Meltdown Sideways Blogging Resumes - With A Near-Gotcha!

We resume our coverage of the ongoing financial debacle by focusing our keen eye on a Treasury give-away sure to incite howls of outrage (and silence this singing!) once noticed.  Or not.

This is a key detail of the Treasury proposal to buy preferred shares plus warrants on bank stock describing how the warrants will be priced (my emphasis):

In conjunction with the purchase of senior preferred shares, Treasury will receive warrants to purchase common stock with an aggregate market price equal to 15 percent of the senior preferred investment. The exercise price on the warrants will be the market price of the participating institution’s common stock at the time of issuance, calculated on a 20-trading day trailing average.

The market wipe-out took hold in earnest one week ago so one might think that the 20 day moving average is well above the current share price for the big banks that were purportedly press-ganged into this.  But one would be wrong!

I only checked three firms.  Morgan Stanley's trailing average is $22.28; at this moment it's shares are at $22.07, up $4.07.

Citigroup has a trailing average of $17.87; its shares are at $18.60, up $2.82.

Goldman Sachs has a trailing average of $121.67; its shares are at $125.37, up $14.37.

Well.  At last night's close this was a sweetheart deal for Goldman and Morgan Stanley, although it is no surprise that their share prices rose.  Hmmph - a near-gotcha.

OTHER ACTION:

In Treasuries we were seeing a nice flight from quality:

 	COUPON	MATURITY
DATE	CURRENT
PRICE/YIELD	PRICE/YIELD
CHANGE	TIME
3-Mo 	0.000	01/08/2009	0.32 / .32	0.14 / .142	13:06
6-Mo 	0.000	04/09/2009	0.9 / .92	0.1 / .102	13:00
12-Mo	0.000	09/24/2009	1.18 / 1.21	0.17 / .175	13:00
2-Year	2.000	09/30/2010	100-11 / 1.82	-0-15 / .243	13:08
3-Year	4.500	09/30/2011	106-28+ / 2.08	-0-21½ / .223	13:07
5-Year	3.125	09/30/2013	100-19+ / 2.99	-1-03½ / .240	13:08
10-Year	4.000	08/15/2018	99-23+ / 4.03	-0-14 / .054	13:08
30-Year	4.500	05/15/2038	104-03+ / 4.25	-2-02 / .118	13:08

Those are still comic book figures for the three month bill but the direction is right.  There will be the customary three and six month bill auctions on Thursday and a one month auction today.  Headlines we want to see include news of successful investment grade and high yield bond issues.

At 1:15 the Dow is up 34 and the S&P up 5.

MORE:  Brad DeLOng is very interesting on depressions, preferred shares and zombie banks:

So what to do? We don't want to let the banking sector collapse into bankruptcy--Lehman Brothers was bad enough, and we don't want to replicate the Great Depression. But we also don't want to repeat Japan's mistakes of the 1990s, with zombie banks neither alive nor dead failing to do their job for the economy as they focused on getting back above water to create some value for shareholders and executives.

And here is my worry about the current plan to buy preferred rather than common stock of the banks. Preferred stock runs a risk of creating zombies--if shareholders and executives conclude that the preferred has all the equity value if they continue business as usual, then they will not continue business as usual but will instead start behaving like the Japanese banks of the 1990s. And we don't want that.

I am not quite clear on how he thinks the Japanese banks performed and why the US banks would perform in a similar fashion.  We had zombie thrifts in the late 80's and the worry at the time was that they were making increasingly risky loans with the (sensible) strategy that if the loans went bust it came out of the government but if the loans surprised everyone by paying off then the equity holders would be back in black.  My impression is that Japanese banks weren't lending to anyone, not that they were only lending on risky (high variance) projects.  In Japan in the 90's, the goal of a top bank official would have been to avoid giving grounds for dismissal, not to promote shareholder value.

But if zombies are the worry, let me approach the issue from a different direction - what impact will restrictions on executive compensation have on a bank's risk taking and innovation?

Suppose the top executives at Citigroup cannot get either stock options or bonuses.  What, other than testosterone and patriotism, is their incentive to push their banks to lend and take risk?  In such a circumstance a prudent bank executive with no opportunity for upside would run the bank with an eye to not getting fired.  In the current environment, that would mean a focus on short, safe loans, no innovation, and no activity that has even a whiff of creativity.

Sounds like a zombie bank to me, but who am I?  Since Brad DeLong is an important liberal voice on all topics economic it will be interesting to see his perspective.  As I understand Chuck Schumer's perspective, he wants all these top execs to go out and save the world economy with no upside and a paycheck that is, by Wall Street standards, derisory.  If one's sense of social justice can be suspended briefly (or can be balanced against the injustices likely to attend a global depression), is this likely to be an effective approach?

ON SCHUMER:

In a letter to Mr. Paulson on Monday, Mr. Schumer, chairman of the Joint Economic Committee, urged the Treasury to demand that banks receiving capital eliminate their dividends, restrict executive pay and stick to “safe and sustainable, rather than exotic, financial activities.”

“I don’t think making this as easy as possible for the financial institutions is the way to go,” Mr. Schumer said in a call with reporters. “You need some carrots but you also need some sticks.”

I am 110% in support of suspending dividends.  Well, 110% diluted down to 99% after noting these second-order caveats.

 

Comments

[bgates]

In the current environment, that would mean a focus on short, safe loans, no innovation, and no activity that has even a whiff of creativity.
No mortgage backed security tranches, no credit default swaps, just loans to productive enterprises with a reasonable expectation of producing a return on investment sufficient to make the loan profitable for the bank.

Does anyone really want to live in a nightmare world like that?

[Pofarmer]

Just heard Henry Paulson saying that this would only be short term, probably only 2 or 3 years. Anybody wanna make some CDS on that?

[Forbes]

Why isn't Schumer a bank executive/CEO--it must be a pretty easy job, seeing how from his perch in the Senate he knows how a bank should be run.

[kim jane il]

Wiliam Timmons, the veteran Washington lobbyist tapped to lead John McCain's transition team was involved in an effort on behalf of Saddam Hussein's government to ease international sanctions against Iraq, according to a report by Murray Waas in The Huffington Post.

The two lobbyists with whom Timmons teamed, Samir Vincent and Tongsun Park, both either pleaded guilty to, or were convicted of, charges that they had acted as unregistered agents of Saddam's government.

link

[LindaK]

Schumer's advice on FNM/FRE was certainly sound. Not. Paulson must be disgusted with these poseurs.

[Pofarmer]

Linda

Paulson is trying to scratch all the carp under the rug.

[steve sturm]

What, other than testosterone and patriotism, is their incentive to push their banks to lend and take risk? Uh, how about keeping their jobs?

[Cecil Turner]

. . . was involved in an effort on behalf of Saddam Hussein's government . . .

You mean a registered lobbyist lobbied? The horror! That's almost as convincing as Obama's ads that McCain's health insurance plan pays . . . wait for it . . . insurance companies. Good grief. How dumb do you guys think the electorate is? (Wait, don't answer that.)

[boris]

Won't work Cecil. When you hold out your boot for a leg humping troll it probably figures you also have a rolled up newspaper behind your back.

[MayBee]

behalf of Saddam Hussein's government to ease international sanctions against Iraq, according to a report by Murray Waas in The Huffington Post.

Wasn't that the liberal position at the time?

[kim jane il]

When you hold out your boot

Republicans have been screwing the rest of the country for so long it was time to return the favor.

[RichatUF]

Maybee-

...Wasn't that the liberal position at the time?

I'm surprised they didn't get the memo. I've got a dusty collection of papers related to the Oil-for-Food program. All sorts of links...this is an underreported one.

[kim jane il]

If the elections were held today, Barack Obama would receive support from 53 percent of voters, against John McCain’s 39 percent the latest New York Times/CBS News poll found.

OUCH!!!

[thelonereader]

leo---
you really are a tool---

[Tom Maguire]

What, other than testosterone and patriotism, is their incentive to push their banks to lend and take risk? Uh, how about keeping their jobs?

Well, if the compensation limits are seen as temporary they may stick around and out-wait them, figuring the chairmanship of, e.g. Goldman Sachs, is historically a lucrative spot.

But if there is no payday in sight the world is full of lucrative opportunities for senior deal makers in private equity, money management and at hedge funds.

As to "do your job" - d'oh! The big challenge facing most of these guys is figuring out what their job is, in terms of markets and products to emphasize/avoid.

Not to say they have collectively done a whiz-bang job of that lately, but of you want banks to be creative you probably need to pay people.

or if you don't want them to be creative, well, why worry about 'zombie' banks?

[bgates]

I've had quite enough of "creative" banking, accounting, and voter registration for a while. How about competent, non-fraudulent work in those fields? I think that can be done without zombies.

[Rick Ballard]

bgates,

I suppose another way to look at it would be to try and estimate the net benefit to society achieved by the very clever and innovative creations of bankers in the past 15 years. Where would society be without Mortgage Backed Securities and Credit Default Swaps? It's a wonder that we didn't all starve to death prior to their invention.

My personal preference would be to chain these idiots to their desks until they had paid off the losses caused by their idiocy - at $1 per hour. TM does have a good point though - if they don't stay where they're at, then they'll just go and steal in a different place. Probably peddling worthless crap securities backing windmills and solar cells. The "wave of the future" - if you happen to live in a sewage treatment plant.

[bgates]

Rick, I'd be opposed to the wage control aspect of that (though if Paulson strongarms the banks into making him majority shareholder, I guess it would be his business, pardon the pun). OTOH, maybe we could combine your "chain these idiots to their desks" idea with TM's plan to turn zombies loose inside the banks?

[PaulL]

Remember back in the 1960s when the full price of an automobile was listed in advertisements? That's when Corvettes and Cadillacs were $3000 each.

I think it was in the 1970s (maybe 1980s?) when those ads disappeared and instead they listed the price for monthly payments.

A credit society has caused a lot of damage.

[boris]

turn zombies loose inside the banks

Soooo ... what's the difference between a zombie and a leg humping troll?

[bgates]

Boris - a zombie eats brains. A leg humping troll has no use for them at all.

[Charlie (Colorado)]

Look, guys, there wasn't anything particularly unusual about either MBS or CDS; they're fairly obvious mechanisms to reduce the risk when you're forced into making loans of lesser quality than what you can set as an interest rate.

The only big issue was people selling credit default swaps when they didn't have the reserves to cover them in all circumstances; even that isn't inherently wrong (insurance companies do exactly that --- no life insurance company could pay off all its term life policies if something like a new flu pandemic killed off half its policyholders.)

The underlying problem was writing bad mortgages, which the government was forcing them to do and Fannie and Freddie were enabling them to do with the fiction of being government sponsored while not having to reveal their positions to the government.

[Charlie (Colorado)]

BTW, Rick, Cramer did a version of your bear raid theory on his show today.

I'm not sure whether this will please you or not. ;-)

[bad]

The zombies smarter?

[kim jane il]

what's the difference between a zombie and a leg humping troll?

Zombies just want brains, so you're safe there boris.

[Rick Ballard]

"OTOH, maybe we could combine your "chain these idiots to their desks" idea with TM's plan to turn zombies loose inside the banks?"

bgates,

Hmmm... it might be more beneficial to society in the long run to chain the zombies to their desks and pay them $1 million per week to not do anything. I've read meltdown numbers putting the world cost of their "innovations" at $17 trillion - that would pay for a bunch of $1 million dollar a week zombies for a decade.

PaulL,

You really have to invert the "cost" of credit and look at it from the "income" perspective. You have a very good point but credit extension makes sense in many instances. The 'sell 'em by the pound' crap turned out by Detroit in the '50's and '60's just isn't the same vehicle that we buy today. The function is the same but there is a substantive difference in quality. Are we net ahead because of credit? Not at the moment, that's for sure. Over time though, that interest paid becomes income received and the strictures applied in maintaining decent credit replace the banker who needed a character reference from a pastor prior to making a loan.

We're forty-five years into 'if it feels good, do it' and I find it very amusing that FICO scores are bringing the same class of people up tight on credit chains as their inability to get that reference did forty-five years ago. I think about that a bit when I'm filling in the "interest income received" line on the 1040.

[kim jane il]

The underlying problem was writing bad mortgages, which the government was forcing them to do

Home ownership is also an important part of our economic vitality. If -- when we meet this project, this goal, according to our Secretary of Housing and Urban Development, we will have added an additional $256 billion to the economy by encouraging 5.5 million new home owners in America; the activity -- the economic activity stimulated with the additional purchasers, the additional buyers, the additional demand will be upwards of $256 billion. And that's important because it will help people find work."

- George W. Bush, U.S. President, October 15, 2002 1:55 P.M.

[hrtshpdbox]

I was hoping for a Reverend Wright moment, but guess I'll have to temporarily settle for something from reliable old anti-Semite Jesse Jackson (gotta help in Florida). LUN

[tina]

OT, but seemingly good news:

BREAKING: 6th Circuit reverses on TRO (devastation, humiliation for Jennifer Brunner)

LUN

[Rick Ballard]

Charlie,

I've always considered "preserve capital" to be Rule 1 for bankers. I don't see MBS and CDS as having done that. I mark "preserve trust" as Rule 2 for bankers. The fact that the 3 month T-rate is currently .12 per cent per annum indicates that not only is trust lost but that it is not being regained. It also indicates that people are not buying the Paulson Plan in numbers sufficient to halt the slide.

I would note that T-rates indicate some sort of end to the silliness at the 2 year mark - which gives a reasonable time horizon for investors, rather than Cramer's trader acolytes.

[tina]

Incendiary New Ad Attacks Obama's "Wrong Values" (That is CBS headline); link to article is via Free Republic (LUN)

Shows Rev Wright and his GD America....

[kim]

Ooh, tina, that is excellent news about the Brunner reversal.
=====================================

[PaulL]

Tina,

Thanks for the link on the despicable Secretary of State of my state.

[hrtshpdbox]

"Incendiary New Ad Attacks Obama's "Wrong Values""

Looks like it's been around since late August. Video at LUN

[kim jane il]

Shows Rev Wright and his GD America....

Think there's anyone that hasn't seen that tape already? And the negative stuff works best before anyone's formed an opinion of a candidate. We're waaaay past that point.

But honestly, it's probably the only shot you guys have left, so you might as well run with it.

[hrtshpdbox]

"But honestly, it's probably the only shot you guys have left, so you might as well run with it."

Alrighty, then. Wish us well!

[Cecil Turner]

But honestly, it's probably the only shot you guys have left . . .

The best shot we have left is that the American electorate will discover the actual cause behind the current meltdown. And if that Bush quote is the best thing you've got, the videos of the CBC chastising regulators for attempting to regulate is in a different league entirely.

But the Reverend Wrong tape sets the scene nicely . . . because it's all about racism, dontchaknow.

[Charlie (Colorado)]

CNN is reporting more on the ACORN/Obama association.

[Charlie (Colorado)]

Boris - a zombie eats brains. A leg humping troll has no use for them at all.

Just wanted to see it again.

[Charlie (Colorado)]

No, Rick, rule 1 of banking is "make a profit". Preserve capital is nice, but if that were rule one, we'd be back to Po's swimming pool vault full of money.

Rule 2 is "reduce risk", which is what they were trying to do.

Rule 3 is "pigs get slaughtered", which is where they went wrong.

[Pagar]

Great catch on the Ohio SOS case Tina.

That is really going to fowl things up for the Democrats. How in the world do they expect to win Ohio now? Here's the way another blogger looks at it.

"BREAKING - Brunner must verify registrations and share mismatches with local boards of election

Jason at DarkeGOP posted this ruling first and has excerpts from the ruling here.

Having read the first 15 pages of the ruling, from the entire 6th Circuit U.S. Court of Appeals, I call the majority opinion decision 'scathing.' They decide that Jennifer Brunner, Ohio's Secretary of State, made claims she could not support in saying that implementing the ruling of the lower court would be too difficult this close to an election. They also write that she tried to straddle two aspects of the law in order to support her position. They document that she had been verifying the information and sharing it with local boards, but that she stopped doing so."

LUN

I'm beginning to have a little bit of hope that at least someone is trying to prevent voting fraud.

[Rick Ballard]

"rule 1 of banking is "make a profit"."

Try it without capital or trust. Profit is the easy part.

The crisis isn't about the ability of the overpaid zombies to come up with scheme L387b concerning gaining profit through obfuscation, obscurity, promises and blue sky. The crisis is about "how come you lost all those people's money and why in hell should I give you any more to play with?".

Any idiot can make money with capital and trust. It takes a very special idiot to make a loss of profit, capital and trust in one not so swift play. Personally, I believe that type of idiot has to be trained in an Ivy League setting where blather is the common currency and gullibility the common denominator. An Aggie or a Sooner couldn't be that dumb and get a job. They don't have the "right" connections which allow an idiot to gain enough power to make that stupid a mistake and continue to hold a job.

[tina]

UH OH. Michelle Obama speaks out. Read the article (LUN, its from africanpress) uses the words "white racist" and goes on and on....

Shocking development: Mrs Obama decides enough is enough: “My husband was born in Hawaii and adopted by his step father, does that make him unpatriotic; she asks”, on a direct telephone to API.

Seems the birth certificate issue is getting to her.....

[tina]

PS. I'm issuing a caution statement about the above post....its a story from a "phone call"....don't know how legit the source is (API). Posting for interest only.

[Pofarmer]

Preserve capital is nice, but if that were rule one, we'd be back to Po's swimming pool vault full of money.

Just for the record, you really need to get out more.

Rule 2 is "reduce risk", which is what they were trying to do.

Except, the CDS weren't really about reducing risk, they were about making large profits for the sellers of said instrument. If they were about reducing risk, you wouldn't have people buying CDS on positions they don't hold. You wouldn't have CDS being TRADED, which just seems even more insane. CDS were/are a way to gamble on the system.

[Pofarmer]

Just watched parts of a PBS special on McCain and Obama. For a "post racial" candidate, Obama sure chose to make a lot of his past work about nothing but race.

[stevesturm]

TM: so these great talents, denied of bonuses and stock options, pack up and go elsewhere, boo hoo hoo. First, given their track record, it's surprising that they'd be in demand. Second, there are plenty of good people doing a fine job in positions that don't throw off billions in bonuses and stock options; they work for merit raises and a decent match to their 401(k) (heck, some even work for the government), I'd happily hire these people and have them get things sorted out.

[bad]

What ever happened with Jerome Corsi and what he was to reveal when he returned from Kenya after being detained there?

[Topsecretk9]

Drudge

The FBI has reportedly begun its own preliminary investigation into an ABC News report that West Palm Beach Congressman Tim Mahoney (D-FL) hired an alleged mistress to work on his official staff and then paid her $121,000 to keep her from going public and filing suit after she was fired.

[hrtshpdbox]

Yeah, was wondering about that guy Corsi too; did he disappear over the Bermuda Triangle or something?

[Rick Ballard]

Steve,

That's terrifying. How could the world continue to exist if stolid mutual fund managers with cow college degrees took the place of Ivy League elite jackasses who've blown a sum greater than the entire GDP of the United States in the course of a few months? What's the world coming too? How will Buffy and Chad be able to exchange their thoughts at the Club when all their friends have been fired for incompetence?

I really like "they'll go to work for hedge funds". That one really tickles me.

[Charlie (Colorado)]

If they were about reducing risk, you wouldn't have people buying CDS on positions they don't hold.

See rule 3.

[clarice]

As I read the law, relinquishment of citizenship requires a very specific act by an adult. Regardless of Berg's assertions, I think that if Soetero did adopt Barack, it would not affect his citizenship. I find the COLB case interesting only because I can't figure out why Obama wouldn't just produce the certificate.
If he was not born in the US, given the particular circumstances of his birth, he would not be a natural born citizen within the meaning of the Constitution.

[Pofarmer]

Steve, the problem is that the dude who got the CDS ball Rolling at AIG worked for the Junk Bond king. These people don't dissapear, they just show up somewhere else . You've got people that made tens or hundreds of millions of $ while their company failed, and they can just walk away and keep the money. That, to me, sounds patently unfair. It's one of the beefs folks have with the corporate world. Anybody working in any management capacity for any of the firms receiving govt largess should be fired and not be allowed to work in any financial institution again, ever. There must be penalties for poor judgement.

[bgates]

I really like "they'll go to work for hedge funds". That one really tickles me.
They could probably find work in hedges. Lots of young guys are going back home to Mexico, so there's work in hedges, tree trimming, all kinds of landscaping.

Depending on how Chad phrases things on his resume, he could even make it sound like he has relevant experience in cutting things to 10% of their original size.

[Rick Ballard]

Clarice,

It's really chaff. If McCain doesn't bring it tomorrow night then he becomes a nice loser. It's in his hands and if he doesn't call the lying scum out then he deserves to lose worse than he did in 2000. I really can't guess whether he has the backbone to do it or whether he's going break in favor of collegiality.

That's why I've never, ever liked him and why I consider him to be very second rate.

Hussein is tenth rate but he might be able to pull off a victory against a second rater. The Muddle is a peculiar beast.

[Pofarmer]

If he was not born in the US, given the particular circumstances of his birth, he would not be a natural born citizen within the meaning of the Constitution.

Didn't I read something about the law being different in the 60's when Obama was born?? As if he was born in Kenya, he wasn't automatically a U.S. citizen? Or am I just dreaming that?

[Pofarmer]

Rick, that PBS documentary tonight also had some pretty revealing stuff on McCain. The Dim's courted him hard, really hard. I think he thinks of them as friends, and idealogically he is sure closer to a lot of the Democrats than most Republicans.

[clarice]

Po, the relevant law is or was at the time that if a person is born overseas to a US oarent and a non US parent and the US parent has not lived in the US for 5 years after reaching 18 years of age, the person is not a "natural born" US citizen. He can be naturalized but that is not the same thing.

Since his father was Kenyan and his US mother only 18, were he born overseas he would not be a "natural born" citizen.

Yadayada about dual citizenship ot his stepfather adopting him and making him Indonesian in my book is just blather or no effect,

[Rick Ballard]

"There must be penalties for poor judgment."

Yep. It's called "denial of custom" or, more commonly, "boycott". It's why I never, ever, click TM's links to the NYT. Because clicking that link adds .000000001 cent to the bottom line line of a company that I really would like to see dead.

If custom (and trust) is denied to those responsible for this crisis, then they die. No matter how clever and well connected they are, they're cripples. Looking over that study I cited, I hope Wells Fargo (and the Wachovia stockholders) live well and prosper. JPM, too, they covered their bases. The rest deserve death and the sooner they're dead the healthier the country. They have betrayed the trust of their investors and depositors and their government supplied prosthetics should only last until they enter the grave which they deserve.

It won't work that way, of course, but Wells is a pretty good bet, if betting is your thing.

[Rick Ballard]

For those wondering about the negative value of Ivy League twits - check out the CVs of Wells Board of Directors. There are winners and then there are - "those trained in the Ivy League" is the most polite way to put it.

Do your own research on Citi. See if you can spot the differences.

[narciso]

One recalls that at least one of Gore's ventures were staffed with former Drexel Burnham employees. staffers at LTCM have resurfaced in various capacities; Lou Rainieri, one of the Masters at Solomon Bros; resurfaced supposedly talking to Paulsen some weeks ago. I don't know if anyone from Lee Higginson, the Brahmin firm that went under in '29; resurfaced but chances are they did.

It's deja vu all over again, the full and complete exam of Andy Martin; is not unlike the attacks on the Swift Boaters; four years ago. Corsi's second round had less success but that was because John O'Neil was at the heart of that campaign; and Bill Dyer vouched for him, as he did for Sarah.
The CBS/NY Times poll is such a stretch, I honestly thought even kji would avoid it.
But stupidity reigns; in some corners, Rick
Sanchez, the latin Chris Matthews
stylistically (although his politics used to be impeccably anti Castro, now I'm not so sure) gave a half an hour to David Neiwert, to propound his crazy theory about "Sarah as a stalking horse for the AIP and the Aryan Nation". There were no such lattitude with Stanley Kurz or David Fredosso. Anderson Vanderbilt Cooper von Schnitzle of Ulm was amused by a McCain wan wave; intimating about the former's attitude toward the working class. Maybe some one should break his arm and throw him a dungeon for 5 years; see how well he lasts.
Tim Mahoney, former investor with Bobby Inman's companies; which makes me think he was a stalking for the Company .apparently replicated the former president's M.O, right down to the hush money.Esquire, had just endorsed him in the new issue; much as they did with Admiral Fallon this spring. CNN yesterday put Phil Gramm as the 5th most wanted in the Subprime debacle; yeah they'll get to Raines, Johnson, & Gorelick any day now.

Not distressing enough, a judge decided KSM should have access to a computer; an American educated industrial engineer turned terrorist, that couldn't possibly go wrong.

[JHG]

Ivy league and world leaders. All the problem ones are from Harvard, like all our problems.

Obama was foreign born and him not signing up for the SS might prove it, thinking he was not American and not needing to.

LUN

[Rick Ballard]

JHG,

Limiting the source of problems to Harvard denigrates the lack of ability demonstrated by other Ivy League school's graduates. A Harvard education is not the signal event in the life of an abject failure - seeking advancement through connection rather than competence is the hallmark.

I'm sure that there are actually competent Ivy League graduates walking the earth at this moment. Granted, their number is surpassed by Aggies and Sooners and Cornhuskers and Huskies and Cardinals (but not Trojans) to an unbelievable extent but there have to be a few who can actually perform at a level worthy of meritorious comment. Just not many.

[glasater]

You've got people that made tens or hundreds of millions of $ while their company failed

We've got some--bailed out early--Enron money floating around our little burg.

[jimmyk]

I have to say I'm finding this outburst of reverse snobbery a bit off-putting. Let's remember who the real culprits are here: The Democrats who have been pushing risky mortgages and other kinds of loans for the past 30 years, and blocking efforts to rein in FM/FM, and who are about to get away with it by expanding their control of both houses of Congress and maybe the presidency. And ridiculous monetary policy and deer-in-the-headlight responses to the growth of CDSs on the part of the Fed. At least the bankers and hedge fund managers are getting punished financially for their mistakes.

You guys sound like you've bought into Obama's mantra that it was all the fault of "Republican deregulation" and Wall Street greed.

[bio mom]

Ignore all polls, all election maps based upon such polls, all averages such as rcp or CNN poll of polls which are based upon the flawed polls, and all McCain is doomed scenarios also based upon these polls. Garbage in = garbage out. Just vote.

Dr. Robert George has an excellent summary of the pro-infanticide Barack Obama up. You can link to it from NRO's the corner.

[kim jane il]

Ignore all polls

Just because you don't like what they're telling you doesn't mean they're wrong. Confidence levels are not 0, especially when many polls are pointing in the same direction.

Also, as a liberal, I want each and every one of you to vote. That way when you lose you'll know you got your asses kicked fair and square.

[kim jane il]

And bio mom- this isn't about badly constructed polls, it's about 8 years of poor governance, especially wrt the economy.

People notice those things and vote accordingly.

[boris]

Bio Mom, just give your leg a good shake and keep a rolled up newspaper handy.

[Gmax]

I am hearing that someone found in the RAS writeup that the certain vote segment of the poll shows Obama +2 and everything else is squishy support. Given RAS is using a a Democrat +6.3 model, which would be way off any historical precedent, the next 19 days may be really really interesting. Dewey beats Truman?

[Gmax]

And in a trickle of good news, reports are the high grade short term commercial paper market seems to have returned to normalcy and is now functioning again. A start. Libor drifting down again this AM, not what some would like but it did not get fouled up in a day or two either.

[bad]

Prayers for Cheney. He is experiencing heart rhythm issues and scheduled to be hospitalized later today per Fox News.

[kim jane il]

Bio Mom, just give your leg a good shake and keep a rolled up newspaper handy.

If it weren't for our canine friends you'd still be a virgin. 'doggy' has a whole different meaning to our friend boris.

[clarice]

Now, just a minute! My son graduated from Harvard and is a brilliant businessman. Of course, he majored in biochemistry , not the soft sciences, and made his money using his own (pre-college attained) entreprenurial skills. I'd have to say were I being honest, what he got from the school was a chance to hone those skills outside the classroom, running the biggest business on campus for the HBA and being president of a group which set up business conferences throughout Asia.

That is to say, the well-funded and supported extra-curricular activities gave him the experience to run his own very successful businesses.

And then there was the bright and talented and wonderful scholarship student he befriended there who years later became his wife who really made his time there worthwhile as far as her loving m-i-l is concerned.

It's not ALL bad.

As for honing business skills inside the classroom--you can do that better at the Univ of Wis which still has more successul CEO alumni than any other school. The Ivies are not the place to learn practical life skills IN THE CLASSROOM.

[bgates]

I have to say I'm finding this outburst of reverse snobbery a bit off-putting. Let's remember who the real culprits are here
Jimmy, you're underestimating the public-mindedness of the Ivy League. Many went from there to Wall Street to invent and play with exotic financial derivatives, but public servants like Harvard graduate Barney Frank and Harvard graduate Franklin Delano Raines have played a part in the latest excitement too.
Besides, there's plenty of blame to go around. Stupid Democratic laws provided the impetus for nonpartisan greed.

[clarice]

Don't forget Brooklyn's brightest light, bgates, Chuckie Schumer.

[clarice]

From Schumer's website:" product of the Brooklyn public schools, Chuck, who was born on November 23, 1950, is a graduate of Harvard College and Harvard Law School. "

[bad]

From Schumer's website:" product of the Brooklyn public schools,

Bet he's glad Obamayers wasn't improving Brooklyn education at that time...

[Barbara]

From African Press International:

Mrs. Obama Decides Enough Is Enough; Calls API

Posted by africanpress on October 15, 2008

Accusing API of colluding with American internet bloggers in an effort to bring down her husband, Mrs Obama said she decided to call API because of what she termed, API’s help to spread rumours created by American bloggers and other racist media outlets in their efforts to damage a black man’s name, saying she hopes African Media was mature enough to be in the front to give unwavering support to her husband, a man Africans should identify themselves with.

When API told her that our online news media was only relaying what the American Bloggers and other media outlets had discovered through their investigations, Mrs Obama was angered and she came out loud with the following: “African press International is supposed to support Africans and African-American view,” and she went to state that, “it is strange that API has chosen to support the racists against my husband. There is no shame in being adopted by a step father. All dirt has been thrown onto my husband’s face and yet he loves this country. My husband and I know that there is no law that will stop him from becoming the president, just because some American white racists are bringing up the issue of my husband’s adoption by His step father. The important thing here is where my husband’s heart is at the moment. I can tell the American people that My husband loves this country and his adoption never changed his love for this country. He was born in Hawaii, yes, and that gives him all the right to be an American citizen even though he was adopted by a foreigner; says Michelle Obama on telefon to API.”

This is a very interesting turn of events. The American man Dr Corsi was recently reported to have been arrested in Kenya because there was fear that he might reveal information on Obama when he wanted to hold a press conference in Nairobi.

API also posted the following concerning the veracity of the story:

ADDED HERE BELOW DUE TO HUGE INTEREST ON THE ABOVE STORY. (TIME 16:08 Scandinavian time)

Verification of the story:
We have found it necessary to publish a telephone number that can be used to reach us should anyone doubt the story. We are doing this because of many requests by many people who want to know more abouth the story.

We are able to receive calls tomorrow the 16th of October through to the 18th October. We find it important that our readers get the truth and not be misled in any way. This is a true story and we stand by everyone written.

NB: For verification, we can be reached on 004793299739

The story is also posted at Gateway Pundit at 10/15/2008 05:12:00 AM:

Michelle Obama Lashes Out at "White Racists"

[kim jane il]

we can be reached on 004793299739

"And in order to accommodate your request for information, please include your bank account information as well as 3 major credit cards."

I especially love this quote:

All dirt has been thrown onto my husband’s face

Now that my friends is some top-quality American grammar!

[clarice]

Now that you mention it, I received a twist on the usual Nigerian scam mail the other night--this one purported to be from the FBI assuring me the solicitation I had received was kosher.The agent said he'd picked up info about the solicitation by listening in on overseas phone calls under the FISA program,HEH.
I think the article about Michelle is interesting but it's really hard to confirm the call was from her or the credibility of the source, isn't it? Maybe that nice fellow from the FBI will write me again , this time about that story.

[bad]

That sounds fun Clarice. My junk mail is mostly penis enlargment...

[worseJane]

clarice October 14, 2008 at 10:53 PM,

I believe there are laws against running under an assumed name without proper permissions - which vary from state to state.

For instance: nick names have to get special permission.

[Jim Ryan]

My junk mail is mostly penis enlargment...

Disgusting. And what exactly are the URLs for these companies?

[bad]

lol Jim

[clarice]

Steve Gilbert reviews the obscene anti-Palin material for sale online and notes the media's silence about this as they tut tut about truthful references to Ayers and Wright.
http://sweetness-light.com/archive/some-obscene-anti-palin-items-for-sale>Palin Porn<.a<

Of course, this underscores the misogyny of the left, no?

[bad]

Naomi Wolf will be all over that in no time. Seriously, no time.

[kim jane il]

My most recent Nigerian scam solicitation came via snail mail. They must think I'm a high-value mark to actually spend money on a stamp.

[Soylent Red]

They must think I'm a high-value mark

We here, of course, are fully aware of how low-value a mark you really are.

[kim jane il]

We here, of course, are fully aware of how low-value a mark you really are.

Mind if I use that glowing reference on telemarketers?

[Soylent Red]

Give me your phone number and I'll alert telemarketers for you...

[glenda waggoner]

stop it-soylent-LOL-humor is wasted on the wasted

[kim jane il]

Give me your phone number and I'll alert telemarketers for you

That's just you, soylent; boundless generosity and a heart-felt concern for your fellow man.

[kim jane il]

Recently, he conducted a focus group in an upper-Midwestern state, showing them the kind of ad he thought would work: A no-holds-barred attack, cut for an independent group, which hasn't aired.

I'm just going to reprint his amazed e-mail about the focus group:

Yes, the spot worked. Yes, they believed the charges against Obama. Yes, they actually think he's too liberal, consorts with bad people and WON'T BE A GOOD PRESIDENT...but they STILL don't give a f***. They said right out, "He won't do anything better than McCain" but they're STILL voting for Obama. [...]

54 year-old white male, voted Kerry '04, Bush '00, Dole '96, hunter, Nascar fan...hard for Obama said: "I'm gonna hate him the minute I vote for him. He's gonna be a bad president. But I won't ever vote for another god-damn Republican. I want the government to take over all of Wall Street and bankers and the car companies and Wal-Mart run this county like we used to when Reagan was President."

The next was a woman, late 50s, Democrat but strongly pro-life. Loved B. and H. Clinton, loved Bush in 2000. "Well, I don't know much about this terrorist group Barack used to be in with that Weather guy but I'm sick of paying for health insurance at work and that's why I'm supporting Barack."

I felt like I was taking crazy pills.

link

[boris]

heart-felt concern for your fellow man

Well either that or a rolled up newspaper.

[sbw]

Michelle Obama calling anyone a white racist is a distraction. We don't pay any attention to Al Sharpton of Jesse Jackson spouting such drivel, so we should not let it get in the way of the real reasons an Obama administration is to be feared.

-- Obama is gullible. He seems to swallow the last thing anyone says. He Monday-morning quarterbacks himself so much his clarifications are a distraction.
-- Obama is insecure. Popularity is more important to him than understanding what is right and why.
-- Obama has no sense of history, economy, or government. He does not appreciate that business raised the quality of life for the poorest of the poor, or that attempts at central control have always worsened it.
-- Obama has no sense of future. He is only running from his past.

[kim]

Well now a Freeper says that API says they have audiotape of the conversation with Michelle.

Leo, 'all dirt' may be 'a lot of dirt'. We'll see. Personally, if she did call, I think it may be because she is getting nervous about the Berg suit. Isn't the judge supposed to do something today?
=========================================

[kim jane il]

Credulous much?

This morning my inbox is filled with the "WHY ARENT YOU COVERING THIS?" emails on the subject. The answer is: because it doesn't appear to be in any way real.

Obama campaign senior adviser Robert Gibbs says the interview is a complete and utter fabrication. "It's bogus, she didn't call, it's all a lie," he says.

And I have to say -- I find their pushback quite believable. The Obama campaign does not tend to directly engage fringe websites making wild charges, and if they were to do so they certainly wouldn't have Michelle Obama make the call.

Maybe the folks at API were taken in by an imposter. Maybe they made it up, I don't know.

In these last three weeks, there is going to be a lot of dung thrown at the wall. Lots of charges and counter-charges and counter-counter-charges.

A word to the wise, my friends. I don't know if you know this, but not everything that appears on the internet is true.

Jake Tapper

[bad]

Does Jake Tapper say anything about Vera Baker?