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Fri Feb 1, 2013, 05:15 PM


Weekend Economists' SuperBawl Special: "NEVERMORE!" February 1-3, 2013

As I understand it, this is a "special" weekend, Superbowl Weekend, and the two competing teams are coached by rival brothers. (I do know some normal people, who keep me clued in to facets of normal American life. They make great pets...besides, it's all over the grocery ads, too.)

But one of the teams, the Baltimore Ravens, are named after that bird immortalized by Edgar Allan Poe, a former resident of Baltimore. And that's what I'd like to fixate and obsess about, because ravens and death and the grave and all that fit my mood. So!

The Raven

Once upon a midnight dreary, while I pondered, weak and weary,
Over many a quaint and curious volume of forgotten lore--
While I nodded, nearly napping, suddenly there came a tapping,
As of some one gently rapping, rapping at my chamber door.
"'Tis some visitor," I muttered, "tapping at my chamber door--
Only this and nothing more."

Ah, distinctly I remember it was in the bleak December,
And each separate dying ember wrought its ghost upon the floor.
Eagerly I wished the morrow;--vainly I had sought to borrow
From my books surcease of sorrow--sorrow for the lost Lenore--
For the rare and radiant maiden whom the angels name Lenore--
Nameless here for evermore.

And the silken sad uncertain rustling of each purple curtain
Thrilled me--filled me with fantastic terrors never felt before;
So that now, to still the beating of my heart, I stood repeating
"'Tis some visitor entreating entrance at my chamber door--
Some late visitor entreating entrance at my chamber door;
This it is and nothing more."

Presently my soul grew stronger; hesitating then no longer,
"Sir," said I, "or Madam, truly your forgiveness I implore;
But the fact is I was napping, and so gently you came rapping,
And so faintly you came tapping, tapping at my chamber door,
That I scarce was sure I heard you"--here I opened wide the door--
Darkness there and nothing more.

Deep into that darkness peering, long I stood there wondering, fearing,
Doubting, dreaming dreams no mortals ever dared to dream before;
But the silence was unbroken, and the stillness gave no token,
And the only word there spoken was the whispered word, "Lenore?"
This I whispered, and an echo murmured back the word, "Lenore!"--
Merely this and nothing more.

Back into the chamber turning, all my soul within me burning,
Soon again I heard a tapping something louder than before.
"Surely," said I, "surely that is something at my window lattice;
Let me see, then, what thereat is and this mystery explore--
Let my heart be still a moment and this mystery explore;--
'Tis the wind and nothing more.

Open here I flung the shutter, when, with many a flirt and flutter,
In there stepped a stately Raven of the saintly days of yore.
Not the least obeisance made he; not a minute stopped or stayed he,
But, with mien of lord or lady, perched above my chamber door--
Perched upon a bust of Pallas just above my chamber door--
Perched, and sat, and nothing more.

Then the ebony bird beguiling my sad fancy into smiling,
By the grave and stern decorum of the countenance it wore,
"Though thy crest be shorn and shaven, thou," I said, "art sure no craven,
Ghastly grim and ancient Raven wandering from the Nightly shore--
Tell me what thy lordly name is on the Night's Plutonian shore!"
Quoth the Raven, "Nevermore."

Much I marveled this ungainly fowl to hear discourse so plainly,
Though its answer little meaning--little relevancy bore;
For we cannot help agreeing that no living human being
Ever yet was blessed with seeing bird above his chamber door--
Bird or beast upon the sculptured bust above his chamber door,
With such name as "Nevermore."

But the Raven, sitting lonely on that placid bust, spoke only
That one word, as if its soul in that one word he did outpour
Nothing farther then he uttered; not a feather then he fluttered--
Till I scarcely more than muttered: "Other friends have flown before--
On the morrow he will leave me, as my Hopes have flown before."
Then the bird said "Nevermore."

Startled at the stillness broken by reply so aptly spoken,
"Doubtless," said I, "what it utters is its only stock and store,
Caught from some unhappy master whom unmerciful Disaster
Followed fast and followed faster till his songs one burden bore--
Till the dirges of his Hope that melancholy burden bore
Of 'Never--nevermore.'"

But the Raven still beguiling all my sad soul into smiling,
Straight I wheeled a cushioned seat in front of bird and bust and door;
Then, upon the velvet sinking, I betook myself to linking
Fancy unto fancy, thinking what this ominous bird of yore--
What this grim, ungainly, ghastly, gaunt, and ominous bird of yore
Meant in croaking "Nevermore."

This I sat engaged in guessing, but no syllable expressing
To the fowl whose fiery eyes now burned into my bosom's core;
This and more I sat divining, with my head at ease reclining
On the cushion's velvet lining that the lamp-light gloated o'er,
But whose velvet violet lining with the lamp-light gloating o'er
She shall press, ah, nevermore!

Then, methought, the air grew denser, perfumed from an unseen censer
Swung by Seraphim whose foot-falls tinkled on the tufted floor.
"Wretch," I cried, "thy God hath lent thee--by these angels he hath sent thee
Respite--respite and nepenthe from thy memories of Lenore!
Quaff, oh quaff this kind nepenthe and forget this lost Lenore!"
Quoth the Raven, "Nevermore."

"Prophet!" said I, "thing of evil!--prophet still, if bird or devil!--
Whether Tempter sent, or whether tempest tossed thee here ashore,
Desolate, yet all undaunted, on this desert land enchanted--
On this home by Horror haunted--tell me truly, I implore--
Is there--is there balm in Gilead?--tell me--tell me, I implore!"
Quoth the Raven, "Nevermore."

"Prophet!" said I, "thing of evil!--prophet still, if bird or devil!
By that Heaven that bends above us--by that God we both adore--
Tell this soul with sorrow laden if, within the distant Aidenn,
It shall clasp a sainted maiden whom the angels name Lenore--
Clasp a rare and radiant maiden whom the angels name Lenore."
Quoth the Raven, "Nevermore."

"Be that word our sign of parting, bird or fiend!" I shrieked, upstarting--
"Get thee back into the tempest and the Night's Plutonian shore!
Leave no black plume as a token of that lie thy soul has spoken!
Leave my loneliness unbroken!--quit the bust above my door!
Take thy beak from out my heart, and take thy form from off my door!"
Quoth the Raven, "Nevermore."

And the Raven, never flitting, still is sitting, still is sitting
On the pallid bust of Pallas just above my chamber door;
And his eyes have all the seeming of a demon's that is dreaming
And the lamp-light o'er him streaming throws his shadows on the floor;
And my soul from out that shadow that lies floating on the floor
Shall be lifted--nevermore!

Anything after that will sound like good news...by contrast. Post what you have.

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Reply Weekend Economists' SuperBawl Special: "NEVERMORE!" February 1-3, 2013 (Original post)
Demeter Feb 2013 OP
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Response to Demeter (Original post)

Fri Feb 1, 2013, 05:27 PM

1. The Skinny on Edgar--wikipedia


Edgar Allan Poe (born Edgar Poe; January 19, 1809 – October 7, 1849) was an American author, poet, editor and literary critic, considered part of the American Romantic Movement. Best known for his tales of mystery and the macabre, Poe was one of the earliest American practitioners of the short story and is generally considered the inventor of the detective fiction genre. He is further credited with contributing to the emerging genre of science fiction.[1] He was the first well-known American writer to try to earn a living through writing alone, resulting in a financially difficult life and career.[2]

He was born as Edgar Poe in Boston, Massachusetts; he was orphaned young when his mother died shortly after his father abandoned the family. Poe was taken in by John and Frances Allan, of Richmond, Virginia, but they never formally adopted him. He attended the University of Virginia for one semester but left due to lack of money. After enlisting in the Army and later failing as an officer's cadet at West Point, Poe parted ways with the Allans. His publishing career began humbly, with an anonymous collection of poems, Tamerlane and Other Poems (1827), credited only to "a Bostonian".

Poe switched his focus to prose and spent the next several years working for literary journals and periodicals, becoming known for his own style of literary criticism. His work forced him to move among several cities, including Baltimore, Philadelphia, and New York City. In Baltimore in 1835, he married Virginia Clemm, his 13-year-old cousin. In January 1845 Poe published his poem, "The Raven", to instant success. His wife died of tuberculosis two years after its publication. He began planning to produce his own journal, The Penn (later renamed The Stylus), though he died before it could be produced. On October 7, 1849, at age 40, Poe died in Baltimore; the cause of his death is unknown and has been variously attributed to alcohol, brain congestion, cholera, drugs, heart disease, rabies, suicide, tuberculosis, and other agents.[3]

Poe and his works influenced literature in the United States and around the world, as well as in specialized fields, such as cosmology and cryptography. Poe and his work appear throughout popular culture in literature, music, films, and television. A number of his homes are dedicated museums today. The Mystery Writers of America present an annual award known as the Edgar Award for distinguished work in the mystery genre.

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Response to Demeter (Original post)

Fri Feb 1, 2013, 05:29 PM

2. No banks down--after all, Superbowl!


Although it's early, odds are it won't happen tonight.

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Response to Demeter (Original post)

Fri Feb 1, 2013, 05:36 PM

3. Predator Drones Stalk US Borders Without Budget or Strategy



US Customs and Border Protection has launched its drone program without undertaking a cost-benefit strategy that includes a specific role for Unmanned Aerial Vehicles. The agency continues to buy drones without planning for their support, maintenance or strategic value. The Department of Homeland Security's drone program isn't classified, unlike the highly secretive CIA and military drone programs outside the United States. Nonetheless, information about the DHS program to "secure the borders" with unmanned aerial systems is guarded, except for the self-serving press releases occasionally issued by Customs and Border Protection (CBP), the DHS agency that includes the Border Patrol. CBP has kept a tight lid on its drone program since 2004, when the agency decided to launch the unmanned aircraft as the homeland counterpart to the foreign "war on terrorism" -- where drone strikes have come to play a central role. Media inquiries and freedom of information requests by groups like the Electronic Frontier Foundation have been met largely by DHS stonewalling. For their part, Congressional oversight committees function almost exclusively as drone booster clubs. However, a trickle of reviews by government entities such as the Congressional Research Service, Government Accountability Office and the DHS Inspector General's Office have begun to shed some light on the secretive homeland security drone program.

Like the government's highly controversial foreign program of hunter-killer drones, it is becoming apparent that the DHS drone operations also deserve urgent public and congressional scrutiny. But not so much because national or international laws are being violated, US citizens targeted, or anyone is being hunted down and killed by these drones - at least thus far. Mostly the DHS drone program needs to be subjected to full transparency and accountability because it's been such a bust - an enormous waste of money. Although the drone program started in 2004, the first hard information provided by DHS about its drone program came in May 2012 in the form of a brief report by the DHS Office of Inspector General: CBP's Use of Unmanned Aircraft Systems in the Nation's Border Security, DHS Office of Inspector General, issued in May 2012. This report, while limited to the shocking management failures of CBP, hints at the more serious underlying problems, like the lack of strategic directions and the dubious achievements of the drone operations of agency's Office of Air and Marine (OAM).

Predators Quickly Adapted for Border Security

The homeland security drone program, directed by a retired Air Force Maj. Gen. Michael Kostelnik (who played a key role in developing the armed Predator drone used for so-called "hunter-killer" missions overseas, deploys a fleet of highly expensive Predators on the nation's borders. The unarmed Predators, produced for border duty by General Atomics, cost $18.5 million to $20.5 million apiece, not counting the hundreds of millions of dollars in contracts for General Atomics to operate and maintain the homeland drones. Flush with billions of dollars in post-9/11 funding for "border security," DHS hurriedly launched the campaign to patrol the borders - north and south - with these Predators. In the rush to secure the homeland, DHS trampled over due-diligence standards to speed through orders for the drones, pilots and crews supplied by General Atomics. CBP started deploying drones along the Arizona border without a plan for how they would be deployed, without a strategy defining their role in border security and without any cost-benefit evaluations, which would determine how effective and cost-efficient drones are compared to other instruments of border control - like agents on the ground, light manned aircraft or less-expensive, smaller drones. The border agency claimed that the Predator drones would function as a "force multiplier." Yet CBP offered no research indicating Unmanned Aerial Vehicles (UAVs) would indeed increase the efficiency of Border Patrol agents or result in higher rates of drug seizures and apprehensions.

Even accepting the notion that arrests of unauthorized immigrants and seizures of marijuana backpackers illegally crossing the border with their bundles of Mexican-grown weed contribute to homeland security, the numbers of immigrant apprehensions and drug seizures (almost exclusively marijuana) are low for these high-tech, high-budget drone operations. CBP boasted in December 20111 that drone operations contributed to 7,500 apprehensions of illegal border crossers and 46,600 pounds of marijuana. The 7,500 "criminal aliens" that the Border Patrol detained are small potatoes when compared to CBP's overall number of detentions since 2005 - 5.7 million immigrants, including the 327,000 detained in 2011. Expressed as a percentage, this amounts to only .001 percent of those detained during that period. While categorized by CBP as "dangerous people" because they have crossed the border illegally, mostly they are simply unauthorized immigrants, although a small number are marijuana backpackers. To give some perspective to the drug haul attributed to UAV surveillance over six years - 46,600 pounds of marijuana - CBP on average seizes 3,500 pounds of marijuana every day in Arizona, making a seizure every 1.7 hours. Drones had a role in the seizure of less than one percent of the Border Patrol's total marijuana in the past six years - only .003 percent to be precise. Then, there is the matter of drones as counterterrorism instruments: how these unmanned remotely piloted vehicles can be used to identify, track and apprehend terrorists and terrorist weapons of mass destruction. The drone program, according to CBP, focuses operations on the CBP priority mission of anti-terrorism by helping "to identify and intercept potential terrorists and illegal cross-border activity." Yet, neither as part of its decision to launch the drone program nor in any subsequent pronouncements, releases, strategy statements or descriptions of drone accomplishments has CBP ever supported its assertion that drones are effective counterterrorist instruments.The failure to link actual drone operations to the agency's "priority mission of anti-terrorism" is not surprising or unexpected. CBP makes the same claim about all its border security operations without ever attempting to detail how these operations are shaped or evaluated by its anti-terrorism mission.


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Response to Demeter (Original post)

Fri Feb 1, 2013, 05:42 PM

4. Student Debt Is More Subprime Than Ever



To the litany of disastrous news about our nation's huge student debt burden, we can add this: more and more of that debt is being held by the borrowers least able to pay it back.

A new report says that subprime student loans—the least likely to be repaid—are rising. From the WSJ:

In all, 33% of all subprime student loans in repayment were 90 days or more past due in March 2012, up from 24% in 2007, according to a Wednesday report by TransUnion LLC.

Meanwhile, the Chicago-based credit bureau found that 33% of the almost $900 billion in outstanding student loans was held by subprime, or the riskiest, borrowers as of March 2012, up from 31% in 2007.

Student loan delinquency in general has been rising. Greater amounts of subprime student loans will no doubt magnify the problem. Not to worry, though: only slightly less than half of Americans are "one emergency away from financial ruin."

And hey, when has America ever been burned by subprime loans?

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Response to Demeter (Original post)

Fri Feb 1, 2013, 05:44 PM

5. END OF FABULOUS FAB: Trader Accused of Misleading Clients Leaves Goldman Sachs



Fabrice Tourre, the Goldman Sachs trader accused of misleading clients over a controversial mortgage deal, is no longer working at the firm.

In 2010, the Securities and Exchange Commission accused Goldman Sachs and Mr. Tourre of misleading a handful of clients by not disclosing that a hedge fund helped select the bonds for an investment product and also bet that those assets would fall in value. Goldman settled the charges, agreeing to pay $550 million. But Mr. Tourre is still fighting the civil case. Mr. Tourre had been on unpaid leave from Goldman for some time and has not been working for the firm since the end of 2012. However, the firm is still paying the trader's legal bill.

The trader's often over-the-top emails made headlines in 2010 when the S.E.C. charged the firm and Mr. Touree with fraud. In one note to a friend, he claimed he managed to sell the product in question to some "widows and orphans" that he ran into at an airport.

Mr. Tourre has denied wrongdoing and could go on trial as early as this year. His lawyer did not return a call for comment...

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Response to Demeter (Original post)

Fri Feb 1, 2013, 05:50 PM

6. Jacob Lew, Mary Jo White and Dunbar’s Number By SIMON JOHNSON



Simon Johnson, former chief economist of the International Monetary Fund, is the Ronald A. Kurtz Professor of Entrepreneurship at the M.I.T. Sloan School of Management and co-author of "White House Burning: The Founding Fathers, Our National Debt, and Why It Matters to You."


Jacob J. Lew, the president's nominee for Treasury secretary, and Mary Jo White, the nominee for chairwoman of the Securities and Exchange Commission, are making financial reformers nervous. The issue is not so much their track record, because neither has worked directly on financial-sector policy issues; it is much more about whom they know. Specifically, how many people do they know and trust outside the financial sector, away from the sphere of influence of the very large banks? More pointedly, when it comes to thinking about financial-sector policy, who exactly is in their inner circle?

Nobody knows a huge number of people, at least not well. In the language of anthropology and biology, the limit to a person's social network is known as Dunbar's Number - which is 147.5, although people often round it to 150. Our brains do not support the interactions required by larger social groups. (AND I THOUGHT IT WAS JUST ME!--DEMETER) More precisely, the predicted size for most human groups, based mostly on the characteristics of our brains, is 100.2 to 231.1 people. For details and caveats, look at Robin Dunbar's 1993 paper, "Co-evolution of neocortical size, group size and language in humans," published in Behavioral and Brain Sciences (Issue 16, Pages 681-735). Or just think about the number of people you know well and would rely on for advice, particularly with complex and sensitive issues. When you get to know new people, you often lose track of your previous close colleagues or even good friends. And what applies to ordinary mortals most definitely applies to the people elected or appointed to run the country. Whenever the world gets complicated - for example, because the financial sector has turned nasty - policy makers need trusted sources and established confidants in order to figure out which way is up and what needs to be done.

If most financial experts you know work at, for example, Citigroup, then you are more likely to see the financial world through their eyes. What is good for Citi (and its executives) will, in your mind, become close to what is good for the United States.
One of the most serious concerns about Treasury Secretary Timothy Geithner was that even though he had never worked in a bank, his social network was full of bankers, mostly because of his time at the Federal Reserve Bank of New York and his close connection with Robert Rubin, a former Treasury secretary and then a director of and senior adviser to Citigroup. In this network, many of Mr. Geithner's deepest financial-sector connections appear to have been with people who were working at Citigroup in 2007-8. (See, for example, a 2009 article by Jo Becker and Gretchen Morgenson.) This observation lines up remarkably well with the devastating critique of Mr. Geithner in Sheila Bair's book, "Bull by the Horns." The main concern of Ms. Bair, former chairwoman of the Federal Deposit Insurance Corporation, is that Mr. Geithner was too close to Citigroup and saw the world as its senior executives did. As Treasury secretary, Mr. Geithner hired people from Citigroup - particularly people who had worked closely with Mr. Rubin (in government or in the private sector or both). Now Mr. Lew, a Citi alum with a central position in the Rubin network, is on the verge of becoming Treasury secretary. How likely is Mr. Lew to confront the risks created by unstable global megabanks? Does he personally know anyone who is concerned about the damage that Citigroup is likely to do in the future - or even has a critical view of what it has done in the past?

While Ms. White's reputation as a prosecutor is second to none, as a defense lawyer she represented executives at several of the largest banks and knows many prominent financial-sector executives. Her husband, John W. White, now a corporate lawyer, had a senior role at the S.E.C. when Christopher Cox was its chairman, a time when the S.E.C. was aiding and abetting excessive deregulation at every opportunity; Ms. White will need to step aside in actions against companies her husband has advised. To whom will Ms. White turn when she wants to understand how to make the financial sector safer? If confirmed, Mr. Lew and Ms. White face formidable policy agendas. They need to demonstrate both an impressive grip of the details of what works in financial sector reform, as well as the ability to ignore a great deal of whining and to resist other pressure from the megabanks...


..."Personnel is policy," people in Washington often remark. The next round of appointments, including those at the deputy and under secretary level, is very important. At this point, I am not optimistic about who will get these jobs. Is the second Obama administration hiring people who understand and can implement financial reform? Or is it again merely promoting people whose social networks are disproportionately tilted toward the big Wall Street banks?

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Response to Demeter (Original post)

Fri Feb 1, 2013, 05:57 PM

7. Unemployment claims rise as fragile US jobs market takes hit



...Initial jobless claims increased by 38,000 to a seasonally adjusted 368,000 in the week ended January 26, the Labor Department said Thursday. The rise was the largest since early November, when claims spiked in the wake of Hurricane Sandy. The rise was higher than the 365,000 figure forecast by economists, but the jobs market still appears to be slowly recovering. Claims above 400,000 signal a deteriorating jobs market. The latest weekly figures come ahead of Friday's monthly non-farm figures, which give a far more comprehensive picture of the US jobs market.

On Wednesday, the Commerce Department said the US economy went into reverse in the last quarter of 2012, the first decline since the recession of 2009. The fall was driven by deep cuts in government spending, including a 22.2% cut in defense expenditure, the largest since the end of the Vietnam war. The US's gross domestic product shrank 0.1% in the final months of 2013 as businesses cut back on inventories and Washington argued over the fiscal cliff.

Investors will be watching carefully on Friday to see how the contraction plays out in the still weak jobs market. More cuts to government spending are expected in March as the US attempts to tackle its budget problems. Economists are predicting the US to have added 150-170,000 new jobs in January. The US added 155,000 in December...

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Response to Demeter (Original post)

Fri Feb 1, 2013, 06:02 PM

8. Obama Administration Considers Joining Publishers In Fight To Stamp Out Fair Use At Universities



from the pure-insanity dept

Okay, this is really quite unfortunate. In 2011, we wrote about an important copyright case involving three publishers suing Georgia State University for daring to have "e-reserves" that allow professors to make certain works available to students electronically via the university library. Nancy Sims, copyright librarian for the University of Minnesota, wrote a guest post summarizing the case for us as follows:
The publisher-plaintiffs are suing over the way instructors (and possibly others on campus) share course readings like academic articles and excerpts from academic books. They are objecting both to readings posted on course websites (i.e., uploaded by instructors and accessible only to students registered for a course) and readings shared via "e-reserves" (i.e., shared online through university libraries, usually also with access restricted to students registered for the course). The publishers claim that sharing copies of readings with students is not usually a fair use, that faculty can't really be trusted to make their own calls about what is or is not fair use, and that permissions fees should be paid for most of these uses.
Thankfully, last year, we wrote about how the district court issued an astounding 350-page ruling that basically said that most of these electronic reserves were clearly fair use. We had some issues with the way the judge went about the analysis -- often coming up with random and arbitrary standards for the amount of a work that could be used while remaining fair use, but, on the whole, it was good to see the judge support fair use relatively strongly (and, in some cases, to not even get to a fair use analysis by saying that the use was allowed as "de minimis" copying).

Of course, no matter what happened, the other side was going to appeal. We're getting closer to the appeals court hearing the case, but something interesting popped up last week. In a somewhat surprising move, the Justice Department jumped in and asked the court for some more time for the filing of amicus briefs from concerned third parties, because it was considering weighing in on the case. The Justice Department? Why should it be interested in a dispute concerning whether or not public university libraries are engaged in fair use by making works available to students?

In digging into this, we've heard from a few sources that it's actually the US Copyright Office that has asked the DOJ to weigh in on the side of the publishers and against the interests of public univerisities and students. Yes, the same Copyright Office that just promoted a former RIAA VP to second in command. I'm sure that's just a coincidence.

Let's be clear: it is flat out ridiculous that the Obama Administration may be supporting the publishers here. Two out of the three publishers are foreign publishing giants, and it would be supporting them against a public university library tasked with helping to educate students. The entire purpose of copyright law is supposed to be to promote the progress of learning. The copyright clause in the Constitution used "science" but back in that era "learning" and "science" were effectively synonymous. The very first Copyright Act in the US was actually titled "An Act for the Encouragement of Learning." Current copyright law is explicit that fair use covers this sort of situation:

the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright.

And yet... these publishers, along with the US Copyright Office and (perhaps) the DOJ, would like to ignore all of this, and reject fair use in such public learning centers? It is ridiculous. Oh, and did we mention that the lawsuit by these publishers is really being funded by the Copyright Clearance Center (who, shockingly, would be in charge of collecting fees for such uses...) and the American Publishers' Association? If the Obama Administration wanted to appear any more in the pocket of "Big Copyright" and against the public interest when it comes to learning and education, I'm not sure of any better position to take...This is just a year after the SOPA fight, and it appears that the Copyright Office, led by Maria Pallante, who was a massive supporter of SOPA, has not learned the lesson of that debacle. It would be a travesty if the Justice Department listened to such an out of touch position and argued that the court should reject fair use in such scenarios. It would be a complete embarrassment for an Obama administration that has argued that improving our education system is a key policy issue to turn its back on education by having its Justice Department argue against a public university library and students, and in favor of a blatantly self-interested copyright collection agency, funding some foreign publishers, trying to shake down students for extra money to learn. Just the fact that the US Copyright Office is supporting this and asking the Justice Department to make this move is a sign of how screwed up the Copyright Office is today. And it remains unclear why this is even an issue that concerns the Justice Department at all. Since when is access of students at a public university to educational materials an issue that should be of any interest to the Justice Department?


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Response to Demeter (Original post)

Fri Feb 1, 2013, 06:06 PM

9. EDGAR ALLAN POE The Early life


He was born Edgar Poe in Boston, Massachusetts, on January 19, 1809, the second child of English-born actress Elizabeth Arnold Hopkins Poe and actor David Poe, Jr. He had an elder brother, William Henry Leonard Poe, and a younger sister, Rosalie Poe. Their grandfather, David Poe, Sr., had emigrated from Cavan, Ireland, to America around the year 1750. Edgar may have been named after a character in William Shakespeare's King Lear, a play the couple was performing in 1809. His father abandoned their family in 1810, and his mother died a year later from consumption (pulmonary tuberculosis). Poe was then taken into the home of John Allan, a successful Scottish merchant in Richmond, Virginia, who dealt in a variety of goods including tobacco, cloth, wheat, tombstones, and slaves. The Allans served as a foster family and gave him the name "Edgar Allan Poe", though they never formally adopted him.

The Allan family had Poe baptized in the Episcopal Church in 1812. John Allan alternately spoiled and aggressively disciplined his foster son. The family, including Poe and Allan's wife, Frances Valentine Allan, sailed to Britain in 1815. Poe attended the grammar school in Irvine, Scotland (where John Allan was born) for a short period in 1815, before rejoining the family in London in 1816. There he studied at a boarding school in Chelsea until summer 1817. He was subsequently entered at the Reverend John Bransby’s Manor House School at Stoke Newington, then a suburb four miles (6 km) north of London.

Poe moved back with the Allans to Richmond, Virginia in 1820. In 1824 Poe served as the lieutenant of the Richmond youth honor guard as Richmond celebrated the visit of the Marquis de Lafayette. In March 1825, John Allan's uncle and business benefactor William Galt, said to be one of the wealthiest men in Richmond, died and left Allan several acres of real estate. The inheritance was estimated at $750,000. By summer 1825, Allan celebrated his expansive wealth by purchasing a two-story brick home named Moldavia.

Poe may have become engaged to Sarah Elmira Royster before he registered at the one-year-old University of Virginia in February 1826 to study ancient and modern languages. The university, in its infancy, was established on the ideals of its founder, Thomas Jefferson. It had strict rules against gambling, horses, guns, tobacco and alcohol, but these rules were generally ignored. Jefferson had enacted a system of student self-government, allowing students to choose their own studies, make their own arrangements for boarding, and report all wrongdoing to the faculty. The unique system was still in chaos, and there was a high dropout rate. During his time there, Poe lost touch with Royster and also became estranged from his foster father over gambling debts. Poe claimed that Allan had not given him sufficient money to register for classes, purchase texts, and procure and furnish a dormitory. Allan did send additional money and clothes, but Poe's debts increased. Poe gave up on the university after a year, and, not feeling welcome in Richmond, especially when he learned that his sweetheart Royster had married Alexander Shelton, he traveled to Boston in April 1827, sustaining himself with odd jobs as a clerk and newspaper writer. At some point he started using the pseudonym Henri Le Rennet.

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Fri Feb 1, 2013, 06:27 PM

10. Quelle Surprise! Prosecutors Get Tough on Mortgage Fraud….At an Itty Bitty Bank


One of the things that has been galling is watching various officials tasked to protect the public from financial services miscreants is to have them prattle meaningless statistics about how the number of actions of various sorts that they’ve taken is up relative to the previous incumbents. That’s tantamount to a MASH unit tallying up what a great job they did in improving the vaccination rate while not even looking at a huge rise in the mortality rate and questioning whether their response was adequate.

A particularly offensive example of prosecutorial belt-notching is the prosecution of Abacus Bank. Ever heard of Abacus Bank? No, and there’s really no good reason you should have. It has $272 million in total assets. That is no typo.

Now that does not mean that fraud, even at a little bank, should not be prosecuted. But the District Attorney for New York, Cyrus Vance, decided to perp walk some former employees of this bank and hold a news conference about the prosecution (the two children of the founder, one of whom appears to have unearthed the fraud, weren’t charged).

Drake Bennett at Bloomberg took note of the peculiar case today:

Abacus, like many banks, had sold its loans to Fannie Mae (FNMA), taking the proceeds and lending them back out to earn more interest. The huge government-backed company in turn bundled those mortgages into securities it sold to investors. Abacus lied about applicants, Vance charged, because otherwise its loans wouldn’t have met Fannie Mae’s income requirements, and the bank depended on Fannie’s money for a significant chunk of its profit…

In Vance’s description, Abacus’s fraud epitomizes the reckless behavior that swelled—and then burst—the U.S. housing bubble. But Vance was understating the uniqueness of the case. The fraud analytics firm Interthinx estimates that there were between $1 trillion and $4.8 trillion in fraudulent mortgages issued nationwide between 2005 and 2007, yet criminal cases against banks for originating such mortgages have been very rare. There have been a few prosecutions of individuals, a few large civil suits brought against banks such as Bank of America (BAC) and JPMorgan Chase (JPM), and deferred prosecution deals where lenders have paid a financial penalty in lieu of criminal charges. But in the wake of the financial crisis only one bank in the whole country has, as an institution, been criminally indicted for mortgage fraud: Abacus.

And even though the bank and its employees violated Fannie and Freddie standards, the loans performed well, in fact, very well:

Abacus borrowers, in fact, are champion repayers: The bank’s default rate is a fraction of the industry average—in late 2009, when 5.4 percent of Fannie loans were defaulting, Abacus’s default rate was less than a tenth of that. “If every bank in this country committed mortgage fraud the way Abacus allegedly did, we wouldn’t have had a financial crisis, because these loans are performing,” says Kevin Puvalowski, the lawyer representing the bank in the case. As a result, Abacus finds itself in the unlikely position of being charged with a fraud that may have made millions of dollars for its victim, Fannie Mae. By the bank’s own calculations, Fannie and the investors who bought its securities have thus far earned more than $174 million in interest from Abacus mortgages.

As Vance suggested, prosecuting a Chinese bank that no one ever heard of sends a loud and clear message to Wall Street…that they have nothing to worry about.

Read more at http://www.nakedcapitalism.com/2013/02/quelle-surprise-prosecutors-get-tough-on-mortgage-fraud-at-an-itty-bitty-bank.html#bE4qhlK9jiwTsLFX.99

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Fri Feb 1, 2013, 06:35 PM

11. Bill Black:Yglesias Pours Geithner, Holder, Breuer (GHB) Banksters Immunity Doctrine in our Drinks


Yves here. Some readers may not get Black’s joke. GHB (gammahydrabuterol) was demonizied as a date rape drug when it was legal and is now a Schedule 1 drug.*

By Bill Black, the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City.


It’s early, but Salon has published on January 30, 2013 either the funniest or saddest column of the year to date: “Are Banks Too Big To Prosecute?”

The column is attributed to Matthew Yglesias, a blogger who studied philosophy as an undergraduate. It could be a brilliantly ironic satire of the Geithner, Holder and Breuer doctrine of immunity for banksters (which I am dubbing “GHB” for short). GHB is the “roofie” that the Obama administration gave us so the banksters could screw us repeatedly with impunity. Alternatively, and far more likely, Yglesias has written the saddest and most immoral apologia for elite white-collar crime that has yet made it into electronic bits. It takes a rerouted beginning student of philosophy, posing as a commentator on finance, to replace what should be a discussion that includes virtue ethics with a virtue-free, criminology-free, and economics-free apologia for the felons who became wealthy by costing the Nation $20 trillion and 10 million jobs.

Matthew Yglesias wrote a similar column on April 14, 2011 embracing the Geithner immunity doctrine. He titled it: “The Fraud Free Financial Crisis” – and it proves our family’s rule that it is impossible to compete with unintentional self-parody. In 2011, Yglesias thought we might be experiencing the first “Virgin Financial Crisis” – conceived without sin.

Here was how Yglesias stated his position in 2011:

[T]he key sentiment underlying the whole thing is that the Obama administration felt it was important to restabilize the global financial system. That meant, at the margin, shying away from anxiety-producing fraud prosecutions. And faced with a logistically difficult task, that kind of pressure at the margin seems to have made a huge difference. There simply was no appetite for the kind of intensive work that would have been necessary.

Tim Geithner’s judgment was probably correct.

I replied to Yglesias’ column on April 16, 2007, in an article entitled: “Fiat Justitia Ruat Caelum (Let Justice be done, though the Heavens Fall).” The article explained why the best means to prevent the financial heavens from falling was to insist on that the rule of law apply to even the most powerful elites. I find it strange that neither of Yglesias’ columns on a subject that has a vital ethical component discusses the ethics of his support for giving elite bank frauds immunity from the criminal laws. Yglesias’ relevant expertise on this subject was in ethics. The context of the excerpt quoted below is that Yglesias is disturbed that “the populists”, as exemplified by Frontline’s documentary, “The Untouchables,” are winning the debate as to whether the elite bank frauds should be prosecuted. Here is his reasoning:

So the populists win that round. But I think that returns us to the real policy question. Would prosecution of major banks have been a good idea? Luigi Zingales is mighty breezy on this subject.

Here’s the counterpoint. When I first moved to D.C., I opened an account at Riggs Bank since Riggs was close to my house. The next year, Riggs ended up in tons of legal trouble since it turned out to have been complicit in a lot of illegal money laundering. That’s shifting frozen funds to indicted war criminal Augusto Pinochet, helping the dictator of Equatorial Guinea conceal funds stolen from his population, and the financing of al-Qaida terrorists. Serious stuff. Serious investigation. Serious penalties. The upshot was to make the bank nonviable, and it got taken over by PNC Bank out of Pittsburgh. A midsized regional bank facing prosecution and being taken over by a larger regional bank from a geographically adjacent region is bank regulation as it’s supposed to be done. But what if the DOJ had prosecuted Bank of America or Citigroup into nonviability in 2009? Who was going to buy them? Nobody! That was the whole point of TARP and all the rest.

Had you secured criminal convictions against these megabanks, you’d have had to nationalize them and assume their liabilities or else face an economic catastrophe. But if the Obama administration wanted to nationalize the banks, it could have secured that outcome without the bother of criminal prosecution. They decided nationalization was bad public policy. Others disagree. That was an interesting debate in 2009, and I think it remains an interesting debate today. At the time I was an ardent nationalizer. In retrospect I’m not so sure.

But either way, implementing a non-nationalization approach to bank recapitalization and then prosecuting the banks into a renewed state of insolvency and then nationalizing them would have been nuts. If saving the banks was a mistake, then the error had nothing in particular to do with prosecutions, and if saving the banks was the right thing to do, then curtailing prosecutions was the only way to execute the strategy.

I do not know what Yglesias intended to convey by the use of the word “breezy.” The article by Zingales that Yglisias criticizes discusses an econometric study that adds another confirmation that fraud by mortgage lenders was “endemic.” Yglesias makes no effort to refute or even question the econometric study, so under normal uses I would describe Zingales’ discussion as “thoughtful” and Yglesias’ ad hominem dismissal of Zingales’ analysis as “breezy.”

* My endocrinologist was outraged by the campaign against GHB, because it produced a very high quality sleep and was out of your system in 4 hours. He strongly suspected Big Pharma was behind the date rape scare, since GHB was superior to prescription sleeping pills (and pretty much any barbiturate in alcohol will knock someone out). YVES

Read more at http://www.nakedcapitalism.com/2013/02/bill-black-yglesias-pours-the-geithner-holder-breuer-ghb-banksters-immunity-doctrine-in-our-drinks.html#KymPJ8vKc0omxEqY.99

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Fri Feb 1, 2013, 09:03 PM

24. Breuer Identifies Real Clients on Frontline then Quits



Lanny Breuer is out as head of the Criminal Division of the Department of Justice, according to the Washington Post. After his ratlike performance on Frontline (transcript here) it won’t be long before we find him at some creepy New York or DC law firm defending his best friends, the banks and their sleazy employees. His legacy is simple: too big to fail banks can’t possibly commit crimes, so minor civil fines and false promises of reform are punishment enough. Jamie Dimon couldn’t have put it better.
Breuer tried his best to dodge questions about why he violated his promise to Senator Kaufman that he was actually conducting an investigation of Wall Street fraud. Martin Smith, the interviewer, asks:

We spoke to a couple of sources from within the fraud section of the Criminal Division, and through mid-2010 they reported that when it came to Wall Street, there were no investigations going on; there were no subpoenas, no document reviews, no wiretaps.

Breuer responds: “we looked very hard at the types of matters that you’re talking about.” He doesn’t deny that there were no investigations; no subpoenas, no document reviews, no wiretaps. Instead, he tries to shift the subject to his pointless insider trading cases, his Ponzi cases, the Lee Farkas case (the mortgage firm Taylor, Whitaker and Bean), and a few hapless mortgage originator cases, and even a policeman defrauded by some fraud or other. Smith won’t let that pass. Eventually we get to the heart of the problem to Breuer:

But in those cases where we can’t bring a criminal case — and federal criminal cases are hard to bring — I have to prove that you had the specific intent to defraud. I have to prove that the counterparty, the other side of the transaction, relied on your misrepresentation. If we cannot establish that, then we can’t bring a criminal case.

But in reality, in a criminal case, we have to prove beyond a reasonable doubt — not a preponderance, not 51 percent — beyond any reasonable doubt that a crime was committed. And I have to prove not only that you made a false statement but that you intended to commit a crime, and also that the other side of the transaction relied on what you were saying. And frankly, in many of the securitizations and the kinds of transactions we’re talking about, in reality you had very sophisticated counterparties on both sides.

Smith says “You do have plaintiffs who will come forward and say that they relied on the reps and warranties, and they relied on the due diligence claims that were made by the bank.”

Breuer keeps talking, but he can’t worm out of this one. Smith then says:

“We’ve spoken to people inside the Residential Mortgage-Backed Securities Working Group who said that when they began their work in January, February, March of 2012 that they found nothing at the Justice Department in the pipeline, no ongoing cases looking at securitization.”

And lest we forget, Lanny reminds us that these cases have ramifications for the rest of the bank. I don’t know who told Breuer that indicting the investment banking arm of a megabank would destroy the bank, but that’s a piece of idiocy that he claims to believe. This is from a speech he gave last September:

In my conference room, over the years, I have heard sober predictions that a company or bank might fail if we indict, that innocent employees could lose their jobs, that entire industries may be affected, and even that global markets will feel the effects. Sometimes – though, let me stress, not always – these presentations are compelling. In reaching every charging decision, we must take into account the effect of an indictment on innocent employees and shareholders, just as we must take into account the nature of the crimes committed and the pervasiveness of the misconduct. I personally feel that it’s my duty to consider whether individual employees with no responsibility for, or knowledge of, misconduct committed by others in the same company are going to lose their livelihood if we indict the corporation. In large multi-national companies, the jobs of tens of thousands of employees can be at stake. And, in some cases, the health of an industry or the markets are a real factor. Those are the kinds of considerations in white collar crime cases that literally keep me up at night, and which must play a role in responsible enforcement.

This concern is so touching. Too bad he and his team of responsible enforcers never thought about the impact on the families of Aaron Swarz, or any of the countless people serving time for possessing pot, or whistleblowers like John Kirakou and Thomas Drake.

The persistent questioning exposes Breuer’s idea of a hard look: he and his crack prosecutors read the offering documents and let the lawyers for the crooks explain why they make it just fine. They don’t need to issue subpoenas for e-mails that drive the civil cases filed by retirement funds and hedge funds that got screwed by the megabanks. They don’t need to haul the clerks and the functionaries into Grand Juries and find out what they knew and who they told. They don’t need to work up the chain to their bosses and on to the top. They don’t need to identify the lawyers from those white shoe firms that wrote those weasel words into the documents, haul them into the Grand Jury room and find out exactly what they knew and what those words meant. And most important, there is no need to let a jury decide their guilt. Breuer does all that for us.

Breuer is sleazy. But remember, he takes his orders from Attorney General Eric Holder and President Barack Obama. This administration refuses to prosecute.

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Mon Feb 4, 2013, 01:00 PM

70. I am convinced ...

Eric Holder is a saw dust dummy, or maybe his head is filled with saw dust. I don't know which. Obama has consistently done two things: picked astoundingly bad cabinet choices (Hillary might have been a good choice but I think it was a 'keep your enemies closer' choice) and give up his main bargaining chip in the first round.

It is a good thing he is pushing for gun control; he keeps shooting himself in the foot.

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Fri Feb 1, 2013, 06:39 PM

12. IRS Anticipates Cheapest ObamaCare Family Plan Will be $20,000 in 2016


Aiee! CNS News found this tidbit (hat tip furzy mouse), contained in IRS final regulations published on January 31. Now admittedly these are examples for the purposes of illustrating how to make various calculations under the new regulations, but the assumptions are pretty clear. The cheapest type of plan in ObamaCare is a bronze plan, and bronze family plans for 4 and 5 person families are assumed to cost $20,000 in 2016.

First see this section on p. 53:

Now we see how affordable coverage thresholds relate to income in these examples, and notice the plan cost assumptions:

Now before you freak out and worry that that is what you will actually have to pay, there are various types of credits for people who are deemed by formula to “lack affordable coverage”. This is above my pay grade. But I’m pretty stunned at the premiums the IRS is assuming will be generally applicable. One of the benefits claimed for Obamacare was that it would help lower premiums by bringing healthy people who heretofore had gone un or underinsured into the risk pool. It looks like the insurers plan to more than offset that by the premiums they are charging for the higher risk groups they had heretofore managed to exclude. Or at least that will be their excuse.

Some of the backers of the ACA are finding it to be less of a deal than they had anticipated. From the Wall Street Journal (hat tip Tyler Cowen):

Labor unions enthusiastically backed the Obama administration’s health-care overhaul when it was up for debate. Now that the law is rolling out, some are turning sour.

Union leaders say many of the law’s requirements will drive up the costs for their health-care plans and make unionized workers less competitive. Among other things, the law eliminates the caps on medical benefits and prescription drugs used as cost-containment measures in many health-care plans. It also allows children to stay on their parents’ plans until they turn 26.

To offset that, the nation’s largest labor groups want their lower-paid members to be able to get federal insurance subsidies while remaining on their plans. In the law, these subsidies were designed only for low-income workers without employer coverage as a way to help them buy private insurance.

I expect the gnashing of teeth over the ACA to get louder as it is rolled out. We said at the time, and we’ll say it again: this plan is a gimmie to Big Pharma and the health insurers. It makes the underlying problem of the American health care industry, that of excessive costs, only worse. The predictable outcome will be costly insurance that does not cover much. Expect it to be OK on routine care, restrictive on preventative care (that may not be entirely bad given how much doctors overtest) and stingy on big ticket items.

Read more at http://www.nakedcapitalism.com/2013/02/irs-anticipates-cheapest-obamacare-family-plan-will-be-20000-in-2016.html#Ht6AZhGdJmsP1BQU.99

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Fri Feb 1, 2013, 06:44 PM

13. Yet Another Cost of Doing Business Fine: Lender Processing Services Settles with 46 Attorneys Genera


All you need to know to get confirmation that Lender Processing Services got a great gift is to look at what its stock did on the day of the announcement of its $127 million settlement with 46 chump state attorneys general, on a day when the market was down generally:

New York’s attorney general Eric Schneiderman had the temerity to tout the settlement:

“Lender Processing Services, Inc., LPS Default Solutions and DocX cut corners in order to maximize their profits,” said New York Attorney General Schneiderman. “My office will pursue any company that generates false or robo-signed documents that are used to foreclose on New York homeowners.”

The proposed consent judgment resolves allegations that the Jacksonville-based company “robo-signed” documents and engaged in other improper conduct related to mortgage loan default servicing. LPS Default Solutions and DocX primarily provide technological support to banks and mortgage loan servicers.

Among other things, the settlement prohibits signature by unauthorized persons or those without first-hand knowledge of the facts attested to in filed documents, enhances oversight of the default services provided, and requires review of all third-party fees to ensure that the fees have been earned and are reasonable and accurate. The settlement also:

· Prohibits LPS (including DOCX) from engaging in the practice of “surrogate signing” of documents;

· Ensures that LPS has proper authority to sign documents on behalf of a servicer, if in fact it is signing documents;

· Requires LPS to accurately identify the authority that the signer has to execute the document and where that signer is employed;

· Prohibits LPS from notarizing documents outside the presence of a notary and ensures that notarizations will comply with applicable laws;

· Prohibits LPS from improperly interfering with the attorney-client relationship between attorneys and services;

· Prohibits LPS from incentivizing or promoting attorney speed or volume to the detriment of accuracy;

· Requires LPS to ensure that foreclosure and bankruptcy counsel or trustees can communicate directly with the servicer;

· Requires LPS to have enhanced oversight and review of processes over third parties it manages, including those entities that perform property preservation services;

· Prohibits LPS from imposing unreasonable mark-ups or other fees on third party providers’ default or foreclosure-related services;

· Requires LPS to establish and maintain a toll-free phone number for consumers concerning document execution and property preservation services (including winterization, inspection, preservation, and maintenance); and

· Requires LPS to modify mortgage documents that require remediation when LPS has legal authority to do so and when reasonably necessary to assist a consumer or when required by state or local laws.
In the settlement, LPS stipulated to important facts uncovered in the investigation, including the practice by DocX of so-called “surrogate signing,” the signing of documents by an unauthorized person in the name of another and notarizing those documents as if they had been signed by the proper person.

Once the judgment is entered by the courts, LPS will undertake a review of documents executed during the period of January 1, 2008 to December 31, 2010 to determine what documents, if any, need to be re-executed or corrected. If LPS is authorized to make the corrections, it will do so and will make periodic reports of the status of its review and/or modification of documents. Consumers may also call the LPS toll-free number and request review and correction of any documents executed by LPS at any time.

As we recounted at length on this blog, the issues with LPS go well beyond robosigning. “Robosigning” was a convenient label to divert attention from the fact that the party that was attempting to foreclose didn’t merely have improperly executed documents, which is what this lame settlement would lead you to believe. It was that it was often the improper party, raising a host of issues (borrower exposure to liability from the proper party, which has occasionally turned out to be a real issue, clouded title). I happened to speak to a reporter on the mortgage beat one of the major New York papers, and that individual was sputtering about the settlement.

Worse, notice how this settlement institutionalized the undermining of procedures that go back to the 1677 Statute of Frauds. LPS is permitted to sign documents on behalf of a servicer if it is authorized to do so. But a bedrock concept of the law has been that evidence submitted in court (an an affidavit stands in lieu of testimony) is based on personal knowledge. LPS does not know the integrity of the underlying servicer systems (and our Bank of America series confirms our suspicion that they often suck). Is it going to be, as before, that servicers file affidavits attesting as to the amount the borrower owes? We might as well throw our judicial system down the toilet if so.

The one small bit of solace is that New York state’s court system has put in a much tougher certification requirement regarding evidence submitted in foreclosures, so that might explain why Schneiderman can be so cavalier. But also notice there is no mention of monitoring or enforcement in the settlement, and all these promises to do better mean squat without them. We plan to look at the agreement when filed, but we aren’t optimistic that it will have any teeth.

I can’t fathom how the Administration and its allies think that these efforts to put band aids over gangrene are going to restore confidence in the housing market. Anyone buying a house with a mortgage in America is putting themselves at risk of being abused by their servicer and suffering severe financial harm. I suppose the American love affair with housing will prove to be yet another exercise in hope over experience.

Read more at http://www.nakedcapitalism.com/2013/02/yet-another-cost-of-doing-business-fine-lender-processing-services-settles-with-46-attorneys-general-for-127-million.html#6Suuzfi9cwbLAKz3.99

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Fri Feb 1, 2013, 07:11 PM

14. EDGAR ALLAN POE Military career


Unable to support himself, on May 27, 1827, Poe enlisted in the United States Army as a private. Using the name "Edgar A. Perry", he claimed he was 22 years old even though he was 18. He first served at Fort Independence in Boston Harbor for five dollars a month. That same year, he released his first book, a 40-page collection of poetry, Tamerlane and Other Poems, attributed with the byline "by a Bostonian". Only 50 copies were printed, and the book received virtually no attention. Poe's regiment was posted to Fort Moultrie in Charleston, South Carolina and traveled by ship on the brig Waltham on November 8, 1827. Poe was promoted to "artificer", an enlisted tradesman who prepared shells for artillery, and had his monthly pay doubled. After serving for two years and attaining the rank of Sergeant Major for Artillery (the highest rank a noncommissioned officer can achieve), Poe sought to end his five-year enlistment early. He revealed his real name and his circumstances to his commanding officer, Lieutenant Howard. Howard would only allow Poe to be discharged if he reconciled with John Allan and wrote a letter to Allan, who was unsympathetic. Several months passed and pleas to Allan were ignored; Allan may not have written to Poe even to make him aware of his foster mother's illness. Frances Allan died on February 28, 1829, and Poe visited the day after her burial. Perhaps softened by his wife's death, John Allan agreed to support Poe's attempt to be discharged in order to receive an appointment to the United States Military Academy at West Point.

Poe finally was discharged on April 15, 1829, after securing a replacement to finish his enlisted term for him. Before entering West Point, Poe moved back to Baltimore for a time, to stay with his widowed aunt Maria Clemm, her daughter, Virginia Eliza Clemm (Poe's first cousin), his brother Henry, and his invalid grandmother Elizabeth Cairnes Poe. Meanwhile, Poe published his second book, Al Aaraaf, Tamerlane and Minor Poems, in Baltimore in 1829.

Poe traveled to West Point and matriculated as a cadet on July 1, 1830. In October 1830, John Allan married his second wife, Louisa Patterson. The marriage, and bitter quarrels with Poe over the children born to Allan out of affairs, led to the foster father finally disowning Poe. Poe decided to leave West Point by purposely getting court-martialed. On February 8, 1831, he was tried for gross neglect of duty and disobedience of orders for refusing to attend formations, classes, or church. Poe tactically pled not guilty to induce dismissal, knowing he would be found guilty.

He left for New York in February 1831, and released a third volume of poems, simply titled Poems. The book was financed with help from his fellow cadets at West Point, many of whom donated 75 cents to the cause, raising a total of $170. They may have been expecting verses similar to the satirical ones Poe had been writing about commanding officers. Printed by Elam Bliss of New York, it was labeled as "Second Edition" and included a page saying, "To the U.S. Corps of Cadets this volume is respectfully dedicated." The book once again reprinted the long poems "Tamerlane" and "Al Aaraaf" but also six previously unpublished poems including early versions of "To Helen", "Israfel", and "The City in the Sea". He returned to Baltimore, to his aunt, brother and cousin, in March 1831. His elder brother Henry, who had been in ill health in part due to problems with alcoholism, died on August 1, 1831.

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Fri Feb 1, 2013, 07:19 PM

15. Not Everyone is Living Longer —By Kevin Drum


On the Wall Street Journal op-ed page, Donald Boudreaux and Mark Perry argue that the middle class is doing better than we liberals think. They haul out all of the usual arguments, some of which are valid (you need to count healthcare benefits as part of income) and some of which aren't (the average is being pulled down by immigrants). But then there's this:

No single measure of well-being is more informative or important than life expectancy. Happily, an American born today can expect to live approximately 79 years—a full five years longer than in 1980 and more than a decade longer than in 1950. These longer life spans aren't just enjoyed by "privileged" Americans.

Harold Meyerson is agog: "Clearly, they missed the recent study in Health Affairs which found that the life expectancy of white working class men fell by three years from 1990 to 2008, and that of white working class women by five years." This is actually the figure for high school dropouts, not the entire working class. At the other extreme of the educational spectrum, whites with more than a college degree, life expectancies have risen by five years for men and three years for women.

The chart on the BELOW shows the difference, with men in light colors and women in darker colors. Longer life spans, it turns out, really do depend on just how privileged you are.


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Fri Feb 1, 2013, 07:24 PM

16. Crazy Ideas FROM ATRIOS



I know my crackpot ideas are unlikely to achieve much beyond a few subscribers to my newsletter, but increasingly I become convinced that the solution to all economic problems is "give free money to people."

We give lots of free money to people, actually. We just tend to give it to banksters. I saw some panicked stuff today about ZOMG THE FED BALANCE SHEET IS $3 TRILLION or something similar, which essentially means the Fed has created 3 trillion bucks out of nothing and purchased financial assets with it. That isn't precisely a gift, but it boosts asset prices, and most of us don't own many financial assets. Rich people do.

So Fed action of this type benefits the wealthy, with the vague hope it improves the broader macroeconomy.

Unless gastritis broke my calculator, 3 trillion fedbucks translates to about 10 grand in free money for each of us. I think I advocated the "mail every SS # holder a 10 grand check" at some point. Would be happy to hear from the Very Serious People why this would be worse policy. It's impossible to imagine it wouldn't be welfare enhancing. Tell me why if I'm wrong.

Speaking of free money... ahem!

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Fri Feb 1, 2013, 07:27 PM

17. Groupthink in Davos: The Financial Crisis Is Over



The hive mind of Davos has concluded that the financial crisis is done, finished. The new worry: a bubble in the credit markets.

There is no official declaration, or even a formal survey. But the chatter at the World Economic Forum in Davos, Switzerland, is about the end of the financial crisis that began in 2008 and dragged on through last summer’s spike in Spanish and Italian government bond yields. “There’s a crystallization of thought that the financial crisis is over,” says Scott Minerd, managing partner and chief investment officer of Guggenheim Partners, a Santa Monica (Calif.) firm with about $160 billion under management.

“I was riding around in a van last night with two guys whose names you’d recognize,” Minerd said. “They were comparing notes and hearing the same thing. The conclusion has sort of gone viral. It’s an interesting social-networking phenomenon.” It has real-world consequences, too. “When thought leaders leave an event like this, they take the message with them, and it affects the way they behave.” That is, they’ll buy.

In fact, the new worry at Davos this week is that people aren’t worried enough. A heavily oversubscribed Spanish bond auction is the latest sign of what some Davosians see as a growing bubble in the credit markets.

Minerd, for one, thinks asset prices have room to rise. People who still worry about the financial crisis are too late, he says, and those who worry about a bubble are too early.

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Fri Feb 1, 2013, 07:30 PM

18. Davos: Was the Mood Too Good to Be True?



Business leaders and policymakers cautioned against complacency on Saturday amid increasing optimism that the euro zone is emerging from the crisis. As the World Economic Forum in Davos drew to a close, Axel Weber, Chairman of Swiss bank UBS told delegates at a CNBC-moderated debate on Saturday that significant challenges remained.

"Expectations, in particular on the role of central banks are too high. The role of central banks should not be overstated, I think some expectation management is in order here," he said.

Weber said said the mood had been good, maybe too good to be true at the annual gathering in the Swiss ski resort. "I think some expectation management is in order." His views echoed those of Mark Carney, Governor of the Bank of Canada who said in Davos that he did not agree with a the optimism that appeared to prevail among delegates. Li Daokui, one of China's leading economists, agreed there were still risks to a sustained global economic recovery. "I do worry about potential risks in 2013," he said. He also said the U.S. economy posed a risk, with problems being pushed back.

"In Europe we've seen some meaningful progress through promises delivered by politicians. In the U.S. my observation is that not even promises..are made. All we have seen is that the difficult problems are pushed back," Daokui said, referring to the ongoing discussions to raise the debt ceiling and last year's struggle to avert the so-called fiscal cliff.

"I do worry that the scenario of July 2011 may come back in 2013," Daokui argued. "If that happens a nasty dynamic will travel through the financial markets and very negative consequences will be felt in many parts of the world."

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Fri Feb 1, 2013, 07:32 PM

19. A handy guide to Davos-speak By Ryan McCarthy



“The impatience for growth will really take patience” — that’s Bank of America CEO Brian Moynihan in a panel on low economic growth, using the particular kind of language particular to the people who inhabit particular places like Davos. A panel called “No Growth, Easy Money — The New Normal?” (those latter three words another terrible Davos phrase) began with the moderator grimly telling the crowd: “Will we ever return to the normal, free world?” This kind of sentence is ostensibly the kind of English you and I subscribe to, but on further examination, not so much.

Are the Davos elite really worrying about their freedom? Well, no. The World Economic Forum has no shortage of silly phrases, but some of them actually do have meaning beyond the euphemistic. What Davos folks mean when they constantly call for a “growth plan” or “restoring growth” is that no one can see any particular industry that’s going to increase the pace at which they get rich. And, as a result, the rest of us will have fewer jobs. Ray Dalio, who runs Bridgewater, the world’s biggest hedge fund, had probably the clearest take on this low-growth world. In a post-crisis, high-debt global economy, Dalio said, economic growth can’t come from debt, as it did during the last few decades or so. Economies are still deleveraging, debt won’t rise faster than income and the primary way large economies can grow is by increasing productivity. What does Dalio actually mean by this? Dalio expanded a bit: the big conversation in politics and economics, he said, will be about how to get more out of workers – growth won’t come from the next Internet, the next real estate boom or any new asset, in other words. This means, he said, hard choices about questions like “How long is a vacation?” or “What is a good life?”

If you unpack this Davos-speak a bit, what Dalio is saying is particularly dire for the rest of us. When the world’s most successful investors tells you economic growth is going to depend on whether or not you take a vacation, it’s time to worry. This is what Tyler Cowen calls “the great stagnation,” a period of declining productivity growth that could hurt living standards. This isn’t good news for those of us who don’t have Davosian savings to rely on. But there’s another troubling phrase that kept coming up: on Friday, Mario Draghi said the ECB’s actions last year had “removed the tail risk” from the Euro, a phrase that was repeated by a handful of panelists on Friday. This a funny way to put it — as my Reuters colleague Felix Salmon has pointed out at length, tail risk is something that is , by definition, improbable, elusive and generally hard to identify. When a Davos luminary, even one as accomplished as Mario Draghi, starts claiming to have identified something largely unidentifiable, take it with a big dose of non-euphemistic skepticism.

Or, to put it in, Davos-speak: retain your “uber-mindfulness-influence”

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Fri Feb 1, 2013, 07:46 PM

20. Stuff about the inaugural speech Posted on January 24, 2013 by riverdaughter



...I’m not surprised that there are so many people in the left blogosphere who were hopeful about Obama’s turn towards liberalism. His forays into the left side of liberalism reminds me of one of those papers that groups put out where they discuss “progress towards the synthesis of some impossibly big and chiral natural product that will save the world from toe fungus” or something like that. I get the feeling that those authors are hoping that the project will be dropped before they have to write on it again...Now, I realize that there are still skeptics among the hopeful but I don’t think they’re skeptical enough. What’s a little surprising is how quickly they forget that Obama started his first term with solid majorities in both houses and a filibuster proof majority in one of them and that public sentiment at the time was running so high against the banks that he could have pushed anything he wanted with the public’s blessing. Oh sure, the right would have called him a socialist but the right would have done that anyway, no matter what he did. When you’re leader of the free world with so much power and public urgency to do something, there are only a couple of reasons I can think of as to why you might do relatively nothing. The first reason is that you don’t know what the heck you’re doing and are therefore susceptible to bad advice. The second is that you think “liberalism” is a dirty word and don’t want to hurt the people who put you in office. The third possibility is that both are true.

But whatever you think went wrong with the first term, here is the thing: for many of us who were affected, the lack of action to serve the vast majority of Americans, the astonishing squandering of two years of Democratic majorities, is insurmountable. It has caused irreversible damage to our personal fortunes and those of our children. Don’t get me wrong, many of us will survive this and go on to lead productive lives again, though never again as securely and prosperously as before. But the pain and the sacrifice that we have had to endure for absolutely no reason whatsoever, the houses that were lost, the careers that have been blighted either at the beginning or the middle, the harshness of the society that we now live in, all that has lead to an America that is vastly different now than it was four years ago. This America has lost its shine. It’s living with what will soon be third world infrastructure. We have given exploitation and extraction of wealth of average Americans the official stamp of approval. We will now be guests at major scientific projects around the world instead of leaders. We have trashed our educational system by making it almost impossible for some of our most talented students to be able to afford it and we have jeopardized our public health system by making research a private endeavor optimized for maximum profit.

Four years ago, there was a golden opportunity to set things right and it was lost. Obama would have to be superhuman and extraordinarily motivated to turn this around. And even if his heart is in the right place, and I see no evidence of that, he still needs to develop the political skills to get around a gerrymandered House.

Now, this doesn’t mean that some people in this country will not succeed. I think there are still opportunities available for success in this country. But it’s going to be more of a Dickensian country in the future and that puts the teachable moment about race in its proper perspective for me. Besides, any “liberal” or “progressive” who thinks that only one group of disadvantaged people can be served at one time and that symbols are more important than actually, you know, getting things done, is a fool and a mark for psychological manipulators in future election cycles. I don’t want to depress my side of the blogosphere or tell them all is lost or that all efforts are wasted. I’d just like for them to be realistic and evaluate the evidence and stop living in a dream world where the good guys triumph. Obama has shown you who he is. He was the wrong guy at the wrong time. He doesn’t have it in him to make it better and he doesn’t have the resources to make it work anymore. This is the guy who was elected- twice- when there were other, better choices available. Pining for Hillary to take over in 2016 doesn’t help those of us who needed a better choice back in 2008 and by 2016, it will be too late to make a difference. These are the parameters you are working with in the next four years. In other words, you can’t rely on the White House. His speech was “just words”. Anyone can read those carefully crafted, committee synthesized words on a teleprompter. Believing them and acting on them are quite different things and we have seen with this president that he has a habit of getting the hopes up of various Americans, making them think he’s going to take action in their favor and then delivering extremely dilute solutions of eau de tea. He has very little integrity, he’s surrounded by advisors who calculate exactly how much or little effort to expend on your behalf and the trust is gone. That’s what we’re working with.

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Fri Feb 1, 2013, 08:50 PM

23. For even more strongly worded criticism


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Fri Feb 1, 2013, 09:28 PM

27. I Guess the “One Leader” Part Is Taken as a Given CREEPIER STILL



Re-reading the Obama quote in my last post, this jumped out at me:

We must do these things together, as one nation, and one people.

While the whole paragraph containing that line is creepily collectivist, that line is two thirds of the infamous “ein volk, ein Reich, ein Furher” slogan, which is truly creepy-especially given the personality cult that surrounds Obama. A personality cult that was on grotesque display yesterday in what should have been a civic occasion celebrating the democratic process, rather than the individual selected through that process to hold (temporarily) executive authority.

Are he and his speechwriters so clueless not to understand the parallel? I certainly hope so, because the alternative would be truly disturbing. But more generally, I reject the entire premise. We are not a herd of bovines that needs to be driven in a single direction. Indeed, the very attempt to do so is doomed to failure.

Again: people associating freely, in firms, private organizations, churches, or what have you-civil society-acting according to their own private lights and own private interests will be much more successful in achieving things great and small than they would be under some central direction.

It is doubly ironic that in that same paragraph Obama mentions Americans defeating fascism, because the fundamental theme of his speech has far more in common with fascism than it does with the traditions of the American Founding. Which is not surprising, because progressives (and Progressives) have always been deeply critical of the Founders’ Constitution, and because during the 1920s and early-1930s many progressives openly admired fascism, especially the Mussolini variant.

But it is deeply disturbing that Obama, likely ignorantly (for he is truly an ignorant man), explicitly adopts two thirds of a fascist formulation of a political philosophy.

As for the third part, that seems to be the province of the deed, rather than the word.

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Fri Feb 1, 2013, 08:06 PM

21. JPMorgan Chase Trying To Block Shareholder Vote On Breaking Up Bank



A federation of U.S. labor unions is looking to force JPMorgan Chase's board to consider breaking up the company after the disastrous "London Whale" affair, but the bank is trying to ensure that its shareholders do not get to vote on the union's proposal.

The largest U.S. bank is seeking permission from the U.S. Securities and Exchange Commission to omit the proposal from the measures that shareholders vote on this spring, according to a letter sent to the agency on January 14.

The AFL-CIO's Reserve Fund, a union fund that owns JPMorgan shares, wants the bank's board to form a committee that would explore "extraordinary transactions that could enhance stockholder value," including breaking off one or more of the company's businesses. The panel should hire third-party advisers and make a report to shareholders 120 days after this spring's annual shareholder meeting, according to the proposal. The bank has become too big manage, the proposal said, citing more than $6 billion in losses last year by a trader nicknamed the "London Whale" in the bank's Chief Investment Office in London. "In our view, the evidence is mounting that JPMorgan has reached the point where stockholders would benefit from restructuring," the AFL-CIO said in its proposal.

In its letter to the SEC, lawyers for JPMorgan said the proposal should be blocked from being included in the bank's proxy filing because it involves the company's ordinary business, an exclusion allowed under SEC rules. The letter also says the proposal includes "false and misleading" statements and is "vague and indefinite." Spokespersons for JPMorgan and the SEC declined to comment on the proposal. In response to a question in an interview on Fox Business News on Thursday, JPMorgan CEO Jamie Dimon said there is no reason for the bank to break up or spin-off businesses.

"We are in four businesses. They are all doing very well," he said. "There is a lot of cross-sell. We have good returns on capital, third year of record profits. There is no reason for us to contemplate something like that."


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Fri Feb 1, 2013, 09:05 PM

25. Banks 'ports in the storm’ during crisis, says JP Morgan's Dimon



The JP Morgan boss led a powerful panel at Davos in an attack on global regulators, pouring scorn on their criticism of bank complexity. “Businesses can be opaque. They are complex. You don’t know how jet engines work either,” he said.

He argued that his bank continued to lend to Spain and Italy knowing that “something might go wrong”, because “we are not a fair-weather friend... What shall we say? That it’s too much risk? We provide a service to you, that’s what happens.”

Mr Dimon argued that regulators are out of their depth and have failed to fix the system despite having spent five years trying. “I think a lot of regulators are also overwhelmed,” he said. “They’re overwhelmed with rules and regulations.”

Unless this changes, Mr Dimon said: “It’s not going to fix. It’s just five more years of pointing fingers, scapegoating, using misinformation and thinking we’re making a better system.”


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Fri Feb 1, 2013, 08:20 PM

22. EDGAR ALLAN POE Publishing career


After his brother's death, Poe began more earnest attempts to start his career as a writer. He chose a difficult time in American publishing to do so. He was the first well-known American to try to live by writing alone and was hampered by the lack of an international copyright law. Publishers often pirated copies of British works rather than paying for new work by Americans. The industry was also particularly hurt by the Panic of 1837. Despite a booming growth in American periodicals around this time period, fueled in part by new technology, many did not last beyond a few issues and publishers often refused to pay their writers or paid them much later than they promised. Poe, throughout his attempts to live as a writer, repeatedly had to resort to humiliating pleas for money and other assistance.

After his early attempts at poetry, Poe had turned his attention to prose. He placed a few stories with a Philadelphia publication and began work on his only drama, Politian. The Baltimore Saturday Visitor awarded Poe a prize in October 1833 for his short story "MS. Found in a Bottle". The story brought him to the attention of John P. Kennedy, a Baltimorean of considerable means. He helped Poe place some of his stories, and introduced him to Thomas W. White, editor of the Southern Literary Messenger in Richmond. Poe became assistant editor of the periodical in August 1835, but was discharged within a few weeks for having been caught drunk by his boss. Returning to Baltimore, Poe secretly married Virginia, his cousin, on September 22, 1835. He was 26 and she was 13, though she is listed on the marriage certificate as being 21. Reinstated by White after promising good behavior, Poe went back to Richmond with Virginia and her mother. He remained at the Messenger until January 1837. During this period, Poe claimed that its circulation increased from 700 to 3,500. He published several poems, book reviews, critiques, and stories in the paper. On May 16, 1836, he had a second wedding ceremony in Richmond with Virginia Clemm, this time in public.

The Narrative of Arthur Gordon Pym of Nantucket was published and widely reviewed in 1838. In the summer of 1839, Poe became assistant editor of Burton's Gentleman's Magazine. He published numerous articles, stories, and reviews, enhancing his reputation as a trenchant critic that he had established at the Southern Literary Messenger. Also in 1839, the collection Tales of the Grotesque and Arabesque was published in two volumes, though he made little money off of it and it received mixed reviews. Poe left Burton's after about a year and found a position as assistant at Graham's Magazine.

In June 1840, Poe published a prospectus announcing his intentions to start his own journal, The Stylus. Originally, Poe intended to call the journal The Penn, as it would have been based in Philadelphia, Pennsylvania. In the June 6, 1840 issue of Philadelphia's Saturday Evening Post, Poe bought advertising space for his prospectus: "Prospectus of the Penn Magazine, a Monthly Literary journal to be edited and published in the city of Philadelphia by Edgar A. Poe." The journal was never produced before Poe's death. Around this time, he attempted to secure a position with the Tyler administration, claiming he was a member of the Whig Party. He hoped to be appointed to the Custom House in Philadelphia with help from President Tyler's son Robert, an acquaintance of Poe's friend Frederick Thomas. Poe failed to show up for a meeting with Thomas to discuss the appointment in mid-September 1842, claiming to have been sick, though Thomas believed he had been drunk. Though he was promised an appointment, all positions were filled by others.

One evening in January 1842, Virginia showed the first signs of consumption, now known as tuberculosis, while singing and playing the piano. Poe described it as breaking a blood vessel in her throat. She only partially recovered. Poe began to drink more heavily under the stress of Virginia's illness. He left Graham's and attempted to find a new position, for a time angling for a government post. He returned to New York, where he worked briefly at the Evening Mirror before becoming editor of the Broadway Journal and, later, sole owner. There he alienated himself from other writers by publicly accusing Henry Wadsworth Longfellow of plagiarism, though Longfellow never responded. On January 29, 1845, his poem "The Raven" appeared in the Evening Mirror and became a popular sensation. Though it made Poe a household name almost instantly, he was paid only $9 for its publication. It was concurrently published in The American Review: A Whig Journal under the pseudonym "Quarles".

The Broadway Journal failed in 1846. Poe moved to a cottage in the Fordham section of The Bronx, New York. That home, known today as the "Poe Cottage", is on the southeast corner of the Grand Concourse and Kingsbridge Road. Virginia died there on January 30, 1847. Biographers and critics often suggest that Poe's frequent theme of the "death of a beautiful woman" stems from the repeated loss of women throughout his life, including his wife.

Increasingly unstable after his wife's death, Poe attempted to court the poet Sarah Helen Whitman, who lived in Providence, Rhode Island. Their engagement failed, purportedly because of Poe's drinking and erratic behavior. However, there is also strong evidence that Whitman's mother intervened and did much to derail their relationship. Poe then returned to Richmond and resumed a relationship with his childhood sweetheart, Sarah Elmira Royster.

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Fri Feb 1, 2013, 09:25 PM

26. Richard Koo Debunks “Deleveraging is Almost Done, American Consumer Getting Ready for Good Times"


Richard Koo of Nomura published an important piece earlier this week which got some attention in the financial blogosphere (Clusterstock, FT Alphaville). It takes issue with a critical part of the economist optimists’ case, namely, that consumer deleveraging is about done and therefore the economy is likely to perform much better in the next few years.

I have doubts even with the thesis as stated, given that the assumption is that having consumers releverage would be a good thing. We have stagnant wages and short job tenures and concerns that demographics will no longer drive growth in the US, combined with the fact that the BIS has found that household debt to GDP ratio of over 85% are associated with a negative impact on economic growth, and we are still above that level:

And that’s before you get into the issue of the composition of debt: a lot of the deleveraging has been involuntary (foreclosures and bankruptcies) and has been partially offset by rising levels of student, which is more pernicious than credit card or mortgage debt, since it can’t be discharged in bankruptcy, and is accumulated at the beginning of an adult’s income-earning years.

Koo makes a different point: that some of the figures that the bulls have cited as positive are anything but:

Those making this argument that deleveraging is over seem to be basing their views on the fact that the Fed’s Flow of Funds Accounts show the US household sector as a net investor in 2012 Q3, the first time that has happened since 2007 Q2…the US household sector was characterized by a financial deficit of 2.8% of GDP, and this, I suspect, led some to argue that the US balance sheet recession was over.

Koo refers to this chart to make his point:


The white bars are financial assets and the red bars are liabilities. The blue line is the difference between the two. Koo again:

While US households did indeed run a financial deficit in Q3, the deficit was not necessarily driven by positive factors. If people who had been paying down debt to repair their balance sheets had actually resumed borrowing, it would mean that balance sheet problems were behind us. However, the fact that the latest colored bar in Figure 1 is above zero indicates that US households are still paying down debt.

Inasmuch as this act of reducing financial liabilities in spite of zero interest rates runs counter to the principle of maximizing profits, it suggests that US households continue to undertake balance sheet adjustments.

And the implications…

The answer can also be found in Figure 1:the fact that the latest white bar is below zero means households drew down financial assets in the quarter. And that is hardly a good sign. It has happened only three times since 2000, including the present occasion.

The first instance (barely visible in the graph) was in 2000 Q4, when the Internet bubble collapsed. The second was in 2008 Q4, when the failure of Lehman Brothers sparked a global financial crisis. People faced cash flow problems in both periods andprobably were forced to draw down existing savings to make necessary payments.

During the bubble period towards the middle of Figure 1, much attention was paid to the fact that the US household savings rate had turned negative. While the sector did run a financial deficit during this period, the deficit was attributable to the fact that the increase in financial liabilities (ie growth in borrowing) was greater than the increase in financial assets (ie growth in savings). There was no drawdown of financial assets.

Hence we need to pay attention to the fact that the latest figure shows only the third drawdown of financial assets since 2000 and that this drawdown is responsible for the financial deficit in the broader household sector. The reason: if household consumption is being financed by the drawdown of financial assets, it is not likely to be sustainable.

This pattern of drawing down financial assets while reducing financial liabilities has been frequently observed in Greece during the last two years and is definitely not a positive development, in my view.

I know the plural of anecdote is not data, but I’m not hearing a lot of optimism in the cohorts I’m in contact with. Most people are less freaked out than they were in 2009 and 2010 but while you can say that trend-wise, it’s an improvement in confidence, that does not translate into confidence in the animal spirits sense. One telling story: a former client who was a partner in a financial firm that was sold at a very handsome price and has a net worth somewhere north of $15 million (how much I have no idea) was visiting New York. He and his wife live part of the year in Chicago and are renovating their apartment. She remarked that she had just been in the D&D Building because the showrooms for the Chicago decorators had become very spare since the downturn. I said I was surprised, prices at art auctions were hitting new highs. She said that the people at the top might be spending, but it was different at the next layer. For instance, when she called the contractor she had used before to ask about his schedule for the spring, he signaled he was wide open. Later he said that his 4th quarter had been “OK” and if the rest of the year had been as weak as his first quarter 2012 had suggested, he wouldn’t be in business...


Read more at http://www.nakedcapitalism.com/2013/01/richard-koo-debunks-the-deleveraging-is-almost-done-american-consumer-getting-ready-for-good-times-meme.html#7yHsOr3EQtggsALe.99

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Fri Feb 1, 2013, 09:45 PM

28. Lest you all think I am on a drug-induced posting binge


I am in fact doing a compulsive distraction-from-an-insoluble-threat procedure, until such time as exhaustion allows sleep to intervene.

Since it's too incredibly cold to go out and fetch papers (it's been under 20F all day, and below 10F since sundown), and since I've depleted my escapist fiction of riveting choices, and since I got rather behind on the inbox when mid-January madness became too much to bear, you all are the beneficiaries of this brain-panic.

At least, I hope you find it beneficial...

More joy. Tuesday's low: prediction of -6F....just shoot me now.

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Fri Feb 1, 2013, 10:21 PM

29. Death of Edgar Allan Poe


From Wikipedia, the free encyclopedia

The death of Edgar Allan Poe on October 7, 1849, has remained mysterious: the circumstances leading up to it are uncertain and the cause of death is disputed. On October 3, Poe was found delirious on the streets of Baltimore, Maryland, "in great distress, and ... in need of immediate assistance", according to the man who found him, Joseph W. Walker. He was taken to the Washington College Hospital, where he died at 5 a.m. on Sunday, October 7. Poe was never coherent enough to explain how he came to be in this condition.

Much of the extant information about the last few days of Poe's life comes from his attending physician, Dr. John Joseph Moran, though his credibility is questionable. Poe was buried after a small funeral at the back of Westminster Hall and Burying Ground, but his remains were moved to a new grave with a larger monument in 1875. The newer monument also marks the burial place of Poe's wife, Virginia, and his mother-in-law, Maria. Theories as to what caused Poe's death include suicide, murder, cholera, rabies, syphilis, influenza, and that Poe was a victim of cooping. Evidence of the influence of alcohol is strongly disputed.

After Poe's death, Rufus Wilmot Griswold wrote his obituary under the pseudonym "Ludwig". Griswold, who became the literary executor of Poe's estate, was actually a rival of Poe and later published his first full biography, depicting him as a depraved, drunk, drug-addled madman. Much of the evidence for this image of Poe is believed to have been forged by Griswold, and though friends of Poe denounced it, this interpretation had lasting impact.


On September 27, 1849, Poe left Richmond, Virginia, on his way home to New York. No reliable evidence exists about Poe's whereabouts until a week later on October 3, when he was found delirious on the streets of Baltimore, outside Ryan's Tavern (sometimes referred to as Gunner's Hall). A printer named Joseph W. Walker sent a letter requesting help from an acquaintance of Poe, Dr. Joseph E. Snodgrass. His letter reads:

“ Dear Sir—There is a gentleman, rather the worse for wear, at Ryan's 4th ward polls, who goes under the cognomen of Edgar A. Poe, and who appears in great distress, & he says he is acquainted with you, and I assure you, he is in need of immediate assistance. Yours, in haste, Jos. W. Walker[6] ”

Snodgrass later claimed the note said that Poe was "in a state of beastly intoxication", but the original letter proves otherwise...Snodgrass's first-hand account describes Poe's appearance as "repulsive", with unkempt hair, a haggard, unwashed face and "lusterless and vacant" eyes. His clothing, Snodgrass said, which included a dirty shirt but no vest and unpolished shoes, was worn and did not fit well. Dr. John Joseph Moran, who was Poe's attending physician, gives his own detailed account of Poe's appearance that day: "a stained faded, old bombazine coat, pantaloons of a similar character, a pair of worn-out shoes run down at the heels, and an old straw hat". Poe was never coherent long enough to explain how he came to be in this condition, and it is believed the clothes he was wearing were not his own, not least because wearing shabby clothes was out of character for Poe.

Moran cared for Poe at the for-profit Washington College Hospital on Broadway and Fayette Street. He was denied any visitors and was confined in a prison-like room with barred windows in a section of the building reserved for drunk people. Poe is said to have repeatedly called out the name "Reynolds" on the night before his death, though no one has ever been able to identify the person to whom he referred. One possibility is that he was recalling an encounter with Jeremiah N. Reynolds, a newspaper editor and explorer who may have inspired the novel The Narrative of Arthur Gordon Pym of Nantucket. Another possibility is Henry R. Reynolds, one of the judges overseeing the Fourth Ward Polls at Ryan's Tavern, who may have met Poe on Election Day. Poe may have instead been calling for "Herring", as the author had an uncle-in-law in Baltimore named Henry Herring. In fact, in later testimonies Moran avoided reference to Reynolds but mentioned a visit by a "Misses Herring". He also claimed he attempted to cheer Poe up during one of the few times Poe was awake. When Moran told his patient that he would soon be enjoying the company of friends, Poe allegedly replied that "the best thing his friend could do would be to blow out his brains with a pistol".

In Poe's distressed state, he made reference to a wife in Richmond. He may have been delusional, thinking that his wife, Virginia, was still alive, or he may have been referring to Sarah Elmira Royster, to whom he had recently proposed. He did not know what had happened to his trunk of belongings which, it transpired, had been left behind at the Swan Tavern in Richmond. Moran reported that Poe's final words were "Lord, help my poor soul" before dying on October 7, 1849.

Credibility of Moran

Because Poe did not have visitors, Moran was probably the only person to see the author in his last days. Even so, Moran's credibility has been questioned repeatedly, if not considered altogether untrustworthy. Throughout the years after Poe's death, his story changed as he wrote and lectured on the topic. He claimed (in 1875 and again in 1885, for example) that he had immediately contacted Poe's aunt (and mother-in-law), Maria Clemm, to let her know about Poe's death; in fact, he wrote to her only after she had requested it on November 9, almost a full month after the event. He also claimed that Poe had said, quite poetically, as he prepared to draw his last breath: "The arched heavens encompass me, and God has his decree legibly written upon the frontlets of every created human being, and demons incarnate, their goal will be the seething waves of blank despair." The editor of the New York Herald, which published this version of Moran's story, admitted, "We cannot imagine Poe, even if delirious, constructing [such sentences]." Poe biographer William Bittner attributes Moran's claim to a convention of assigning pious last words to console mourners.

Moran's accounts even altered dates. At different points, he claimed Poe was brought to the hospital on October 3 at 5 p.m., on October 6 at 9 a.m., or on October 7 (the day he died) at "10 o'clock in the afternoon". For each published account, he claimed to have the hospital records as reference. A search for hospital records a century later, specifically an official death certificate, found nothing. Some critics claim Moran's inconsistencies and errors were due only to a lapse of memory, an innocent desire to romanticize, or even to senility. At the time he wrote and published his last account in 1885, Moran was 65.

Cause of death

All medical records and documents, including Poe's death certificate, have been lost, if they ever existed. The precise cause of Poe's death is disputed, but many theories exist. Many biographers have addressed the issue and reached different conclusions, ranging from Jeffrey Meyers' assertion that it was hypoglycemia to John Evangelist Walsh's conspiratorial murder plot theory. It has also been suggested that Poe's death might have resulted from suicide related to depression. In 1848, he nearly died from an overdose of laudanum, readily available as a tranquilizer and pain killer. Though it is unclear if this was a true suicide attempt or just a miscalculation on Poe's part, it did not lead to Poe's death a year later.

Snodgrass was convinced that Poe died from alcoholism and did a great deal to popularize this idea. He was a supporter of the temperance movement and found Poe a useful example in his temperance work. However, Snodgrass's writings on the topic have been proven untrustworthy. Moran contradicted Snodgrass by stating in his own 1885 account that Poe did not die under the effect of any intoxicant. Moran claimed that Poe "had not the slightest odor of liquor upon his breath or person". Even so, some newspapers at the time reported Poe's death as "congestion of the brain" or "cerebral inflammation", euphemisms for deaths from disgraceful causes such as alcoholism. In a study of Poe, a psychologist suggested that Poe had dipsomania.

However, Poe's characterization as an uncontrollable alcoholic is disputed. His drinking companion for a time, Thomas Mayne Reid, admitted that the two engaged in wild "frolics" but that Poe "never went beyond the innocent mirth in which we all indulge... While acknowledging this as one of Poe's failings, I can speak truly of its not being habitual". Some believe Poe had a severe susceptibility to alcohol and became drunk after one glass of wine. He only drank during difficult periods of his life and sometimes went several months at a time without alcohol. Adding further confusion about the frequency of Poe's use of alcohol was his membership in the Sons of Temperance at the time of his death. William Glenn, who administered Poe's pledge, wrote years later that the temperance community had no reason to believe Poe had violated his pledge while in Richmond. Suggestions of a drug overdose have also been proven to be untrue, though it is still often reported. Thomas Dunn English, an admitted enemy of Poe and a trained doctor, insisted that Poe was not a drug user. He wrote: "Had Poe the opium habit when I knew him (before 1846) I should both as a physician and a man of observation, have discovered it during his frequent visits to my rooms, my visits at his house, and our meetings elsewhere – I saw no signs of it and believe the charge to be a baseless slander."

Numerous other causes of death have been proposed over the years, including several forms of rare brain disease or a brain tumor, diabetes, various types of enzyme deficiency, syphilis, apoplexy, delirium tremens, epilepsy and meningeal inflammation. A doctor named John W. Francis examined Poe in May 1848 and believed Poe had heart disease, which Poe later denied. A 2006 test of a sample of Poe's hair provides evidence against the possibility of lead poisoning, mercury poisoning, and similar toxic heavy-metal exposures. Cholera has also been suggested. Poe had passed through Philadelphia in early 1849 during a cholera epidemic. He got sick during his time in the city and wrote a letter to his aunt, Maria Clemm, saying that he may "have had the cholera, or spasms quite as bad".

Because Poe was found on the day of an election, it was suggested as early as 1872 that he was the victim of cooping. This was a ballot-box-stuffing scam in which victims were shanghaied, drugged, and used as a pawn to vote for a political party at multiple locations. Cooping had become the standard explanation for Poe's death in most of his biographies for several decades, though his status in Baltimore may have made him too recognizable for this scam to have worked. More recently, analysis suggesting that Poe's death resulted from rabies has been presented.


Poe's funeral was a simple one, held at 4 p.m. on Monday, October 8, 1849. Few people attended the ceremony. Poe's uncle, Henry Herring, provided a simple mahogany coffin, and a cousin, Neilson Poe, supplied the hearse. Moran's wife made his shroud. The funeral was presided over by the Reverend W. T. D. Clemm, cousin of Poe's wife, Virginia. Also in attendance were Dr. Snodgrass, Baltimore lawyer and former University of Virginia classmate Zaccheus Collins Lee, Poe's first cousin Elizabeth Herring and her husband, and former schoolmaster Joseph Clarke. The entire ceremony lasted only three minutes in the cold, damp weather. Reverend Clemm decided not to bother with a sermon because the crowd was too small. Sexton George W. Spence wrote of the weather: "It was a dark and gloomy day, not raining but just kind of raw and threatening." Poe was buried in a cheap coffin that lacked handles, a nameplate, cloth lining, or a cushion for his head.

On October 10, 2009, Poe received a "do-over" funeral in Baltimore. Actors portrayed Poe's contemporaries and other long-dead writers and artists. Each paid their respects and read eulogies adapted from their writings about Poe. The funeral included a replica of Poe's casket and wax cadaver.

Burial and reburial

On November 17, 1875, Poe was reburied with a new monument. The remains of his wife, Virginia, and mother-in-law, Maria, are also interred there.

Poe is buried on the grounds of Westminster Hall and Burying Ground, now part of the University of Maryland School of Law in Baltimore. Even after his death, however, he created controversy and mystery.

Poe was originally buried without a headstone towards the rear corner of the churchyard near his grandfather, David Poe, Sr. A headstone of white Italian marble, paid for by Poe's cousin Neilson Poe, was destroyed before it reached the grave when a train derailed and plowed through the monument yard where it was being kept. Instead, it was marked with a sand-stone block that read "No. 80". In 1873, Southern poet Paul Hamilton Hayne visited Poe's grave and published a newspaper article describing its poor condition and suggesting a more appropriate monument. Sara Sigourney Rice, a teacher in Baltimore's public schools, took advantage of renewed interest in Poe's grave site and personally solicited for funds. She even had some of her elocution students give public performances to raise money. Many in Baltimore and throughout the United States contributed; the final $650 came from Philadelphia publisher and philanthropist George William Childs. The new monument was designed by architect George A. Frederick and built by Colonel Hugh Sisson, and included a medallion of Poe by artist Adalbert Volck. All three men were from Baltimore. The total cost of the monument, with the medallion, amounted to slightly more than $1,500.

Poe was reburied on October 1, 1875, at a new location close to the front of the church. A celebration was held at the dedication of the new tomb on November 17. His original burial spot was marked with a large stone donated by Orin C. Painter, though it was originally placed in the wrong spot. Attendees included Neilson Poe, who gave a speech and called his cousin "one of the best hearted men that ever lived", as well as Nathan C. Brooks, John Snodgrass, and John Hill Hewitt. Though several leading poets were invited to the ceremony, Walt Whitman was the only one to attend. Alfred Tennyson contributed a poem which was read at the ceremony:

Fate that once denied him,
And envy that once decried him,
And malice that belied him,
Now cenotaph his fame.

Probably unknown to the reburial crew, the headstones on all the graves, previously facing to the east, had been turned to face the West Gate in 1864. The crew digging up Poe's remains had difficulty finding the right body: they first exhumed a 19-year old Maryland militiaman, Philip Mosher, Jr. When they correctly located Poe, they opened his coffin and one witness noted: "The skull was in excellent condition—the shape of the forehead, one of Poe's striking features, was easily discerned."

A few years later, the remains of Poe's wife, Virginia, were moved to this spot as well. In 1875, the cemetery in which she lay was destroyed, and she had no kin to claim her remains. William Gill, an early Poe biographer, gathered her bones and stored them in a box he hid under his bed. Virginia's remains were finally buried with her husband's on January 19, 1885, the 76th anniversary of her husband's birth and nearly 10 years after his present monument was erected. George W. Spence, the man who served as sexton during Poe's original burial as well as his exhumation and reburial, attended the rites that brought his body to rest with Virginia and Virginia's mother, Maria Clemm.

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Sat Feb 2, 2013, 12:33 AM

30. Listened to Ray Bolger sing "Bye Bye Blackbird" this morning

on the "Partridge Family". I tuned in to see him in 1970.

I searched to see if i could find it online after seeing the "WE" theme but I only found it stored privately on Youtube:

This is the episode:

He sang it to his TV wife Rosemary DeCamp on stage with the family singers and his ukelele.

Is there a better search than Google for media like this?

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Response to kickysnana (Reply #30)

Sat Feb 2, 2013, 05:12 AM

32. Congratulations!


I'm no expert on it....I am just happy with whatever I can find.

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Sat Feb 2, 2013, 05:08 AM

31. ‘There Is A Drone With Assange’s Name On It’ - William Blum / Interview By John Robles



Blum: American interventions carried out via the CIA and all the U.S. military have been my specialty for many-many years. My books emphasize those things. As does my monthly newsletters “The Anti-Empire Report”...As far as the backlash: the U.S. government doesn’t bother American authors that much, because they know we don’t have that much influence, they can afford to have us write things and point to that as proof of freedom of speech in America. So they don’t care.

Robles: I see. They said that you had exposed more than 200 CIA employees.

Blum: That was in 1969 when I was working for the “Underground Press” in Washington D.C. and I and a colleague-- we parked our car outside the CIA headquarters in Virginia and for a couple of hours or so, we recorded the license plate numbers of all the cars going into the CIA. And with that information we were able to compile a list of names and addresses of these people, which we published in our underground newspaper.

Robles: That sounds very interesting! You talked about CIA assassination plots, you’re pretty much an expert on that. Can you tell us a little bit about what you know about the plot to remove Hugo Chavez?

Blum: Assassination attempts? That was in 2004, the U.S. government met with the coup plotters both in Venezuela and Washington and these people then carried out a military coup which overthrew Chavez and the people took him to custody, but he was freed after about two days, because of a combination of public outcry and pressure from the remaining members of the military who were not part of the coup. So then he actually had and still has a lot of support in the military. He, himself was a member of it. So a combination of the military and a public outcry forced the coup plotters to abandon their plans and after two days Chavez was released.

Robles: Can you tell us about your book “Rogue State: A Guide to the World’s Only Superpower”? And could you comment on an endorsement you received, at the time, in 2006 by Osama bin Laden?

Blum:It was supposed to be a mini-encyclopedia of all the nefarious things done by the U.S. foreign policy. There’s a chapter on assassination, a chapter on bombings and so on. There are many chapters covering the gross and illegal aspects of U.S. foreign policy. It’s compiled together many things which most Americans, and most people in the world are not aware of. Individual elements of each of these compilations one could find in some public area or other but to put it together into long tables of information was my contribution and that came out in about 2000. And then in 2006 the Arabic version of the book, the book had many foreign translations, there were two in Arabic and one of those two was read by Osama bin Laden and he, in one of his periodic audio recordings, mentioned that Americans would be well served if they read my book and get a better understanding of their enemy. And I can only guess that the theme in that book Rogue State which most caught his attention and his sympathy was one chapter dealing with the motivations of anti-American terrorists. Contrary to what we were being taught, and still now to a large extent, were that these people were: just hated America, or they hated Christianity, or they were just crazy, or they were just envious of democracy and our wealth, all of these reasons, but never even a hint that they were acting out of retribution for the decades of very serious military and other infringements upon people in the Middle East. All kinds of bombings and overthrows of governments, supporting dictatorships, supporting Israel,all kinds of things I gave a long list of the American actions which created all these anti-American terrorists, and that is what I am assuming most appealed to Bin Laden.

Robles: What do you know about the assassination plot to kill Ecuadorian President Rafael Correa? Before the elections, he is supposed to be assassinated.
...Correa made this statement that they had uncovered a plot to assassinate him before...

Blum:I wouldn’t doubt that. I would be surprised if the CIA did not attempt to assassinate him. I mean among other reasons, he’s sheltering Assange! That by itself is reason to assassinate him... The CIA attempts to assassinate people for much less reasons than that. Assange is the public enemy №1 in America. The U.S. is obsessed with him and they are afraid that he will be issuing the release of more classified documents so they’d really like to put him out of the way, if they can. They were all set to invade the Ecuadorian Embassy in London, when the British government was finally talked out of it by their own people: That it would set a terrible precedent, that the U.K. Embassies all over the world would not be safe then. That was the reason that they called off the invasion plan. They’re very serious about Assange. I mean he has to go. He’s the most marked man in the world... I would say that if the US had a choice it would get him out of the way before anyone else...There is a drone somewhere with his name on it, and if he walks around in the world and he is not in the midst of a big city, he’s a marked man. There’s a rocket with his name on it inside of a drone with his name on it. So I can not imagine that would not be the case. The CIA has, if you delve as much as I have into the history of assassinations and so on, that is totally expected....


William Blum is the author of several books on US foreign policy. He also sends out a monthly newsletter called “The Anti-Empire Report” http://killinghope.org/#essays

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Sat Feb 2, 2013, 05:17 AM

33. To End Extreme Poverty, Let’s Try Ending Extreme Wealth By Sam Pizzigati



The world’s wealthy gathered in the Alps again last week to discuss how to ‘solve’ the world’s problems. The world’s biggest problem, suggests one top global anti-poverty outfit, may be their fortunes -- Apologists for inequality have a standard retort to anyone who calls for a more equal distribution of the world’s treasure. If you took all the wealth of the wealthy and divvied it up equally among all the poor, the retort goes, no one would gain nearly enough to accomplish much of anything. Oxfam International, one of the world’s premiere anti-poverty charitable organizations, would beg to differ. The world’s top 100 billionaires now hold so much wealth, says a new Oxfam report, that just the increase in their net worth last year would be “enough to make extreme poverty history four times over.”

“Oxfam’s mission is to work with others to end poverty,” Oxfam analyst Emma Seery noted last week. “But in a world with limited resources, this is no longer possible without an end to extreme wealth.”

Oxfam timed its new analysis, The cost of inequality: how wealth and income extremes hurt us all, to appear right on the eve of last week’s World Economic Forum in Davos, Switzerland. This earnest “issues” confab annually brings together a glittering array of global business and political leaders. The world’s corporate and financial elites began this January trek into the Alps back in 1971. But the Davos sessions really didn’t start grabbing big-time global media attention until the go-go 1990s.

“Throughout the boom years,” as a UK Guardian profile last week noted, “chief executives would gather every winter high up in the Swiss Alps to discuss in a lordly fashion the world economy and how it could be revised to suit their objectives and views.”

But in these days of deep global economic uncertainty, the power suits that frequent Davos have lost their mojo — and even feel pressured to address the global economic inequality they’ve so long tried to sweep under the rug. That pressure last week came from figures like Christine Lagarde, the former French finance minister who now directs the International Monetary Fund. Lagarde blasted outsized executive pay in high finance, attacked bankers for lobbying against new regulation, and called for more “robust social safety nets.”

Oxfam, for its part, is calling for much bolder steps to narrow the stunning gap between the global uber rich and everyone else. The group is urging world leaders to “commit to reducing inequality to at least 1990 levels.” Meeting that goal, the new Oxfam report relates, would require a wide range of measures, everything from far more steeply graduated income tax rates to actual pay caps that limit how much corporate executives can take home to a multiple of what the lowest-paid workers in the firms they run are making. Oxfam is also emphasizing the importance of cracking down on offshore tax havens. As much as a quarter of global wealth now sits shielded offshore...But don’t hold your breath waiting for the Davos crowd to buy into any of this bolder agenda. Even the modest reforms that the IMF’s Lagarde urged last week found no wide support among the corporate and banking movers and shakers who ambled up to the Alps for this year’s Davos gathering. One American on hand for the 2013 Davos festivities, JPMorgan Chase chief exec Jamie Dimon, made no move to hide his distaste for reformers. Bank regulators, he charged, were “trying to do too much, too fast” — and spreading “huge misinformation” about the noble work underway at banks like his. “We’re doing the right thing,” Dimon assured his fellow Davos notables...MORE AT LINK


Veteran labor journalist Sam Pizzigati, an Institute for Policy Studies associate fellow, writes widely about inequality. His latest book, The Rich Don’t Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class, has just been published.

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Sat Feb 2, 2013, 05:53 AM

34. The Untouchables Video FRONTLINE examines why no Wall St. execs have faced fraud charges





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Sat Feb 2, 2013, 06:00 AM

35. 2014: TOO LATE TO LEAVE THE U.S.? Wendy McElroy



The Ex-PATRIOT Act lies like a coiled snake on a table in the U.S. Senate. The longer title of this unenacted bill from 2012 is the Expatriation Prevention by Abolishing Tax-Related Incentives for Offshore Tenancy Act. Its self-description is, "A bill to amend the Internal Revenue Code of 1986 to provide that persons renouncing citizenship for a substantial tax avoidance purpose shall be subject to tax and withholding on capital gains, to provide that such persons shall not be admissible to the United States, and for other purposes."

The Ex-PATRIOT Act seeks to impose a perpetual exit tax and a re-entry ban on “specified expatriates.” A specified expat is anyone with a net worth of at least $2 million or a tax liability averaging at least $148,000 over the last 5 years. A renunciation of citizenship would be automatically viewed as a tax dodge. The person would need to prove his innocence to the IRS to become exempt from a permanent and annual 30% tax on all earnings from U.S. investments. The net worth level at which the tax triggered would undoubtedly sink over time and, perhaps, quickly so.

(Even the Nazis were not so extreme. Until 1941, the third Reich used the Reichsfluchtsteuer (Reich Flight Tax) to charge emigrating Jews a one-time 25 percent exit tax. Schumer wants 30% in perpetuity.)

The Ex-PATRIOT Act would also ban “former citizens” from U.S. soil unless he received a waiver. The waiver requirements are to be determined at a later date. Current expats have no legal right to return, but they are rarely banned from doing so. The Act was introduced in May 2012 by Senator Charles Schumer (D-NY), read twice, and referred to the Senate Committee on Finance. It is likely to pass in 2013.


Reason #1. When the Act emerged from the Democrat-dominated Senate, John Boehner – the Republican leader in the House of Representatives -- was luke-warm. He would back the Act if it was “necessary,” he stated. But he asked, is this really necessary? Since then, the two parties have feuded bitterly over a budget bill, with the Republicans accused of serving millionaires at the expense of America. The mud stuck. Boehner caved; despite a vow to never do so, he allowed taxes on millionaires to rise. If he opposes the Ex-PATRIOT Act, Republicans will be excoriated for pandering to jet-set tax evaders. Democrats will chortle with joy. In fact, they have already played the embarrassment card. A co-sponsor of the Act challenged Boehner through a press conference, “Washington needs to work together in a bipartisan manner. I request that you introduce the Ex-PATRIOT Act in the United States House of Representatives and call for an immediate vote on this important legislation.” The political dynamic favors passage of the Act in both the Senate and the House.

Reason #2. The average trapped American is resentful of expats...and, most especially, rich ones. As long as the rate of expatriation was small, it could be dismissed as an aberration. After all, who would flee from the land of the free? That was something Europeans did. But the annual rate of expatriation has been rising sharply since Obama's first term (2009-2012). In 2008, 231 Americas went through the complex and expensive process of officially leaving. In 2009, 750 left; in 2010, 1534; in 2011, 1782. These are official numbers from the Taxpatriate Lists published by the IRS. The real numbers would be much, much higher. Consider a series of Zogby International polls conducted between 2005 to 2007. The polls focused on households, not individuals, and excluded households in which any member went abroad as a part of work for the government or a private company. Zogby found that “1.6 million U.S. households had already determined to relocate abroad; an additional 1.8 million households were seriously considering such a move, while 7.7 million more were 'somewhat seriously' contemplating it.” Zogby concluded, “If the data collected in the seven polls...are fairly representative of the current decade, then, by a modest estimate, at least 3 million U.S. citizens a year are venturing abroad." The polls were pre-Obama. If the post-Obama rate of household relocation tracks the Taxpatriate List rate, then household relocation increased more than eight-fold from 2008 to 2011. No one knows the real numbers but the “expat problem” is now too large to ignore.

Reason #3. Even if the expat numbers remained small, Eduardo Saverin was a game-changer. On May 11, 2012, a Global Post headline announced, “Eduardo Saverin, Facebook co-founder, to renounce his US citizenship ahead of IPO.” Bloomberg estimated that Saverin might well save $67 million in taxes by renouncing prior to Facebook going public. One week later, on May 17, Schumer announced the Ex-PATRIOT Act as a direct response to Saverin's “outrage.” Even Boehner was politically compelled to denounce Saverin. Then Denise Rich – a prominent songwriter, socialite and political fundraiser – went expat for tax advantages. And, now, it is rock legend Tina Turner. The United States cannot permit mega-rich and famous people to make expatriation trendy, especially not for tax reasons.

Reason #4. The Ex-PATRIOT Act is another in what seems to be an irresistible juggernaut of repression against expatriates and Americans abroad.

Some of the totalitarian measures are well known, such as the Foreign Account Tax Compliance Act. Others fly under the radar. For example, a provision was buried in an unrelated and 1676-paged Transportation Bill entitled “Moving Ahead for Progress in the 21st Century Act” (MAP21). Section 40304 allows the IRS to unilaterally revoke the American passport of anyone it believes "owes" $50,000 or more in taxes. There is no hearing or due process. The IRS can now prevent Americans from fleeing abroad by slamming shut the exit door. And that's that.

Reason #5. Expats and unobtrusive Americans abroad have no hand. Politicians do not care about exiles who do not vote or about people who expose “America, the beautiful” as a lie. Politicians need to demonize them as being greedy, unpatriotic, and thieving elitists. By accusing expats of their own sins, the politicians create a scapegoat.


As it is currently written, the Ex-PATRIOT Act would not be retroactive in its tax provisions. But 2013 may be the last year to use the old tax code. If you are thinking about leaving the U.S., then do it NOW! The legislative pipeline in Congress has been clogged during much of 2012. Do not wait until measures like the Ex-PATRIOT Act or another Section 40304 pass the blockade and land directly into your life. 2014 may be too late.


Wendy McElroy is a renowned individualist anarchist and individualist feminist. She was a co-founder along with Carl Watner and George H. Smith of The Voluntaryist in 1982, and is the author/editor of twelve books, the latest of which is "The Art of Being Free". Follow her work at http://www.wendymcelroy.com.

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Sat Feb 2, 2013, 06:09 AM

36. Tina Turner 'to become Swiss, give up US passport'



US pop legend Tina Turner, who has been living in Switzerland since 1995, will soon receive Swiss citizenship and will give up her US passport, Swiss media reported Friday.

"I'm very happy in Switzerland and I feel at home here. ... I cannot imagine a better place to live," Turner told German language daily Blick.

Turner, 73, who was born Anna Mae Bullock, lives in picturesque town of Kuesnacht, on the shores of Lake Zurich in northern Switzerland, and has passed a local civics test and interview, according to an official announcement published in the Zuerichsee-Zeitung daily. The woman behind such hits as "Private Dancer", "Simply the Best" and "What's Love Got to Do With It?" will still need a green light from the canton of Zurich as well was federal authorities before she can receive red passport, the two papers reported.

Turner spokeswoman Karin Rhomberg told the Zuerichsee-Zeitung that the singer wanted to "clarify her situation".

"Tina Turner will therefore also give back her US citizenship," she said.

Turner, who has learned German, reportedly moved to Switzerland in 1995 when her longtime partner, German record executive Erwin Bach, was transferred here.

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Sat Feb 2, 2013, 06:17 AM

37. Character assassination OF EDGAR ALLAN POE


After Poe's death, an obituary appeared, signed by "Ludwig". The author was later revealed to be Rufus Wilmot Griswold, who called Poe a "brilliant, but erratic" star. Griswold had engaged in character assassination to make Poe universally hated even before Poe's death, and his attempts continued afterwards. In the obituary, Griswold claimed Poe was known for walking the streets in delirium, muttering to himself. Griswold said Poe was excessively arrogant, that he assumed all men were villains, and that he was quick to anger. Much of this characterization was lifted almost verbatim from that of the fictitious Francis Vivian in The Caxtons by Edward Bulwer-Lytton. First printed in the New York Tribune, the Ludwig obituary quickly became the standard characterization of Poe.

Griswold had served as an agent for several American authors, but it is unclear whether Poe appointed him to be his literary executor or whether Griswold became executor through a trick or a mistake by Poe's aunt and mother-in-law, Maria. In any event, he presented a collection of Poe's work that included a biographical article titled "Memoir of the Author", in which Poe was depicted as a depraved, drunk, drug-addled madman. Many parts of it were believed to have been fabricated by Griswold, and it was denounced by those who knew Poe, including Sarah Helen Whitman, Charles Frederick Briggs, and George Rex Graham. However, Griswold's account became popularly accepted, in part because it was the only full biography available and was widely reprinted. It also remained popular because many readers assumed that Poe was similar to his fictional characters or were thrilled at the thought of reading the works of an "evil" man.

No accurate biography of Poe appeared until John Henry Ingram's of 1875. Even so, historians continued to use Griswold's depiction as a model for their own biographies of Poe, including W. H. Davenport in 1880, Thomas R. Slicer in 1909, and Augustus Hopkins Strong in 1916. Many used Poe as a cautionary tale against alcohol and drugs. In 1941, Arthur Hobson Quinn presented evidence that Griswold had forged and re-written a number of Poe's letters that were included in his "Memoir of the Author". By then, Griswold's depiction of Poe was entrenched in the mind of the public, not only in America but around the world, and this distorted image of Poe has become part of the Poe legend despite attempts to dispel it.[

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Sat Feb 2, 2013, 06:33 AM

38. "We're Going to Kill the Dollar" The Fed’s Plan B By Mike Whitney



"Information Clearing House" - “How do you solve a problem when you’re running a 10% fiscal budget deficit? You are not going to get growth without private sector credit demand. The government’s idea right now is that we’re going to export our way out of this, and when I asked a senior member of the Obama administration last week how are we going to grow exports if we will not allow nominal wage deflation? He said, “We’re going to kill the dollar.” Kyle Bass interview.

Last week, amid growing rumors of a global currency war, the Fed’s balance sheet broke the $3 trillion-mark for the first time in history. According to blogger Sober Look: “For the first time since this program was launched (QE) it is starting to have a material impact on bank reserves … which spiked last week. 2013 will look quite different from last year. The monetary base will be expanded dramatically as long as the current securities purchases program is in place. ‘Money printing” is in now full swing.’” (“Fed’s balance sheet grows above $3 trillion, finally impacting the monetary base”, Sober Look) Take a minute and consider the implications of the Fed’s money printing operations in relation to the above quote by market analyst Kyle Bass. Can you see what’s happening? The Fed is acting exactly as one would expect it to act given it’s stated intention to increase inflation (currency debasement) while intensifying the class war at the same time.

How is the Fed waging class war, you ask?

Fed chairman Bernanke has been a big supporter of deficit reduction, which is code for slashing public spending. The recent “fiscal cliff” settlement raises taxes immediately on working people by ending the payroll tax holiday. As Bloomberg notes: “Everybody took a two percentage-point pay cut.” This is bound to impact consumer spending and confidence which dropped sharply last week. Here’s more from Bloomberg:

“Payroll taxes went up. As part of its budget agreement on Jan. 1, Congress agreed to let the tax, used to pay for Social Security benefits, return to its 2010 level of 6.2 percent from 4.2 percent. That reduces the paycheck by about $83 a month for someone who earns $50,000.” (Bloomberg)

So all the worker bees (you and me) have less money to spend, which means that there’s going to be less activity, higher unemployment and slower growth. This is what all the liberal economists have been warning about for over 3 years, that is, if the government withdraws its fiscal support for the economy by reducing the budget deficits too soon, the economy will slip back into recession. So what is the Fed doing to counter this slide and to create the illusion that nutcases who preached “austerity is good” were right? Well, the Fed is buying mortgage-backed securities, right? So the Fed is actually dabbling in fiscal policy, assuming a role that is supposed to be played by the Congress. Now, I realise that the buying of MBS doesn’t precisely fit the definition of fiscal policy because the Fed doesn’t collect taxes and redistribute the revenue. But it sure doesn’t fit the description of monetary policy either, now does it? The Fed is not setting rates to control the flow of credit into the system. No, the Fed is buying stuff; financial assets that provide credit to loan applicants who are purchasing hard assets. That ain’t monetary policy, my friend. It is fiscal policy writ large.

The Fed is currently purchasing $45 bil per month in US Treasuries to push down long-term interest rates in order to help the banks sell more mortgages so they can reduce their stockpile of distressed homes. And, the Fed is buying $40 billion of MBS per month to help the banks clear their books of left-over MBS and to provide funding for the banks to generate new mortgages. Also, 95% of all new mortgages are financed through Fannie and Freddie. In other words, the government is providing all the money and taking all the risk, while all the profits go to Wall Street.

Let’s review:

Fannie and Freddie’s policy is designed to help the banks
The Fed’s MBS purchasing program is designed to help the banks.
The Fed’s QE (UST purchases) policy is designed to help the banks.

Do you see a pattern here? It’s all for the banks, which is why Marx was correct when he referred to “political economy” because the economy doesn’t operate according to free market principals. It is organized in a way that best achieves the objectives of the constituency that controls the levers of political power.

Now guess which constituency controls those levels of political power presently?

If you guessed “the Wall Street banks”, give yourself a pat on the back.

So, what effect is this going to have on policy? Well, to some extent we already know the answer to that question because–as we pointed out earlier–the policy is shaped to benefit the banks. Even so, an analogy may be helpful to better grasp what’s going on. Let’s say you have $5 million that you want to put into manufacturing. In fact, you have decided you want to open your own factory and produce widgets of one kind or another to sell to the public. Eventually, you whittle your options down to two choices; you will either produce a modern line of electric cars to reduce emissions and pave the way for new technologies or you will make hula hoops. So, what’s it going to be? Fortunately, for you, the Fed announces a new program that will provide $45 billion per month “indefinitely” to manufacturers who provide low interest loans to people who want to buy hula hoops.

“Yipee”, you say. “I will abandon my plan to save the planet from poisonous greenhouse gases and make my fortune selling hula hoop bonds to the Fed instead.” Isn’t this what’s happening? None of this has anything to do with lowering unemployment, strengthening the recovery or increasing growth. It’s all just a way of funneling money to powerful constituents. And one thing is certain, that if the Fed creates the demand for a product (like MBS), then someone is going to fill that demand whether it helps the broader economy or not.

But if the Fed can buy mortgage bonds, then why can’t they buy infrastructure bonds? What’s the difference? The difference is that mortgage bonds boost profits for bankers, whereas infrastructure bonds merely provide jobs for people who need them. In other words, the difference is not between fiscal and monetary, but between the “haves” and the “have nots”, which is the same as saying that the Fed’s policies are based on class interests. And, that brings back to our original comment by Kyle Bass, who wonders how the US can grow its way out of its present predicament (big budget deficits and weak exports) without more “private sector credit demand”? Great question. But you can see that Fed chairman Bernanke has already tipped his hand. The Fed is going to keep waving that “$45 billion per month” carrot in front of the banks until they rev-up the credit flywheel and create a new regime of toxic mortgages. (The new Consumer Financial Protection Bureau’s rule on “Qualified Mortgage”, which requires neither a down payment nor credit scores, makes this prospect even more likely.) Bernanke is playing the role that the repo market played before the Crash of ’08, that is, the Fed is promising to buy all the complex bonds (MBS) the banks produce off balance sheet to keep money flowing to the banks. It’s just like the free market, except there’s nothing free about it. It’s all fake and Bernanke doesn’t care if you know it.

$45 billion per month isn’t chump change. It’s enough to inflate housing prices, to employ more out-of-work construction workers, to grow the economy, and to save bank balance sheets that are deep in the red. At the same time, the Fed’s ballooning balance sheet will put downward pressure on the dollar which will increase exports while lowering real-inflation adjusted wages. Like the man said, “We’re going to kill the dollar.” This is the Fed’s plan: Bail out the banks, transfer the banks bad bets onto its own balance sheet, hammer the greenback, slash wages (via inflation), boost exports, and pump as much money as possible into the unproductive, overbuilt black hole we call the US housing market.

Of course, President Obama could avoid all this nonsense and just launch a government-funded jobs program that would snap the economy out of its coma, increase demand, and turbo-charge GDP, but that would be way too easy. And probably bad for profits, too.


Mike Whitney lives in Washington state. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion (AK Press). Hopeless is also available in a Kindle edition. He can be reached at fergiewhitney@msn.com.

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Sat Feb 2, 2013, 08:18 AM

39. Musical Interlude

Blackbird by The Beatles:

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Response to hamerfan (Reply #39)

Sat Feb 2, 2013, 09:11 AM

44. Oooh! Thanks, Hamerfan!


I couldn't even imagine music to this theme, beyond maybe this one:

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Sat Feb 2, 2013, 08:42 AM

40. America's Baby Bust The nation's falling fertility rate is the root cause of many of our problems.



AS YVES SAYS: Help me. When these people who are pearl-clutching start worrying about high unemployment, burgeoning student debt, and high health care costs, all of which make it hard to afford childrearing, then I might take them seriously.


Americans are not reproducing enough, and the long-term consequences are dire, says Jonathan V. Last, author of "What To Expect When No One's Expecting."

For more than three decades, Chinese women have been subjected to their country's brutal one-child policy. Those who try to have more children have been subjected to fines and forced abortions. Their houses have been razed and their husbands fired from their jobs. As a result, Chinese women have a fertility rate of 1.54. Here in America, white, college-educated women—a good proxy for the middle class—have a fertility rate of 1.6. America has its very own one-child policy. And we have chosen it for ourselves.

Forget the debt ceiling. Forget the fiscal cliff, the sequestration cliff and the entitlement cliff. Those are all just symptoms. What America really faces is a demographic cliff: The root cause of most of our problems is our declining fertility rate. THE MAN CONFUSES CAUSES WITH CONSEQUENCES The fertility rate is the number of children an average woman bears over the course of her life. The replacement rate is 2.1. If the average woman has more children than that, population grows. Fewer, and it contracts. Today, America's total fertility rate is 1.93, according to the latest figures from the Centers for Disease Control and Prevention; it hasn't been above the replacement rate in a sustained way since the early 1970s. The nation's falling fertility rate underlies many of our most difficult problems. Once a country's fertility rate falls consistently below replacement, its age profile begins to shift. You get more old people than young people. And eventually, as the bloated cohort of old people dies off, population begins to contract. This dual problem—a population that is disproportionately old and shrinking overall—has enormous economic, political and cultural consequences.

For two generations we've been lectured about the dangers of overpopulation. But the conventional wisdom on this issue is wrong, twice. First, global population growth is slowing to a halt and will begin to shrink within 60 years. Second, as the work of economists Esther Boserups and Julian Simon demonstrated, growing populations lead to increased innovation and conservation. Think about it: Since 1970, commodity prices have continued to fall and America's environment has become much cleaner and more sustainable—even though our population has increased by more than 50%. Human ingenuity, it turns out, is the most precious resource. WHERE DOES THIS MAN GET HIS INFORMATION? FOX NEWS?

Low-fertility societies don't innovate because their incentives for consumption tilt overwhelmingly toward health care. They don't invest aggressively because, with the average age skewing higher, capital shifts to preserving and extending life and then begins drawing down. They cannot sustain social-security programs because they don't have enough workers to pay for the retirees. They cannot project power because they lack the money to pay for defense and the military-age manpower to serve in their armed forces. THAT'S A FEATURE, NOT A BUG...If our fertility rate were higher—say 2.5, or even 2.2—many of our problems would be a lot more manageable. But our fertility rate isn't going up any time soon. In fact, it's probably heading lower. Much lower. America's fertility rate began falling almost as soon as the nation was founded. In 1800, the average white American woman had seven children. (The first reliable data on black fertility begin in the 1850s.) Since then, our fertility rate has floated consistently downward, with only one major moment of increase—the baby boom. In 1940, America's fertility rate was already skirting the replacement level, but after the war it jumped and remained elevated for a generation. Then, beginning in 1970, it began to sink like a stone. AND LOOK HOW THIS NATION TREATED THE BOOMERS...AND STILL DOES: CANNON FODDER, WHIPPING BOYS, DEBT SLAVES, GENERAL ALL-PURPOSE EXCUSES FOR WHY WE CAN'T DO THIS, THAT AND THE OTHER.


—Mr. Last is a senior writer at the Weekly Standard and author of "What to Expect When No One's Expecting: American's Coming Demographic Disaster" (Encounter), from which this essay is adapted.

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Sat Feb 2, 2013, 08:52 AM

41. A ‘dark money’ push behind Obamacare? By Sasha Chavkin



This morning, Politico published a fascinating story about a new campaign to support implementation of the Affordable Care Act that will be underwritten by outside funders. The leaders of the initiative include both former White House and Obama campaign officials, and leading executives from the health insurance industry. Politico’s Kenneth Vogel and Jennifer Haberkorn describe the effort this way:

Organizing for Action, the successor to President Barack Obama’s presidential campaign, and Enroll America, a group led by two former Obama staffers that features several insurance company bigwigs on its board, are planning to unleash the same grass-roots mobilization and sophisticated micro-targeting tactics seen in the 2012 campaign.

Instead of getting people to vote, they’re trying to get people to buy insurance.

If the coalition is successful, 30 million uninsured Americans will get health coverage and the now-unpopular law that Obama’s team pushed through Congress and defended at the Supreme Court could go down in history alongside lauded national institutions such as Medicare and Social Security.

But if large numbers of younger and healthier Americans don’t sign up for coverage this fall alongside the older and sicker ones, the whole thing won’t work.

The story flags an important development in the growing role of outside money in politics, and makes clear that the “permanent campaign” is not just a metaphor. In 2012, the media was primarily concerned with whether new political institutions backed by shadowy outside donors and special interests could tip elections toward their preferred candidates. Now that the elections are over, it’s time to start looking at what it means for similar groups to get involved with policy implementation. (Organizing for Action is a 501(c)(4) institution, like Crossroads GPS, which means that it is not required by law to disclose its donors—though group has publicly committed to disclosure. Enroll America is a more conventional 501(c)(3) group; according to the Politico story, the organization “would not say… whether it planned to disclose its donors.”)

There’s every reason, of course, for the White House and its political supporters to promote Obamacare’s implementation through a wide variety of means. After the epic political battle to pass the legislation and defend it before the Supreme Court, it makes perfect sense to try to make sure that the law delivers the benefits its supporters fought so hard to bring about. And under the current legal landscape, the plans outlined in the Politico story are perfectly legitimate.

Still, this blurring of lines not just between campaigning and governance but between government outreach and corporate marketing raises important questions for future reporting. For example, the board of Enroll America includes senior executives from Blue Shield of California, Kaiser Permanente and Teva Pharmaceuticals, and its advisory council includes Aetna and CVS Caremark. Do the companies helping to steer the campaign stand to benefit at the expense of their competitors by being on the front lines of enrollment —and will they have opportunities to direct attention away from potential rivals? (CJR’s Trudy Lieberman has noted that Congress recently slashed subsidies for state insurances cooperatives, making it harder for these alternatives to major insurers to get off the ground and market themselves to customers.) MORE


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Response to Demeter (Reply #41)

Sat Feb 2, 2013, 04:32 PM

55. Congress Kills Part of the Affordable Care Act



If the ACA is a bundle of experiments in how to lower health care costs and make it more affordable for everyone, then this deal gives Republican a mark in their "kill" column for the ACA and consumers.
On the very last page of the part of the fiscal cliff bill dealing with various Medicare extenders, the doc fix and other health care considerations, there is a provision which de-funds appropriations allowed in the Affordable Care Act for Community Operated and Owned Plans, or "co-ops".

The appropriations were for loans to be made to new, non-profit plans established by people who were not already health insurance providers, with a goal to increasing competition in the insurance marketplace.

Sarah Kliff at the Washington Post reports:

When Congress struck a deal to avert the fiscal cliff, it also dealt a quiet blow to President Obama’s health overhaul: The new law killed a multibillion-dollar program meant to boost health insurance competition by funding nonprofit health plans.

The decision to end funding for the Consumer Operated and Oriented Plans has left as many as 40 start-ups vying for federal dollars in limbo. Some are considering legal action against the Obama administration, after many spent upwards of $100,000 preparing their applications.

“Currently there are some things in motion,” said Robert Raasch, who had requested a multimillion-dollar loan to set up a nonprofit health plan in Oklahoma. “There may be some legal challenges or some legislative mechanisms we could use. All of that is in discussion.”

The Consumer Operated and Oriented Plan, or CO-OP, program was aimed at spending as much as $6 billion to help launch nonprofit health insurance carriers. It came into favor with Democrats when it became clear that a government-run plan, known as the public option, could not gain enough political support.

I'm going to disagree with that last paragraph a bit. Yes, this was intended to create an option that was non-profit, with 95 percent of premium dollars going toward actual health care expenses rather than padding the bottom line for profits. But this was not ever sold as or intended to create the impression that it was any sort of replacement or even consolation prize for the public option. . Despite Wendell Potter's belated endorsement of co-ops as a possible sleeper solution to the public option, there were many barriers to success to overcome.

The plan intended to take the place of the public option was and is the OPM alternative to be offered on all health insurance exchanges alongside commercial options, which is national in scope.

The right wing hates the OPM option and wishes they could kill it. It appears they had to settle for de-funding the loans to CO-OPs instead. Conservatives have long looked for ways to de-fund the ACA, and the CO-OPs were one of the first and primary targets. By conflating the Solyndra loan guarantees with the loan guarantees in the ACA, they managed to create enough negative energy to kill them in exchange for raising taxes, evidently.

Unfortunately, this has left a lot of people hanging out to dry in several states, just as they were ramping up their operations to be ready in 2014.

Kliffe writes:

The decision to end CO-OP funding has hit Robert Schyberg hard. Schyberg had submitted a request for $60 million to launch a plan in West Virginia. He estimates that his organization, HMO Affiliates, spent more than $100,000 preparing the application and numerous hours negotiating with hospitals and physicians, convincing the providers to join their nascent network.

On Nov. 13, Schyberg’s colleague received a letter from Medicare noting that they had “been selected to enter into discussions to potentially receive a loan or loans under the CO-OP Program for the State of West Virginia.” Schyberg said he had a meeting scheduled for the last week of December to finalize details of the loan. When it got pushed to Jan. 3, he did not think much of the one-week delay.

“New Year’s Eve happened, and everything changed,” he said.

His colleague received another letter from the Obama administration, on Jan. 9, saying “CMS no longer has authority to enter into new loan agreements with CO-OP applicants, including your organization.”

It appears the White House and Congressional Democrats weren't particularly averse to letting go of this single provision in order to get the tax issue put behind them. On the one hand, it doesn't seem like a dealbreaker on its face. On the other hand, they've now placed the ACA on the budget negotiation table, which increases its vulnerability in the upcoming budget showdown with repeal-hungry Republicans.

Killing these organizations was a concession to the large insurers. Here's how the National Review framed it:

Furthermore, several provisions in Section 1322 actually make it less likely that these co-ops will work. To start with, the legislation expressly prohibits the most likely and sensible path to setting up a co-op insurer, namely, a divestiture or conversion by an existing health insurer. Thus, neither an existing nonprofit health insurer (such as Kaiser Permanente) nor an existing stockholder-owned insurer (such as Aetna) could become a co-op under the provisions of Section 1322. Nor would either of them be allowed to spin off a portion of their existing business as a co-op. The only way to create one of the proposed co-op insurers is to start one from scratch — an inherently lengthy, uncertain, and expensive task.

Yes, of course. That is because these were intended to compete with the Kaisers and Aetnas of the world, which is exactly what they didn't want. Co-ops were barred from using federal grants for marketing and had the steep Medical Loss Ratio requirement of 95 percent, which would have made them lean and mean in the marketplace. Aetna in particular couldn't have that.

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Sat Feb 2, 2013, 09:00 AM

42. As U.S. Growth Lags, Some Press the Fed to Do Still More By BINYAMIN APPELBAUM



In the five months since the Federal Reserve started a campaign to increase growth and reduce unemployment, the economy has slowed and unemployment has increased.


Some economists found the disappointing data an indication the Fed had reached the limit of its powers, or at least of prudent action. But there is evidence that the Fed is not trying as hard as it could to stimulate growth: it is allowing inflation to fall well below the 2 percent pace it considers most healthy. Inflation, unlike job creation, is something the Fed can control with some precision. Higher inflation could accelerate economic growth and job creation by encouraging people to spend more and make riskier investments. Yet annualized inflation fell to 1.3 percent in December, and asset prices reflect an expectation that the pace will remain well below 2 percent in the next decade.

“By their own framework, they’re not doing enough,” said Justin Wolfers, an economist at the University of Michigan. “They said that they were going to expand the economy and keep inflation around 2 percent, and they just haven’t done it.”

The rest of the government is making that task more difficult. Federal spending cuts, tax increases and the prospect of further cuts March 1 are hurting growth. The Fed chairman, Ben S. Bernanke, has warned repeatedly that monetary policy cannot offset such fiscal austerity. And it is likely that the latest economic data does not reflect the full impact of the Fed’s efforts. Despite the rise in unemployment, job creation has increased in recent months, consumer spending has strengthened and the housing market is healing. Partly because monetary policy is slow-acting, most forecasters expect modest growth this year. But the Fed also is acting with a clear measure of restraint. Mr. Bernanke and other officials have made clear that they believe the central bank could do more to increase the pace of inflation and bolster growth and job creation. They simply are not persuaded that the benefits outweigh the potential costs — in particular, the risk that their efforts will distort asset prices and seed future financial crises.

The Fed is constrained in part because it already has done so much. The central bank has held short-term interest rates near zero since December 2008, and it has accumulated almost $3 trillion in Treasury securities and mortgage-backed securities to push down long-term rates and encourage riskier investments. Under its newest effort, announced in September and extended in December, it will increase its holdings of Treasuries and mortgage bonds by $85 billion a month until the job market improves. The Fed also said that it planned to hold short-term rates near zero even longer, at least until the unemployment rate fell below 6.5 percent...


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Sat Feb 2, 2013, 09:07 AM

43. The Master Meme By James Howard Kunstler



The gentlemen and ladies of the meme-o-sphere, where collective notions are birthed like sleet from clouds, have decided lately that the USA has entered a full-on broad-based bull market - a condition of general happiness and prosperity as far advanced beyond mere "recovery" as a wedge of triple-cream Saint-Andre cheese is advanced over a Cheez Doodle. It has become the master fantasy of the moment, following the birth of some junior memes such as... we have a hundred years of shale gas and the "housing sector" (i.e. the suburban sprawl-building industry) is "bouncing back." What a sad-sack nation of credulous twits we have become. You can be sure that when a nation is led by the reality-deficient, unhappy outcomes are a sure thing. They will systematically destroy trust in the way things actually work and beat a fast path to either tyranny (where reality doesn't matter) or anarchy (where reality cannot be managed at all). This is what happens when nations go mad. Even when they are led by people later-determined to be "evil" (Hitler, Lenin) this sad process is allowed to happen because it just seems like a good idea at the time - which is the central political tragedy of human history. To the beaten-down Russians, Bolshevism seemed like a good-idea at the time. To the bankrupt, hopeless Germans, Naziism seemed like a good idea.

I'm not even sure what to call the current disposition of unreality in the USA, though it is clearly tinged with different colors of grandiosity ranging from the plain dopey idea of "American exceptionalism" to the wishful claim that we're about to become "energy independent," to the lame assertion so popular in presidential addresses that "together we can do anything." Speaking of the inaugural, in all the Second-Coming-of-Lincoln-Meets-MLK hoopla of the grand day, with the national mall lined by gigantic flat screen TVs (an Orwellian nightmare), and the heartwarming displays of ethnic diversity, and the stridently inoffensive songs and poem, there was the genial Mr. Obama at the epicenter of the huge ceremony delivering a bouquet of platitudes so stale and trite that it could have been composed in a first-year Harvard Law School ethics skull session at a back table of Wagamama. Despite all the blather about his graying hair, and the wisdom of age, and the supposed music of his rhetoric, I couldn't detect a single idea in Mr. Obama's inaugural address that wasn't either self-evident, or devised to flatter some "identity" bloc, or an imitation of old tropes out of the "Great Speeches" book.

What's obvious to me is what I have been fearing about this country for some time now: that all the disorders of our time would prompt a campaign to defend the status quo at all costs and to sustain the unsustainable. That is really the master wish behind all the political hijinks of the day, especially the pervasive accounting fraud in all high-order money matters. We see the comforts and conveniences of modernity slipping away and we'll do anything to try to hang onto them, including lying to ourselves to such an immersive degree about what is really happening that we suppose we can manufacture a happy counter-reality. That's at the heart of zero interest rate policies, and Federal Reserve manipulation of markets, and statistical misreporting from all the national agencies charged with adding things up. So, the Fed pumps its $90 billion-a-month and the Standard & Poor's index inflates like an old tire while ten thousand more families get added to the food stamp rolls, and the banks sit on enough foreclosed property to fill the state of Indiana, and another 25-year-old college loan debt serf ODs on vodka and Xanax because he finally understands that even bankruptcy will not save him from perpetual penury.

Apparently, there are moments in history when nations just get lost. I maintain that things would go a whole lot better for us if we acknowledge what is actually going on, namely: a major shift of direction into economic contraction after 200-plus thrilling years of expanding energy resources and easy-to-get material riches. It's in the nature of this world that things cycle and pulse, and we have entered a certain phase of the cycle that demands certain responses. We have to make the scale of human activities smaller, finer, simpler, and more rooted to the local particulars of place. We have to let go of WalMart and globalism and driving cars incessantly and attempting to manage the affairs of people half a world a way... and we just can't imagine engaging with this endeavor. That is true poverty of imagination.

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Sat Feb 2, 2013, 09:21 AM

45. Goldman Sachs pay and bonuses rise to £250,000 each



Bank has set aside $13bn to cover the salaries, bonuses and perks for staff worldwide – a rise of more than $30,000 a head on 2011...Goldman Sachs risked stoking the row over City pay on Wednesday by revealing its bankers were paid an average of $400,000 (£250,000) each last year, a rise of more than $30,000 a head on 2011.

Goldman's annual financial results show the bank has set aside $13bn to cover the salaries, bonuses and perks for the 32,400 it employs around the world. Details of the payroll come just a day after the bank was forced to back down from plans to defer bonuses until April so that its highly paid staff could avoid the 50% tax rate.

The size of the bill to pay staff is 6% higher than a year ago. However, the average individual payouts to staff are higher as the number of employees has fallen by 3%.

Staff will find out in the coming days what their bonuses for 2012 will be. Some of them will be expecting to receive millions of pounds ...


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Sat Feb 2, 2013, 09:27 AM

46. Have we solved 'too big to fail'? Andrew G Haldane



The Subprime Crisis became the Global Crisis when one too-big-to-fail bank was allowed to fail. (BECAME, OR WAS REVEALED?) This column argues that too-big-to-fail is far from gone despite years of reform efforts. It is important that it not be forgotten. Further analytical work, weighing the costs and benefits of different structural reform proposals, would help keep memories fresh and policies on the right track.

Have we solved 'too big to fail'? No.

That is not my pessimistic verdict; it is the market’s. Prior to the crisis, the 29 largest global banks benefitted from just over one notch of uplift from the ratings agencies due to expectations of state support. Today, those same global leviathans benefit from around three notches of implied support. Expectations of state support have risen threefold since the crisis began. This translates into a large implicit subsidy to the world’s biggest banks in the form of lower funding costs and higher profits. Prior to the crisis, this amounted to tens of billions of dollars each year. Today, it is hundreds of billions (Haldane 2012). In other words, if the market’s expectations are to be believed, the regulatory response to the crisis has not plugged the 'too-big-to-fail' sink...On the face of it, that sounds perplexing. Rarely a day passes without a warning from the financial industry about overbearing regulation of, in particular, the world’s biggest banks. What is certainly true is that, in the light of the crisis, regulation to quell the too-big-to-fail problem has come thick and (at least in regulatory terms) fast. This reform effort falls into roughly three categories:

(a) Systemic surcharges: of additional capital levied on the world’s largest banks according to their size and connectivity. This Pigouvian tax on systemic risk externalities is built on conceptually sound foundations (for example, Brunnermeier 2009). And, encouragingly, good economics has found its way into good public policy. Last year, the Financial Stability Board (FSB) agreed a sliding scale of systemic surcharges for the world’s largest banks. The highest surcharge was set at 2.5% of capital. Yet therein lies the problem. Based on my estimates (Haldane 2012), a charge levied at this rate would leave the majority of the systemic externalities associated with the world’s biggest banks untouched. The reduction in default probabilities associated with lowering leverage by a percentage point or two would not offset the higher system-wide loss-given-default associated with the world’s largest banks. The systemic tax is being levied at rates which are too low to meet Pigouvian ends.

(b) Resolution regimes: In principle, orderly resolution regimes for banks could lower the collateral costs of a big bank defaulting, thereby tackling at source these systemic externalities. And significant public policy progress has been made on this front, with the FSB publishing (and the G20 approving) some Key Attributes for Effective Resolution Regimes during the course of the past 18 months. A key component of these plans is the ability to impose losses on private creditors – so-called 'bail-in' – rather than have those losses borne by taxpayers. As with systemic surcharges, the issue here is not to so much the bail-in principle, but its application in practice. Bail-in, whether of big banks, sovereigns or companies, faces an acute time-consistency problem. Policymakers face a trade-off between placing losses on a narrow set of tax-payers today (bail-in) or spreading that risk across a wider set of tax-payers today and tomorrow (bail-out). A risk-averse, tax-smoothing government may tend towards the latter path – and historically has almost always done so, most notably in response to the present financial crisis. Next time may of course be different. But the market is sceptical. For example, in the US the Dodd-Frank Act on paper rules in future bail-in and rules out future bail-out. Yet market expectations of state support for US banks are higher today than before the crisis struck and are unchanged since Dodd-Frank became law. The time-consistency dilemma, at least in the eyes of markets, is as acute as ever.

(c) Structural reform: One way of lessening that dilemma may be to act on the scale and structure of banking directly. Several recent regulatory reform initiatives have sought to do just that, notably the “Volcker rule” in the US, the 'Vickers proposals' in the UK and, most recently, the 'Liikanen plans' in Europe. While different in detail, each of these proposals shares a common objective: a degree of separation or segregation between investment and commercial banking activities. In principle, these ringfencing initiatives confer both ex-post (improved resolution) and ex-ante (improved risk management) benefits. Because they act on banking structure, they have a greater chance of proving time-consistent. While this is a clear step forward, those benefits are only as credible as the ringfence itself. The issue raised by some is whether, in practice, the ring-fence could prove permeable. Without care, today’s ring-fence could become tomorrow’s string vest. If each of these initiatives is necessary but none is individually or collectively sufficient to tackle too-big-to-fail, what is to be done? One solution might lie in strengthening these proposals... MORE...Too-big-to-fail is far from gone. It is even more important it is not forgotten. Further analytical work, weighing the costs and benefits of different structural reform proposals, would help keep memories fresh and policies on the right track.


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Sat Feb 2, 2013, 09:34 AM

47. The Poe Toaster


The Poe Toaster is an unofficial nickname given to a mysterious person (or more probably two persons in succession, possibly father and son) who, for over seven decades, paid an annual tribute to American author Edgar Allan Poe by visiting the stone marking his original grave in Baltimore, Maryland in the early hours of January 19, Poe's birthday. The shadowy figure, dressed in black with a wide-brimmed hat and white scarf, would pour himself a glass of cognac and raise a toast to Poe's memory, then vanish into the night, leaving three roses in a distinctive arrangement and the unfinished bottle of cognac. Onlookers gathered annually in hopes of glimpsing the elusive Toaster, who did not seek publicity and was rarely seen or photographed.

According to eyewitness reports and notes accompanying offerings in later years, the original Toaster made the annual visitation from sometime in the 1930s (though no report appeared in print until 1950) until his death in 1998, after which the tradition was passed to "a son". Controversial statements were made in some notes left by the post-1998 Toaster, and in 2006 an unsuccessful attempt was made by several onlookers to detain and identify him. In 2010 there was no visit by the Toaster, nor did he appear in 2011 or 2012, triggering speculation that the 75-year tradition had ended.


Poe died at the age of 40 in Baltimore on October 7, 1849 under mysterious circumstances. The Poe Toaster tradition may have begun as early as the 1930s, according to witnesses, and continued annually until 2009. Each year, in the early hours of the morning of January 19 a black-clad figure (presumed male), face obscured by a scarf or hood, carrying a silver-tipped cane, would enter the Westminster Hall and Burying Ground in Baltimore. At the site of Poe's original grave, which is marked with a commemorative stone, he would raise a cognac toast and place three red roses on the monument in a distinctive configuration, along with the unfinished bottle of Martell cognac. The roses were believed to represent Poe, his wife Virginia, and his mother-in-law Maria Clemm, all three of whom were originally interred at the site. The significance of the cognac is uncertain, as it does not feature in Poe’s works (as would, for example, amontillado); but a note left at the 2004 visitation suggested that the cognac may have represented a tradition of the Toaster's family rather than Poe's. Several of the cognac bottles are kept at the Edgar Allan Poe House and Museum in Baltimore.

A group of varying size composed of reporters and Poe enthusiasts observed the event each year. A photograph, reputedly of the Toaster, was published by Life Magazine in 1990.

The notes

On several occasions, the Toaster left a note along with the roses and cognac. Some notes were simple expressions of devotion, such as "Edgar, I haven't forgotten you." In 1993, a cryptic message stated, "The torch will be passed." In 1999, a note announced that the original Toaster had died the previous year and had passed the tradition to "a son." Subsequent eyewitnesses noted that the post-1998 Toaster appeared to be a younger individual.

A note left at the 2001 visitation, which happened to occur a few days before Super Bowl XXXV between the Baltimore Ravens and the New York Giants, spurred controversy in Baltimore: "The New York Giants. Darkness and decay and the big blue hold dominion over all. The Baltimore Ravens. A thousand injuries they will suffer. Edgar Allan Poe evermore." Never before had the Toaster commented on sports or other current events, nor could anyone explain the negative reference to Baltimore's football team, whose nickname was inspired by "The Raven," Poe's most famous poem. The prophecy, a play on the last line of "The Masque of the Red Death" ("And Darkness and Decay and the Red Death held illimitable dominion over all", proved inaccurate, as Baltimore won the game 34–7.

The Toaster's 2004 note was apparently critical of France's opposition to the war in Iraq: "The sacred memory of Poe and his final resting place is no place for French cognac. With great reluctance but for [sic] respect for family tradition the cognac is placed. The memory of Poe shall live evermore!"

Events leading up to Poe's bicentenary

In 2006 a group of onlookers unsuccessfully attempted to intercept the Poe Toaster. Aside from that incident, spectators, out of respect for the tradition (and, perhaps, the mystery), never interfered with the Toaster's entry, tribute ritual, or departure, nor was any concerted effort made to identify the individual.

In 2007 a 92-year-old man named Sam Porpora claimed that he had started the Poe Toaster tradition. A former historian for Baltimore's Westminster Church, Porpora claimed that he invented the Toaster in the 1960s as a "publicity stunt", to reinvigorate the church and its congregation, and had falsely told a reporter at the time that it had begun in 1949. However, reports of the annual visits date from well before the 1960s, for example a 1950 article in The (Baltimore) Evening Sun that mentions "an anonymous citizen who creeps in annually to place an empty bottle (of excellent label) against the gravestone."

Porpora's daughter said she had never heard of her father's actions but that it fit in with his mischievous nature; but Jeff Jerome of the Edgar Allan Poe House and Museum pointed out that the details of Porpora's story seemed to change with each telling. "There are holes so big in Sam's story, you could drive a Mack truck through them," he said. Jeff Savoye of the Edgar Allan Poe Society also questioned Porpora's claims, but admitted he could not definitively prove or disprove them. While never retracting his claim, Porpora later acknowledged that it was not he making the annual visits; that someone else (he knew not who) had made the tradition his own.

In 2008 Jerome reported that nearly 150 gathered to observe the Toaster's appearance. 2009 marked the bicentenary of Poe's birth; despite this milestone, the crowd was smaller than in past years, and the Toaster left no note. In 2010 the Poe Toaster failed to appear. Jerome, who had witnessed every visitation from 1976 on, had no explanation, but did speculate that if the Toaster intended to end the tradition, the 2009 bicentennial would mark a logical ending point.

The 2011 anniversary saw only the appearance of four impostors—immediately dubbed "faux Toasters"—identified as such because all four walked in clear sight of waiting observers (contrary to the real Toaster's secretive nature); none gave the secret signal that only Jerome knows, a gesture the Toaster predictably made each year at the grave; and none arranged the roses in the unique pattern established by the Toaster. The faux Toasters' appearance sparked controversy: While some preferred that the tradition die a "dignified death", others urged that it be carried on, by imitators if necessary.

In 2012, once again, there was no appearance by anyone identifiable as the "original" Toaster. Jerome (who has denied rumors that he himself was the Toaster) proclaimed the tradition "over with."

In popular culture

The Poe Toaster has appeared as a character in books, occult documentaries, and other media. The 2001 novel, In a Strange City, by Baltimore crime fiction novelist Laura Lippman features dueling Poe Toasters, one killing the other, during a tragically failed "Poe Toasting" at Westminster Hall and Burial Grounds. The Poe Toaster is the subject of numerous non-fiction occult treatises, most notably Curt Rowlett's Labyrinth 13: True Tales of the Occult wherein a chapter is dedicated to the Poe Toaster mystery. More recently, the 2011 audio play The Poe Toaster Not Cometh, by Washington Audio Theater seeks to explain the Poe Toaster mystery by suggesting the Poe Toaster is in fact a contemporary of Poe's, surviving through the centuries via occult means.

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Sat Feb 2, 2013, 09:38 AM

48. Well, it's still snowing--lightly


and the temperature is up to 18F although wind chill is 8F.

Guess this is where I go defy death and Mother Nature.

Happy Groundhog Day, everyone. Don't forget your booties, 'cause it's COLD outside!

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Sat Feb 2, 2013, 12:49 PM

49. Spoken Word Interlude

The Raven by James Earl Jones:

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Sat Feb 2, 2013, 12:55 PM

50. Musical Interlude II

Surfin' Bird by The Trashmen:

(I actually remember this song on the radio)

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Sat Feb 2, 2013, 02:03 PM

51. Snoopy


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Sat Feb 2, 2013, 02:37 PM

52. Mario Draghi has saved the rich, now he must save the poor



The European Central Bank has washed its hands of any further responsibility for the 27m people across the eurozone listed as unemployed or classified as discouraged workers. The Governing Council has concluded that nothing more can usefully be done to lift the region out of double-dip recession, a relapse that it failed to foresee and to a great extent caused by allowing all key measures of the money supply to contract in early-to-mid 2012.

It will not take fresh action to offset fiscal tightening this year of 2.3pc of GDP in Spain, 2pc in France, or 1.2pc in Italy -- not to mention draconian retrenchment in the three indentured states of Greece, Portugal, and Ireland -- or take action to cushion the shock of deep reforms.

Japan’s premier Shinzo Abe has more or less ordered his central bank to both reflate and target jobs creation. The US Federal Reserve stands ready to inject stimulus until America’s jobless rate falls to 6.5pc. Yet the ECB professes itself helpless in the face of 11.8pc unemployment, a post-EMU record and rising each month.
The ECB’s Mario Draghi said there is "not much" that monetary policy can do to fight structural unemployment. If it really was "structural", his plea might convince. It is not.

Ireland has one of the world’s most flexible labour markets yet its jobless rate has risen from 4.6pc to 14.6pc, and that includes the safety valve of massive job flight to the UK, US, and Australia. Spain’s rate has jumped from 7.8pc to 26.6pc in four years, or 55.8pc for youth. This has occurred very fast precisely because it is easy to sack Spanish workers on short-term contracts. The European Commission’s 400-page report last week on the jobless crisis quietly demolishes the claim that labour rigidities are the elemental cause of the social tornado sweeping across Club Med and parts of Eastern Europe....MUCH HORROR AND CRUELTY RETOLD AT LINK. IN CONCLUSION...The horror before our eyes right now is social ruin. Europe’s crisis strategy is to the break the back of labour resistance to pay cuts by driving unemployment through the roof. That is what `internal devaluations’ are. It stinks. And the ECB is adding to the cruelty by keeping money too tight.

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Sat Feb 2, 2013, 02:39 PM

53. Europe drawn into global currency wars as slump deepens



The world is edging closer to all out currency conflict as Europe’s politicians join a chorus of policy-makers across the globe pushing for devaluations to fight for market share. Jean-Claude Juncker, EuroGroup chief, has signalled that Europe is no longer willing to be the last economic player holding the toxic parcel of an over-valued exchange rate, describing the euro as “dangerously high” after its three-month surge against the dollar, yuan and yen.

The comments follow warnings by two French ministers this month that the strong euro is holding back efforts to pull the France out of deep industrial slump.
Alexei Ulyukayev, deputy head of Russia’s central bank, said the tilt in EMU policy marks a new escalation as every major bloc of the global economy tries to drive down its exchange rate at the same time. “We are now on the threshold of very serious currency wars,” he said.

Korea has asked the G20 take a stand against beggar-thy-neighbour policies in Moscow next month, accusing Japan and the West of covert debasement through loose money.

Japan’s premier Shinzo Abe kicked off the latest skirmishes by threatening to change the Bank of Japan’s statute unless it agrees to launch a monetary blitz and weaken the yen. The euro has rocketed by 20pc against the yen since July. “This will soon start to hurt core Euroland and Germany. The Japanese compete in the same export niche of cars, machine tools and electronics,” said Hans Redeker from Morgan Stanley....

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Sat Feb 2, 2013, 02:42 PM

54. The Eurozone and Greece: Is the Crisis over?



A journalist from Chile’s El Mercurio just put two questions to me: (1) Is the Eurozone safe? and (2) Is Greece stabilising? Here are my answers:

1) Are the threats over the Eurozone’s survival over?

Certainly not. The serious design faults of the Eurozone remain intact. The promised decoupling of the banking crisis from the debt crisis has been ditched. All moves toward debt mutualisation or for a central Eurozone budget have been suspended. The ECB’s bond purchasing program (OMT) remains in the sphere of the imagination, a purely phantom program whose announcement-effect cannot continue forever. Meanwhile, recession in the Eurozone’s centre and depression in the periphery is eating away at the heart of Europe’s social economy.

2) Is the economic situation in Greece getting better (considering that the risk premium is lower than few months ago and the local stock market is going up)?

Greece has been given a reprieve, in the sense that it has been told that all discussion of being thrown out of the Eurozone is over – at least for now. Thus, the panic caused by the ‘conversion’ risk (i.e. assets being redenominated in drachmas) has passed and, thus, the stock exchange has moved upward. However, the falling yields of the Greek bonds mean absolutely nothing for two reasons: First, after the recent debt buyback, Greek banks hold no GGBs and, therefore, the GGBs’ increased value does not help the Greek banking sector in the slightest. Secondly, the Greek state is not issuing new bonds, which means that the Greek state cannot benefit from the falling yields. The only beneficiaries are the hedge funds that purchased the 35 billions of GGBs that remain in play and are trading them with each other for speculative reasons. Meanwhile, Greece’s social economy is continuing to collapse, with a defunct banking sector ensuring a dearth of credit even for profitable firms, unemployment reaching world record levels, and aggregate demand that is continuing to shrink. In brief, the stabilisation of Greece’s financial markets is in sharp contrast to the continuing tailspin of its social economy.

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Sat Feb 2, 2013, 04:42 PM

56. EDGAR ALLAN POE'S Literary style and themes



Poe's best known fiction works are Gothic, a genre he followed to appease the public taste. His most recurring themes deal with questions of death, including its physical signs, the effects of decomposition, concerns of premature burial, the reanimation of the dead, and mourning. Many of his works are generally considered part of the dark romanticism genre, a literary reaction to transcendentalism, which Poe strongly disliked. He referred to followers of the movement as "Frog-Pondians" after the pond on Boston Common. and ridiculed their writings as "metaphor-run mad," lapsing into "obscurity for obscurity's sake" or "mysticism for mysticism's sake." Poe once wrote in a letter to Thomas Holley Chivers that he did not dislike Transcendentalists, "only the pretenders and sophists among them."

Beyond horror, Poe also wrote satires, humor tales, and hoaxes. For comic effect, he used irony and ludicrous extravagance, often in an attempt to liberate the reader from cultural conformity. In fact, "Metzengerstein", the first story that Poe is known to have published, and his first foray into horror, was originally intended as a burlesque satirizing the popular genre. Poe also reinvented science fiction, responding in his writing to emerging technologies such as hot air balloons in "The Balloon-Hoax".

Poe wrote much of his work using themes aimed specifically at mass-market tastes. To that end, his fiction often included elements of popular pseudosciences such as phrenology and physiognomy.

Literary theory

Poe's writing reflects his literary theories, which he presented in his criticism and also in essays such as "The Poetic Principle". He disliked didacticism and allegory, though he believed that meaning in literature should be an undercurrent just beneath the surface. Works with obvious meanings, he wrote, cease to be art. He believed that work of quality should be brief and focus on a specific single effect. To that end, he believed that the writer should carefully calculate every sentiment and idea.

In "The Philosophy of Composition", an essay in which Poe describes his method in writing "The Raven", he claims to have strictly followed this method. It has been questioned, however, whether he really followed this system. T. S. Eliot said: "It is difficult for us to read that essay without reflecting that if Poe plotted out his poem with such calculation, he might have taken a little more pains over it: the result hardly does credit to the method." Biographer Joseph Wood Krutch described the essay as "a rather highly ingenious exercise in the art of rationalization".

Legacy--Literary influence

During his lifetime, Poe was mostly recognized as a literary critic. Fellow critic James Russell Lowell called him "the most discriminating, philosophical, and fearless critic upon imaginative works who has written in America", suggesting – rhetorically – that he occasionally used prussic acid instead of ink. Poe's caustic reviews earned him the epithet "Tomahawk Man". A favorite target of Poe's criticism was Boston's then acclaimed poet, Henry Wadsworth Longfellow, who was often defended by his literary friends in what would later be called "The Longfellow War". Poe accused Longfellow of "the heresy of the didactic”, writing poetry that was preachy, derivative, and thematically plagiarized. Poe correctly predicted that Longfellow's reputation and style of poetry would decline, concluding that "We grant him high qualities, but deny him the Future".

Poe was also known as a writer of fiction and became one of the first American authors of the 19th century to become more popular in Europe than in the United States. Poe is particularly respected in France, in part due to early translations by Charles Baudelaire. Baudelaire's translations became definitive renditions of Poe's work throughout Europe.

Poe's early detective fiction tales featuring C. Auguste Dupin laid the groundwork for future detectives in literature. Sir Arthur Conan Doyle said, "Each of Poe's detective stories is a root from which a whole literature has developed.... Where was the detective story until Poe breathed the breath of life into it?" The Mystery Writers of America have named their awards for excellence in the genre the "Edgars". Poe's work also influenced science fiction, notably Jules Verne, who wrote a sequel to Poe's novel The Narrative of Arthur Gordon Pym of Nantucket called An Antarctic Mystery, also known as The Sphinx of the Ice Fields. Science fiction author H. G. Wells noted, "Pym tells what a very intelligent mind could imagine about the south polar region a century ago."

Like many famous artists, Poe's works have spawned innumerable imitators. One interesting trend among imitators of Poe, however, has been claims by clairvoyants or psychics to be "channeling" poems from Poe's spirit. One of the most notable of these was Lizzie Doten, who in 1863 published Poems from the Inner Life, in which she claimed to have "received" new compositions by Poe's spirit. The compositions were re-workings of famous Poe poems such as "The Bells", but which reflected a new, positive outlook.

Even so, Poe has received not only praise, but criticism as well. This is partly because of the negative perception of his personal character and its influence upon his reputation. William Butler Yeats was occasionally critical of Poe and once called him "vulgar". Transcendentalist Ralph Waldo Emerson reacted to "The Raven" by saying, "I see nothing in it" and derisively referred to Poe as "the jingle man". Aldous Huxley wrote that Poe's writing "falls into vulgarity" by being "too poetical"—the equivalent of wearing a diamond ring on every finger.

It is believed that only 12 copies of Poe's first book, Tamerlane and Other Poems, have survived. In December 2009, one copy sold at Christie's, New York for $662,500, a record price paid for a work of American literature.

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Sat Feb 2, 2013, 06:34 PM

57. FTC gives consumers a peek into how debts are bought and sold:

By Sheryl Harris, The Plain Dealer
on February 02, 2013 at 12:00 PM, updated February 02, 2013 at 12:11 PM

As is" sales.

Limited time for returns.

Take it or leave it terms.

A debt buyer's shopping experience sounds a lot like, well, yours and mine.

We all know that when credit card companies, hospitals and utilities have delinquent accounts they can't collect on, they sell those debts on the second-hand market, much as you and I might unload stuff at a garage sale.

Consumers get a fascinating peek into the inner working of the debt-buying industry through a Federal Trade Commission report issued last week.

The report, for the first time, provides consumers with data-driven evidence that the rules created to protect people from debt collection abuses are due for some retooling.

The FTC took a deep dive into what happens to that debt once it changes owners. By scrutinizing more than 90 million consumer accounts held by the nation's largest debt buyers over a three-year period, the FTC found:



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Sun Feb 3, 2013, 08:40 AM

58. David Bowie - Lets Dance

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Sun Feb 3, 2013, 08:43 AM

59. Support for Spain's ruling party falls in corruption scandal


(Reuters) - Public support for Spanish Prime Minister Mariano Rajoy and his ruling People's Party has fallen as they have been engulfed by a corruption scandal, an opinion poll showed on Sunday.

Media reports over the past fortnight have alleged that at least a dozen top party officials, including Rajoy, received kickbacks from a slush fund operated by its former treasurer.

While Rajoy has vehemently denied any wrongdoing, the growing scandal has provoked the fury of Spaniards who were already disenchanted with the government's handling of a deep economic recession and high unemployment.

The center-right People's Party (PP) was swept to power with an absolute majority in late 2011 as voters rejected the policies of the former ruling Socialists (PSOE).

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Sun Feb 3, 2013, 08:47 AM

60. {i'll believe it when i see it} New measures to lift veil on banks' capital ratios


(Reuters) - The game may soon be up for banks that have made themselves look healthier by understating how risky their businesses are, which should help pension funds, savers and companies to decide which institutions to invest in.

Bowing to pressure from regulators and investors, some of the world's biggest banks will soon implement a landmark initiative that promises to reveal far more detail on how banks calculate how much capital they need to guard against potential future losses.

It's designed to restore faith in the capital ratios that are the global benchmark for banks' financial health, ratios that are highly sensitive to banks' risk judgments since they are determined as a percentage of banks' own measure of assets as weighted by risk.

"We're expecting a lot of good disclosure from the banks, and where it's not happening we're expecting institutional investors to challenge management on why they're not doing so," said Russell Picot, chief accounting officer at bank HSBC (HSBA.L) and co-chair of the industry taskforce that came up with the new standards for what banks should tell investors.

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Sun Feb 3, 2013, 08:51 AM

61. The Raven - Read by Christopher Lee

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Sun Feb 3, 2013, 08:53 AM

62. "Great Rotation"- A Wall Street fairy tale?


(Reuters) - Wall Street's current jubilant narrative is that a rush into stocks by small investors has sparked a "great rotation" out of bonds and into equities that will power the bull market to new heights.

That sounds good, but there's a snag: The evidence for this is a few weeks of bullish fund flows that are hardly unusual for January.

Late-stage bull markets are typically marked by an influx of small investors coming late to the party - such as when your waiter starts giving you stock tips. For that to happen you need a good story. The "great rotation," with its monumental tone, is the perfect narrative to make you feel like you're missing out.

Even if something approaching a "great rotation" has begun, it is not necessarily bullish for markets. Those who think they are coming early to the party may actually be arriving late.

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Response to xchrom (Reply #62)

Sun Feb 3, 2013, 10:26 AM

64. People on working on Commission and "Bonuses" will say anything to make a sale


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Sun Feb 3, 2013, 08:58 AM

63. Fed officials see brighter global economic outlook


(Reuters) - Two top Federal Reserve officials painted a picture of cautious optimism on Friday for the U.S. economy in 2013, helped by stronger global growth as the central bank aggressively prints money to curb the nation's lofty rate of unemployment.

The Fed this week decided to keep buying bonds at a $85 billion monthly pace, and hold interest rates near zero until the jobless rate falls to 6.5 percent, so long as inflation does not threaten to rise above a threshold of 2.5 percent.

U.S. unemployment edged up 0.1 percentage point to 7.9 percent in January, and the economy shrank slightly in the final quarter of 2012.

But New York Federal Reserve President William Dudley and St. Louis Fed chief James Bullard, who both voted in favor of the U.S. central bank's policy decision this week, saw reasons to be cheerful about the year ahead.

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Sun Feb 3, 2013, 10:48 AM

66. Fed officials sent to Detox


Here's hoping something of their brains can be salvaged, once they come down from that artificially-induced high.

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Sun Feb 3, 2013, 10:46 AM

65. Dilbert Gets It (Thanks, Scott Adams)


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Sun Feb 3, 2013, 11:03 AM

67. Dirty Money: The Finance and Fossil Fuel Web

1/26/13 Dirty Money: The Finance and Fossil Fuel Web

Banks and Oil not only make up the most wealthy corporations, they sit on each other's boards and their executives include some of the world's most powerful political and social institutions. An insight into one dimension of the 'Davos class.'

These infographics are produced as part of TNI's State of Power 2013 report, a visual insight into who is dominating the planet at a time of systemic economic and ecological crisis.

more infographics...

edit to correct second link

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Sun Feb 3, 2013, 11:22 AM

69. It was a brisk morning for paper route


+/- 0F, with no wind. Got up to 6F by the time I was done.

Good luck to the Superbowlers, may the best bird win.

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Sun Feb 3, 2013, 11:20 AM

68. Cryptography


Poe had a keen interest in cryptography. He had placed a notice of his abilities in the Philadelphia paper Alexander's Weekly (Express) Messenger, inviting submissions of ciphers, which he proceeded to solve. In July 1841, Poe had published an essay called "A Few Words on Secret Writing" in Graham's Magazine. Realizing the public interest in the topic, he wrote "The Gold-Bug" incorporating ciphers as part of the story. Poe's success in cryptography relied not so much on his knowledge of that field (his method was limited to the simple substitution cryptogram), as on his knowledge of the magazine and newspaper culture. His keen analytical abilities, which were so evident in his detective stories, allowed him to see that the general public was largely ignorant of the methods by which a simple substitution cryptogram can be solved, and he used this to his advantage. The sensation Poe created with his cryptography stunt played a major role in popularizing cryptograms in newspapers and magazines.

Poe had an influence on cryptography beyond increasing public interest in his lifetime. William Friedman, America's foremost cryptologist, was heavily influenced by Poe. Friedman's initial interest in cryptography came from reading "The Gold-Bug" as a child—interest he later put to use in deciphering Japan's PURPLE code during World War II.

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