Memeorandum


Powered by TypePad

« 'Chas' Freeman | Main | It's Alive! »

March 09, 2009

Comments

TCO

why do you assume some government needs to take it over. Chapter 11 buddy.

Rick Ballard

"Its balance sheet separates deposits in U.S. offices, which are insured by the FDIC, from deposits in offices outside the U.S., which aren't."

What a nice whistle to blow for the foreign depositors. I know how excited I would be as a foreign depositor to read about the FDIC being able to "handle the problem" because there were $500 billion in deposits that would just become run of the mill unsecured debt. Gosh, I'd borrow more money just to put it on deposit to see what happens next.

Charlie (Colorado)

This is a serious question: do you suppose you can get a PhD in Economics, and then a Nobel Memorial Prize, without ever really learning to read a balance sheet? It seems this is the second or third time I've seen Krugman make some argument that either had bad arithmetic, or bad accountancy, destroying it.

Charlie (Colorado)

TCO, it might have something to do with the fact that banks don't do bankruptcy the same way other companies do. If Citibank went Chapter 11, then under the law FDIC would, yes, have to take it over to re-organize it. Like, oh, Washington Mutual.

What you're saying is "Why do you assume that the government needs to take it over. Have the government take it over, buddy."

MayBee

"Its balance sheet separates deposits in U.S. offices, which are insured by the FDIC, from deposits in offices outside the U.S., which aren't."

Interesting.
When I lived in Japan, Citi was THE expat bank because they spoke English and had ATMs that had some English on them (along with the post office). Not just American expats either, but anyone that knew some English and didn't know Japanese.

I'm just imagining a bunch of Obama-loving expats trying to get their overseas deposits covered, like people who didn't pay for flood insurance.

TCO

The FDIC would take over the part they regulate. the rest of it would go throught normal bankruptcy. The term "bank" is being used to cover for derivative speculators like Goldman.

MuscleDaddy

Sorry - I don't usually do this, but this just dovetails so nicely...

The problem in 'nationalizing' Citi isn't in the whys-hows-and-wherefors... but rather that we're talking about this at all.

Another Jolt of Perspective

- MuscleDaddy

Elliott

a bunch of Obama-loving expats

I won't comment lest I be accused of questioning someone's patriate-ism.

BR

MuscleDaddy! How wonderful to see you here! Remember F250 at E3? I'm off to dinner, but I'll check back later.

Fresh Air

Charlie--

I do think it's possible to be an economist and not understand balance sheets and income statements. To make matters worse, IIRC, Krugman's specialty is Marxian labor economics.

When I read the WSJ, I used to see even their supposedly brilliant writers routinely confuse the impact of financial items on the balance sheet and income statement, like talking about "red ink" on the balance sheet or SCF items as impacting the income statement.

If nothing else, Krugman has demonstrated a boundless arrogance in every sphere of finance and politics, despite how bereft he is of actual knowledge outside of his tiny little windowless world. Does he know how to read a set of financial statements--not superficially, but really? Could he model out some projections for an enterprise beginning with sales and ending with retained earnings? Something tells me he couldn't. The problem is that he's so intellectually dishonest he will never admit it.

Fresh Air

I'm cool with a prepackaged, FDIC-managed bankruptcy for Zombiegroup, so long as at least a majority of the bank side of the beast is acquired by someone other the U.S. taxpayer. I just don't see a lot of foreign banks, not to mention domestics, with the kind of scratch to absorb the $250 billion in assets. I would rather see a careful disposal of the pieces whose values aren't shredded, followed up with a comprehensive reorg that resuscitates Zombie but keeps its nighttime haunting within a narrow corridor of businesses. No more CDS R Us!

BR

OT but in rhyme with Fresh Air's nighttime hauntings, I'm always so amazed at the people who visit this site during the night.

Hullo, Bombay, Maharashtra, what a pity the I-can-call-spirits thread is closed for comment, it would have been so nice to chat.

And I giggle when I see treas.gov's late night visitations here. Could it be the Geithner threads or maybe the food-and-sex thread that draws them here?

And the one from Abu Dhabi, wouldn't it be funny if Osama bin Laden were reading JOM from his sailboat hotel penthouse.

We even have readers from mainland China!

BR

Don't worry, OBL, you can finish your breakfast, you don't have to make the dash down the private elevator to the bunker in the fake island -- you've been superseded by a teleprompter.

hit and run

Good Morning JOM.

Time marches on...

kim

They Typepad Goddess has banished our spirits? What a vindictive deity.
================================

Jane

Happy Birthday Vnjaquets

hit and run

It's Jim's birthday!?!!!?!!??

After finding out that Mr. Clarice turned 70 this week, thinking he looked not a day older than 50, I hesitate to guess vnjagvet's age...but here goes nothing...he turns 57 today (I woulda said 49, but I'm guessing that my guesses are on the low side, so I'm going higher just to be safe; plus, I figure one year for each state in Obama's America just makes sense). That's my guess, and I'm sticking to it, no matter what stunning doses of reality he or anyone else tries to sell around here.

Happy Birthday!

centralcal

Happy Birthday, Jim! And a belated birthday wish to Mr. Clarice!

bad

Good morning!! Spring is even more beautiful than usual.

BO sucks.

bad

And Happy Birthday Jim!! May you have many more.

Old Lurker

Good morning, Hit. How are you doing?

So here's a question. ABC radio news reported Obama has summoned Bernanke to the WH to opine about the direction of the economy. Not to be picky, is that not what that twit Romer is for, rather than the Fed chair? And shouldn't that have been "settled" before submitting a $3.7T budget that assumes a second half 09 return to growth, and robust growth beyond? But, then, that was last week I supose.

hit and run

Doing well, OL, doing well. Like bad, I am especially enjoying the spring weather. All this leisure time, and lots of yard work to do.

bad

Hit, don't get too attached to your life of leisure. I've been in conference with someone who's gonna put your butt back in the saddle again.

kim

Warren, the Remorseful Buyer and Seller, Buffett has weighed in on card check, on Obama's damaging policies, and in particular, on the 'Never waste a crisis' rhetoric. Scales are falling from eyes all over America, revealing a stunningly ugly reality.

We told ya so.
=======================================

Thomas Collins

Via Drudge, see LUN for an article in which Vikram claims things are looking rosier for Citi.

One of the confusions with the nationalization debate is that different folks mean different things by the term. Some are talking about an orderly liquidation after a temporary governmental takeover. Some are talking about a more medium term solution ending in reprivatization. A third group would like the government to own everything, and views ownership of the banks as a good start.

kim

Mickey Kaus is all over the Buffet business. The worm is turning. Those having the scales fall from their eyes will not be so easily fooled again. Obama's drop in popularity is going to be permanent. What, short of a miracle, is going to let him rebound? What is more likely, a miracle, or continuing evidence of Obama's 'tiredness'?
===============================================

bad

I love to see the fresh shoots peeking out of the earth as dead foliage and leaves are cleared away.

It's better than opening a present.

kim

Heh, Wikipedia is deleting entries about Obama's eligibility within minutes of posting. This from World Net Daily.

We know Wikipedia on climate is warped by a single editor, William Connolley, a rabid alarmist.

But why so immediately sensitive about the birth certificate mess? Where there is smoke, sometimes there is fire.

This is an easy solution to a lot of the world's problems, right now. Maybe. But why aren't we allowed to find this out? Curiouser and curiouser.
=====================================

Caro

Happy Birthday, JR!

kim

The Skeptic's Conference in NYC is on now, and Buffett remarked on climate, too. He said you don't fix global warming on the day after D-Day, but I think he slipped. I think he meant the day after Pearl Harbor.
============================================

Jane

Jim,

I'm sorry about spelling your name wrong. The problem is, if I can't pronounce it, I can't spell it.

bad

He did Kim. His original remarks on the issue said "the day after December 7th."

MayBee

Happy Birthday, Jim aka vnjagvet!!!!

DebinNC

Speaking of deletions, this a.m. I read a comment that Geithner is BO's Michael Brown. It struck me that BO's response to the economic "catastrophe" is like the myth of Bush's handling of Katrina. The WH website Agenda section on Katrina shows some telling deletions:

Katrina

President Obama will keep the broken promises made by President Bush to rebuild New Orleans and the Gulf Coast. He and Vice President Biden will take steps to ensure that the federal government will never again allow such catastrophic failures in emergency planning and response to occur.

President Obama swiftly responded to Hurricane Katrina. Citing the Bush Administration's "unconscionable ineptitude" in responding to Hurricane Katrina, then-Senator Obama introduced legislation requiring disaster planners to take into account the specific needs of low-income hurricane victims.

The bolded portions are now gone. At some point will BO be compelled to assure us Timmy is doing a heckuvajob?


Jane

I wonder if the President can stop himself from having to blame someone else ( generally President Bush) for EVERYTHING. We certainly have not seen this level of immaturity in the oval office in my lifetime. If it is grating on his big supporter Warren Buffet, it has to be grating on a lot of people.

But the best part is, I am confident it doesn't bother President Bush at all, because unlike Obama, he is comfortable in his own skin.

clarice

Happy Birthday Vnjagvet,
You know this bank stuff is giving me a terrible headache.

Thomas Collins

Birthday greeting to Vnjaquets and belated birthday greetings to Clarice's Stud.

Have I missed any recent birthdays?

Thomas Collins

Whoops! It's vnjaqvet. Sorry for the misspelling!

bad

I have a new perspective on Obama supporters. I've found a group of them who earn too little to pay income tax, love their stimulus checks and the idea of soaking the "rich" yet still are really pissed at O because O is giving bailouts they don't qualify for.

Ironic isn't it?

Jane

TC,

What did TC Jr. say about CPAC?

bad

I wonder if the President can stop himself from having to blame someone else ( generally President Bush) for EVERYTHING.

I hope he doesn't stop the blame game. He's setting himself up.

kim

Here's the pronunciation: 'Vietnam Judge Advocate General Veteran', and many happy returns to the Man.
=======================================

Uncle BigBad

Jane

When Obama blames everybody but himself for his failings, I'm reminded of his other sophmoric behaviors. When he gave the finger to both Hillary and McCain, I remember thinking that he was the most immature candidate in history.

Those two seemingly insignificant incidents should have been a major warning sign of the kind of president we would be electing.

kim

It's a character flaw, always blaming other people, one of many he has.
===============================

kim

Wait'll he tries to blame Hillary for some foul-up. And isn't Billy Boy zipping his lip lately? Hmmmm.
==========================================

kim

The Big Dog is lying doggo. How much is that doggo in the window? Woof, woof.
=============================

kim

The buck stops....Oh, we don't let it stop, we keep it spinning.
======================================

Jane

I have a new perspective on Obama supporters. I've found a group of them who earn too little to pay income tax, love their stimulus checks and the idea of soaking the "rich" yet still are really pissed at O because O is giving bailouts they don't qualify for.

WEll that certainly is one way to reach them bad. I know someone that would easily work on.

DebinNC

WP: Tim Geithner's Black Hole

We are leaderless.

Thomas Collins

He thought Wayne LaPierre's speech was great, Jane. He also liked Romney's presentation. I haven't had a chance to talk to him about Limbaugh's speech.

By the way, if any JOMer in Central Mass is looking to attend a provocative talk tomorrow, see below.

Lecture: The Left's Assault on Free Speech with Don Feder
The UMass Republican Club invites you to a special lecture by Don Feder, conservative activist and author, about hate crimes laws and other forms of censorship.
Wed Mar 11, 2009, 7:00 pm
Student Union Cape Cod Lounge

kim

Right, Deb, and Obama's team is on record about not wasting crises. They are in trouble, plenty.
============================================

bad

It's a thing of beauty, Jane. I didn't say a word, just listened as they shared what they discovered all by themselves.

And then assured them of the righteousness of their anger. Why?

Because I'm bad....

Jane

TC,

Oh dear I already have dinner plans. Hey how about organizing a central MA tea party for April 15th?

bad

I read yeterday that Turbotax was up 6% from last year. Is it the free publicity or those hoping to have an excuse in case of an error?

Porchlight

Happy Birthday, vnjagvet/Jim! I hope it's wonderful.

Thomas Collins

Why not on April 14th, when you will have your radio show? Maybe you can convince DV to make it a tea party show.

Wasn't there a Tuesday in April that you and Caro and some other JOMers were having a Central Mass get together? Was that April 14th? It could turn into a tea party!

bad

From Deb's link:

Notice that the president's budget already contains a contingency fund of up to $750 billion for a future bank bailout -- a politically shrewd number that roughly matches the size of the Paulson bailout. The true cost is likely to be two or three times as much, unless some last-minute intellectual breakthrough -- a tax holiday for derivatives? -- arises.

This will infuriate sooooooo many of those who are into the redistibution of wealth, as long as they are on the receiving end.

Thomas Collins

I used TurboTax over the weekend, bad, but it wasn't because of the publicity from Turbo Timmy. I find it great to use.

bad
Obama's new urban czar renovated his Bronx home with help from the architect on a major development that needed his approval, a Daily News investigation has found.

Adolfo Carrión, who last week left his job as Bronx borough president to be director of the White House Office on Urban Policy, hired the architect to design a renovation of his Victorian two-family on City Island.

Weeks after the architect's work on Carrión's house was complete, Carrión approved the architect's project.

Carrión would not say how much he paid the architect, if anything. He also refused to provide copies of checks for the work.

BTW, the WH refused to comment. Of course, to question his suitability for the HUD post would be racist. LUN

bad

DOH, should be OUP rather than HUD.

Porchlight

I love TurboTax too, TC. We used to pay someone to do our taxes and now I can do them in 30 minutes for 1/6 the cost (and with far more pleasing results). It's a miracle product, as far as I'm concerned.

Rick Ballard

The valuation methodology used by Citi for its Stinky Stuff can be found beginning on page 193 of the 10-K linked by TM at the top. I don't see much "blue sky" in the MBS valuation at all. They're using a 33% peak to trough fall in home values and that may prove to be somewhat high (assuming that they are not truly overweighted in CA and FL). The corpse appears almost lifelike re MBS - small wonder the vultures are drooling.

bad

More from Deb's WaPo link:

Geithner has reason to be terrified. He was part of the Henry Paulson-led team that underestimated the devastating global-contagion effect of the collapse of Lehman Brothers. Geithner won't make the mistake of underestimation again.

Geithner also knows that the mood in Congress has changed. Were a global financial brush fire to break out as a result of bank restructuring or nationalization, today's populist Congress might just let it burn. Congressional anger is likely to intensify when policymakers realize that credit default swaps demand a stream of premium payments like a life insurance policy, not just a payment due at termination. And recent signs indicate that firms such as Citigroup, in recycling their taxpayer bailout funding, may have helped other financial firms, including some in Europe, meet these payment obligations.

In addition, Geithner worries that because the troubled insurance giant American International Group (AIG) is a conduit for the banks' use of credit default swaps, a collapse of AIG (as an unintended consequence of dismantling the big banks) could be catastrophic. AIG's more than 300 million terrified holders of insurance-related investments and pension funds, who have investments totaling $20 trillion (U.S. GDP is $14 trillion), could suddenly rush for redemptions -- the equivalent of a run on a bank. Geithner would face a worldwide insurance collapse to accompany his global banking collapse.

We are at the mercy of politicians, idiots for the most part. God help us.....

Porchlight

Per Rasmussen, Obama's numbers today are identical to yesterday's, meaning he is holding steady at his lowest ever approval index (+6) and highest ever "strongly disapprove" number at 32%.

For comparison's sake, his approval index last week went from +10 on Monday to +13 on Tuesday.

kim

We are at the mercy of a man who thinks the solution to his tax problems is to cheat. He's looking for the cheat. Good luck, Tiny Tim. Good luck, World. Bad luck, Buffet. We told ya so.
==========================================

kim

And you tried to tell us differently, Warren. I'm highly amused that all the benefit from years of good judgement is now wiped out by one piece of bad judgement. Since where did you think someone like David Axelrod constituted honest management?
===========================================

hit and run

Bad:
I've been in conference with someone who's gonna put your butt back in the saddle again.

Really? Well, after all that talk of Michelle's Hugh Jass the other night, this is a very, very intriguing prospect.

No but seriously, do tell...

Soylent Red

who's gonna put your butt back in the saddle again...

No but seriously, do tell...

How do you feel about the nickname "The Gimp", hit?

Jane

Why not on April 14th, when you will have your radio show? Maybe you can convince DV to make it a tea party show.

TC

That's fine with me, but the radio station doesn't have a lot of land on which to gather.


Caro is indeed coming in April and we are all (that means you) going to lunch where we will sip vodka not tea.

bad

No but seriously, do tell...

Well, I've been on my knees for most of the meetings.

glenda

bad...you are so good! but, Hit is a worthy project!!!
Happy day to Vnjagvet/Jim!
Any word on today's FWDJ, yet?

clarice

He certainly is prayer worthy, bad.

Thomas Collins

I'm checking with my contact at the UMass Amherst Republican Club to see if he knows whether any Central Mass tea parties are in the offing, Jane.

hit and run

Oh, man...thank you, Bad, and everyone.

Some interesting (albeit not necessarily likely) prospects arising just through networking.

And heck, I was browsing usajobs.gov this morning to see if I could become part of Obama's exponentially burgeoning federal payroll.

You know, there is a quite intriguing job listing at the Census Bureau that could get me on the inside to sabota... well ... I'm sure they'll track me down and read everything I've ever written, so I should stop right there.

Then again, I've written more than enough that if they did track everything down, I'm toast.

DrJ

Hit,

If it would help you, my wife would be happy to work with your resume. She is a professional recruiter (but undoubtedly not in your field) so she has worked with thousands of resumes over the years. She's very good, in my opinion, but then I'm biased.

No obligation of course, but if you are interested, send me an email with the resume. You should still have my address, but if not, let me know and I will send you contact info.

hit and run

Thanks DrJ. The separation package I received includes professional outplacement services. I am hoping they are good, and actually I do want help with my resume, I suck at it. If I don't think I'm getting what I need from the outplacement outfit, I'll definitely give you a shout.

DrJ

Hit,

Almost everyone sucks at writing their own resume.

Best wishes with the service, but the offer will remain open if you need it. Most of these services are not really that good, but you might be fortunate.

bad

Oh, man...thank you, Bad, and everyone.

I hope that "everyone" will grow to thousands. We tend to be viral....

Jane

Hit,

The Government is the place to be. And they are looking. But I heard today that a few other industries are looking as well, like engineers.

My niece works at Monster in case that would help.

I find it hard to believe you won't be scooped up momentarily but these are weird times.

bad

Privacy protected of course... cause the big guy knows.

TCO

Liquidate the mother fuckers like Circuit City. Maguire is a RINO worm who stabbed Palin and Republican principles in the back. Bailout maggot. Go send your money to Goldman, fuckwad. Get your cotton picking hands off of mine.

bad

TCO, I'm glad you are okay. I worried about you being in Alabama.

kim

Hey, don't look now, but it's Obama with his hand in your pocket, now. Forbes has a nice article about the huge deficits stretching over the horizon.
==============================================

The comments to this entry are closed.

Wilson/Plame