bloomberg) -- Clayton Holdings Inc., the Connecticut company that conducts due diligence for banks on pools of loans, is cooperating with a New York probe of whether Wall Street firms failed to sufficiently disclose risks tied to subprime lending.

Clayton will receive immunity from civil and criminal prosecution in New York, Jeffrey Lerner, a spokesman for New York Attorney General Andrew Cuomo, confirmed today in an e-mail. In exchange, Clayton will provide documents and testimony from officers, directors and other employees.

``We have complied with a subpoena to produce due diligence reports on various pools of loans that we had reviewed for issuers of mortgage-backed securities,'' Clayton Chief Executive Officer Frank Filipps said in an e-mailed statement.

Clayton, based in Shelton, was subpoenaed in June, Filipps said. New York is among a handful of states, along with the U.S. Securities and Exchange Commission, probing the mortgage industry as foreclosures have risen nationwide. Banks including Citigroup Inc. and Merrill Lynch & Co. that packaged subprime loans as investments have written down the value of the securities by billions of dollars.

The agreement between New York and Clayton was first reported today in The New York Times. Clayton is the largest provider of mortgage-related due diligence to Wall Street firms, the company said in its statement.

Rumor: Giuliani may end his presidential bid - that wouldnt suck

Rudy Giuliani appears to be pondering an end to his long pursuit of the Republican presidential nomination.

In a meeting in the back of his chartered plane en route to St. Petersburg, Fla., a short while ago, the onetime, longtime GOP front-runner told a small group of reporters, including The Times' Louise Roug: "The winner of Florida will win the nomination."

He then went on to predict he would win. And his spokeswoman, Maria Comella, said later he was speaking with confidence.

But that's an unusually categorical statement suggesting that only a total first-place upset by Giuliani, who trails both Mitt Romney and John McCain in all major polls for Florida's Republican primary tomorrow, will keep him in the competition, despite previous repeated vows to continue.

A Good Idea, as Heard on a Bloomberg News Podcast While Noshing on Some Choclate Chip Cookies

From the Bloomberg on the Economy with Tom Keene Podcast, economist John Markin with the American Enterprise Institute called for a 100bps point cut on January 30th, and, most importantly, an auction of all troubled assets to ascertain true market prices, a process similar to what occurred to the S&L related bankruptcies. People will get some deals, but the banks will adjust to the new market value of their assets with out further delay. The only reason this has not been done yet, is people don't want to hear the number.

Another high ranking Merrill Lynch Axing - Ahmass Fakahany, co-president, Peace out

Merrill officials had no immediate comment, but Fakahany is widely regarded as one of the key architects of Merrill's strategy of ramping up balance sheet risk by holding risky bonds packed with subprime mortgages that led to its writedown of more than $14 billion.

Meanwhile, CNBC has learned that the firm is now looking to cut costs. Merrill's Brokerage Department Chief Robert McCann is conducting a massive review of the brokerage-department's costs that will likely lead to layoffs in the department, according to one person with knowledge of the matter. The layoffs, however, aren't expected to touch at least initially the firm's 16,610 brokers, but will focus on other personnel, this person said.

Great Downtime Jazz Track - From a Great Blog Art Decade

As always, follow the link above. And check out the allstar goup on this:

Grant Green on Guitar, Joe Henderson on Tenor Sax, Bobby Hutcherson on Vibes, Duke Pearson on Piano (song credit), Bob Crenshaw on Bass and Al Harewood on Drums.

Treeman - WHOA!!! this is some s*&t - watch

Ben Stein Makes a Funny, and then Makes a Point

From Sunday's Times.

“Legal realism” said that the whole common-law system of abiding by past decisions was a fig leaf. What really happened, at the appellate level and probably at the trial level, too, was that judges made up their minds based on their predilections, their biases, which lawyer was their friend, what they had for breakfast that day. (I myself love peach Activia yogurt.)
Because I usually write about finance, I have come to believe in the theory of what I would call “financial realism,” or what might more accurately be called “trader realism.” Under this theory, on which I have an imaginary patent, traders can see masses of data any minute of any day. They can find data to support hitting the “buy” button or the “sell” button. They don’t act on the basis of what seems to them the real economic situation, but on what’s in it for them.

Just as a tiny example, years ago a close friend, now deceased, was a trader in London for a big financial house. As he told it, one day I.B.M. came out with stellar numbers. The boss of the trading floor said, “O.K., the guy who’s getting the prize is the one who can make us money selling I.B.M. short.”

So the traders grabbed for their phones and started to put out any bad thoughts they could dream up about I.B.M. They called journalists, retailers, anyone. They sold huge amounts of I.B.M. short. Soon, they had I.B.M. on the run, made money on their shorts and went to Langan’s to drink champers.

As I see it, this is what traders do all day long — and especially what they’ve been doing since the subprime mess burst upon the scene. They have seized upon a fairly bad situation: a stunning number of defaults and foreclosures in the subprime arena, although just a small part of the total financial picture of the United States. They have then tried — with the collaboration of their advance guards in the press — to make it seem like a total catastrophe so they could make money on their short sales. They sense an opportunity to trick other traders and poor retail slobs like you and me, and they generate data and rumor to support their positions, and to make money.

MORE than that, they trade to support the way they want the market to go. If they are huge traders like some of the major hedge funds, they can sell massively and move the market downward, then suck in other traders who go short, and create a vacuum of fear that sucks down whatever they are selling.

Note what is happening here: They are not figuring out which way the market will go. They are making the market go the direction they want.
I know this because I know traders. They’ve told me that they love to sell into fear because fear is bottomless — you can make money selling all day, while buying eventually slows because enthusiasm has limits. The amount of money available to large professional traders is so large that they can overwhelm the market, at least for a while, anytime they want. And they like to do it when the market least expects it.

To my humble eyes, this is what we have seen recently on world markets. Note that the losses in United States markets alone are on the order of about $2.5 trillion in recent weeks. How can a loss of roughly $100 billion on subprime — with some recoveries sure to come as property is seized and sold — translate into a stock-market loss 25 times that size? The answer is trader realism.

Genius! bet on news stories - whats better?

Nigel Eccles, a news junkie and former online betting site employee, wanted to try pursuing both interests at once.

Thus was born Hubdub - a new Web site Eccles and three colleagues in Edinburgh, Scotland, assembled - where customers will bet for fun, not money, on the outcomes of real news stories.

The site launches Monday as an influential technology conference gets under way in Palm Desert, Calif. - where Eccles plans to try drumming up support from investors.

Here's how it will work. After signing up, you'll receive 1,000 "Hubdub dollars," play money that works only on the site. You can look at stories about, say, whether Gregg Williams will be named the next head coach of the Washington Redskins or who will win the Florida Republican primary.

Guess right, and you'll win more Hubdub dollars. Lose, and your account will draw down. In the spirit of the board game Monopoly, where simply sticking it out is rewarded, you'll also get 20 new Hubdub dollars ever day you log in.

No wonder Al Gore not interested in being president, he is too busy stacking chedder

Current Media, the youth-oriented cable channel founded by former U.S. Vice President Al Gore and Joel Hyatt, has filed for a $100 million initial public offering.

The company aims to trade under the Nasdaq symbol CRTM; neither share prices nor number of shares have been disclosed.

Acknowledging that it has "a history of losses," relies on an "unproven media model," and had an accumulated deficit of $31.9 million at the end of 2007, Current Media is nevertheless pushing forward in the hopes that it will be able to better cover expenses as a public company. Revenues for 2007 were $63.7 million.

Michael Nutter says F%@# Tha' PA Supreme Court

Nutter: Enforce Phila.'s gun laws
The mayor is setting up a legal showdown with the state Supreme Court, which banned such city ordinances.

By Jeff Shields
Inquirer Staff Writer
Mayor Nutter yesterday said he would enforce new city gun-control laws even without state authorization to do so - setting up a possible legal and political showdown between the state and the new mayor.

At the first regular meeting of the new City Council yesterday, Council members Darrell L. Clarke and Donna Reed Miller introduced the same package of gun-control measures that languished last year while the state legislature refused to authorize them.

But these bills have a new wrinkle - they don't call for state-enabling legislation. The previous bills were conditional on companion state laws in recognition of a 1996 Pennsylvania Supreme Court ruling that said cities could not enforce their own gun laws.

But Nutter, Clarke and Miller, frustrated by the repeated failure of gun-control measures in the legislature, now appear ready to do just that.

"If these bills pass and if I sign them, then I expect to enforce them," Nutter said. "If you believe we can have a safer city by putting these measures in place, I think as good public servants we are compelled to take some type of action in the face of no relief coming from anywhere else."

Clarke said only that the new bills are "part of a legal strategy."

I Guess Being Learned in Torah Doesn't Always Lead to Logical Thinking

Moishe, what position would Rabbi Caine take on this?

Last update - 16:20 28/01/2008
Report: Chief Rabbi says move Gazans to a Palestine in Sinai
By Saul Sadka
According to Metzger, the plan would be to "take all the poor people from Gaza to move them to a wonderful new modern country with trains buses cars, like in Arizona - we are now in a generation where you can take a desert and build a city. This will be a solution for the poor people - they will have a nice county, and we shall have our country and we shall live in peace."

Metzger was quoted as telling the paper that the plan was new and he had not presented it to Prime Minister Ehud Olmert.

Belichick - nice short shorts bro

Update!: New Information

Sunday, January 27, 2008

Leon Black, Best character on Curb Your Enthusiasm, Ever! - Krazy Eyes Killer not far behind

who would think the NY Times would recognize how good "Leon Black" (JB Smoove)was on Curb this past season.

IN the pantheon of fictional houseguests that spans from Sheridan Whiteside to Blanche DuBois to Mork from Ork, perhaps none has wreaked as much havoc in the lives of his hosts as the character of Leon Black. On the most recent season of “Curb Your Enthusiasm,” the underdressed layabout Leon was a willfully vulgar foil to the television incarnation of Larry David, offering assistance that fractured the few relationships Mr. David’s misanthropy alone could not demolish.

But for as much trouble as Leon has caused others, he has been nothing but a boon to J. B. Smoove, the writer and performer who portrayed the character on the acerbic HBO sitcom. The role has been a vehicle for Mr. Smoove to reach an increasingly wider audience and an opportunity to stretch the boundaries of what his comedic alter egos can get away with...

Crazy Eyes, Moishe still has love for you though:

Morty's Update: For extra cedit, here is the Crazy Eyez Killah Remix

Compelling - Private money funding public works projects

With this countries infrastructure in dire need of upgrading and lack of public monies to complete these projects - this could be a new model for financing. Public works projects are notorious for cost overruns and delays, think Boston's Big Dig, as their is no accountability or bottom line concerns(who cares about the publics money?). If the private sector were running the show their would be a strong incentive to build on time and on budget resulting in a win-win. Some might argue that $25 is too much to charge consumers to use this tunnel but it's a very simliar concept to congestion pricing. Using market forces (namely charging a premium for something) to control congestion and to some extent help the environment as this would encourage "rationing" and wider use of public transportation.

An interesting angle may be to pass legislation similar to Historic Tax Credits that would provide equity funds that would go towards the capital stack to fund these public works projects that would have cash flow. In addition, to the extent these projects offset carbon emissions into the atmosphere they should be entitled carbon offsets which they could sell on the Chicago Climate Exchange or other commodities exchange or directly to a user (an energy company or the like) in a private transaction.

OYSTER BAY, N.Y. (AP) - It would be the world's longest highway tunnel, running more than 16 miles under the west end of Long Island Sound.

The cost is estimated at $10 billion - and it wouldn't cost taxpayers a dime. A developer wants to build the tunnel with private money, recouping his costs by charging drivers $25 each way and by selling advertising.

Developer Vincent Polimeni says the tunnel between Oyster Bay and Rye on the New York mainland would let travelers going between Long Island and New England avoid crowded New York City highways and help alleviate traffic congestion.

While not expected to be completed before 2025, the proposal received renewed attention this past week when a state Senate committee held a hearing.

Polimeni acknowledges his idea was initially met with "smirks and skepticism." But he added: "The more people looked at the plan, the larger circle of intrigued citizens who said 'tell me more.'"

The tunnel also brought back memories of Robert Moses, the powerful New York municipal planner who was rebuffed in his bid to build a bridge over Long Island Sound three decades ago. Long Island officials savaged Moses for his plan.


While Moishe not exactly the Hybrid guy (in a Prius sense), I think a Benz S Class hybrid would work

Mercedes-Benz appears to be close to launching a hybrid version of its S-Class luxury sedan. Called the S400, the gas-electric car is believed to be built around a 275-horsepower V6 with lithium batteries and regenerative braking.

The S400 is likely to deliver fuel economy of 30 miles per gallon. Last year, Mercedes previewed an S300 Bluetec Hybrid, which was based on a four-cylinder gas engine. It appears the German automaker decided customers would prefer a more powerful setup.

It's not known if Mercedes plans to introduce other S-Class models with hybrid powertrains. It's fair to assume Mercedes would eventually like to compete with the Lexus LS600h, which deliver 430 horsepower from a hybrid V8 powertrain.

Saturday, January 26, 2008

Very interesting, and the USA is the saudi arabia of Coal

Peabody Energy Acquires Equity Interest in GreatPoint Energy

ST. LOUIS, Jan. 25 /PRNewswire-FirstCall/ -- Peabody Energy (NYSE: BTU) today announced that it has reached an agreement to become a minority investor in Cambridge-based GreatPoint Energy, Inc. GreatPoint Energy is commercializing its proprietary bluegas(TM) technology that converts coal, petroleum coke and biomass into ultra-clean pipeline quality natural gas while enabling carbon capture and storage. As part of the agreement, Peabody and GreatPoint Energy will evaluate the potential for development of joint coal gasification projects using Peabody reserves and land.

GreatPoint Energy uses a single-stage catalytic gasification process to create natural gas that is 99.5 percent pure methane and can be transported throughout North America utilizing the existing natural gas pipeline infrastructure. They are developing the technology for commercial-scale use for power generation, residential and commercial heating and production of chemicals. GreatPoint Energy has completed highly successful testing in a pilot facility in Des Plaines, Ill., and is commencing engineering for the first commercial project.

FRANKFORT, Ky. -- Peabody Energy is expected to announce next week that it has chosen Western Kentucky as the site for a $3 billion plant that would convert coal to natural gas.

The St. Louis-based energy giant won preliminary approval yesterday for up to $250 million in tax incentives under an energy bill approved in August by a special session of the General Assembly.

The incentives were approved unanimously at a meeting of the Kentucky Economic Development Finance Authority.

Friday, January 25, 2008

One Last Think Piece for the Weekend From Moishe's Favorite Writer

Chuck Klosterman on

While writing "Metaphysics," Aristotle outlined the three concepts of perfection as follows:

1. Something that is complete.

2. Something that is so good that nothing of the kind could be better.

3. Something that has achieved its purpose.
he '72 Dolphins were "perfect" by virtue of Aristotle's first and third definitions (the squad was a self-contained, untarnished unit that won the championship). The Patriots cannot make similar claims unless they win Feb. 3 (and if they lose, everything turns to smoke). However, they can already allege to embody that second designation of perfection: When one considers the advent of free agency, the salary cap, the enforced distribution of talent and the realties of present-day professional football, it's possible New England has built a team "so good that nothing of the kind could be better." Some of this was a product of chance (Brady was not drafted until the 199th pick in 2000), and some of this was a product of other teams' failures (the Packers could have acquired Randy Moss in 2007 for a third-round pick). But most of this has to do with the way the Pats perform: They have the most talent, combined with the most unselfishness, fueled by the greatest desire to unilaterally dominate. Their most consistent criticism has been running up the score against already humiliated opponents, a condemnation almost never applied to contemporary teams at the pro level. The Patriots are not literally perfect, but they are perfect enough to be historically singular.

Which is why it would be so much more interesting if they lose
Man o' War is arguably the finest horse who ever lived, and one of the best arguments for thoroughbred perfection. It is, however, very difficult to name any horse he raced against, except one: Upset, the only ungulate who ever beat him. This is how it goes. When measuring -- and particularly when remembering -- the greatest performances in the history of any sport, the moments that matter most are almost always tied to situations when that entity failed. Very often, those specific failures are the essential details people recall about dynastic achievement. The memory of perfection is inevitably tied to the memory of lost perfection.

Keeping with Today's Drug War Focus

It's a real think piece, and not short, so here's a taste.

How America Lost the War on Drugs
After Thirty-Five Years and $500 Billion, Drugs Are as Cheap and Plentiful as Ever: An Anatomy of a Failure.

Ben Wallace-Wells

Posted Nov 27, 2007 12:56 PM
Even by conservative estimates, the War on Drugs now costs the United States $50 billion each year and has overcrowded prisons to the breaking point - all with little discernible impact on the drug trade. A report by the Government Accountability Office released at the end of September estimated that ninety percent of the cocaine moving into the United States now arrives through Mexico, up from sixty-six percent in 2000. Even Walters acknowledges that for all of the efforts the Bush administration has devoted to overseas drug enforcement, the price of cocaine has dropped while its purity has risen. More than forty percent of Americans support legalizing marijuana, yet the government continues to target pot smokers. In October, the administration announced it was planning a new military offensive, dubbed Plan Mexico, with a price tag of $1.4 billion. Things look so bleak that Walters was recently moved to describe a momentary upward blip in drug prices as "historic progress."

There are a handful of battles in the War on Drugs that have actually been won, times when fresh thinking prevailed over politics - but they are not the kind of victories that the Bush administration is eager to trumpet. In the summer of 2003, the police department in High Point, North Carolina, held its annual command-staff retreat in a small conference center themed to look like the log cabins of the pioneers who settled the region. One topic dominated the conversation: an increase in violent crime that was concentrated in three drug-dealing neighborhoods in the city. "The place we were at was that all the traditional enforcement was making no difference," says the department's deputy chief, Marty Sumner. "We agreed we weren't going to be able to eliminate drug use. We weren't even going to try to go after drug use. We wanted to change the marketing of the drug."

Counterpoint to Morty's Vermont post

California Justices Put Limits on Medical Marijuana Law

SAN FRANCISCO — In the latest setback for advocates of medical marijuana in California, the State Supreme Court ruled Thursday that employers were within their rights to fire employees who fail drug tests.

The ruling, a 5-to-2 decision that affirmed the findings of lower state courts, involved a former Air Force mechanic, Gary Ross, who injured his lower back in a fall off an airplane wing in 1983. In 1999, a doctor, acting under the state’s Compassionate Use Act, prescribed marijuana in an effort to relieve Mr. Ross’s pain.

The act, approved by voters in 1996, legalized the use and sale of marijuana to those with a chronic illness or infirmity.

Two years after he began using the drug, Mr. Ross was fired from a job as a systems administrator with a telecommunications company after failing a drug test.

Mr. Ross filed suit, contending that his dismissal violated state laws barring wrongful termination and discrimination based on disability.

But the state’s highest court firmly rejected that argument on Thursday, saying that the act deals solely with criminal prosecution, not terms of employment.

“The Compassionate Use Act does not eliminate marijuana’s potential for abuse or the employer’s legitimate interest in whether an employee uses the drug,” Justice Kathryn M. Werdegar wrote.

The Pacific Legal Foundation, a conservative, free-enterprise group, praised the decision as a victory for “safe, drug-free workplaces.”

“You don’t want employers to be trying to figure who is impaired and who is not,” said Deborah J. La Fetra, a lawyer for the group.

“They need to have a bright-line, no-drugs-in-the-workplace rule.”

Advocates of medical marijuana said Thursday that they hoped the Legislature would provide medical marijuana users some workplace protections, and Assemblyman Mark Leno, a Democrat from San Francisco, said he planned to take up the cause.

Mr. Ross, now 46 and a host at outdoor camps in the Sacramento area, said he never intended to use marijuana on the job, only to relieve pain and help him sleep. But he said he was not surprised at the judges’ ruling.

“Their mind is stuck in 1967,” he said in a telephone interview. “They just say, ‘My mind was made up in the 1960s, and that’s the way it’s going to stay.’ ”

Baby Steps Toward Sanity

January 21, 2008

MONTPELIER, Vt.—Vermonters get to weigh in this week on a bill before the Legislature that would decriminalize possession of small amounts of marijuana.
more stories like this

The state Senate Judiciary Committee plans a public hearing Wednesday on a measure that would make possession of four ounces or less punishable by a civil penalty instead of criminal prosecution. Also on the agenda: a bill that would stiffen the penalties for selling heroin and cocaine.

"I think both are public policy issues that ought to be explored," said state Sen. Richard Sears, D-Bennington, who chairs the committee.

Sen. Hinda Miller, one of the sponsors of the marijuana bill, said it would help Vermont courts focus on more important crimes if passed.

"It's time to be realistic and look at the world as it is," said Miller, D-Chittenden.

Positive spin on otherwise awful earnings for Lennar

Keep one thing in mind, Lennar (and the rest of the homebuilders) were making money hand over fist the last 5 years and paying lots of taxes. these huge losses they are taking now not only clean up their balance sheets but my guess is they will result in tax refunds which will come back onto the balance sheet. Also, while they are writing down the value of their land holdings (using overly conservative valuations), when the market improves these land holdings will be marked back to market and that too will come back onto the balance sheet. So net net, no need to hold a telethon for these guys. They will weather the storm and be positioned for when the market improves. moishe's take.

MIAMI (AP) — The Lennar Corporation, the home builder, reported a $1.25 billion fourth-quarter loss on Thursday — its biggest ever — as a slowdown drove home prices lower and the company took a write-down on land.

Lennar also reported a $1.9 billion loss for all of 2007. And with few signs of market improvement, the company said it was aggressively trying to generate cash and reduce inventory while taking heavy impairment charges.

The quarterly loss was $7.92 a share, compared with a loss of $1.24 a share, or $195.6 million, a year ago. Lennar lost $513.9 million in the third quarter. Excluding a charge of $7.50 a share to write down the value of land options, the company would have lost 42 cents a share in the quarter.

Revenue fell 49 percent to $2.18 billion, from $4.27 billion in the 2006 period, as home deliveries fell 50 percent to 7,044 homes, and new orders slid 50 percent with a cancellation rate of 33 percent.

In the fourth quarter, revenue from home sales was halved to $2 billion compared with the same period in 2006. The average sales price of homes decreased to $291,000, from $302,000 a year earlier.

Great editorial piece by Andy Kessler on the state of banks

WSJ: What's Next for the Banks

If you want to know what's going to happen to the big banks and investment banks, you've got to go back to early 2003, when the seeds of destruction were planted.

It had been a year or so since a couple of trillion dollars of investor wealth had been wiped out. The Dow was 8000 and dropping, and the stocks of big institutions from Citi to Merrill Lynch to Morgan Stanley were at multiyear lows. Bank lending was down, but no one was really worried. The old "borrow short, lend long and pocket the difference" game had been around for millennia, and banks had weathered worse than this mild economic slowdown.

[financial institutions]

What was not at all clear was how investment banks were going to make money going forward. Wall Street had piles of capital and no place to go. Stock trading and large parts of bond trading had gone electronic. Decimalization of the stock market wiped out markups. IPOs were down, mergers were down and, gasp, bonuses were way down.

Stocks were out and investors wanted yield -- safe, predictable returns -- but there wasn't much profit in that. Some, especially hedge funds and international investors, insisted on even higher yields than plain old government bonds.

So Wall Street, as it always does, gave investors what they wanted -- excess yield in the form of derivatives, asset-backed, mortgage-backed, collateralized debt obligations (CDOs), basically funky amalgamations of lots of other pieces of paper. Done right, no one but you knew how to value these exotic instruments, so you could mark them up way more than a penny and generate huge fees, profits and bonuses. Win-win.

Low interest rates from the Federal Reserve and a rising housing market meant the subprime flavors of these CDOs took off like wildfire. Merrill Lynch and Bear Stearns and everyone else raced to package up these CDOs with pretty bows and sell them off as high rated goodness to those hungry for yield.

Banks loved it because they could sell off loans, generate fees and go make some more. It wasn't enough. Billion-dollar hedge funds popped up overnight to buy these things, with leverage on leverage to generate even higher returns. Savings & Loan banks were long gone, so by 2006, armies of mortgage brokers, many just online, answered the call to feed the beast with loans.

Until it went on for too long. By 2006, it was a one-way trade. Banks, especially Citigroup and State Street, couldn't resist the sweet siren's call, especially with "borrow short, lend long" in their DNA. Off balance sheet, they set up conduits, so-called SIVs, to use leverage and buy up lots of these subprime CDOs -- $100 billion worth for Citi -- breaking Wall Street's unwritten "sausage" rule that you sell this stuff to clients, but never own it yourself.

Wall Street's unwritten "sausage" rule is that you sell this stuff to clients, but never own it yourself.

SIVs were mostly invisible yet huge money makers, which makes me question how much money the plain old bank was making. Not much, it turns out. And in the end, neither did these SIVs. Others like Merrill Lynch and UBS got caught with inventory of these CDOs, having packaged them but not able to sell them off fast enough. Goldman Sachs smelled spoiled meat and shorted enough of the market to minimize the hit to their capital structure.

When the inevitable blowup came, most holding the toxic sausage required new capital from a government bailout to survive. No not from the Fed, but from the governments of China, Singapore, Abu Dhabi, Kuwait and New Jersey. Without their cash, Citi and Merrill stocks would halve again.

But that's old news. What about going forward? First, no one, and I mean no one, is going to buy a package of loans without knowing what each and every one of them is, what the risk of default is, etc. Rating agencies can no longer be trusted. The good news is that the same computer technology used to create CDOs can easily be extended to offer this needed transparency, loan by loan. But the bad news for investment banks: The packaging game just won't be as profitable.

So who has the strong hand? As always, it's a capital game, whoever accumulates the most will be best positioned for what's next.

Banks? Sure, they're slow and steady, but lending is dull, not that profitable, as we have seen, so growth is limited. While Citigroup fiddles, JP Morgan is the model, as one of the few big banks to not load up on CDOs to enhance earnings. Instead, it has been quietly accumulating billions in hedge fund assets.

Investment banks? Balance sheets are now mostly cleaned up, but outside of Goldman Sachs, management teams are under scrutiny to see who can come up with the right business model away from CDOs. It won't be until that model becomes clear that their stocks can go up enough to raise serious capital to compete. Not all will.

How about hedge funds or private equity? Lots of money will be made buying distressed debt at the bottom of this cycle, but most of it by firms that are small partnerships on a relative basis, and I don't see them gearing up huge sales forces to become big players. But that can be fixed.

My view is that firms that successfully combine banking and investment banking will walk away with the prize, by being able to offer a full range of services to clients -- short-term loans against assets or receivables as well as bonds and equity for long-term projects, the kind of underwriting and trading that requires large amounts of capital. The inevitable consolidation that should have occurred after Glass-Steagall (the 1933 law that separated banks and investment banks) was repealed in 1999 had been on hold while everyone chased easy profits. But now the shakeout is here.

Goldman Sachs will own a bank, maybe even Citigroup (Goldman's $85 billion market capitalization might be able to swallow Citi's $125 billion value) and strip it down to what it needs. JP Morgan should reunite the House of Morgan by merging with Morgan Stanley, and become a full-service powerhouse. But JP Morgan could buy Merrill or Lehman or Bear Stearns instead. Bank of America will merge with who's left. But don't count out others who have done well with capital. Fortress Investment Group, despite a rocky IPO a year ago, has a powerful real estate arm that could own loan origination and servicing and enough assets to buy its way into the banking or investment banking business. Same for the Blackstone Group.

Capital flows a lot more fluidly around the globe these days. Expect consolidation to start now. The real winners on Wall Street will be the ones with huge stockpiles of capital who listen to the market, and who are fleet of foot enough to smell out and deploy their capital creating instruments that global growth companies need, rather than false profits from eating their own sausage.

The Big Five?: Goldman CitiSachs, House of Morgan, Bear of America, Fortress Lehman Lynch and Blackstone Suisse.

Kids these days and their use of technology

ALLENTOWN, Pa. - Police faced a difficult if not impossible task Thursday as they tried to stop the spread of pornographic video and photos of two high school girls, images that were transmitted by cell phone to dozens of the girls' classmates and then to the wider world.

District Attorney James B. Martin said at least 40 Parkland High School students believed to have received the images would not face prosecution as long as they show their phones to police by Tuesday to ensure the images have been erased.

But students at the school said the distribution was far more widespread. "Most people got it and kept passing it along for fun to everyone in their phonebook," said Jon Gabriel, 16, a junior who said he received and deleted the images.

Giving Credit Where it is Due

Can a leopard change its' spots?

Wal-Mart Chief Offers a Social Manifesto
Published: January 24, 2008

KANSAS CITY, Mo. — Wal-Mart pledged Wednesday to cut the energy used by many of its products 25 percent, to force the chain’s suppliers to meet stricter ethical standards and to apply its legendary cost-cutting skills to help other companies deliver health care for their employees.
In a lofty address that at times resembled a campaign speech, the chief executive of Wal-Mart Stores, H. Lee Scott Jr., said that “we live in a time when people are losing confidence in the ability of government to solve problems.” But Wal-Mart, he said, “does not wait for someone else to solve problems.”

He then laid out sweeping plans for the company on several health and environmental issues, and he hinted that even more ambitious goals might be on the horizon. Mr. Scott said, for instance, that Wal-Mart is talking to leaders of the automobile industry about selling electric or hybrid cars — and might even install windmills in its parking lots so customers could recharge their cars with renewable electricity.

With the new commitments, Wal-Mart is trying to cement its reputation as a leader in areas where it was once known as a laggard. The initiatives are the most visible sign to date that Wal-Mart, which spent much of the past decade defending itself against criticism of its business practices, has gone on the offensive.

Since 2005, it has committed itself to a dizzying number of reforms, and even some of the chain’s critics concede that it has begun to make good on the promises. For instance, Mr. Scott said Wednesday that Wal-Mart had sold 145 million compact fluorescent light bulbs, which he said had saved enough electricity to forestall the need for three coal-fired power plants in the United States.
Several experts applauded the new goals, saying they would have an impact beyond Wal-Mart, given the chain’s influence over companies that supply Wal-Mart and other retailers. “When Wal-Mart asks, suppliers jump,” said Noah Horowitz, a senior scientist at the Natural Resources Defense Council. “There are positive ripple effects throughout the supply chain.”

Thursday, January 24, 2008

Morty's first cousin - props to for this, great site!

This is very astute and true

Bill Gates, the world's richest man, believes the US economy will not fall into a slump because technological progress will help it to grow, he said in an interview with a German newspaper on Thursday.

The Microsoft co-founder told Bild he believed the severe turbulence on the global markets sparked by concerns of a recession in the United States would calm down.

"The US economy has been very strong in the last 10 to 15 years. Unfortunately I don't have a crystal ball to see into the next few years," Gates said.

"But I am an optimist. The US economy could remain strong in the next few years because technological progress will propel it."

Gates denied he was anxiously keeping an eye on the Microsoft share price.

"I'm no expert on shares, I'm a software person," he said. "I look at the share price every couple of weeks.

"The important thing is that in the past it has gone up far more often than it has gone down."

Gates was in Germany to announce that Microsoft will spend 235 million dollars (161 million euros) over the next five years to introduce more computers into classrooms.

He was to address the World Economic Forum in Davos on Thursday.

Gates led the Rich List compiled by Forbes magazine for the 13th year in 2007 with an estimated fortune of 56 billion dollars.