Monday, March 31, 2008
The AL is simply loaded. The RedSux have four to five quality starters even without Schilling, although for some reason the RedSax-leaning baseball press doesn't think it should question the ability of Lester and Buchholz to produce for a full season to the extent that it questions the ability of Hughes-Kennedy-Joba to do the job. And the RedStiffs have a healthy Ortiz . . . who was a monster last year despite a bum leg, and will have Ellsbury helping jumpstart the offense for the whole year.
The Yankees are getting misunderestimated. If the Tigers have pitching questions but a great offense, why does the baseball press seem to pick them over the Yanks even though the Yanks have three top young pitchers, a solid veteran, and the man who has more wins in the past two seasons than any pitcher in baseball, combined with a top tier closer, strengthened bullpen (Hawkins, Joba, and a revived Farnsworth after Torre's departure), reigning AL MVP and a potential 1000-run offense of their own? Explain that. If you think Dontrelle Willis is the pitching answer for Detroit, when that team has no Zumaya and potentially no Fernando Rodney holding down the late innings for the iffy Todd Jones, you're nuts.
The second/third best team is the Indians. They were second-best in the postseason when they reversed their failures against the Yanks, but third-best in the regular season. Either way, that's worth a playoff berth. The Indians' questionable 'pen will remain a weakness, especially if Raffy-righty pitches like he did against the Bosax (a convicted steroider, he must've been off the juice during the ALCS). But with Travis Hafner likely to improve after last year's semi-bonk, Cleveland is a potential 950-run offense too. The Indians are the boutique pick for the World Series this year but I don't love their rotation -- they have a top two and three mediocrities. They also have Joe Borowski as their closer again. Then again, with the Twins taking a drop, the Chisax and the Royals in their division, the Indians only have to beat the Tigers.
Then there are the Tigers, Angels and Ems. All together in a clump. Take the kitties' offense with the Ems' pitching and you get the best team in the AL. The Angels lost Escobar, but have Lackey, Weaver and Garland -- as good a top three as anyone in the league. And the Ems have added Erik Bedard, who may be the missing piece to get them past the Angels.
Some of the also rans are decent: the BluJs could win the NL Central by five games; the (D)Rays have tons of raw talent, especially with the bat; the Twins are young and have some solid players too despite losing Santana; and who knows what the A's can do -- if Harden is healthy (big, huge if), that team could have a solid top three (Harden, Blanton, Gaudin) that costs less than $3.1M/season combined.
So why worry too much about the NL? The Cubs will celebrate their 100th anniversary of championship-free baseball, cementing their status as the biggest sack of manure franchise in the history of American team sports; the bandbox ballpark teams will regress such that the Rox and Phils will not make the playoffs; the Mess will benefit from a decent 1-2 with Santana and Maine, plus 3-4 other guys whose shoulders are held together with tape and toothpicks; the DBacks will improve the most without improving their record much, if at all, thanks to the addition of Danny Haren (they were -20 in run differential but won 90 games so the runs for/against should improve); the Braves will improve their record and challenge for a playoff spot with a quatrogenerian-based rotation. And ultimately the NL champ will fall again to the AL champ in the World Series . . .
. . . Except Santana's presence means the Mess could actually win a game, unlike three of the past four NL pennant winners.
You want picks?
AL = Bahstin, Indians and Ems with Yanks (WC).
NL = Mess, Cubs (NL Central = other than the Pirates, who knows who'll win?), Dodgers, Snakes (WC).
My only guarantee -- these picks will suck less than at least 60% of the "experts".
The Monk correctly predicted 75% of the Final Four. Dickie V and Fran Fraschilla didn't. Bobby Knight predicted Pitt would win the whole thing . . . The Monk told you Pitt is a perennial NCAA underachiever.
For the record, that's at least three times in the past four years that I've picked at least three of the Final Four (I can't remember if I got two or three right in '04 -- I know I had UConn and Duke, and I think I had Ok. State but can't swear to it . . . unfortunately I also had Kentucky [second-round bonk] that year). Last year I correctly picked the entire Final Four.
The Monk is currently playing a happy tune whilst tooting his own Monk-horn.
And for your further edification: the stupidest thing said during the NCAAs, courtesy of SI's Seth Davis who has a penchant for uttering idiocies:
After noting Kevin Love's performance in UCLA's whupping of Xavier: "No one left in the Tournament has anyone who can match up with him."
Seriously, that's what he said.
Kevin Love is the center for UCLA. Tyler Hansbrough (22.8 ppg, 10.3 rpg) is the consensus player of the year and lit the Louisville front line for 28 and 13. He plays for UNC, which is in the Final Four.
Hansbrough is the UNC center.
Seth Davis needs to reinstate his thought-reflect-speak process before saying anything else reprehensibly stupid during the Final Four.
Wednesday, March 26, 2008
But the Yankees' schedule this season is preposterous for reasons that vary from last season's insanity. This year, instead of 8 games in 12 days in August against Detroit, the Yanks play the Tigers six times in the first 45 days of the season . . . and that's it. This is what passes for wisdom in MLB: the Yanks, Redsux, Indians and Tigers are likely to be fighting all year for three playoff spots (and do look out for the Mariners with Bedard and Hernandez), are four of the six best teams in baseball (Angels, Mess) and of the 26 games between Yanks/Sawx v. Tigers/Indians, only four (Cleveland at Baaastin) will be played after May 11. (Yanks play Detroit 6 times, Cleveland 7; Bahstin's split is the opposite).
And it is ABSOLUTELY APPALLING that the Yankees do not close out the season in Yankee Stadium in the final year of the House that Ruth Built. Instead of having the Yanks and RedSux close the Stadium in style on the final weekend of the season, the Yanks will be on the road in the Bastin rat den while the Mess will close out Shea Stadium in its final year of slowly sinking into the muck in Flushing, on the final weekend.
What a smack in the face to the greatest franchise in American sports history.
Thank God for Barack Obama. Until his “More Perfect Union” speech last Tuesday, it seems it never occurred to anyone that America needed to talk about race.
“Maybe this’ll be the beginning of a conversation,” Wall Street Journal columnist Peggy Noonan proclaimed on Meet the Press. The Chicago Tribune reported that “many voters, black and white, say they were moved by Obama’s speech ... which they see as a long-awaited invitation to begin an honest, calm national dialogue about race.” Newspaper editorial boards agree. In the words of the San Diego Union-Tribune: “Prodding Americans to confront their racial differences is, by itself, an accomplishment of historical proportions.”
As Goldberg noted, the issue of race has come up before:
Oh, thank goodness Obama fired the starter’s pistol in the race to discuss race. Here I’d been under the impression that every major university in the country already had boatloads of courses dedicated to race in America. I’d even read somewhere that professors had incorporated racial themes into classes on everything from Shakespeare to the mating habits of snail darters. I also had some vague memory that these universities recruited black students and other racial minorities, on the grounds that interracial conversations on campus are as important as talking about math, science, and literature. A ghost of an image in my mind’s eye seemed to reveal African-American studies centers, banners for Black History Month, and copies of books like Race Matters and The Future of the Race lining shelves at college bookstores.
Were all the corporate diversity consultants and racial sensitivity seminars mere apparitions in a dream? Also disappearing down the memory hole, apparently, were the debates that followed Hurricane Katrina, Trent Lott’s remarks about Strom Thurmond, the Supreme Court confirmation hearings for Clarence Thomas, the publication of The Bell Curve, and O.J. Simpson’s murder trial. Not to mention the ongoing national chatter about affirmative action, racial disparities in prison sentences and racial profiling by law enforcement.
Yep, Barack Obama says something and people become stupider.
The answers to both, by a 6-3 margin on the Court, were NO. Medellin could not obtain a new trial because of the Texas police's failure to notify the Mexican consulate (as Andy McCarthy noted, under the Vienna Convention on Consular Relations, police in the United States have no obligation to contact the Mexican consulate due to the nature of the obligations assumed by the US and Mexico under the Convention -- remember, international treaties are generally binding on nations to the extent that they choose to be bound). The consular notification was not an individual right granted by the treaty; instead, the treaty created diplomatic rights between the participating nations, which could be made individual rights by legislative action.
The ICJ also had no authority to bind the various states because its jurisdiction is only over the nations that bring a dispute before it and agree to be bound by its decision. Thus, Pres. Bush sought to force compliance with the ICJ's decision through an executive order. The Supreme Court (with all nine members in agreement on this point) said that the President could not do so because the Executive's powers to make treaties did not allow it to impose legal duties upon the states to comply with those treaties -- only Congress and the President could do so through lawmaking processes.
The WSJ touts the ruling as a victory for the US Constitution because:
Chief Justice John Roberts, writing for the 6-3 majority, ruled that the ICJ finding was not binding because the Vienna Convention is an understanding between governments, a diplomatic compact. It was never intended to automatically create new individual rights enforceable domestically by international bodies. Texas's violation was of diplomatic protocols, and calls for a diplomatic remedy.
Treaty obligations, in other words, do not necessarily take on the force of law domestically. Rather, Congress must enact legislation for whatever provisions -- such as consular notification -- that it wants to make the formal law of the land. This distinction matters because it establishes a fire wall between international and domestic law. It also protects the core American Constitutional principles of federalism and the separation of powers. As Justice Roberts points out, the courts must leave to the political branches "the primary role in deciding when and how international agreements will be enforced."Bush's first Supreme Court pick has enhanced the President's legacy.
Tuesday, March 25, 2008
CARACAS, March 25 (Reuters) - Venezuelan President Hugo Chavez, a socialist and fierce U.S. critic, warned on Tuesday that relations with Washington could worsen if Republican candidate John McCain wins this year's presidential election. Chavez said he hopes the United States and Venezuela can work better together when his ideological foe, U.S. President George W. Bush, leaves the White House next year, but he said McCain seemed "warlike." "Sometimes one says, 'worse than Bush is impossible,' but we don't know," Chavez told foreign correspondents. "McCain also seems to be a man of war."
Hopefully an endorsement of Obama will come in due course.
Monday, March 24, 2008
The endorsement is notable, but not for the default obvious reason that Kmiec is a conservative endorsing a liberal. Nor is it notable because Kmiec was an official in two Republican administrations. And the mere fact that a Republican (possibly) is crossing party lines is not necessarily notable either -- there will be plenty of "Democrats" crossing over for McCain come election time.
Instead, the endorsement is notable because Kmiec's reasoning is vapid. One reason:
I do have confidence that the Senator will cast his net widely in search of men and women of diverse, open-minded views and of superior intellectual qualities to assist him in the wide range of responsibilities that he must superintend.
Really? What imbues Kmiec with that confidence -- the far-left liberals Obama listens to when making his political and policy decisions or the radical church leaders who have endorsed him?
Kmiec notes that:
As a Republican, I strongly wish to preserve traditional marriage not as a suspicion or denigration of my homosexual friends, but as recognition of the significance of the procreative family as a building block of society. As a Republican, and as a Catholic, I believe life begins at conception, and it is important for every life to be given sustenance and encouragement. As a Republican, I strongly believe that the Supreme Court of the United States must be fully dedicated to the rule of law, and to the employ of a consistent method of interpretation that keeps the Court within its limited judicial role. As a Republican, I believe problems are best resolved closest to their source and that we should never arrogate to a higher level of government that which can be more effectively and efficiently resolved below. As a Republican, and the constitutional lawyer, I believe religious freedom does not mean religious separation or mindless exclusion from the public square.
In various ways, Senator Barack Obama and I may disagree on aspects of these important fundamentals, but I am convinced based upon his public pronouncements and his personal writing that on each of these questions he is not closed to understanding opposing points of view, and as best as it is humanly possible, he will respect and accommodate them.
That statement is ludicrous. In the next 4-8 years, some of the septu- and octogenarians on the Supreme Court will retire or (based on actuarial probability) die. The eldest is Justice Stevens, a Republican appointee who turned left-wing on the Court. These actuarial probabilities present a Republican president opportunities to appoint justices who will be like Chief Justice Roberts and Justice Alito -- conservative, nondoctrinaire practitioners of judicial restraint. Since the Bork hearings 20 years ago, the Supreme Court has been the biggest political prize of the presidency precisely because the president can appoint people who will long outlast his tenure to implement the president's own judicial philosophy.
Why would a Republican consider a liberal Democrat an ally or even a non-enemy in such a scenario? Why would Kmiec consider Obama liable to "accommodate" his views on judicial restraint when Obama voted no on both Roberts and Alito -- two unquestionably highly qualified jurists? Kmiec's reasoning and conclusions are preposterous. So Kmiec is dissatisfied with the current President, he offers no reason that the likely Republican nominee cannot succeed where the current President has failed.
Ultimately the audacity of hope has manifested in Kmiec's writing as the rhodomontade and drivel of the intellectual.
This is currently a "go figure" tournament. Seriously, I said G'Town lacked offense . . . and then the Hoyas go out, fire in 63+% of their FG attempts and LOSE to a 10 seed they out shot by 25 percentage points. ESPN noted last night that the Georgetown shooting accuracy was the second-best mark by a loser since the Tournament expanded to 64+ teams . . . but the top shooting loser ever, So. Illinois, lost in a 7-10 game by 96-92 to a team that shot well (Syracuse); the Salukis didn't blow a 17-point lead to a team eight seeds below them in a game where they outshot their opponents by three orders of magnitude.
More insanity: the #3 seeds are 8-0 and all in the Sweet 16; the #2 seeds are 6-2 and two are out.
And now some trenchant observations from the weekend: (1) UNC obviously had the best weekend of any team -- it whomped an overmatched #16, then crushed a senior-led Arkansas team that had drilled #8 seed Indiana, the lowest seeded 25-win major conference team ever; (2) I told you Michigan State is a Tourney overachiever -- and it had a perfect foil in perennial underachiever Pitt in round 2 -- the Mich St./Memphis game should be interesting because Izzo is a good coach who will throw bodies and fouls at a Memphis team that cannot shoot FTs; (3) Kansas plays good defense -- that's an improvement the J'Hawks have made during the Bill Self years; (4) other than UNC, the ACC sucks -- two mid-level Big East teams dropped the second- and third-best ACC teams out of the Tourney -- I'm thinking expansion has diluted the talent distribution in the conference; (5) of the other #1s, UCLA still has a crappy offense -- I thought that had been rectified a bit by getting an interior scorer in Kevin Love; Memphis is loaded with talent, but its FT shooting will kill it in a close game; (6) Wisconsin is pretty good, which only proves that the 22-point loss to Duke was an early-season outlier result and the win over Texas in Austin may have been a more accurate measure of the team; (7) the two worst performances of the Tournament by teams that were not just cannon-fodder are easily Notre Dame's 61-41 loss to Wazzou and Vandy's 21-point beating from 13-seed Siena -- there's no excuse for ND to lose by 20 points in such a low scoring game and no small conference team should be able to drill a major conference opponent 83-62 in the NCAA Tournament.
Some quick television observations: (a) when did "unbelievable" become a substitute for fantastic, tremendous, extraordinary, superb, and outstanding? Everyone from coaches to commentators misuse this adjective. If something is unbelievable, it cannot be believed. That doesn't mean it is good. Say what you mean -- Stephon Curry had a fantastic second half against Georgetown (25 points) to follow up his excellent performance against Gonzaga (40 points); not Stephon Curry played an unbelievable second half against Georgetown to follow his unbelievable performance against the Zags.
(b) Why so much love for Bob Huggins? He's an irascible curmudgeon who got canned from Cincinnati because his drunk driving violations gave the administration an excuse to fire him who does not improve his players to help them in the NBA and who does not graduate his players. His players' academic record is atrocious -- Cincy was the poster child for NCAA efforts to tie graduation progress to scholarships. And yet "Huggy" gets treated as a revered member of the coaching fraternity.
(c) Jim Spanarkel had it wrong yesterday -- Miss. State failed to lengthen the game against Memphis when, with 2:30 left, it didn't play hack-a-star with the horrible FT-shooting Tigers. From that point on, the game should have been hack city. Only when MSU tried the hackathon in the final minute and Memphis bonked did the Bulldogs whittle a 68-59 deficit to the 77-74 final.
Saturday, March 22, 2008
Friday, March 21, 2008
Rowan Scarborough examines CAIR, its critics, its tactics and its founders in the article linked to this post.
Thursday, March 20, 2008
The East bracket is the toughest, but it's also the Carolina invitational. UNC tends to reach the Final Four after winning the ACC Tournament (11 of 16 so far and UNC won this year), and UNC tends to reach the Final Four when playing in its home state in the regionals (see 1997). The committee did the Tar Heels no other favors: Louisville is solid; Tennessee is the top #2 seed (which should not have been placed in the same bracket as the top overall seed); Indiana is a tough potential second round opponent. UNC should win. If the regional final were in any other state, I might pick Louisville.
Possible upset specials: (7) Butler over (2) Tennessee (round two), (13) Winthrop over (4) Wash. State, (12) GMU over (5) Notre Dame.
You heard it here first: (11) St. Joe's over (6) Oklahoma.
Sweet 16 teams: UNC, GMU, Louisville, Tennessee; UNC over Louisville for the regional title.
The Midwest is much more difficult to pick because it is riotously difficult to pick KU, and probably foolish not to do so. Bill Self has coached four teams to the regional finals, and those teams are 0-4 with a trip to the Final Four on the line. But the #2 seed is a bit weak -- Georgetown simply lacks offense and in basketball, defense alone never wins championships (see Princeton). The #3 seems strong -- Wisconsin and its 29-4 record. But the Badgers played in the Big T(elev)en and that conference is horrid. Wisco's record against top nonconference opponents is mixed -- a buttwhipping from Duke, a loss to middling Marquette, and a win at Texas. Without my doubts about Self, this would be an easy pick.
Possible Upset Specials: (10) Davidson over Gonzaga, (13) Siena over (4) Vandy.
You heard it here first: USC to reach the Sweet 16.
Sweet 16 participants: Kansas, Clemson, USC, G'Town. KU over G'Town for the Final Four.
No, I haven't gone out on a limb yet and I won't for the West either. After all, Phoenix is just a drive down I-10 from Los Angeles, home of UCLA, the two-time defending West Regional champ. The tournament committee did UCLA and Duke a big favor -- this is the weakest of the four regions, and Duke's half of the bracket is a joke. Coach K is 10-1 in regional finals . . . he should be 10-2 after this year.
Possible Upset Specials: (11) Baylor over (6) Purdue; (10) Arizona over (2) Duke.
You heard it here first: This region is most likely to follow seedings but I'd say Xavier goes out in round two.
Sweet 16 participants: UCLA, UConn, Duke, Baylor/Purdue winner. Seriously. And another trip to the Final Four for UCLA . . . this time without Florida in its way.
Finally, the South region is a curiosity. Texas is good enough to win, Memphis has more talent than some NBA teams, and the other two top seeds (Pitt and Stanford) are perennial underachievers. Location is key here -- Houston is the site of the regional final and it's closer to Austin than to Memphis.
Possible Upset Specials: (3) Stanford can lose at any time; (5) Michigan State is a Tournament overachiever and could even spoil Memphis's run.
You heard it here first: Miami-St. Mary's will be the best game of the tournament. Or the least watched.
Sweet 16 participants: Texas, Memphis, Michigan State, Marquette, with Texas beating Memphis for the Final Four.
UNC has a difficult task: winning the toughest region then having to beat both KU and UCLA in the Final Four to win a national title. It won't. The pick here is UCLA over Carolina.
We'll see if I'm right.
Sunday, March 16, 2008
It has been an eventful weekend for the financial markets.
The Fed emergency lending to Bear Stearns via JP Morgan Chase on Friday was an unpleasant surprise. (JPMorgan became the intermediary as Bear was a non-depository institution and therefore not technically allowed to access the discount window.)
On Sunday evening it was announced that JPMorganChase would acquire Bear Stearns for $2 a share in stock. That's a heartwrenching 93% discount to the $30 that Bear had closed on Friday which was already down 47% from Friday's open.
For all intents and purposes JPMChase is buying Bear for free. I should say taking on their assets and liabilities for the pittance of $236 million. This means that whatever liquidity crunch or what have you that Bear came up against is much more toxic than even Friday's events suggested.
AT THE SAME TIME THE FED ANNOUNCED THAT IT WAS CUTTING THE DISCOUNT RATE BY 25 BP. Gold rallied sharply on the news to 1030 from about 1000 at close of business Friday. The dollar sank another cent vs. the euro and stock markets are getting smoked. The fact that the Fed felt it had to act a mere 48 hours before the FOMC meeting suggests deep concern.
It is a real possibility that the FOMC could cut the Fed Funds rate a full point on Tuesday down to 2%. This expectation would drive the weakening dollar even lower and concomitantly cause dollar priced commodities like crude and gold to surge.
I noted in this space in December that I thought the dollar would fall as low as 1.60-65 at its nadir this year and gold would see a high of 1200. The dollar may sink as low as 1.60 to the euro THIS WEEK and even for someone whose experience argues that markets need to find their level by themselves this is starting to go too far too fast AND WITHOUT ANY INDICATION THAT THE FALL IS NEAR ITS BOTTOM.
A major problem for the US and for global markets is the skyrocketing price of crude oil. AT $110 a barrel it is driving headline inflation everywhere and will make it harder for the Fed to cut much further (not that it has that much further to go) but is also preventing the hawkish ECB from even considering cuts. The high price of energy also hurts in that it causes basic staples to rise in price and indirectly encourages bad energy decisions (like the ethanol idiocy in the US which drives up the price of corn and beef and...). According to folks in the energy sector there has been very little fundamental demand for crude at these prices or at anywhere above $90. In other words, the furious rally of past two weeks has been nearly completely driven by speculators.
I view the unrelenting strength of crude oil as one of the primary forces weakening the dollar. And at the moment there seems to be no upside limit in sight. This past week crude inventories rose sharply which should have caused a selloff in crude oil as the opposite had caused a $10 spike the week before. At the end of the day crude ended HIGHER than before the data was released. This suggests heavy, heavy demand or potential manipulation.
In sum my concern for the financial markets and for the health of the United States economy and the dollar derives from the fact that at the moment buying commodities, particularly crude, and selling the dollar is a free ride. And free rides are bad- they eventually end but before they do they often a prodigious amount of damage. Look at the bulk of how pegged currency regimes ended in the past 11 years starting with the Thai baht in 1997.
In my debate with Monk I've argued that while a stronger dollar would benefit virtually everyone, practically there's not that much that can done unilaterally with the market so heavily biased. Fed intervention to stem the dollar's decline without the commitment of our trading partners would simply line the pockets of speculators.
However in recent weeks I have come to feel strongly that, for the health of the Republic, something needs to be done now.
Nothing short of serious fundamental changes will correct the secular decline of the dollar. A fundamental change, for example, would be the US economy finding a bottom and starting to bounce, a significant slowdown in China and/or Europe leading to potential rate cuts OR a steep correction in commodity prices. Since affecting anything fundamental will take time what needs to be done immediately is to put serious doubt in the minds of speculators who are significantly driving certain markets.
A quick history lesson: a generation ago the Hunt Brothers tried to corner the silver market and by buying 200 million ounces they drove silver from $2 to $50. Upon ignoring demands that they stop the Comex with the approval of regulators squeezed them out. The COMEX did this by increasing sharply margins required to hold positions. The Hunts went bankrupt and silver quickly fell back to single digits for a generation.
Today it takes approximately $7700 of initial margin to control 1 lot of WTI which has a value of $110,000. (This is a correction of a mathematical error, originally it said $1,100,000) Allowing speculators nearly 15 times leverage is too much.
TRIPLING the initial and maintenance margins would CRUSH speculation immediately as the impact of requiring 200% more immediately would force speculators or the exchange to liquidate positions. The CME and IPE on which world crude is primarily traded are now for-profit organizations who would be extremely loath to do anything that might cut trading volume but the cooperation of US and UK authorities to even THREATEN this through regulatory changes along with initiating demands that identities of those behind large bloc trades be made public would likely trigger a fire sale in crude. Ideally this would be coordinated with a statement by the US that it will sell 20% of the Strategic Petroleum Reserve which would amount to something in excess of 100 million barrels. This left-right would see crude shed 25-30% of its value in A WEEK. It would quite literally disembowel speculators and hedge funds would fall like leaves in late autumn after a early, bitter frost.
Combine this with coordinated central bank intervention supporting the dollar and the ECB indicating a willingness to cut rates by perhaps evening offering a token cut and we would go a long, long way to putting uncertainty back into one-way markets and likely buy time for the US economy to recover and change some of the fundamental factors driving the secular decline of the dollar.
As a free-marketer and a conservative this type of meddling in the markets would generally be anathema. However the furious and economically unjustified rally in crude coupled with a collapsing dollar that is driving inflation and making stagflation even a remote possibility is doing material damage to the Republic. Measures need to be taken.
The leader in this enterprise has to be Secretary of the Treasury Henry Paulson. Robert Rubin built a legend of mythic proportions on the back of coordinating the bailout of Long Term Capital Management in 1998. While that was a sudden, serious shock to the system it was a case of the sniffles compared to the raging infection that ails the economy today. We needed a money guy at Treasury for times like this. Mr. Paulson, it's time to step up to the plate.
The last major protests in Tibet took place in 1989, when China's current President Hu Jintao was in charge of the region. He ordered a harsh crackdown that established him as a rising star in the Chinese leadership hierachy, but is believed to have resulted in hundreds of deaths.
Maybe it will be enough to deal Beijing a big black eye for the Summer Olympics.
Wednesday, March 12, 2008
Spitzer's short tenure (January 1, 2007-March 12, 2008) is notable for three things: (1) his illegal attempt (for which his aides took the blame) to manufacture FALSE ethics charges against state Senate Majority Leader Joseph Bruno merely because Bruno is a political rival; (2) his moronic scheme to grant drivers' licenses to illegal aliens, which he withdrew under incredible political pressure; and (3) his status as Client 9 in a federal probe of an international high-price hooker ring.
The facts just get worse every day. Even CNN's story (linked in title) about Spitzer's resignation, which is as pro-Spitzer as possible considering this disgraceful man, noted that federal prosecutors have evidence that Spitzer spent more than $15,000 for hookers.
Married man, three kids, public servant, public sector salary, and $15K for whores. Other reports indicate he'd been whoring for nearly 10 years and dropping upwards of $80,000 on the habit.
Sad conditions for New York to celebrate its first-ever black governor, David Patterson. From a personality standpoint, Patterson is the anti-Spitzer -- collegial, approachable, personable, mellow and seemingly collaborative. Perhaps he's the tonic that New York needs.
My views on the dollar decline are clearly stated here, here and here.
To restate briefly the causes of the dollar decline are:
1. Variance in the economic cycle
2. Balance of trade
3. Overall market position (long dollars as a result of 2. and holding massive amounts of US assets)
4. The subprime crisis
6. Anti-Bush, anti-Americanism
If you look at items 1-6 it is clear that Bush economic policies cannot reasonably be blamed for weakness in the dollar. The administration cannot manage the economic cycle especially for China and the Eurozone. Nor can it directly manage the balance of trade. Certainly #3 is not an issue. #6 is the idiocy of the rest of the world but that's many other posts. If you want to lay blame indirectly you could blame Bush for not regulating the loan origination folks but I don't think that's the thrust of his argument. Oil is interesting and as I said previously it is both a cause and effect of the weak dollar. You could argue that the administration could have done/be doing more to suppress oil prices but again that's a direct post (forthcoming).
In short the secular decline of the dollar comes after a secular rally during the Clinton administration based on the explosive growth of the internet and related businesses.
I am shocked that David Malpass, chief economist of Bear Stearns, seems to think that President Bush (and even Hank Paulson) could effectively jawbone the dollar significantly higher. Maybe that is why he is chief economist at Bear Stearns (cheap shot :) Even intervention against the wind tends to be quite ineffective and will often draw speculation - see George Soros and the Bank of England.
In sum there isn't that much the Bush administration could have done and could do by itself at the moment.
The dollar at current levels is weaker than I like but not weaker than I expect. It's lost 5% so far this year. What worries me is that being long commodities, principally oil, and short the dollar has become a free ride.
What can be done? It's difficult though not impossible. The U.S. along with its trading partners would have to agree on coordinated, widespread intervention on the dollar AND couple that with a statement from the ECB that it sees rate cuts on the horizon (which it doesn't currently and due to the ECB charter AND the legacy of the mighty Bundesbank, often called the dead hand of the Bundesbank, is always hawkish)
However at the end of the day given the significant weakness in the economy the dollar, correctly, should not be the first priority as we are, after all, a reasonably contained domestic economy.
Though it is creeping up the ladder in large part due to the cost of energy.
Tuesday, March 11, 2008
David Malpass has written about this issue before. In today's WSJ he pounds the Bush Administration for its fecklessness regarding the dollar and discusses why a commitment to a strong dollar (which Clinton had, to his credit) is crucial for the US:
The dollar is now weaker than the loonie, the Canadian dollar, yet the same hollow 1990s phrases are being mouthed. If a strong dollar is in the "national interest," then the seven-year dollar collapse is clearly in need of a remedy. There's an equally deep logical flaw in claiming that the dollar should depend on economic "fundamentals." A strong, stable currency is itself one of a country's most valuable fundamentals, not a byproduct of other fundamentals. Our fundamentals haven't been nearly as bad as the dollar's seven-year slide. More likely, the weak dollar trend is itself a bad economic fundamental, masking health elsewhere.
The policy shift to a stronger dollar is as critical for national security as it is for economic health. Oil would cost less if the dollar were stronger, slowing the transfers to our antagonists in Venezuela, Iran and Russia. A stronger dollar would allow U.S. wealth to grow as fast as foreign wealth, adding to our strength and independence.
Though many economists still support the theory of unlimited free-floating exchange rates, no weak-currency country has had a healthy economy. Momentum takes over and pushes currencies to extremes that can't be hedged. Many also think current interest rates control currencies. But 1% more or less in annual interest won't make up for a country's longer term intentions for its currency. Markets have labeled the U.S. a weak-currency country. That's an albatross that the president should dump.
Of course, as with any scandal (read: Clinton, Lewinsky, and NOW) there are always the sycophantic fools who believe that ethically and morally reprehensible politicians should remain in power because they are intelligent and liberal:
"This is one of the most intelligent, brightest elected officials in the region. You don't change governors of New York lightly, and I think it would be a mistake to act precipitously," political consultant Joseph Mercurio told CBS 2 HD.
That's a spectacularly moronic analysis, but let's take it for what it's worth:
Ok. Don't act precipitously. Let's wait an hour or two for the news to sink in that the Governor of New York set up an appointment in WASHINGTON, DC to meet a high-class hooker, whose services he paid for with . . . money. Yes, money -- in other words, the manifestation of the compensation he obtained from the People of the State of New York for the work he has performed for the past couple of decades (from an ADA in Manhattan to Attorney General of the State to Governor).
Get it? He used public money to get his jollies with a high-dollar whore.
What part of this is not reprehensible? None.
What part of this should not be impeachable? None.
And what part of this does not require his exit from the state governmental position constitutionally mandated to ensure the laws of the State of New York are faithfully executed?
The WSJ has toned down its internal inclination for jubilation at Spitzer's idiocy to make some more salient points about arrogant power-hungry politicians in general:
The stupendously deluded belief that the sitting Governor of New York could purchase the services of prostitutes was merely the last act of a man unable to admit either the existence of, or need for, limits. At the least, he put himself at risk of blackmail, and in turn the possible distortion of his public duties. Mr. Spitzer's recklessness with the state's highest elected office, though, is of a piece with his consistent excesses as Attorney General from 1999 to 2006.
He routinely used the extraordinary threat of indicting entire firms, a financial death sentence, to force the dismissal of executives, such as AIG's Maurice "Hank" Greenberg. He routinely leaked to the press emails obtained with subpoena power to build public animosity against companies and executives. In the case of Mr. Greenberg, he went on national television to accuse the AIG founder of "illegal" behavior. Within the confines of the law itself, though, he never indicted Mr. Greenberg. Nor did he apologize.
In perhaps the incident most suggestive of Mr. Spitzer's lack of self-restraint, the then-Attorney General personally threatened John Whitehead after the former Goldman Sachs chief published an article on this page defending Mr. Greenberg. "I will be coming after you," Mr. Spitzer said, according to Mr. Whitehead's account. "You will pay the price. This is only the beginning, and you will pay dearly for what you have done."
Jack Welch, the former head of GE, said he was told to tell Ken Langone -- embroiled in Mr. Spitzer's investigation of former NYSE chairman Dick Grasso -- that the AG would "put a spike through Langone's heart." New York Congresswoman Sue Kelly, who clashed with Mr. Spitzer in 2003, had her office put out a statement that "the attorney general acted like a thug."
These are not merely acts of routine political rough-and-tumble. They were threats -- some rhetorical, some acted upon -- by one man with virtually unchecked legal powers.
Eliot Spitzer's self-destructive inability to recognize any limit on his compulsions was never more evident than his staff's enlistment of the New York State Police in a campaign to discredit the state's Senate Majority Leader, Joseph Bruno. On any level, it was nuts. Somehow, Team Spitzer thought they could get by with it. In the wake of that abusive fiasco, his public approval rating plunged.Any other questions?
Monday, March 10, 2008
It must be true -- the NY Times actually has a report damaging to a Democrat!
Spitzer is an unmitigated ass. As a prosecutor he attacked Wall Street with numerous baseless claims and worthless investigations designed to tarnish reputations despite any absence of wrongdoing (three letters: A I G) and caused the business climate of New York to become even less friendly than its stratospheric tax burden had already made it.
As governor, Spitzer has been as ethically corrupt as anyone north of Louisiana, including New Jersey, and has compounded his moral lapses with Nixonian dirty tricks such as the attempt to have NY State troopers give false testimony about NY Senate Majority Leader Joe Bruno. Watch The Wire (or now, get the DVDs) -- Spitzer is Tommy Carcetti crossed with Huey Long.
New Yorkers: you voted for this man, he's your problem.
Wongdoer has made up for my absence by earning every penny I pay him.
Meanwhile, The Monk is likely quitting his NCAA pool (50+ entrants each year) that he had been in for the past 4 years with this record of success:
2004 = 3rd place
2005 = co-champion
2006 = we don't talk about 2006
2007 = picked whole Final Four, would have won if OSU beat Florida
The pool is going to a seed-point format wherein you get 1/3/5/10/25/50 points for picking each round correctly AND the number of points for the seed -- thus correctly picking a 12-seed winning in the first round is worth 13 points but picking a second-seed to make the Final Four is worth 12. That's stupid -- it's a lot harder to pick round-by-round progress than to throw a dart at the bracket and pick an upset. Picking four wins by the 2-seed would be worth 27 points, picking one upset would be worth 13. That's screwy. The Monk can understand double values in the first round for correctly picking a 10-16 seed winning, but just adding the points is nutty.
Worse yet, The Monk will be on vacation from Monday-Wednesday of next week, so I'll even miss the bracket announcement. For that reason, I'm offering these Tourney Tidbits even before the brackets come out.
First, The Monk predicts that the #1 seeds will be Tennessee, Memphis, UNC and UCLA. The overall #1 will be UNC if it wins the ACC. A loss by UNC or UCLA in their upcoming conference Tournaments could enable KU or Duke to slip into a #1 seed, but a 30-win Memphis and seven-wins-against-RPI-top-25 Tennessee should be safe.
Next, curious factoids: (i) only five NCAA Tournaments since 1985 have not had an ACC team in the Final Four, until 2006 each time Syracuse had won its regional (1987, 1996, 2003, 2006, 2007); (ii) in 2007, Duke failed to reach the Sweet 16 for the first time since 1997; if Duke survives the first weekend, remember that it has lost six times in the Sweet 16 under Coach K but only once in the Regional Finals and each team that beat Duke in the Sweet 16 went on to the Final Four; (iii) three #1 seeds have reached the Final Four only three times since the seeding system started in 1979 (1993, 1997, 1999), by contrast three (or more) non-#1 seeds have reached the Final Four in four of the past eight years (2000, 2003, 2004, 2006) and seven times since the first 3-#1 Final Four in 1993 (1994, 1995, 1998, 2000, 2003, 2004, 2006), by far the most common occurrence is a pair of #1 seeds making the Final Four, like 2005 and 2007, and the rarest is zero #1 seeds -- that has happened only in 1980 and 2006; (iv) only four No. 15 seeds have ever beaten a #2, no #1 seed has ever lost a first round game and only Arizona and South Carolina have lost first round games as a #2 and #3 seed in consecutive years; (v) the last Ivy League team to win a first-round game was Princeton in 1998 but it was a #5 seed, the last lower-seeded Ivy to win a first-round game was Princeton in 1996 -- it then lost badly in the second round; this year's Ivy winner is Cornell; (vi) no team has ever lost in the quarterfinals of its conference tournament and won the NCAA -- Texas was a rarity by reaching the Final Four in 2003.
Second, when all else fails pick the team with the best player on the floor to win. Look at the recent past champions: 2005 UNC had May, 2004 UConn had Okafor, 2003 Syracuse had Anthony, 2002 Maryland had Dixon, 2000 Mich. State had MoPete. Duke's 2001 champ doesn't count because it had 3 players better than most other team's best player (Battier, Dunleavy, J. Williams) but nearly all the other squads that won in the '00s all had one player who was so far above any of the competitors that they had no answer for him. Last year is an exception to this rule because Florida had too much size (6-0, 6-6, 6-9, 6-11, 6-10) for the non-Oden midgets on Ohio State (6-1, 6-1, 6-4, 6-7 and Oden at 7-0).
And finally, one other tip. If you have two teams that seem even, go with the bangers over the jumpers. The game has changed since 1986, when a high-flying Louisville could just outjump a stronger UNC team. Instead, interior power is a key ingredient. It kept Kansas in the 2003 title game; it helped UConn win in '04, it was THE difference in UNC's win in '05 and a major factor last year when Florida rolled through the Final Four, and it made the difference in Maryland's Final Four win over Kansas in 2002 (which effectively was the national title game). Sure, the human pogo sticks can do some work, but the increased athletic talents of players now means that a 215 pound jumping jack will be going up against a 275 pound jumping jack and I know who's likely to win that battle. This is why Duke lost to LSU in '06, Michigan St. in '05 and UConn in '04 -- not enough beef inside.
And no, Duke's not going to win this year, either.
Monday, March 03, 2008
Chavez is saber-rattling hard. President Bush whom I support has regrettably been Clintonesque in his silence on Chavez in Latin America. If Colombia, a key US ally, and Chavez/Correa come to blows here's hoping that President Bush stands fast.