Wednesday, December 17, 2008

Best Auto Bailout Solution

Donald Trump, in an interview today, gave one of the best answers I've heard recently on how to solve the question of whether to bail out the Big Three:

[Paraphrase]

"The government should offer $35 billion in DIP financing to Detroit." DIP is shorthand for debtor-in-possession financing. For the auto industry it'd be very hard to get from the private sector but the US government can certainly do it. Essentially, like the airlines-many of which have continued to fly while in Chapter 11, it would work like a pre-packaged bankruptcy where GM or Chrysler would be able to operate largely shorn of onerous, decades old obligations to the UAW and states' laws regarding distributorships. Consumers can be confident that the car companies will continue to exist and make good vehicles and cover their warranties. Of course the howl from the unions and the left in the Democratic party would be tremendous because it would make bankruptcy a sensible option. Donald Trump knows about chapter 11 operations as he's taken a number of his companies through it. In my pessimistic view I think Detroit gets a lifeline. I would not be surprised at all if they got it from President Bush who may have deep personal sympathy for the autoworkers. The view here of course is that for Detroit to emerge as viable, going concerns a drastic change in the current structure is required. At least Bush should leave this rather tough decision for the Messiah aka Obama. I would be pleasantly flabbergasted if Obama let Detroit go. Ain't gonna happen - someone will bail them out. And we will come to regret it. Climate Change Buffoonery FoxNews has a good article in response to an alarmist AP offering on Monday which called global warming a "ticking time bomb": Scientists fear that what's happening with Arctic ice melt will be amplified so that ominous sea level rise will occur sooner than they expected. They predict Arctic waters could be ice-free in summers, perhaps by 2013, decades earlier than they thought only a few years ago. Unfortunately, it appears that this is not only bad science, but bad basic science: James O'Brien, an emeritus professor at Florida State University who studies climate variability and the oceans, said that global climate change is very important for the country and that Americans need to make sure they have the right answers for policy decisions. But he said he worries that scientists and policymakers are rushing to make changes based on bad science. "Global climate change is occurring in many places in the world," O'Brien said. "But everything that's attributed to global warming, almost none of it is global warming." He took issue with the AP article's assertion that melting Arctic ice will cause global sea levels to rise. "When the Arctic Ocean ice melts, it never raises sea level because floating ice is floating ice, because it's displacing water," O'Brien said. "When the ice melts, sea level actually goes down. "I call it a fourth grade science experiment. Take a glass, put some ice in it. Put water in it. Mark level where water is. Let it met. After the ice melts, the sea level didn't go up in your glass of water. It's called the Archimedes Principle." Oops. Sunday, November 30, 2008 We are still here and hopefully will be a bit more active going forward. Monk's been busy as have I, throw in a 'technical' issue to boot and a general funk from the election and, well, there you have it. Hope you all had a great Thanksgiving. A few general observations: 1. Have you ever seen a President-elect have THISMUCH limelight? He might as well already be Co-President or President. 2. The Messiah's cabinet picks have been better than expected. Geithner at Treasury puts the policy wonk in the top spot and is the safe pick. Would have personally preferred a top man like Bob Rubin, John Thain or perhaps Jon Corzine. Like the fact that Larry Summers is on the team given the ignominy of his fall at the hands of the overwrought feminist-victims. Hillary at State is much, much more preferable than John Kerry. 3. What would really impress me though is if the Messiah and/or the Democratic Congress allows GM (and Ford and Chrysler) to fail. It's absolutely the right thing to do. This isn't comparable to bailing out the banks which were going concerns that were profitable and had a business plan that worked. The Big 3, on the other hand, do not have a viable business model and cannot unless they unburden themselves through a packaged bankruptcy of legacy commitments that should never have been made but in any case are now dead weight. My bet here is that they will get bailed out. The Democratic Party will NOT allow a chance that their union backing will fracture. The brighter ones probably realize that without the unions pushing most of these folks probably will vote like NASCAR. Keeping Gates short-term is tokenish but isn't much different I think than Bush keeping Tenet and Obama's move is safer for him and probably the Republic. 4. The pirates off the Somalian coast are a disgrace. It does, however, show folks who are paying attention what happens when the United States is unwilling or unable to exercise its power. No one will act. Stopping piracy off the Somalian coast shouldn't be difficult for anyone who can and is willing to project air power in the area and has access to real time satellite imagery. E.g., any waterborne craft in excess of 50 feet in length that doesn't respond appropriately to hails gets blown up. A few examples would dampen pirate ardor one would think. 5. Gutted that Ted Stevens ALMOST pulled one out and that Smith in Oregon lost by a hair. Weren't both GOP'ers leading on election night...? Chambliss should pull it out in Georgia and Minnesota is too silly to call. We are still THISCLOSE to a filibuster proof majority. 6. George Soros is a jerk and comes off as someone who now that he has made his fortune is trying to keep other folks from making one. 7. Been a great, great month to be an Alabama fan. Monk, sorry for Iowa. Would have liked to see the Old Man win another. 8. Been a great month to be a Jet fan. If Brett somehow wins a Super Bowl here he would never be able to pay for a meal in Queens or Long Island ever again. Wednesday, November 12, 2008 Train stopping The Monk and Monkette went to Japan last May and traveled more than 900 miles by train all over the country. We rode "national" Japan Rail trains every day except one. We had one delay of about 10-12 minutes. And no, it wasn't on the super-fast Shinkansen bullet train. Those average a schedule deviation of 36 seconds per year! So The Monk thought it'd be interesting on his trip to DC last weekend to ride the rails a bit. Because a flight to BWI was less expensive than a trip to Reagan National, I chose the BWI flight and would hop a train to DC from there. Not doing that again. Amtrak is a mess, pure and simple. The first train I wanted to catch was listed at 25 minutes late when I arrived at the station, it came 40 minutes past its schedule. On the way back to BWI from DC, the early train I hoped to catch was 20 minutes late. Unlike the clean and bright Japanese stations, BWI's lounge was ill-lit and the bridge to the southbound tracks smelled of urine. And the Amtrak coach seat I had from DC to BWI on Sunday was in a poorly lit, dank and musty coach car -- also opposite the intercity trains I rode in Japan. This is a bad situation. Trains COULD be convenient and inexpensive if they were even mildly reliable. Long haul distances in the US are not for train travelers, but high speed rail could be beneficial for certain areas: Chicago-Milwaukee-Detroit-St. Louis, the Texas Triangle, and the Pacific Coast. If the Greens and the liberals really want to cut carbon emissions, they should strive for public-private partnerships for rail travel in these areas. And don't let Amtrak run the trains. Saturday, November 08, 2008 The Rot in New England Christopher Shays' narrow defeat in Tuesday's election means that there will be no Republican representatives from the six states in New England in the 111th Congress. Massachusetts - 10 Connecticut - 5 New Hampshire - 2 Maine - 2 Rhode Island - 2 Vermont - 1 22-0, nominally not a large number of representatives, but the fact that there are no Republicans is a result long term effective control of state houses and the gerrymandering that goes along with it as well as the reflexive and well funded liberalism of the northeast matched no where else in the country. Even red Texas is 19-13 Republican. And unlike Texas there aren't many conservative Democrats from New England. You can smell the stench from here in NY. Wednesday, November 05, 2008 CONGRATULATIONS to President Obama November 4, 2008 is now an historic date - the day that the United States became the first democracy in what is misleadingly called the Western World (essentially Europe, the US, Canada) to elect a black man ("African descent" is a misleading description here) to its highest office. Congratulations to President-elect Obama. The fact is that even though The Monk is part of the opposition, I am the loyal opposition. Loyal to the country and the office of the presidency. I do wish the new President all the best, and hope he proves to be a good one. My misgivings and doubts are set out in this blog on other posts. And let's be direct: the likelihood is that Obama will be president until 2017. Since World War II ended, only three sitting presidents have lost re-election bids: Ford ('76), Carter ('80), and George HW Bush ('92). In two of the three cases, extraordinary circumstances existed -- Ford had pardoned the embodiment of political corruption, Richard M. Nixon, and had no mandate because he'd never been elected even as VP; Carter presided over a horrible economy whilst suffering daily humiliation in the Iran Hostage Crisis and somehow that race was close until Carter agreed to debate Reagan and the Gipper wiped the floor with the peanut man. Obama won't be an LBJ or Truman who decides not to run for a second full term -- first, no man who runs the gauntlet of the modern presidential race has the humility to stand down after getting elected four years earlier; second, unless presidents do something actively wrong or foolish, they generally maintain approval ratings over 50% at re-election time; and third, and worst for Republicans, is that unless Obama completely fouls up the economy (or capitulates to terrorists), it is more likely that the country will be in recovery or even a boom cycle by 2012 than a downturn of the type that felled the first Pres. Bush's reelection campaign in 1992, therefore it would be almost foolish for the man not to run. That's the political landscape. And for Republicans and conservatives, it means finding a new and better message than whatever muddled mush that passed for a message the party has peddled in 2006 and 2008. Tuesday, November 04, 2008 Why today is the day to vote There are many fine reasons to wait until Election Day to vote including: (1) early voting lends itself to fraud due to less poll scrutiny; (2) late revelations can change wavering voters' minds. But National Review summarizes the best reason to vote today (which The Monk did, and which he always does), not on an early voting day: While it is important that voters go to the polls decently informed, it is also important that they go to the polls together. This is partly for reasons of prudence — among other concerns, absentee ballots offer many greater opportunities for organized fraud — but also for reasons of ritual. Voting is by its nature a communal exercise, and the franchise should be exercised in a way that reminds us that in our republic the people are the masters of the state, not the other way around — that we are citizens, not subjects . . . There is nothing like a presidential campaign to remind us that democracy is not especially majestic, but there is a kind of austere beauty in free people coming together to cast their votes, whether they are purple-fingered Iraqis or citizens of the world’s oldest democracy gathering at schoolhouses and town halls. The togetherness of that exercise should not be diminished. There will always be some necessary exceptions, but those should be — exceptional. Today is the day to vote. Friday, October 31, 2008 Thoughts on the Final Weekend I have had a number of generally reliable conservative or libertarian friends who are flirting with voting for Obama in what I think is the ultimate victory of hope over experience. Some are deeply upset over Sarah Palin. As you mull it over I'd like you to consider the following- I'll keep it short and simple. 1. While many conservatives, myself included, probably feel MORE comfortable with Governor Palin than Senator McCain, you are voting for the TOP of the ticket. And John McCain will be 72 in January 2009. Ronald Reagan was 74 when he started his second term. 2. While Senator Obama's lack of serious experience is troubling, we should actually be more worried about his JUDGMENT. Someone who is inexperienced but smart could surround himself with good advisers. Bad judgment is another case entirely. Two examples: The surge in Iraq where Obama will not admit he was wrong. He harps on the mistake of the Iraq War but would have compounded it tremendously by precipitously withdrawing. I would cite Cambodia, 1975 as a lesson. 3. Who do you trust? McCain has a long history of being a maverick with plenty of spine. His family has served this republic honorably and long for four generations. When allies like Israel, Taiwan or perhaps Poland are threatened who would you trust to make the right decision? The only thing we can trust Senator Obama to do is talk and look for a UN mandate. 4. Jeremiah Wright. By his own words "a virtual father and someone he could not condemn any more than his white mother or grandparents"...UNTIL HE HAD TO THROW WRIGHT UNDER THE BUS FOR POLITICAL REASONS. Obama was in this man's congregation FOR YEARS and listened to the hateful invective in which Wright attacked the United States. Would you sit through years of sermons like that unless you agreed?? 5. Economically Obama would look to redistribute wealth via taxes. Taxes should not be a means to redistribute wealth, taxes should fund the common defense, necessary services and a basic social safety net and that's it. 6. In 1992 conservatives unenamored of George HW Bush argued that putting a Democrat in office would 'renew' the conservative roots of the GOP. We got eight years of Bill Clinton's fecklessness as a result. Whether or not you love McCain (or Palin) you know what you will get with Obama. Zogby, a left-leaning pollster, has the race in a dead heat in his latest single-day tracking poll. It's still a long shot with McCain in uphill battles in Pennsylvania and Virginia and a host of other swing states but it's close. By the grace of God and Divine Providence... An Agnostic's Prayer I've been an agnostic for as long as I can remember. This doesn't mean that I don't pray. It's usually the Lord's Prayer with specifics for family added afterwards. In recent weeks I've been also been adding the following: "I pray for the welfare of this great republic which I believe would be far better served by Senator McCain but in this as in all things THY WILL BE DONE." Those who understand...are voting McCain NEW YORK, Oct 30 (Reuters) - Chief financial officers of U.S. companies still prefer Republican presidential nominee John McCain over Democrat Barack Obama by a wide margin...according to a new survey. CFOs are much less optimistic about the U.S. economy and about their own businesses, and expect it will be much harder for their companies to access credit over the next six months, the survey by Financial Executives International and Baruch College's Zicklin School of Business found. Sixty-two percent said they hoped McCain would win next week's presidential election, compared with 15 percent who prefer Obama... Twice as many said McCain was best able to handle the economic crisis than said so about Obama, the survey found. The survey, conducted electronically between Oct. 2 and Oct. 17, included responses from 290 corporate CFOs. Monday, October 27, 2008 American voters: what are you doing? The Monk's dislike of Sen. Barack Obama has numerous causes. He is a socialist. He is a pacifist. He is anti-capitalist. He is anti-Israel. He is a trade unionist at his core. He is a vote fraud enabler. He is an unrestrained ego. He is a naif. His will be the second administration of Jimmy Carter. There is no better explanation for what is wrong with the potential Obama presidency and how we arrived at this point than the short essay by Mark Levin that I linked to this post. I agree with everything Levin says, and he states my own beliefs and unease clearly and concisely. Read the whole thing. Here are significant excerpts: There is a cult-like atmosphere around Barack Obama, which his campaign has carefully and successfully fabricated, which concerns me. The messiah complex. Fainting audience members at rallies. Special Obama flags and an Obama presidential seal. A graphic with the portrayal of the globe and Obama's name on it, which adorns everything from Obama's plane to his street literature. Young school children singing songs praising Obama. Teenagers wearing camouflage outfits and marching in military order chanting Obama's name and the professions he is going to open to them . . . I dare say, this is ominous stuff. Even the media are drawn to the allure that is Obama. Yes, the media are liberal. Even so, it is obvious that this election is different. The media are open and brazen in their attempts to influence the outcome of this election. I've never seen anything like it. Virtually all evidence of Obama's past influences and radicalism — from Jeremiah Wright to William Ayers — have been raised by non-traditional news sources. The media's role has been to ignore it as long as possible, then mention it if they must, and finally dismiss it and those who raise it in the first place. It's as if the media use the Obama campaign's talking points — its preposterous assertions that Obama didn't hear Wright from the pulpit railing about black liberation, whites, Jews, etc., that Obama had no idea Ayers was a domestic terrorist despite their close political, social, and working relationship, etc. — to protect Obama from legitimate and routine scrutiny. . . And, of course, while experience is crucial in assessing Sarah Palin's qualifications for vice president, no such standard is applied to Obama's qualifications for president. . . The worst aspect of Obamania is that the voters have lost the ability to scrutinize the candidate. . . . my greatest concern is whether this election will show a majority of the voters susceptible to the appeal of a charismatic demagogue. This may seem a harsh term to some, and no doubt will to Obama supporters, but it is a perfectly appropriate characterization. Obama's entire campaign is built on class warfare and human envy. The "change" he peddles is not new. We've seen it before. It is change that diminishes individual liberty for the soft authoritarianism of socialism. It is a populist appeal that disguises government mandated wealth redistribution as tax cuts for the middle class, falsely blames capitalism for the social policies and government corruption (Fannie Mae and Freddie Mac) that led to the current turmoil in our financial markets, fuels contempt for commerce and trade by stigmatizing those who run successful small and large businesses, and exploits human imperfection as a justification for a massive expansion of centralized government. . . Rather than pursue the American Dream, he insists that the American Dream has arbitrary limits, limits Obama would set for the rest of us — today it's$250,000 for businesses and even less for individuals. If the individual dares to succeed beyond the limits set by Obama, he is punished for he's now officially "rich." . . . And so it is that the middle class, the birth-child of capitalism, is both celebrated and enslaved — for its own good and the greater good. The "hope" Obama represents, therefore, is not hope at all. It is the misery of his utopianism imposed on the individual.

Unlike past Democrat presidential candidates, Obama is a hardened ideologue. He's not interested in playing around the edges. He seeks "fundamental change," i.e., to remake society. And if the Democrats control Congress with super-majorities led by Nancy Pelosi and Harry Reid, he will get much of what he demands.

The question is whether enough Americans understand what's at stake in this election and, if they do, whether they care. Is the allure of a charismatic demagogue so strong that the usually sober American people are willing to risk an Obama presidency? . . . while America will certainly survive, it will do so, in many respects, as a different place.

The World Series, take II

The Monk is thinking that the Rays look alot like the '06 Tigers. Young upstarts who won the AL pennant and tanked in the Series. The Tigers whupped the A's in the ALCS (the only ALCS sweep during the three-round playoff era 1995-present) and were favored over the 82-win Cardinals in the Series. The Cards had the Tigers scouted extremely well, outpitched the kitties and won the Series in five. The Phils have the Rays scouted extremely well (Pena and Longoria have whiffed in almost 1/2 of their combined at bats), have outpitched them, and are in line to win the Series in five.

Since the '06 season, the Tigers have honked badly -- 88-74 in '07, a seven-win dropoff from '06 and six games off the wild card pace; 74-88 and last place in the AL Central this year as three starters from the '06 AL champs (Verlander, Rogers, Robertson) combined for a 27-41 record and ERA over 5.

Are the Rays en route to a Tiger-like downfall? Unlikely -- the Rays have good young players and a better overall pitching staff than the kitties. Consider that the Rays' fourth starter this year (Andy Sonnanstine) will be the #5 in '09 because David Price will surpass him. But their weaknesses (bullpen gaps, hitters' soft spots) have been exposed in the last six games dating back to game 6 of the ALCS. And the Rays play in a division even tougher than the AL Central.

Don't underestimate the Yanks or RedSawx. The latter (to The Monk's chagrin) is one of the three or four best-run franchises, has a great farm system and good young talent. The Yanks have a solid farm system with some top talent, and ridiculous financial resources. Remember, the Sawx won 95 despite a subpar Beckett who missed 20% of his starts, a collapse by Buchholz, Big Papi's various injuries, and have three top-of-the-rotation quality pitchers who are under 30 (Matsuzaka, Beckett, Lester).

The 89 wins the Yanks compiled was surpassed only by the Sawx, Rays, Phils, Cubs and Angels. If that's unimpressive, consider that the Yanks lacked Posada for 2/3 of the year (and he was hobbled when he did play), Matsui for about 1/2 the year, played with a CF who had a sub-.650 OPS, lost their top starter Chien-Ming Wang (19 wins in both '06 and '07) in mid-June, had Darrell Rasner, Sidney Ponson and Carl Pavano start 42 games, and were still in the thick of the playoff chase until Joba Chamberlain went down in early August. And they'll be deep in the Sabathia sweepstakes that could start as soon as tomorrow (first day for free agency filing is the day after the WS ends).

Oh yeah, the BluJs won 86 this year despite losing McGowan for just under 1/2 the season, have a perennial Cy Young contender (Halliday) and two very good pitchers who are 27 and 23 (Marcum, Litsch). That's a good starting four even after they lose Burnett after his career year.

So don't write the Rays in as the new dynasty in the AL East. But that division should be a war zone for years to come.

Wanted: guards for henhouse, must be a fox

The WSJ discusses the top officials at the US Department of Justice in charge of monitoring voting rights issues. In an election season where the biggest stories are about ACORN's registration of fraudulent voters in an effort to obtain more votes for Obama, Obama's own support of ACORN, and the Obama campaign's intentional efforts to enable illegal campaign contributions through online donations (start here and scroll down for more), the WSJ points out that the Justice Department officials with decisionmaking authority to determine what the DOJ will investigate regarding voter fraud allegations all have one thing in common.

They contributed to Obama.

And this is the effect:

The lawyers at the Civil Rights Division are already falling into line. Justice recently decided to reverse a policy in place since 2002 to send criminal attorneys and other federal employees to monitor polling places. The decision came two weeks after a September meeting to which the Civil Rights Division invited dozens of left-wing activist groups to discuss voter "access" to the polls.

Justice has also failed to enter the fray in Ohio. As many as 200,000 new voter registrations in that state are suspect, yet Democratic Secretary of State Jennifer Brunner is refusing to follow the 2002 Help America Vote Act that requires her to verify these registrations. The Ohio Republican Party sued Mrs. Brunner, but the Supreme Court said the GOP lacked standing. Justice does have standing -- it is charged with upholding that law -- but has ignored the fight. The Justice excuse is that it isn't appropriate to file litigation so close to Election Day.

Yet that hasn't stopped the Civil Rights Division this month from filing a lawsuit against Waller County, Texas, to correct alleged violations of the Voting Rights Act; a lawsuit against Vermont for failing to report accurately on overseas ballots; and an amicus brief in a case filed by a civil-rights group that is suing to stop the Georgia Secretary of State from complying with voter verification rules. Justice's election suits always seem to side with liberal priorities.

At what point does the United States begin to prosecute voter fraud and implement measures designed to protect legitimate votes that are at least on par with a third-world country like Iraq? Purple-dyeing voters at their first exercise of the franchise means they cannot vote twice.

The World Series and a sadness

The worst thing about this World Series is not its ratings or the relatively uninteresting matchup (after all, the GOOD thing about this WS is that the Red Sawx are not in it and the Dodgers bonked in the NLCS so we don't have to hear more paeans to Joe Torre). For The Monk, the worst thing is that, as the Phillies get closer to their second ever World Series victory, The Monk is continually reminded of his friend The Chef.

Jeff was a huge Phillies fan. No one ever explained that well (he grew up in No. Virginia, which was Orioles territory). But it's a fact. And he would have loved the 2008 baseball postseason, at least to date. If the Phillies do the expected and win tonight with another fine pitching performance by NLCS (and potential WS) MVP Cole Hamels, Jeff's friends will feel his absence even more. Of course, as Monkette said early in our relationship, when she missed me she knew it was a positive feeling because that reminded her of what we had together.

Go Phils.

Wednesday, October 22, 2008

Proto-communist to the Fore

Long serving liberal Democrat Barney Frank (D-Ma.), chairman of the House Financial Services Committee, is feeling his oats, calling for a freeze on Wall Street bonuses according to a Bloomberg report.

"There should be a moratorium on bonuses,'' Frank, a Massachusetts Democrat, told reporters yesterday in Washington. "They have a negative incentive effect because they are the ones that say if you take a risk and it pays off you get a big bonus,'' and if it causes losses "you don't lose anything.''

This is a good idea if:
1. you want to encourage a massive brain hemorrhage of talent from US banks to less regulated, possibly foreign entities
2. you think that folks work 80-120 hour weeks regularly on Wall Street do it for the base salary
3. you want to rupture the economy of the New York Metropolitan area which generate a lot of revenue from Wall Street bonuses
4. you want to thoroughly nationalize the banking system

By the way, Barney, if you take a risk and it DOESN'T pay off, you generally LOSE YOUR JOB.

Not a prospect, clearly, that the beloved Representative considers remotely likely.

Tuesday, October 21, 2008

Our new socialist overlords . . .

The coming Obama disaster, if it indeed comes, will have many facets. Ultimately, an Obama presidency will be the second term of Jimmy Carter -- windfall profit taxes on oil companies, redistributionist tax policies, weak foreign policy, abandonment of US allies, heavily reduced support for Israel. And this is just the beginning. These opening sentences serve one purpose: during the 2012 presidential campaign, borrowing the line from the great Robert Conquest, I will say to the Republicans who have come out as essentially anti-McCain due to their patrician anti-Palin views (Chris Buckley, Peggy Noonan, David Brooks), their complete inversion of what the Republican party stands for (Colin Powell), and/or self-delusion as to what Obama is really about (Ken Adelman, Doug Kmiec) that "I told you so, you f**king fools!"

But the warning signs are everywhere. And all in one place today: the WSJ's editorial pages.

First, read Bill McGurn's dissection of the Obama tax plans, which are summed up neatly by Andrew Biggs of the American Enterprise Institute: "It's interesting that Mr. Obama calls his plan 'Making Work Pay' because the incentives are just the opposite. By expanding benefits for people whose benefits exceed their taxes, you're increasing their disincentive for work. And you're doing the same at the top of the income scale, where you are raising their taxes so you can distribute the revenue to others."

Then, read how the diminishment of American power worldwide during an Obama administration would be disastrous.

And ultimately, Obamanomics would devastate the economy, twice over.

There is no tenet of Obamanomics that is not part of the British economic policies of 1970-79, before Lady Thatcher became Prime Minister. And the socialist disaster of 1970s Britain is one that the US will end up embracing if the American public votes for Obama, a Senate with 60+ Democrat Senators and a larger majority for Nancy Pelosi in the House.

Not good.

Monday, October 20, 2008

The Long National Nightmare is OVER

Thanks to Matt Garza and the Rays, we will NOT have another season-long set of ruminations about the possibility of a RedSax dynasty.

Kudos to Garza and David Price, who pitched with a two-run lead and held it as opposed to the hacks in the Rays' bullpen who coughed up a 7-0 lead needing only 7 outs to win the pennant last Thursday. Garza's pitching was the single biggest reason that the Rays did not capitulate to what would have been a choke job that rivaled the Yanks' bonk in 2004.

And the Rays deserved it -- they outscored the Sawx 43-28 (including 29-5 through the first 24 innings at the Ratway), banged 16 homers (the Sawx had 10 for a total of 26 for the series, yipes) and should have had this thing done last Thursday.

I'm thinking the Mets and Twins are feeling really stupid right now. The Mets traded their top prospect Scott Kazmir to the Rays for Victor Zambrano in 2004 -- a trade that was stupid when made, not just in retrospect. Kazmir is a top lefty (only 26) who has a career ERA+ of 124 (better than Glavine, Sabathia, Beckett, Peavy and better than Drysdale, Marichal and Spahn), 780+ Ks in just over 720 career IP and a winning percentage of .560 for a team that, until this year, was awful. The Twins traded Garza for problem child Delmon Young. Put those pitchers with their previous teams, and both the Mess and Twins would have been in the postseason.

A couple of notes about the broadcast on TBS. No, not the glitch issue from Saturday, this is about the broadcast team. Chip Caray took a LOT of heat last year for being bombastic, talking nonsense off the cuff, and getting his facts completely wrong. He improved this year in all three, although he's still a preening peacock in his delivery. Give him credit where due -- he reads the ball well off the bat and worked better with his broadcast partners this year. That first is important -- Caray's grandad is famous for long drives that the third baseman caught on the infield, and how many "deep" flyballs called by Michael Kay in Yankee telecasts are caught 25+ feet in front of the warning track (Paul O'Neill has previously needled Kay about this)?

Those broadcast partners are a hit and a miss. Ron Darling may have a Yale degree, but he's not capable of putting what he knows into a broadcast. He also comes up with too many irrelevant facts and comments. Buck Martinez is far better. The long-time broadcaster and former manager is better at detailing the strategy of the game and rightly noted that Joe Maddon's thought process in the 8th inning, with a tired Matt Garza on the mound and a bullpen that stank on Thursday, was "is the guy I want to bring in better than the guy I have pitching right now"? As for the studio show -- for next year TBS should ditch Eckersley, light a fire under Ripken's butt, and borrow Chris Singleton from ESPN.

Congrats to the Rays for whupping the RedSax, choking, and rebounding. And for showing the Yanks the blueprint for the future -- young, energetic players who work hard (hear that Robby Cano?).

Sunday, October 19, 2008

Red Sox beat Phillies 4 games to 1 in World Series

This is a prediction as Boston has come back to tie the ALCS at 3-3 after being down 7-0 in the 7th inning and down 3 games to 1 in game 5. They will beat Tampa tonight as their surging confidence will lead them to the AL championship. Plus they are pitching Dice-K their ace.

Like 2004 when it started against the Yankees prevailing after being down 3-0 and last year prevailing after being down 3-1 vs. the Indians- Bawstin BELIEVES.

Red Sox Nation is celebtrating while Yankee fans like us are wondering whether they've made a deal with the Devil and also where has that confidence and sense of inevitability gone after we couldn't hold the 2-1 lead in 9th in game 7th against the D-Backs.

*of course I hope I'm wrong and the Rays crush these roaches...(Boston are like roaches, aren't they...)

Friday, October 17, 2008

How the Democrats will impoverish us all

An oldie but oh-so-appropriate while proving the pure idiocy of 'redistributing' wealth as espoused by the 'liberal-progressives':

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this: The first four men (the poorest) would pay nothing. The fifth would pay$1.
The sixth would pay $3. The seventh would pay$7.
The eighth would pay $12. The ninth would pay$18.
The tenth man (the richest) would pay $59. So, that's what they decided to do. The ten men drank in the bar every day and seemed quite happy with the arrangement, until on day, the owner threw them a curve. "Since you are all such good customers," he said, "I'm going to reduce the cost of your daily beer by$20." Drinks for the ten now cost just $80. The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. But what about the other six men - the paying custom! ers? How could they divide the$20 windfall so that everyone would get his 'fair share?'

They realized that $20 divided by six is$3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer. So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay. And so:

The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of$3 (33% savings).
The seventh now pay $5 instead of$7 (28% savings).
The eighth now paid $9 instead of$12 (25% savings).
The ninth now paid $14 instead of$18 (22% savings).
The tenth now paid $49 instead of$59 (16% savings).

Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare thei! r savings. "I only got a dollar out of the $20," dec! lared th e sixth man. He pointed to the tenth man," but he got$10!" "Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, too. It's unfair that he got ten times more than I!"

"That's true!!" shouted the seventh man. "Why should he get $10 back when I got only two? The wealthy get all the breaks!" "Wait a minute," yelled the first four men in unison. "We didn't get anything at all. The system exploits the poor!" The nine men surrounded the tenth man and beat him up... The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill! And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier. David R. Kamerschen, Ph.D. Professor of Economics University of Georgia I would also add that it could be quite likely that the tenth man actually may employ some of the other men. The goal of taxation should NEVER to be to redistribute wealth. Taxation should pay for critical services, to provide for the common defense and those who require help to get on their feet [limited entitlement] and to repay those who have paid into the system [Social Security and Medicare]. And if you want to make a meaningful tax cut that spurs spending and job creation you have to cut it from the well-to-do and the wealthy because the first through the seventh men don't pay enough in taxes for cuts to be have any effect!! A colleague has characterized the Obama taxation plans very well. It may modestly help the middle class but by soaking the well-to-do but not significantly affecting the truly wealthy. Here's why. Warren Buffett pays less taxes than his secretary because he is so wealthy that he's set up to get his income as dividends rather than orginary income. The wealthy - let's say$2 million per annum and above can afford to invest in tax structures that significantly benefit. But those who do well, say from $250,000 to$1,000,000 in income, may not be able to afford the high priced tax help.

Also let's look at this subset of people. Who are they? They are likely to be financial professionals, physicians, attorneys and consultants. They work hard, spending time away from their families to provide for a comfortable lifestyle. They work for their money and at the end of the day with marginal tax rates (federal, state and city) that can exceed 40% actually support an extremely heavy tax burden. And we haven't counted other taxes like property levies sales tax which would make their real tax level exceed 50%

Wednesday, October 15, 2008

Krugman Nobel a political decision?

Economist Paul Krugman won the Nobel Prize the other day.

Krugman is much better known as the vitriolic anti-Bush New York Times columnist than for his work in economics. I am unqualified to really judge whether he deserves this Nobel - I would note that he won the John Bates Clark medal for best economist under 40 earlier in his career.

It is worth noting that the Nobel committee certainly has grown quite progressive, a list of 'politicized' winners of the Peace prize:

2007- IPCC and Al Gore
2002- James Carter Jr. [ugh]
2001- Kofi Annan
1993- Yasser Arafat

The most appropriate comment regarding Krugman's secondary career as a pundit (also applies to Frank Rich) is from the 1965 Nobel Physics Prize winner (HT: Tigerhawk)

"I believe that a scientist looking at nonscientific problems is just as dumb as the next guy."
--Richard P. Feynman *42

Wednesday, October 08, 2008

McCain - Obama II

Missed it but a comment from a colleague who was an undecided maverick. Reagan Democrat who voted for Kerry in the last election.

"I thought McCain kicked his butt."

WAS undecided but now likely McCain as found Obama and the Democratic leadership extremely disingenuous about the subprime collapse.

Thursday, October 02, 2008

Palin - Biden

Missed opening statement

Key points:

Palin: "Darn right it was the predatory lender." Populist ugh. But popular.
Biden: McCain championed deregulation...Joey Danko can't fill up his tank. Effective +1
Biden: Good riposte on Palin's charge that Obama voted to raise taxes on families making $42,000; McCain voted to raise taxes 477 times. Not sure if true but direct. +1 Palin: Avoiding the moderator's questions - questionable strategy?? -1 Biden: the rich aren't listening to this broadcast? Palin: Decent riposte on$250k only - affects small business
Palin: tax credit doesn't cost anything? budget neutral. Biden doesn't pounce
Biden: got a laugh but long, verbose response to McCain health plan

[Biden has nice smile - grin, even. Palin looks great]

Palin: Barack voted for in 05 the big tax break for Exxon Mobil and I TOLD IT BACK IN ALASKA +2
Biden: Oil companies have made 600 billion since 2001. DOESN'T SOUND RIGHT AT ALL!?!?! [Palin doesn't attack - probably doesn't have the data]
Palin: nice push on energy independence but definitely does not answer as directly as Biden
Palin: Alaska sees climate change anyone else. Not sure what the causes are but I don't want to argue about it. I want to fix it. First governor to appoint climate change subcommittee. +1
Biden: We know the causes. [really] China is building 3 new dirty coal mines a week. We should export technology to fix that. Yeah, sure.
Palin: you've opposed all drilling - "raping the Continental shelf" - nice. +1
Biden: Constitution supports homosexual rights? Doesn't enumerate that.
Palin: Marriage is between one man and one woman! +1
Biden: Obama-Biden doesn't support gay marriage - I couldn't quite make out the mumble!!!! Wow. The gays gonna hate this??? -1

[Palin seems to be getting more comfortable.]

Palin: I admire you Senator Biden for calling Obama out on not funding troops +1
Biden: We are spending 10 billion a month and Iraq have an 80 billion surplus +1
Palin: White flag of surrender...you said "you'd be honored to run on McCain's ticket. +1
Biden: John McCain voted the same way. +1

Good question - nuclear Iran or unstable Pakistan - which is more dangerous?

Biden: both very dangerous- Mac says Iraq is the central front on terror. But attack with come from al-Qaeda in Afghanistan and Pakistan. Build schools to win their hearts and minds.
Palin: Both Petraeus and head of al-Qaeda say central front is Iraq - I'll listen to them. +1
Biden: Mac wouldn't sit down with the government of Spain! This sounds like out of context. Palin doesn't answer though
Palin: Strong support of Israel. Israel can create peace. Jordan, Egypt
[I don't believe that Biden/Obama supported putting NATO troops into Lebanon to oppose Hezbollah- maybe I'm wrong but sounds like an odd claim]
Biden: "I haven't heard..." 4x +1
Palin: Obama's reckless comment - nice - but needed to pound it home
Biden: "Our commanding general in Afghanistan said surge principles will not work" - but then "we need more troops" sounds pretty similar
Palin: Good riposte on Biden's claim in Afghanistan

Palin is much more comfortable in her element while Biden clearly very glib after 35 years in the Senate

Palin: values of Main Street Wasilla should be in Washington
Palin: need better standards in education, No Child Left Behind needs more flexibility
Palin: nice moment of levity on Vice President
Biden: Cheney the most dangerous Vice President in history. Overall pretty good though that first comment is too overarching +1
Biden: Nice emotional moment about his family after wife died - almost a little overwrought +1
Palin: We've both taken on our own party.
Biden: Nice rhetoric on "Mac not a maverick" when it counts +1
Biden: Ideology is important on judges. Hates Bork. Not very effective!
Palin: Have had to 'cave' on some budgets to progress. Haven't compromised my principles. Better than Biden's
Biden: Nice comment on Jesse and Dot Helms +1
Palin: I've appointed Democrats and Republicans

Palin closing comment: Gracious. Great finish with Reagan! Freedom is only one generation from extinction +1
Biden closing comment: Reasoned.

Gwen Ifill did fine.

I tried to rate the debate very unscientifically and the ratings just came out even. Thought Biden started out better significantly, Palin picked it up in the middle. Biden finished strong the last comment goes to Palin with invoking Reagan. Overall I'd have to say Biden sounded more experienced and knew issues better which is not a surprise.

Think Palin held against match point but the undecided will break a bit for Biden. Still a battle ahead.

Tuesday, September 30, 2008

Ketiva ve-chatima tovah 5769

Speak unto the children of Israel, saying, In the seventh month, in the first day of the month, shall ye have a sabbath, a memorial of blowing of trumpets, an holy convocation.

Leviticus 23: 24-25

To our friends, may you and yours be inscribed in the Book of Life.

Monday, September 29, 2008

It's NOT a bailout, STUPID.

What neither the Congress, Paulson or Bernanke have made clear is that this 'bailout' plan is NOT going to cost $700 billion. Not even close. First of all they should have called it a bailout plan because a) its not that accurate and b) it sounds terrible on Main Street What this plan is envisioned to do is to create a market for distressed debt that is severely weighing on bank balance sheets. How severe is this? Wachovia was talking about BUYING investment banking giant Morgan Stanley a week and a half ago. Today THEY had to be BOUGHT OUT by Citigroup. Banks aren't lending to each other and no one wants to lend to banks for fear of the other party failing. The central bank windows have become the only lenders. The Paulson plan will take many of these assets off the books of the banks so they can start anew. Here's a hypothetical example: Let's say a$10 billion slice of these problem loans is trading at 30 cents on the dollar. This assumes that 70% of the loans will default. A 70% default rate it on virtually any package would be extremely unlikely. So the Treasury will bid 40 cents on the dollar for this debt. If an institution has already marked the loan down to 30 cents they are likely to sell as it gets it off their books at a mark-to-market profit. Now they will have lost 60 cents on the investment but its better than all of it. Treasury can hold this until maturity or eventually sell these assets out. If other buyers want to come in ahead of the Treasury and bid higher that would be fine.

Ultimately it is quite possible for Treasury to be selling purchased assets at a profit. It's important to remember that panic market pricing does not necessarily represent value and for any but the most absolutely toxic group of loans to default 70% is very unlikely. [The absolutely toxic stuff should be bid at 5 cents on the dollar]. The long term cost of this is unknown at this point but the taxpayer could end up being flat on this. Even a 100 billion dollar loss which prevents a deep recession is well worthwhile.

Friday, September 26, 2008

Excellent video on the subprime crisis

Here is a remarkably good explanation of the origins of the subprime crisis.

It does miss the seminal role of the ratings agencies whose malfeasance is well Jack Grubman-like.

McCain-Obama I

I'd say overall the debate was a draw. It seems unlikely that this debate changed anyone's minds. The Obama camp will be happy that he held his own in the 'national security' debate. McCain held his own despite Obama's edge in eloquence and glibness.

Two things that McCain needs to do.
1. Hammer home the point that whether you supported or did not support the war initially should not affect how you prosecute it now
2. We cut taxes to spur the economy and to meaningfully cut taxes you have to cut where it matters and that's not the bottom 50%

Obama claims he "warned about the subprime problem two years ago" - somehow I doubt it.
McCain - nice touch on the Eisenhower story.
McCain - "You afraid I can't hear it" - nice parry
Mac - "We Republicans came to change Washington and it changed us."
Mac - Obama has asked for $932 million in earmarks - a fundamental difference. Obama - Mac has called for$300 BILLION in tax cuts for the rich. Tries to hang Bush-McCain
Mac - The problem is that "it [earmarks] corrupts people"
Mac - The 'business tax' is 35% in US, 2nd highest in the world. Ireland has 11%.
Obama - Loopholes reduce business tax

Mac - Energy bill had loads of breaks for big oil, Obama voted for it, I voted against it.
Mac - it's hard to reach across the aisle from that far to the left
Mac - get rid of ethanol subsidies, get rid of 'cost-plus' military spending; i know how to get cost overruns under control; e.g., 6.6 billion Boeing and Pentagon

...(unavoidable family interruption)

Even between Obama's hit on getting in the war in Iraq and Mac's hit on his mistake on the surge.
Obama - What is this with PAHK-IS-TAN?? Like NIHKA-RAHGUA...
Obama - good hit on McCain's 'extinction' comment for N. Korea. [Difference is Pakistan, is at least nominally, an ally.]
Mac - create a League of Democracies since Russia causing issues in United Nations
Mac - don't sit down with dictator who advocate a second Holocaust legitimizes them
Mac - catches Obama on initial reax to Russian invasion of Georgia after Obama tacks hard right
Obama - I warned the administration in April about Georgia. REALLY? that's seems to be hard to believe
Obama - China's conspicuous presence in the world is only matched by our absence because we've taken our eye off the ball

Thursday, September 25, 2008

Bush Makes the Case

President Bush did in tonight's prime-time address to the nation what Henry Paulson and Ben Bernanke have not been able to do as effectively this week in front of Congress.

Bush spoke in clear, simple language and described very well the genesis and development of the mortgage problem and the solution proposed to solve it. This is rendered so simply and directly that even nearly all of Congress could understand it:

Second, as markets have lost confidence in mortgage-backed securities, their prices have dropped sharply. Yet the value of many of these assets will likely be higher than their current price, because the vast majority of Americans will ultimately pay off their mortgages. The government is the one institution with the patience and resources to buy these assets at their current low prices and hold them until markets return to normal. And when that happens, money will flow back to the Treasury as these assets are sold. And we expect that much, if not all, of the tax dollars we invest will be paid back.

Henry Paulson as brilliant as he certainly is [if there are three certain things in life, it's death, taxes and you don't get to be chairman and CEO of Goldman Sachs by being a dummy] speaks Wall Street and 'market mechanisms' and 'reverse auctions' which frankly are gobbledygook to most of America. Hopefully enough of America paid attention tonight.

Let me give a dollars and cents example.

John Thain at Merrill Lynch recently sold off some risky loans at 22 cents on the dollar. This means if Merrill paid one billion dollars for this basket of loans it only got 220 million dollars back. A lot of this toxic stuff is still sitting in the financial system, in the investment banks as well as pension funds and insurance companies. THE MARKET'S UNCERTAINTY ABOUT HOW MUCH A FIRM HAS AND HOW MUCH IT HAS BEEN MARKED DOWN has directly caused the failure of Lehman Brothers and nearly the failure of Freddie and Fannie and AIG.

What Paulson proposes to do is have Congress approve a fund up to 700 billion dollars that creates a market for these securities that haven't existed for the better part of a year.

22 cents on the dollar simply speaking assumes that only 78 percent of these mortgages would default. Since many of these loans particularly those made in 2006 and 2007 were made to marginal customers it is probable that there will be significant defaults. BUT NOT 78%. If the US Treasury examined a bucket such as this and shows the market a 45 cent bid for these securities it would be likely that many institutions will sell to the Treasury as many could actually book a profit if they had already marked these securities lower. A profit only in the sense that they had written down 78 cents of loss but would gain back 23 cents of that loss by selling to the Treasury. Even if this bucket of loans was particularly toxic even a default rate of 40% would mean a 15 cent profit for the Treasury and the taxpayer.

What it also does is allow the banks to clean house and with the books clean can start to lend again. Just as important with the uncertainty removed firms won't be subject to panic liquidation which claimed Lehman Brothers and threatened AIG as well as the venerable investment bank Morgan Stanley.

Wednesday, September 24, 2008

Country First

McCain knows what this means and Obama, not surprisingly, does not.

McCain announced he was suspending his campaign and looking to postpone Friday's debate in Mississippi so he can return to Washington to work on the Paulson plan. McCain has always been a maverick often to the GOP's chagrin and his decision though a surprise is certainly not out character.

A flummoxed Obama has weakly countered that the debate should go ahead...

Developing...

Polls to reprint on toilet paper and use accordingly

In previous years, The Monk would have gone into conniptions after seeing the ABC/WaPo poll that had Obama up 9 points nationwide. But I've smartened up over the course of the last two presidential elections and decided to drill down into the poll results a bit.

The first problem with the poll is simple: nationwide voting is irrelevant. If Obama wins New York, California, Massachusetts and Illinois by 80-20 and loses every other state, he could actually win a majority of votes but he'd get drubbed in the election. The Electoral College matters, the national majority winner is irrelevant.

Then I noticed this anomaly: Obama holding a 53-40 lead in the "Midwest." That seemed like rank bs. Every poll in Minnesota, Wisconsin, Michigan, Ohio and Indiana has been close in recent days, even after McCain's poor week last week. Unless the Midwest consisted solely of Northern Illinois and Milwaukee, the result was out of line.

Sure enough, the poll is riotously unreliable. Don't take my word for it, check out these facts:

(1) the sample, including persons who "leaned" toward one party or another, was 54% Dem, 38% Republican.

(2) the largest spread in party identification in a presidential election since 1988 has been FOUR points -- the 1996 election when Clinton had a high approval rating. Even in 2006, when the Democrats ripped the Republicans in the Congressional elections, party ID was 38% Dem, 35% Rep., 27% independent/other.

More analysis from Kristen Soltis, a Republican pollster who notes the trends:

During presidential years, over the last five presidential elections, the biggest party ID gap was four points, and the greatest swing was four points as well.

Arguments can certainly be made that in this environment, Democrats should be expected to have a huge partisan shift in their favor. But note that in 2006, when Democrats clearly found enormous success at the ballot box, that the advantage in party ID was only three points (38-35). Polls leading up to the election showed party ID gaps as big as eleven points (Newsweek's poll on Oct 5-6, 2006), rarely showing party ID gaps of less than +5 for the Democrats.

* * *

[Reacting to a CBS poll in August:] . . . a twelve point spread [in party affiliation]? Whether this is a blip or what consistently turns up in the numbers, I have incredible difficulty believing that a margin of that magnitude is an accurate reflection of the electorate. A six-point lead is within the realm of possibility given a really great year for Democrats. But a twelve-point spread is simply outside the bounds of history, given that in twenty years of political change and history, the greatest margin has been four.

Smarmy Schumer

Watching my senior Senator Chuck Schumer hold hearings on the Paulson plan:

He is extraordinarily self-serving and smarmy and has no qualms about using this opportunity to score political points.

700 billion dollars is a lot of money. But giving the SecTreas 150 billion and asking him to come back for more if he needs it is like sending a soldier out into battle with one clip in his M16 and asking him to come back for more if he needs it.

The Paulson plan is predicated on two items.

1. Taking deeply marked down mortgage assets off the books of banks probably at some premium to current marks or market. It will mean getting out of these investments at a reasonable price and possibly at a mark-to-market profit.

2. The confidence that now there is a buyer of last resort.

Schumer's idea blows 2. out of the water.

STUPID. STUPID. STUPID.

Tuesday, September 23, 2008

Survival Football

Survival football has become a popular game over the past few years, particularly in the financial markets. Though there can be a slight variation in the rules the premise is simple: Put down a stake and pick an NFL team to win every Sunday. They must win. Losses and TIES lose. One loss and you lose your stake. If are the last person standing you win the stake (or share it). the largest pools have thousands of entries with payoffs in hundred of thousands of dollars.

The kicker, of course, is you can only pick each NFL team ONCE during the course of the season.

The key to this game isn't to map out who to pick each week in advance. Trying to figure out who to pick for week 13 is a LOSING PLAY.

The key in this game is to SURVIVE AND GET TO NEXT WEEK.

This is in effect what the Treasury and Federal Reserve have been doing over the past year and specifically over the past two weeks.

1. The conservatorship of Freddie Mac and Fannie Mae became necessary as a looming downgrade from rating agencies put the two primary buyers of US mortgages into capital difficulty. If Freddie and Fannie stopped buying mortgages the entire housing market would have effectively come to a screeching halt. Freddie and Fannie shares were trading under a dollar.

2. Lehman Brothers, unable to secure additional capital and in a disastrous miscalculation on the announcement of third quarter earnings and steps to be taken, does not get help and is forced to declare bankruptcy. This stuns the market as Treasury and the Fed do not step in to backstop Lehman debt and essentially allows Lehman to fail most likely judging that the financial system could survive Lehman going down. The market did not expect this as most thought the Bear Stearns bailout would have served as a model. This decision in retrospect was probably a mistake given subsequent events.

3. The US government takes up to 79.9% of the huge American insurer AIG in exchange for an emergency $85 billion bridge loan priced at a near usurious Libor + 800 bps rate for a two year period. AIG shares were under tremendous pressure as a downgrade looked imminent. A downgrade would have meant that AIG would have to ante up billions in additional collateral and potential trigger debt covenants. Treasury and the Fed judged in this case, unlike Lehman, that AIG could not be allowed to fall or declare bankruptcy as possibly tens of millions of drivers and homeowners could find themselves without insurance. 4. Treasury Secretary Paulson and Fed chair Bernanke announce a$700 billion plan to buy distressed mortgage and real estate assets. The plan gets at the core of the problem by buying loans that are weighing on banks' balance sheets. It would provide a buyer of last resort for distressed securities and stabilize the market by getting these assets off bank balance sheets and should also remove questions about assets that brought down Lehman Brothers.

5. SEC bans naked short selling for financial stocks. Philosophically anathema but provides a window of relief for harried financial shares. Effective, crude and philosophically vile but there are no atheists in foxholes and no libertarians in distressed markets.

One hopes here that we are now getting into the late innings of this game and a large enough fund would give the market confidence that a real backstop is in place and cut off speculation and panic that have gripped the financial system.

George Will wonders:

It is arguable that, because of his inexperience, Obama is not ready for the presidency. It is arguable that McCain, because of his boiling moralism and bottomless reservoir of certitudes, is not suited to the presidency. Unreadiness can be corrected, although perhaps at great cost, by experience. Can a dismaying temperament be fixed?

That sounds erudite and pithy, but if it's the best argument against McCain and for Obama, it's no argument at all. After six years of on-the-job experience, Clinton still completely failed to inquire about and realize the determination and capabilities of Islamist terrorism, took no steps to stop it and failed to both capture bin Laden when the US could have and retaliate effectively against his organization. Certain great costs are too high to pay for unreadiness. Obama's dithering personality and Carteresque internationalist approach to foreign policy means he gets the big issues wrong.

McCain called for overhauling Fannie Mae and Freddie Mac in 2005 and railed against military lollygagging in Iraq before the President insisted upon the Surge. He gets the big things right, even if his temperament or style are a bit terse.

Will's best reasons against McCain do not make an argument for Obama.

Two retired numbers from now . . .

The next retired number for the Yankees will be 42 for Mariano Rivera. Although the number is retired throughout baseball for Jackie Robinson, it will be retired for pinstripes too because the greatest closer in baseball wore it.

After that will be the number 2 for Yankee captain Derek Jeter. His greatness is frequently derided or overlooked by number crunchers and sabremetricians, but he is much more than just The Toss or The Dive. Just ask Peter Gammons.

And Jeter embodied the class of the Yankees organization Sunday night when he gathered the Yankees at the pitchers' mound and addressed the crowd on the PA system.

It's a huge honor to put this uniform on every day and play. And every member of this organization past and present has been calling this place home for 85 years . . . We are the New York Yankees and that means pride and tradition, but most of all we have the greatest fans in the world. On behalf of the entire organization, we want to take this moment to salute you, the greatest fans in the world.

Class, pride, dignity, excellence, Jeter, Yankees.

Monday, September 22, 2008

Whither Rocket?

Watching the celebration prior to the final game at Yankee Stadium yesterday I thought it was churlish to have omitted any reference to Roger Clemens who went 83-37 in 5.5 seasons, won the Cy Young in 2001 and was a mainstay of this last Yankees dynasty. It was a long period of service comparatively but he brought a level of professionalism and intensity that should have been recognized. Boomer was there and so was Jimmy Key.

Also Joe Torre should have a more prominent mention no matter how things went last winter.

It's harbinger that the Boss has probably faded completely into the twilight and his sons don't share the same passion and sentiment that he had for the team.

Friday, September 19, 2008

A fair point re: McCain

There are substantial questions regarding a report by Amir Taheri that Sen. Obama "had urged Iraqi leaders to postpone making an agreement with the United States until there was a new administration in Washington." Taheri stands by the report and the reporting. Obama's campaign denied the report earlier this week, although the denial left a lot of wiggle room in interpretations.

ABC's Jake Tapper, who is one of the fairest reporters in the media, wonders why McCain's campaign did not ask Republicans who attended the meeting that included Obama and various Iraqi leaders what happened.

This is a fair point because the Bush Administration and the self-important Chuck Hagel both indicate that Obama's version of events is correct. So Tapper faults the McCain campaign for blasting Obama based on the Taheri report. This is proper . . . to an extent. The McCain statement, which Tapper quoted in his blog entry, is also proper because it is correctly qualified:

If news reports are accurate, this is an egregious act of political interference by a presidential candidate seeking political advantage overseas. Senator Obama needs to reveal what he said to Iraq's Foreign Minister during their closed door meeting. The charge that he sought to delay the withdrawal of Americans from Iraq raises serious questions about Senator Obama's judgment and it demands an explanation.

Tapper's evaluation of the McCain campaign reaction is, ultimately, unfair:

What actually demands an explanation is why the McCain campaign was so willing to give credence to such a questionable story with such tremendous international implications without first talking to Republicans present at Obama’s meeting

Is Obama just a humorless, lying bully?

Peter Robinson says Barack Obama has displayed no sense of humor. That's basically true -- his pleasant mien has essentially masked the fact that everything Obama says is serious and the man himself is a bit aloof. Compare that with the always sunny Ronald Reagan, the drinkin' buddy aspect of Clinton and the good ole boy currently in the White House.

But Obama is more than just serious. First, he's a bully. His campaign uses its own digital brownshirts to stifle dissent: "Obama's presidential campaign is increasingly using the list [of top supporters] to beat back media messages it does not like, calling on supporters to flood radio and television stations when those opposed to him run anti-Obama ads or appear on talk shows." Compare that with McCain's bemused and nonchalant reaction to the Code Pink protesters who slipped into the Republican convention.

Second, he's a serial fabricator, and will do so both on his own and through his surrogates. And fairly blatantly as Byron York shows.

And he's a inveterate race-baiter who will distort parodies into position papers to make his opponents look like racists.

This is a presidential candidate?

Is Peggy Noonan out of touch?

Or has the hot old chick of the Republican party begun to lose her mind? In the whole arc of her column today on the election campaign she flits from thought to thought while missing one thing: Congress.

Simply stated, the US supposedly has one. While wondering if "the presidential election doesn't matter as much as we think" because "[w]hoever wins will govern within more of less the same limits, both domestically and internationally [we'll save that debate for another time -- TKM]" Noonan does not mention the parameters of those limits. And the notion is absurd on its face -- just ask the CIA directors under Carter and Clinton about the importance of presidential leadership.

Right now, Congress is the least important branch of government. Both Congress and the president have left questions of constitutional law to the Supreme Court, thereby abandoning their own role to evaluate the legality of legislative enactments.

The executive is in charge of foreign policy under the Constitution. But it is now by far the leading branch on domestic policy because Congress has: (1) abdicated its role to set a coherent domestic agenda; (2) failed to enact reasonable legislation; (3) overrided the president's veto to pass high spending bills; (4) and admitted its uselessness (Senate Majority Leader Harry Reid on the market crisis: "no one knows what to do"). It's the executive, through Treasury Secretary Henry Paulson, that has taken the lead on shoring up the financial markets while Reid, Pelosi and Obama (D-Fannie Mae) decry capitalism and Joe Biden (D-MBNA) says it's patriotic to pay higher taxes.

The Monk works hard in the hardest-working country in the Western world. None of us deserve this Congress. It's a question of leadership -- and to say that the presidential election winner won't have a great effect on that is just foolish.

Monday, September 15, 2008

A thought so stupid . . .

. . . only an academic would generate it.

The stupid notion is from Catherine McNicol Stock and the concept is this: Sarah Palin is from the great northwest, the great northwest has few African-Americans, "the beliefs of ultraconservative, evangelical churches like her family's come dangerously close to those of the Christian Identity movement of those years," there are radical white supremacist groups in Montana and Idaho (Stock mentions none in Alaska) and Palin has no on the record remarks wherein she kowtows to the gods of diversity and racial grievance. Therefore, "it is high time to review the cultural ideals and models of the radical rurals from the Great White Northwest and find out for sure where Gov. Palin stands."

Now liberal idiocy is fully revealed. So let's look at some other facts that Stock elides.

First, Stock admits "there is no evidence that Palin was ever affiliated with white-supremacist groups during her years in Idaho or at home in Alaska."

Second, there is no evidence that Palin's church has ever promoted, tolerated, espoused or otherwise condoned white supremacist beliefs. It would be hard for Palin, whose children are all Eskimo in significant part thanks to their dad, to stomach such a church. Evidently, it is less difficult for Barack Obama, who is half-white, to enjoy a 20-year association and participation in a black supremacist hate-whitey church whose pastor thought 9-11-01 was an indication of the US's chickens coming home to roost.

Third, Stock does not mention the deep KKK history of Indiana and Illinois -- Obama's neighboring state and home state. Why not? Obama could be the first black white supremacist not shown on the Dave Chappelle show, right? Of course not, the notion is stupid and offensive. So is Stock's musing that just because she's white, Christian and from the Pacific Northwest that Palin could well be an undercover member of Aryan Nation.

It's preposterous that the Philly Inquirer -- that city's equivalent of the NYT or WaPo -- not only published the article, but it paid the professor to air her idiocy.

Wow.

Whoa

Tina Fey has the Sarah Palin impersonation market cornered. Check out the video from Saturday Night Live's Palin-HRC skit from this past Saturday's season premiere. Fey's intonation and accent is dead-on.

One man with courage . . .

If there's a better argument for McCain over Obama than their positions on The Surge -- the Gen. Petraeus-led increase in force and counterinsurgency techniques in Iraq implemented in late 2006 -- it would be hard to find. And despite his anti-Bush analysis, Bob Woodward's new book, The War Within, is demonstrating that not only does the President matter, he can determine the direction of the country for decades to come.

Think about it: Lincoln replaced McClelland with Grant, and Grant won the Civil War. LBJ and his Cabinet were cowed by Westmoreland and his terrible strategies in Vietnam, and the US effectively lost the war before Nixon became President and actually had an effective military strategy. And 20 years from now, just as we can regret Reagan's withdrawal of the Marines from Lebanon and curse Carter's vacillation during the Iran hostage crisis, we will point to George W. Bush's determination as the main factor in winning in Iraq.

Unlike nearly every Senator (McCain is a rare exception), the Secretaries of State and Defense (Rice and Rumsfeld), the Joint Chiefs of Staff, the Iraq Study Group led by James Baker III and Lee Hamilton, and much of the military's top brass, President Bush held firm and decided that the United States had to WIN the war in Iraq instead of claiming victory in the midst of a retreat. He was "out of touch" and his own top generals and admirals worked against implementing their commander-in-chief's orders to increase counterinsurgency tactics. (For more about the turf wars and NSA Steve Hadley's role in winning them for the President, see here).

Bush did the unpopular and correct thing. His decision and Petraeus' leadership have restored the reputation of the American military. And Andrew Jackson's maxim that "one man with courage makes a majority" was proven correct.

Friday, September 12, 2008

Ready, aim, fire . . . OW, my foot!

Amateur hour at the Obama campaign hit a new low. Let's show how this played out.

At 5:15 EDT this afternoon, Jonah Goldberg of National Review discussed the new Obama campaign ad, which claims McCain is out of touch because he is computer illiterate. Goldberg wondered:

Does anyone know why McCain doesn't use a computer or email? As a couple readers suggested to me, it might be because his injuries prevent it. I mean he can't lift his arms much higher than his chest and it looks like he has all sorts of other mobility problems with them. Maybe he can't type or use something like a blackberry. I don't know. But I hope the Obama campaign found out before they played the granpa Simpson card on McCain. I'd hate for Obama to be mocking a veteran's disability to score cheap points.

Well, it turns out that is EXACTLY what Obama did. As the Boston Globe profile of McCain during the Republican Primary season of 2000 noted:

McCain's severe war injuries prevent him from combing his hair, typing on a keyboard, or tying his shoes. Friends marvel at McCain's encyclopedic knowledge of sports. He's an avid fan - Ted Williams is his hero - but he can't raise his arm above his shoulder to throw a baseball.

Less than 90 minutes after wondering why McCain is not big on computer usage, Goldberg posted the paragraph containing the snipet of the BoGlo article I referenced above and said:

In a similar vein I guess it's an outrage that the blind governor of New York David Patterson doesn't know how to drive a car. After all, transportation issues are pretty important. How dare he serve as governor while being ignorant of what it's like to navigate New York's highways.

Mark Steyn had a sharp last word on this:

Jonah, why didn't the Obama guys and the AP figure that out? It's extraordinary that someone who wants to be our president and our commander in chief knows how to send an e-mail ...but not how to do a five-minute Google search.

The Obama camp has become a disgrace.

Obama's Palin problem in a nutshell

James Taranto, after analyzing Charles Gibson's reliance on an inaccurate AP report of what Gov. Palin said at her church regarding the US forces in Iraq, also notes that the use of the inaccurate AP report by Gibson, CNN and the AP have effectively been "disparaging her for praying." Read the whole analysis for how Gibson tried to make Palin appear as if she had called the troops' mission a mission from G*d (which she denied -- she was quoting Abraham Lincoln who said, "let us not pray that G*d is on our side in a war or any other time, but let us pray that we are on G*d's side.").

Taranto's key point sums up Obama's biggest problem in the wake of the Palin nomination, and it's not only of Obama's own creation:

It really does seem as though the media and the Angry Left loathe Sarah Palin precisely because she is normal. Through the words of his supporters, Barack Obama has become the candidate of those who oppose religion and motherhood. With friends like these, who needs Karl Rove?

Thursday, September 11, 2008

7 years after

Click the link -- it's Mark Steyn's column on September 11, 2002. And here's the crux:

Here is my worry: At one end of the national spectrum are the anti-American elite, the Edward Saids and John Lahrs secure in their redoubts. At the other end are the great full-throated "These colors don't run" patriots. But in between is a big wobbly blurry mass trembling on the brink of making this just another wallow in victimization-the "dominant discourse" (as Said would say) of the day. Five years ago, Bob Dole wondered, "Where's the outrage?" Three years ago, Bill Bennett wrote a book called The Death of Outrage. In Europe, the ferociously anti-American Left is plenty outraged — it is raw, visceral, passionate, and none the worse for that. If we can't get outraged-not sad, not weepy, not candle-in-the-windy, but outraged — over thousands of people killed for no other reason than that they went to work, then we're really in trouble. If cultural passivity — love the world, be non-judgmental, everybody does it — co-opts even this awesome event, then the sleeping giant isn't sleeping so much as comatose.

Tuesday, September 09, 2008

Joe Biden's breath smells like his feet

Sen. Biden is a dope and unfortunately thinks he's brilliant. This attitude was best summed up in a political cartoon in 1987 during the confirmation hearings of Robert Bork -- the cartoonist drew something akin to this exchange:

Biden: Judge Bork, 2+2 = 4

Bork: Yes, Senator Biden, but $f(a)+\frac{f'(a)}{1!}(x-a)+\frac{f''(a)}{2!}(x-a)^2+\frac{f^{(3)}(a)}{3!}(x-a)^3+\cdots\,,$.

which showed the relative intellects of the two (and the equation reads better here.

Today, the Senator from the MBNA state said this:

I hear all this talk about how the Republicans are going to work in dealing with parents who have both the joy, because there's joy to it as well, the joy and the difficulty of raising a child who has a developmental disability, who were born with a birth defect. Well guess what folks? If you care about it, why don't you support stem cell research?

That bout of insensitivity, combined with the liberal's blind passion for embryonic stem cell research (non-embryonic stem cell research is supported by Republicans) is typical of Biden. Yuval Levin, who follows this subject closely, noted:

. . . while stem cell work, including embryonic stem cell research, can help in the study of human development in general, as a matter of basic science, the notion that it offers a path to the treatment of Down syndrome or other developmental disabilities is just not sound. The basic science (which at its edges could have some impact on the study of developmental disabilities) can be and has been pursued under the Bush administration’s stem cell policy, and even the most adamant advocates of the policies Biden has supported have not listed a cure for Down syndrome among the miracles they promise. Biden’s remark is indicative of the lack of seriousness with which some Democratic politicians treat the relevant science here: they don’t themselves think this is one avenue of cell biology that could offer important help in one range of potential biomedical advances but rather they see it as a kind of magic bullet and universal cure-all that allows them to be for curing all that ails the human race and accusing their opponents of being against it all, meanwhile paying no heed to ethical concerns.

And of course Biden's press secretary said this falsehood: We've heard not a dime's worth of difference between the McCain-Palin ticket and the Bush Administration on medical breakthroughs [through stem-cell research].

Don't tell anyone the truth. What is the truth? It's not what Biden's lackey said: Levin notes that McCain "voted to overturn the president’s stem cell policy, just like Joe Biden did" and ultimately, "the example Palin sets in how she and her family have welcomed her Down syndrome child points in precisely the opposite direction from Biden’s call for the destruction of human embryos for research: it . . . treats every human life as deserving of protection and regard."

Monday, September 08, 2008

740,000,000--0

Barack Obama went after Sarah Palin's acceptance (initial) and rejection of the Bridge to Nowhere earmark in a stump speech on Saturday. Obama's point is she was for it before she was against it.

This is a good soundbite, and the Republicans beat John Kerry over the head with it on a crucial issue (his support for deposing Saddam Hussein), not on a tangential issue like an earmark over which Palin essentially had no say (Congress voted whether or not to fund the earmarks, a governor's input was irrelevant).

And Gov. Palin ultimately made the right decision, unlike Kerry (who flip-flopped the wrong way) and unlike Obama (who still claims he was right to oppose the surge in Iraq because "no one" could have anticipated its rousing success . . . except John McCain). As J.M. Keynes said "When the facts change, I change my mind. What do you do, sir?"

In other words, Gov. Palin has the capacity to smarten up, but Obama retains his level of stupid.

And Obama's level of stupid is unstinting. After all, he is doing two things wrong: (1) attacking a VP candidate after his own campaign chief said the campaign would not worry about Gov. Palin; (2) making an outrageously ridiculous comparison.

Why is the comparison so bad? Because through early March, Obama had requested $740,000,000 in earmarked spending requests such as "$1 million for a hospital where Mr. Obama’s wife works, money for several projects linked to campaign donors and support for more than 200 towns, civic institutions and universities in Illinois."

That's 740M since 2005 when Obama's Senate career began.

Since 1987, the start of McCain's Senate career, he has requested $0 in earmarks.$740,000,000 for projects "linked to campaign donors" and local Illinois junk.
\$0 for pet projects in Arizona.

Obama's starting a fight he cannot win on this issue. There's 740M of potential corruption on Obama's side of the ledger, a clean slate on McCain, and people compare the PRESIDENTIAL candidates, not the Dems' President to the Repubs' VP.

What a WIMP

Obama is a parody of the left-wing Democratic wimp Presidential candidate. He's starting to make Carter and Mondale look tough. Here's a note from Time on Obama's most recent Sunday morning talkathon performance:

This Week [with George Stephanopoulos]: Obama refused to say if Palin is qualified for VP, saying he’s not interested in “a résumé contest.” Defended his community organizer years, calling attacks on the job “puzzling.” Said he once considered joining the military in Hawaii, and said he would cross his party on charter schools and teacher merit pay, military spending, and health care tort reform. Conceded he was “probably” too flip with Rick Warren when he said defining the beginning of life was above his pay grade.

He's not interested in a resume contest? That means he knows he'll lose.

As for his considering joining the military, there's a lot here that went unsaid: Obama claims he considered joining the military when he graduated high school in 1979 and that he signed up for Selective Service (i.e., possible future draft) that same year. This is not so -- Selective Service registration was halted in 1975 and reinstated in 1980 (The Monk signed up in 1988). Obama would have had to sign up in 1980 (the requirement was retroactive), but by then he was a collegian and had more than a year to ponder any decision to join the military.

Does this matter? Only in the landing-in-Bosnia-during-a-firefight manner of exaggerating reality and one's own ego.

Just one week in the NFL

Jumping to a conclusion after week one in the NFL, The Monk asks this question: is the balance of power shifting from the AFC to the NFC? Until the Giants beat the Pats in Super Bowl XLII, the AFC had won 8 of the previous 10 (following an NFC win streak of 13) and four in a row.

Coming into this season, the AFC again supposedly had three of the four strongest teams in football: Pats, Chargers, Colts (Cowlumps from the NFC round out the foursome). But this weekend, excepting the Bills rout of the S'hawks, the most impressive teams have been from the "weaker" conference:

(1) Carolina goes TO San Diego and drops the Bolts on a final-play touchdown;
(2) Dallas makes the Browns (10-6 in '07, tiebreakered out of the playoffs) look like a Pop Warner team and does so IN Cleveland;
(3) The Iggles dump the allegedly improved Rams 38-3;
(4) The Giants stifle the 'Skins (9-7, playoff team in '07), even without the Pro Bowl DEs they lost in the offseason and preseason;
(5) Da Bearz go TO Indianapolis and on the opening night of a new football stadium drub the Colts 29-13.

With Brady's injury, the Pats are no longer one of the top five teams in the NFL. They already had secondary questions and age issues on both defense and the O-line. Now they have a quarterback question. The Colts looked old and slow last night. The Chargers again seem to be missing something. And seemingly everyone's favorite dark horses, the Jags and Browns, were terrible.

We'll see in the coming months whether the balance of power has shifted again. Right now, the best teams in the NFL (unordered) are the Cowpatties, Steelers, and Iggles, and the Giants, Panthers, Vikes, and Pack don't suck.

Sounds like balancing in the works . . .