WC Varones

Don't lend your hand to raise no flag atop no ship of fools

Celebrate good times!

Gold hits $800!

And to think we were buying it under $500 less than two years ago.

"Gold is not a real investment," they told us. "Gold doesn't yield anything," they whined. "Gold is not a legitimate asset class," they said arrogantly.

I hope they're enjoying their 5% nominal returns on a plummeting dollar.

I'd hate to share a jail cell with this guy

Three monkeys

Inflation? We don' see no steenkin' inflation!
Proctor & Gamble gave investors the earnings they expected but not the guidance they hoped for. The consumer-products company cautioned Tuesday that
mounting costs will crimp its margins next quarter.

...

In response to the rising costs, Procter & Gamble will raise price increases across its offerings. The move could throttle the company's sales. "With consumers now facing rising prices for many everyday items, this is cause for some concern, but given the strength of Procter & Gamble's brands, we think the company will succeed in passing through these price increases without sacrificing too much in the way of sales volume," said Morningstar analyst Lauren DeSanto.

Nope, no inflation here! Another 50 bps, please, Mr. Bernanke!
A joyous video done by a college classmate of mine:

Metaphor

Scientist: Human race will split into two different species

The human race will one day split into two separate species, an attractive, intelligent ruling elite and an underclass of dim-witted, ugly goblin-like creatures, according to a top scientist.

Some would say it already has.

Frank Chu is stalking me

... or maybe I'm stalking him. I've seen Frank three days in a row: at the Q for Mayor party Thursday night, then at Critical Mass Friday night, then at the war protest Saturday.

Pics of the protest here.

Just another day in San Francisco



Yes, that's a bearded transvestite saxophone player in fishnet stockings.

How the cops know who not to stop in Tennessee

Bernanke's crime spree continues

The dollar hits another all-time low, breaking 77 on the dollar index.

Gold prices continue to skyrocket.

The Orange Midget predicts happy days for Countrywide, because if dollars aren't worth anything, people won't have any trouble paying their mortgages.

Some 4.41 percent of Countrywide's conventional first mortgage loans were delinquent as of Sept. 30, up from 2.57 percent in the year-ago quarter. For prime home-equity loans, delinquencies inched up to 13.5 percent compared to 13.4 percent.

The number of subprime loans that were behind in payments soared to 29.08 percent, compared to 18.32 percent in the year-ago period.

In the subprime loan category, 12.63 percent of the loans were behind in payments by 90 days or more, more than twice the year-ago rate.


Countrywide expects to "earn" 25 cents to 75 cents next quarter, because when people don't pay their mortgages, Countrywide counts the non-payment as "income" under the assumption that either the borrowers will win the lottery and be able to pay, or Countrywide will be able to foreclose and sell at 2006 inflated-appraisal, cash-back prices.

Tonight

See you at the Q for Mayor party at the Bayview Boat Club with the Ron Jeremy Explosion.

Rats desert a sinking ship

I don't think that phrase has ever been more appropriate than now.

Corrupt former HUD Secretary Henry Cisneros leaves Countrywide's Board of Directors.

Facebook hits critical mass

I finally signed up on Facebook this week after being urged to do so by multiple friends. Until recently, Facebook was used by cool kids and early adopters. Now it has hit the ranks of professionals, and it's really exploding.

Facebook is everything that LinkedIn tried to be but couldn't. I've been on LinkedIn for a couple years, and found it sort of interesting, but never very useful. Join Facebook now, and avoid the LinkedIn IPO.

Goldman Sachs: California Suchs!

From a Goldman Sachs housing industry report (no link; go open an account, you cheapskates!):
House prices are significantly over-valued in California

Our house price model indicates that Californian homes are 35-40% above the price range implied by current and forecast economic conditions (compared to 13-14% over-valuation nationally). As of August the median house price in California was $589K, but economic conditions support prices between $350-380K; material price declines are likely, in our view.
How do you like them apples, homedebtors?

Paulson makes a mockery of the G7

One of the burdens that comes with being a major developed economy and member of the G7 is that you're not supposed to turn your currency into toilet paper.

France, Italy, and German tried to remind the U.S. of this responsibility, but Treasury Secretary Paulson vetoed their statement.

More on SIVs

SIVs are the latest talk of the financial press. Structured Investment Vehicles are a way for banks to hide bad loans off of their balance sheets, a la Enron.

SIV also stands for Simian Immunodeficiency Virus, the predecessor to HIV.

SIV was possibly transmitted to humans by people who screwed monkeys.

SIVs are commonly held by people who were screwed by monkeys like Mozilo.

Closing the barn door after the orange man has raped the horses

CtW Investment Group, a pension-fund advisory group affiliated with seven big labor unions, said it sent a letter to the board of Countrywide Financial Corp. urging it to ask for the immediate resignation of Angelo Mozilo, chairman and chief executive of the nation's largest home-mortgage lender in terms of loan volume.

Fax Congress

If you don't want Ben Bernanke, Nancy Pelosi, and George Bush to turn America into a Third World country, please click here to send a fax for common sense to Congress.

Inflation - the fighting 10th's view

So.....

when helicopter Ben decided to drop the FED Funds Rate while the rest of the worlds' major national banks were raising their lending rates, I decided to contact my voice in congress by getting a hold of Ellen Tauscher of the fighting 10th. I wanted to write my voice in Congress and say "HE LADY, Ben-o is goin' all medieval on the dollar and if he's not careful, he's going to drain every last ounce of it's value so that we are going to need wheel barrels of cash just to buy a loaf a bread, a la Germany 1933." I may have phrased it differently but the jist was please stop killing the dollar. Wall Street needs to sleep in the bed they made and it isn't the tax payer and the middle class who should finance their follies. In addition could you please give the currency printing presses a little break and tell the FED to actually raise the FED rate because the CPI value they are using to justify this action is the very definition of fraud.

So Congresswoman Tauscher replied, or should I say some uneducated democrat lackey replied. I certainly hope it wasn't Ms. T because if it was it means that someone without the simplest understanding of economics is voting for me in congress. So to keep faith in the system we will say this page replied with this statement about the 'relative worth' of the dollar:

Dear most valued constituent,

...To be sure, the hapless tax cuts and profligate spending policies of the Bush Administration have not strengthened our economy. However, other factors - including a decreased flow of international funds into America, extensive reliance on credit, and a lack of personal savings by many Americans - have also driven down the value of the dollar. The dollar's relative worth is most often a symptom of movements of capital between countries. As such, it is these flows, and the forces behind them, that are likely to determine the strength of our economy. Be assured that I will continue to work to implement policies that promote fiscal responsibility and inspire strong economic growth.

Now to be clear, at no point did I even suggest the problem was the Bush Administration, even though of course all administrations that choose to spend gagillions more then they bring in greatly contribute to the problem. I purely commented on 2 things: 1. the FED lowering the borrowing rate when their job is to protect us from inflation which that specifically does not and 2. STOP PRINTING SO MUCH GOD DAMNED MONEY.

Let's look at each factor that lackeyboytoy included:
1. Decreased flow of international funds into America - why would that happen? Because the dollar is weaker and they can earn more in foreign markets then in the US. SORRY that's the result, not the problem.
2. Extensive reliance on Credit - absofuckinlutly, except the way her boytoysexslave states it, it makes one think that she is actually referring to consumer credit and again it can't help, but the problem here is the liberal debt driven policies of our government's monetary leaders.
3. Lack of personal savings - hhhwwwwhhhaaatttt???? How does our populations' lack of savings impact the value of the dollar? So if we save more does that mean those dollars are out of circulation? OF COURSE NOT, the banks loan those dollars out to other folks so they can cash in on their home equity and get that dream pair of jet skiis with plasma tv's attached. So the dollars are in circulation meaning the new dollars printed, going into circulation dilute the value of the existing dollars and voila, we are seeing double digit percent increases in everything we need to live, which inherently means everything not counted in the CPI.

I am not endorsing our lack of savings of course. But I am calling out that she, sorry her sexboytoyfrombucknell, is suggesting that the population is the reason for inflation instead of the monetary policy makers who believe that the best way to support the rich is to destroy the middle class.

If this is my representative and this is what the Democrats think, and the Republicans are spending at lights out speed then we need a new party. How about the REAL CONSERVATIVES. Mr. Paul would you be available?

Dollar hits new low

Bernanke's O.J. Simpson job on the dollar continues:
The dollar index, a measure of the dollar's value against six major currencies, was down 0.7 percent at 77.576. Earlier in the session it fell to 77.478, the lowest since its post-Bretton Woods inception more than 30 years ago.

Topical Halloween costumes

I can't beat this one from The Nose on Your Face, although they didn't really get the "Wide Stance."

W.C. Varones narrowly escapes mob hit

I was sitting in Nick's Crispy Tacos last night, facing the door, as family members arrived one by one. Then, on the jukebox, that song started.

Just a small town girl
Living in a lonely world
She took the midnight train going anywhere
Just a city boy
Born and raised in South Detroit
He took the midnight train going anywhere

A singer in a smoky room
A smell of wine and cheap perfume
For a smile they can share the night
It goes on and on and on and on

Don't stop believing...
Fortunately, the literary reference ended there. No guy in Members Only jacket, no cut to black.

But thinking about the greatest TV series ending of all time got me thinking about other great art. I know I've told you about Dogville before, but I also know that you're lazy and haven't gotten around to seeing it. Dimwitted movie critics will dismiss it as an anti-American rant from a European kook. But it's really a religious allegory about a vengeful God. And it's about the dark side of all humans, not specific to America. It's one of the greatest movies of all time, right up there with The Big Lebowski. Put it on your Netflix now, dammit.

Your mission, should you choose to accept it...

... is to post this at your local Countrywide office and send me pics.

What would Brian Boitano do?

What would Brian Boitano do
If he were here today?
He'd skate with Barry Manilow
That's what Brian Boitano'd do.

CNBC for morons

Fox to launch business channel:
"Our goal is to essentially broaden the pie that watches business news," said Kevin Magee, the Fox News executive in charge of the new business channel, which will be beamed into 34 million homes in the U.S. at first.

Magee wouldn't divulge programming details except to say it will focus on de-mystifying the financial world and attracting the average investor who may be put off by the way business news is presented.

Viewers are likely to see shows on saving for retirement or buying a house.
If CNBC is too complicated for you, maybe business isn't your thing. Take up gardening. And don't we already have garbage like "Flip this House" on the other cable channels?

SIVs = Enron accounting

So all the big banks are in trouble because of Enron-style off-balance sheet entities that hold a boatload of bad mortgages. Now they are getting together to try to figure out what to do about it:

The ultimate fear: If banks need to write down more assets or are forced to take assets onto their books, that could set off a broader credit crunch and hurt the economy. It could make it tough for homeowners and businesses to get loans. Efforts so far by central banks to alleviate the credit crunch that has been roiling markets since the summer haven't fully calmed investors, leading to the extraordinary move to bring together the banks.

In recent weeks, investors have grown concerned about the size of bank-affiliated funds that have invested huge sums in securities tied to shaky U.S. subprime mortgages and other assets. Citigroup, the world's biggest bank by market value, has drawn special scrutiny because it is the largest player in this market.

Citigroup has nearly $100 billion in seven affiliated structured investment vehicles, or SIVs. Globally, SIVs had $400 billion in assets as of Aug. 28, according to
Moody's.


If banks are forced to take assets onto their books? Either it's a bank asset or it's not. If it's a bank asset, it ought to be on the books in the first place.

Did the idiot regulators learn nothing from Enron? Chuck Prince ought to be sharing a cell with Andy Fastow.

Visualize steel bars

Faith-based prison programs flourish

Priorities

Countrywide, still throwing employees out in the street, hires U2's Bono to play at an industry conference. Nice sensitivity.

Bono runs around acting like he has a social conscience. Wouldn't it be nice if he called Mozilo up onstage and suggested The Orange One give his ill-gotten hundreds of millions to the employees and borrowers whose lives he's ruined?

Bloodbath in Paradise

California sun
But you're still in bed
And the California rain is turning red



Retail sales rose nationally in September, up 0.6% compared to expectations of 0.3%.

But not in California:
Based on sales tax revenue, it now appears that the California economy is in recession... September sales tax revenue was off 7% compared with last year.


What's the difference? Mortgage Equity Withdrawal. California is at the center of the housing bubble and the housing ATM bubble. No more cash-out refis, no more consumer.

And if you think that sales tax drop is funny, wait until you see how far below projections property taxes will come in over the next few years. Property tax revenues go up from construction of new houses and sales of existing homes at higher valuations. Both of which just stopped happening. And just as Arnie was ramping up spending!

And, to quote a late Californian singer, "We've only just begun..."

Match.com success stories

or not.

Well, he was quite a womanizer

Barack Obama is JFK heir, says Kennedy aide

Gold doesn't burn

But it sure is on fire.

Flying over the Folsom Street Fair

You think this guy got any converts?

She's going to be disappointed

Jennifer Lopez confirms she's expecting twins.

I was expecting twins once. But when they showed up at the hotel room, it was obvious they weren't even related.

W.C. Varones joins Kooks for Ron Paul

Yes, I've been tempted by Condi, then Rudy, then Fred.

But I'm sticking with this one through the primaries. Why? Ron Paul is the only candidate who has a clue about the debt and inflation problem facing our country.

Read the transcript of the last debate here (or just skip through to the Ron Paul statements).

Sure, I'll vote for anybody in the general election who opposes Hillary's communist health care. But in the primary, I have the luxury of voting for someone who is honest and comprehends the big issues. How often do you have the privilege to vote for someone with those credentials?

Obama wants to establish Christianist theocracy

Obama to evangelicals:
"We're going to keep on praising together. I am confident that we can create a Kingdom right here on Earth."

CNN, of course, buries the quote below the fold in a story fawningly headlined "Obama: GOP doesn't own faith issue."

Lenders learned the lesson on bad subprime loans issued in 2005 and 2006

NOT.
Subprime mortgage bonds created in the first half of 2007 contain loans that are going delinquent at the fastest rate ever, according to Moody's Investors Service.

The average rate of "serious loan delinquencies" in the securities has been higher than 2006 bonds, New York-based Moody's analysts Ariel Weil and Amita Shrivastava wrote in a report today. Serious loan delinquencies are those 60 days or more past due, including properties in foreclosure or already foreclosed upon.

"It is shocking what you see," said Kyle Bass of Hayman Advisors LP, a Dallas-based hedge fund that reported a 400 percent return on its bet the U.S. housing market would fall. "Anything securitized in 2007 has got to have the worst collateral performance of any trust I've seen in my life."

That's an unfortunate way to lose

From today's AP report on the Chicago marathon:
Cheruiyot was in position to contend but stomach craps forced him to drop back after 22 miles.

This morning at Countrywide

This morning at Countrywide, there was a new memo posted in the window (click the picture to enlarge):



It was an amazing stroke of luck that a Varones photographer was there to capture it on film as employees read the memo.

Czar or Tsar? - that's my first question

Apparently the bobbleheads in Washington are talking about creating a new Mortgage “CZAR” which is just what we need. I’m always in favor for more government especially when it means spending my tax dollars to help those who can’t read but get $500,000 loans when their income is $50,000 gross a year. Anyway......

My question is why the term CZAR? The last czar of Russia (Russia being the only country that I am aware of who uses that term), Nicky 2, was a complete failure. There was nothing good about him and his most telling accomplishment/mistake was fostering a society that could let Communism seem like a really good idea.

SO we name all of our important enforcer positions czar. Does that seem a little strange? Why not kaiser, or how about fuhrer or maybe kahn. Why can’t we have a Drug Kahn and Mortgage Kaiser?

And while we are at it, wasn't it Nicholas II who nearly bankrupted Russia completing the most awesome of public works projects of the time, the Trans Siberian Railway? Do we really want to have the leaders of our always effective government enforcer departments be titled something related to that? I supposed the answer in the United States is a resounding YES. It makes complete sense.

Yahoo Czar Article

Countrywide hires PR firm to squash sleazy image

WSJ:
Having suffered a barrage of negative headlines while battling to shore up its finances and shrink its work force of 60,000 by as much as 20%, the nation's largest home-mortgage lender is launching a PR blitz aimed at repairing its reputation. And it starts inside the company.

For the demoralized employees who remain, the new campaign means wristbands with the phrase "Protect Our House" and pep talks promising to keep "amply" rewarding the most successful among them amid a struggle with the sharp drop in mortgage lending as defaults soar and house prices decline.

Oh, yeah. Employees are going to love wearing wristbands as they fear the next round of layoffs and their evil orange CEO laughs on his piles of hundreds of millions of dollars from dumping stock and as news reports expose their sleazy lending practices.

Anyone not wearing a wristband is the next to go!

Speaking Truth to Power

Robert Kuttner's testimony yesterday to the House Committee on Financial Services:
The Senate Banking Committee, in the celebrated Pecora Hearings of 1933 and 1934, laid the groundwork for the modern edifice of financial regulation. I suspect that they would be appalled at the parallels between the systemic risks of the 1920s and many of the modern practices that have been permitted to seep back in to our financial markets.

Although the particulars are different, my reading of financial history suggests that the abuses and risks are all too similar and enduring. When you strip them down to their essence, they are variations on a few hardy perennials – excessive leveraging, misrepresentation, insider conflicts of interest, non-transparency, and the triumph of engineered euphoria over evidence.

The most basic and alarming parallel is the creation of asset bubbles, in which the purveyors of securities use very high leverage; the securities are sold to the public or to specialized funds with underlying collateral of uncertain value; and financial middlemen extract exorbitant returns at the expense of the real economy. This was the essence of the abuse of public utilities stock pyramids in the 1920s, where multi-layered holding companies allowed securities to be watered down, to the point where the real collateral was worth just a few cents on the dollar, and returns were diverted from operating companies and ratepayers. This only became exposed when the bubble burst. As Warren Buffett famously put it, you never know who is swimming naked until the tide goes out.


Not that those idiots in Congress will understand it, much less act on it against the interests of their Wall Street campaign contributors.

I'm all for unregulated, free-market capitalism, but that's not what we have. What we have is no regulation, and an implicit government promise that the Fed/ GSEs /Bush /Congress will bail out the speculators any time they get in trouble. If the taxpayer is always going to be on the hook to bail out speculators, we need to regulate the risks we are signing up for.

Calling BS on the Fed goes mainstream

MSNBC (yes, it's technically a mainstream network, even though nobody watches it) on the Fed and inflation:
Catch that bit about "core inflation"? That's Fedspeak for: inflation is under control, unless you look at the costs of things that are going up.

And CNN: Bernanke screws the responsible to bail out the speculators.

Thanks to the daily must-read Patrick.net for the links.

Some things are better written

Between shows on PBS tonight, they ran a teaser segment from "This Old House." The lesson: the perils of using too much caulk in sealing windows. I kid you not, the segment closed with the show's host deadpanning, "Remember--a little caulk goes a long way!"

YouPrude

I uploaded a few videos from the Folsom Street Fair to YouTube. Guess which one got censored. Women whipping each other? Women in degrading acts in bizarre gear? Nope.

Google/YouTube is opposed to this wholesome, happy young woman dancing bare-breasted.

Use LiveLeak instead. GooTube is a bunch of idiots.

NY Times: Countrywide is the second coming of Enron

So says Paul Krugman.

One big difference in Countrywide's favor: Paul Krugman isn't an advisor to Countrywide.
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