WC Varones

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

Loser Country - USA

So it BEGINS - the losers of this country are being rewarded by unwilling, paying non-losers. Every poor, poor "homeowner" that signed a loan you couldn't afford and are now being bailed out by people like me, you are scum. And you definitely aren't American, you hopeless, useless leeches inhabiting this once great country.

I woke up this morning and found we are socialist. Nikita was right.

On the appeal of Hopey McChange

If you're going to vote for Hopey McChange as the lesser of two evils, I can accept that.

But if you're actually enthusiastic about either of these two politicians, you're part of the problem.

Here's the Wall Street Journal on desperate Americans flocking to Obama like Germans flocking to Hitler.

AIG Sponsorship

In soccer teams are sponsored by companies and on their jersey is the logo of that firm. Firms like VW, Thomas Cook, Samsung and Carlsberg all have their logos on 1 or more club uniforms.

The richest club in the world is Manchester United. They are sponsored by AIG and they have a $19 million contract per year to sponsor them.

It's funny to me that the company that should have gone under without a taxpayer bailout obviously still has to fulfill their contractual commitments (unlike the poor, poor American homeowner). So while 19 million is fractional compared to the total amount of money needed to bail them out, isn't it a little odd that we still see their logo on their uniform? Isn't it just a little infuriating?

I suggest that instead of AIG on the uniform, it should be this:

19 million is nothing in the scheme of things but I still find it absurd that even that much is going to the pockets of a foreign team....owned by an American.

Dems to Wall Street: no taxpayer money for bonuses!

This is encouraging. Henry Waxman sends a pointed letter demanding documents from banks relating to whether they are going to use the bailout money for bonuses:



And then Andrew Cuomo says:
"Specifically, corporate expenditures and payments, made in the absence of fair consideration of undercapitalized firms, may well violate NY Debtor and Creditor Law 274, which deems such payments illegal fraudulent conveyances [...] obviously, we will have grave concerns if your expected bonus pool has increased in any way as a result of your receipt or expected receipt of taxpayer funds from the Troubled Asset Relief Program."

So Republican Treasury Secretary Henry Paulson says, "Give me a blank check for almost a trillion dollars or it's the end of the world." Republicans in Congress hesitate, but are quickly bought off with pork. Republican Paulson then abandons the plan to buy the banks' toxic assets, and instead gives money directly to banks with almost no strings attached. Democrats, then, point out that Wall Street millionaires and billionaires should not pay themselves bonuses out of taxpayer money.

If a landslide happens next Tuesday, the Republicans earned it.

Metaphor



Never wrong, just early.

Bad day, mate -- Coogee Bay Gelato

Memo to self: don't EVER complain about the service in an Australian pub.
Stephen and Jessica Whyte and their three sons were served complimentary gelato dessert by Coogee Bay Hotel staff three weeks ago after complaining about food prices, facilities and staff attitude.

After eating the dessert Mrs Whyte became violently ill. A heated argument erupted with staff over the contents of the bowl. Distraught, the family took a sample of the gelato and had it tested at the National Measurement Institute. A report from the institute found: "The sample has an offensive odour and physical properties similar to human excreta."

Coincidentally, I used to live down the street from the Coogee Bay Hotel, and frequented it infrequently. I never tried the gelato, though.

HT: Wombat Dolphin.
Coogee Bay Gelato

Life imitates South Park

This clip, from four years ago, is a pretty good portrayal of this year's race.

Golfers are fun

This is almost as good as Golf Course Airhorn (click pic for vid).

Golfers make such good targets for stuff like this because they take their silly little game so seriously.

HT: Todd Seavey.

Portrait of a seller finding motivation: 803 Ida Avenue

The sellers at 803 Ida Avenue in Solana Beach are gettin' real. After holding out for $1,199,000 for more than four months, they have been dropping the price by small amounts almost daily, and yesterday added a $54,000 drop bringing the price to $995,000. That's a 17% price drop in less than six months, or a 38% annualized decline.



It's a nice house in a pretty good neighborhood. But there are a lot of million dollar houses in coastal San Diego, and not that many buyers who can afford a million dollar house in a recession.

The problem with paying a million dollars for a house is that you'll never own it. You'll be renting it in perpetuity from the state. Even if you have $200,000 in cash lying around for a down payment, and even if you can make the $5500 monthly mortgage payment plus a little more for insurance, you still owe the state more than $1000 a month in property taxes. That's a rent check in itself to some people. And if you manage to pay off the mortgage in 30 years and retire, that $1000+ per month plus inflation adjustments will eat up a big chunk of your Social Security check (assuming you haven't been means-tested out of getting a Social Security check). You had better be saving a big chunk of change outside of your home equity if you don't want to be eating Alpo in that house.

Notice the current tax assessment on the house: $623,838. So if you buy the house at the current asking price, you jack up the tax bill by 59.5% forever. Bad trade!

Back to the future

I've been beta-testing a new app for Google that lets you see web sites in the future. It's pretty cool. Here's the W.C. Varones Blog two weeks from now, for example:

Greenspan's Body Count: Dallas Dwayne Carter, David and Sharron Hetzel, and Cliff Kendall

The toll rises:
Pinellas Park, Florida, resident Dallas Dwayne Carter was a 44-year-old disabled single dad who lost his job, fell into debt and was faced with eviction. "He always talked about needing help -- financially and help with the kids," neighbor Kevin Luster told the St. Petersburg Times. On July 19th, Carter apparently called the police to say he was armed and disturbed. When they arrived, Carter fired his pistol and rifle inside the apartment, before emerging and pointing his weapons at the officers on the scene. Police say they ordered him to drop them. When he didn't, they killed him in a 10-round fusillade.
And from the same Salon.com ripoff of Greenspan's Body Count:
Bay City, Michigan, residents David and Sharron Hetzel, both 56, "lost their home to foreclosure and filed for bankruptcy protection. But they did not follow through with the Chapter 13 proceedings." On August 1, say police reports, David Hetzel mailed a letter of apology to his family members. Later that night, according to the local police, he attacked his sleeping wife, striking her in the head with a golf club and repeatedly stabbing her with a kitchen knife. After that, he began setting fires throughout the house before crawling into bed beside his wife and killing himself with "a single, fatal wound to his torso."
And:
[...] in northern California, Cliff Kendall, Petaluma's chief building official, shot himself [fatally] with a rifle. A week earlier, Kendall had learned that he was being laid off. "He was afraid we'd lose our home, and we probably will because I can't afford to keep it," his wife Patricia, who is on disability with a back injury, told the Press Democrat. "He was extremely upset about it and hurt."
That's four more kills for Alan Greenspan, who is finally getting the recognition he deserves in the media and on Capitol Hill. We are not even counting grizzly cases of attempted murder or attempted suicide like that of Sylvia Sieferman, who tried to stab her two 11-year-old daughters to death. Greenspan's Body Count now stands at fifty-nine:

Dallas Dwayne Carter

David Hetzel
Sharron Hetzel
Cliff Kendall
Pamela Ross
Roland Gore
Mrs. Gore
Wanda Dunn
Karthik Rajaram
Subasri Rajaram
Krishna Rajaram
Ganesha Rajaram
Arjuna Rajaram
Indra Ramasesham
Joe X
Isabelle Jarka
Robert Wagner
Lt. Michael Howe
John Roberts
Palmer C. White
Dianne Pittman White
Ed Boesen
Edwin F. Rachleff
Carlene Balderrama
Troy VanderStelt
Scott M. Coles
Dawn E. Armstrong
Thomas Lizotte
Jonathon Calvin "40-Cal" Jacques
Salvador X
Lupe X
Jade X
Little Boy X
Little Girl X
Kashmir Billon
Bill McMurtry

Lisa McMurtry
James Hahn
Raymond Donaca
Deanna Donaca
[redacted]
[redacted]
Michel Veillette
Nadya Ferrari-Veillette
Marguerite Veillette
Vincent Veillette
Mia Veillette
Jacob Veillette
Maurice Pereira
Natasha Pereira
Mark Achilli
Raed Al-Farah
Andrew Kissel
Rufus Shaw Jr.
Lynn Flint Shaw
Mr. Pierce
Walter Buczynksi
Marci Buczynski
Jason Washington

Your bailout at work, Part 2

After receiving the first $250 billion of a taxpayer bailout, Wall Street banks still won' t lend your money back to you at anything near reasonable interest rates. But they have found another use for your money: huge bonuses to executives.
Financial workers at Wall Street's top banks are to receive pay deals worth more than $70bn (£40bn), a substantial proportion of which is expected to be paid in discretionary bonuses, for their work so far this year - despite plunging the global financial system into its worst crisis since the 1929 stock market crash, the Guardian has learned.

Staff at six banks including Goldman Sachs and Citigroup are in line to pick up the payouts despite being the beneficiaries of a $700bn bail-out from the US government that has already prompted criticism. The government's cash has been poured in on the condition that excessive executive pay would be curbed.

Just thought you'd like to know.

Navigating the Depression

It was a good day for Depression management strategies at the Varones house. I:

* canceled HBO
* switched from Yahoo to GoDaddy for web hosting, saving more than $30 a month
* filled up for $3.179 a gallon at Arco, the cheapest I can recall this year
* found a shiny quarter while jogging

What are you doing differently so far? What are your next steps?

Your bailout at work

You'll recall that the reason we had to sell your children into debt to bail out Henry Paulson's Wall Street buddies was "to get the banks lending again," so that the money would trickle down to "Main Street."

How's that working? From a Jefferies research note this morning:
While government intervention may have caused a temporary bottom in the equity markets, signs of improving credit conditions continue to be limited to the inter-bank lending market (now guaranteed by the Government). Jumbo mortgage rates continue to trend higher and wider vs. the U.S. 10 year on a relative basis. This comes as Wells Fargo, a bank that recently received cash from the government, yesterday published a 9.5% rate for a 30 year fixed rate jumbo mortgage on its web site. This is a further sign that tight consumer credit will continue to put pressure on the economy making the prospects for a recovery in the short term more difficult.

Ever-increasing bailout expenditures and serial consumer stimulus checks mean huge increases to an unsustainable national debt. That means higher interest rates, and this exposes the lie of the "rescue for Main Street."

Why are the taxpayers lending to Wells Fargo at 5%, only to have Wells Fargo lend the money right back to Joe Taxpayer at 9.5%? Why not cut out the middle man and have the government issue mortgages directly at 5% or 6%? That's similar to McCain's recent trial balloon. It's a stupid, socialist idea. But not nearly as stupid or socialist as what Paulson is doing now.

Andrew Lahde's farewell letter

If you haven't read Andrew Lahde's farewell letter, read it here. He's right about a lot of things: the complete corruption of Congress, the hereditary caste system in the Ivy Leagues and the financial and governmental establishment, the incompetence and unworthiness of the beneficiaries of that caste system, and the need for a complete revamp of our governmental system.

Lahde is wrong about one thing, though, when he says, "I do not understand the legacy thing. Nearly everyone will be forgotten. Give up on leaving your mark." To the contrary, a single moment of brilliance can leave a permanent legacy. Exhibit one: Gerard Finneran. Andrew Lahde is still a young man. He has plenty of time to find his inner Finneran. And when he does, the W.C. Varones Blog will be here to salute him.

Silver lining

The silver lining to the greatest speculative excess in the history of the world (remember how you laughed when I called it that a couple years ago?) is that we've now got a lot of stuff laying around. Not all of it is useful (jet skis, $5,000 purses, etc.), but much of it is. In the Great Depression (hereafter referred to as GD I), there wasn't enough stuff to go around. In GD II, there is plenty of stuff to go around. Homeless? The government can put you up for nominal rent (or free) in one of millions of vacant tract homes it now owns. Need a car? When the government forecloses on GM, it can give the inventory to the needy. You know how Cuba still uses American cars from the 50's? Well, we've got plenty of 2008 Denalis that could last for decades.

Sure, we still need to come up with food, water, and a little energy. But that shouldn't be too big a challenge to come up with enough of them to sustain a minimalist lifestyle. Got beans?

The fall of the empire

Capitalism will be a scapegoat and a casualty of the collapse of the financial system. Unfairly so. The problem is not free-market capitalism, but the lack of it. Fannie and Freddie bribed Congress to prevent risk control while putting the entire public purse at risk for private gain.

The irony is that with limited government (no Fannie/Freddie/FHA/HUD), we wouldn't be in this mess. And now the solution to the problem created by big government will be more big government, less freedom, and less opportunity for the prudent little guy to become wealthy.

Birmingham International Airport annual report

You might recognize your luggage in this x-ray image from Birmingham International Airport's annual report.



Hat tip to notorious international man of mystery Keith.

CRE Survey: Retail and Office Space in Del Mar, California

If any place is immune from the consumer downturn, it ought to be Del Mar, California, one of the wealthiest cities in San Diego County, and a perennially popular tourist location. So I took a walk down the 6 short blocks that constitute its prime retail district.


Dragonflew.


This place apparently sold English phone booths, office furniture, cases of bottled water, and wires hanging out of walls.



Space available. I know someone that can fill some space.


I think this refers to the vacant parking lot where they have the weekly farmer's market.


Booth for rent. Is that only for stylists, or could I set up a lap dance booth?


This one didn't have a For Lease sign. I guess they like it vacant.


You've got a few slots open, I see.




When life gives you lemons, make lemonade!


A realtor trying to get out of a lease?




Three suites. Sweet!


The building at 221 15th Street got an emergency waiver to allow office use even though it was zoned for retail, because they couldn't find any retail tenants. As I recall, they had some financial advisors in there until recently. Also Del Mar Jet. How's the jet business these days? Now it's vacant, repainted, and apparently still going to be used as an office.


Another booth. This one looks like it might have a little more privacy.


On vacation for a month? Does that cause a noticeable drop in sales?


Now the high-end Del Mar Plaza uses mirrored windows to make it look like it's not really vacant (it is).


Or even more clever, paint the windows with some arty stuff to make it look like there's not even supposed to be a store there.


Another one here.


I haven't bothered to check out this web site yet, and I couldn't tell what they were trying to sale-lease. Better do it soon, though, or it will be 4closure.


This place doesn't have any sign. Maybe it's some secret, exclusive club.


Nope.


Not out of business yet, but planning on it!








Wow. Things are really flying off the shelves at the Village Consignment.


With any luck, Three Dog Bakery (not yet open) will be the next to go. For the record, they don't bake dogs; they bake cookies for dogs.


As you can tell, the one thing Del Mar needs is more retail space. So Proposition G is to build a new strip mall. Because "Yes on The Strip Mall -- Yes on G" didn't do well in focus groups, they're calling it "The Garden."

That's all in six short blocks. Most, if not all, of these shops and offices were vacant before the recent credit crunch. We've only just begun.

And just a half mile up the road, the Southfair complex has a heck of a lot of vacancies. "$2.95 + Utilities." I'm not sure if that's $2.95 for each office, or for all six.


UPDATE 11/2/08: A couple more vacancies.

A Tribute to Varones' Heroine

Here's a fun site to play around with:

palinaspresident.us

Varones voters' guide to the California propositions

... well, not just the California propositions. Let's do the national stuff too.

President: Bob Barr (Libertarian). Barr is not an ideal candidate nor an ideal Libertarian. But the two major parties are responsible for the financial crisis we are in, and both candidates have Senate records supporting the policies that caused this crisis. Neither has any clue how to get out of this crisis. The empty suit is marginally worse than the grumpy old man, but a Libertarian vote is a protest vote that says you're not going to be a sheep anymore.

Senate: Libertarian if you're not in a competitive state, Republican if it is competitive. If the Democrats get a filibuster-proof 60 seats, we'll have one-party, Stalinist rule, and the first things on tap are massive Medicare expansion, taking away your 401(k), and getting rid of secret ballots in union organizing.

Congress: vote the incumbents out... unless they opposed the Wall Street bailout. List of Yeas and Nays here. My guy, Brian Bilbray, voted no. I harassed his office endlessly before the vote, so I kind of have to support him now that he did the right thing.

State Senate: Republican. The Democrats are dangerously close to a supermajority where they can ram through tax hikes, which is the last thing the dying California economy needs.

State Assembly: Republican. Ditto.

Now for the propositions:

Prop 1A - High speed train bonds:
No. Would be nice to have fast trains, but in case you hadn't noticed, California is broke.

Prop 2 - Farm animal welfare: Yes. If you want your factory-farmed meat to be raised in tiny boxes where the animals can't even move their whole miserable lives, you are a sick bastard. If you must eat meat, be a real man like Sarah Palin and kill it yourself.

Prop 3 - Children's Hospital Bonds: No. Did I mention that California was already broke?

Prop 4 - Parental notification for abortion: Yes. The school has to notify parents to give kids aspirin, but not abortions? Are you kidding?

Prop 5 - Drug treatment instead of jail for nonviolent offenses
No. Sounds good in concept, but this is not about drug offenses but about real crimes like burglary. I don't care if my neighbor smokes dope, but if he robs my house I want him locked up.

Prop 6 - More police and prison funding:
No. We already have too many police, as evidenced by the fact that they are harassing citizens for DWP. And did I mention that California is broke?

Prop 7 - Renewable energy: No. Expensive mandates on utilities that will drive utility bills higher and make little old ladies eat Alpo.

Prop 8 - Ban on gay marriage:
No. It's a simple matter of equal rights. A state marriage is not the same thing as a religious marriage. Your church won't be required to marry them. True, your children will be taught about gay marriage in public schools, but that's the least of your worries. Your children are already indoctrinated with left-wing propaganda by teachers who don't understand the first thing about the Constitution, individual liberty, or economics. Your children are being brainwashed into being leftist drones for the Democratic Party who will vote consistently for ever-expanding government programs and higher taxes. Accepting gay couples doesn't seem like such a big deal, now, does it?

Prop 9 - Victims' rights:
Yes.

Prop 10 - Alternative fuel vehicle bonds: No. What part of "California is broke" do you not understand?

Prop 11 - Redistricting: Yes. California's districts are gerrymandered so that incumbents almost never lose. In 2006, moronic voters defeated a sensible redistricting plan. Let's see if they are moronic again. This one doesn't fix Congressional districts, but fixing state legislative districts is a start.

Prop 12 - Veterans bonds: No. California is BROKE.

That's how I see it. Your comments are welcome.

San Francisco comes to San Diego

Cross-dressing perverts use "domestic violence awareness" to get their jollies in public.

That is such a flimsy excuse. What does cross-dressing have to do with domestic violence? Come out of the closet already.

We get the leaders we deserve

Meet your electorate: (audio file).

HT: C-Lo.

Who says gold doesn't yield?

One of the principal complaints of the gold haters is that gold doesn't yield anything.

Well, take a look at the GDX gold miners index ETF. It's at 22, an all-time low, and the gold mining stocks are immensely profitable right now. What's more, the index yields over 3% in dividends.

If you haven't joined the gold crowd yet, the GDX is an epic opportunity. I added more today.

Body Count Nation: Pamela Ross and Roland Gore

This is Greenspan Country. People across America are offing themselves and others due to the fallout from Greenspan's bubble.
Pamela Ross, 57, and her husband were fighting foreclosure on their home when sheriff's deputies in Sevierville [Tennessee] came to serve an eviction notice. They were across the street when they heard a gunshot and found Ross dead from a wound to the chest. The case was even more tragic because the couple had recently been granted an extra 10 days to appeal. [...]

In Ocala, Fla., Roland Gore shot his wife and dog in March and then set fire to the couple's home, which had been in foreclosure, before killing himself. His case was one of several in which people killed spouses or pets, destroyed property or attacked police before taking their own lives.

Greenspan's Body Count now stands at fifty-five (sad as the Gore dog killing is, canines do not qualify for the GBC):

Pamela Ross
Roland Gore
Mrs. Gore
Wanda Dunn
Karthik Rajaram
Subasri Rajaram
Krishna Rajaram
Ganesha Rajaram
Arjuna Rajaram
Indra Ramasesham
Joe X
Isabelle Jarka
Robert Wagner
Lt. Michael Howe
John Roberts
Palmer C. White
Dianne Pittman White
Ed Boesen
Edwin F. Rachleff
Carlene Balderrama
Troy VanderStelt
Scott M. Coles
Dawn E. Armstrong
Thomas Lizotte
Jonathon Calvin "40-Cal" Jacques
Salvador X
Lupe X
Jade X
Little Boy X
Little Girl X
Kashmir Billon
Bill McMurtry

Lisa McMurtry
James Hahn
Raymond Donaca
Deanna Donaca
[redacted]
[redacted]
Michel Veillette
Nadya Ferrari-Veillette
Marguerite Veillette
Vincent Veillette
Mia Veillette
Jacob Veillette
Maurice Pereira
Natasha Pereira
Mark Achilli
Raed Al-Farah
Andrew Kissel
Rufus Shaw Jr.
Lynn Flint Shaw
Mr. Pierce
Walter Buczynksi
Marci Buczynski
Jason Washington

Things they should have told me before I went to Haiti

"VIAGRA does not protect against sexually transmitted diseases, including HIV."
- disclaimer in ads for Viagra.

Principles of finance

A bank is a manufacturer of bullshit.

Every century or so, people wake up and smell it.

Gratuitous, traffic-drawing Satyajit Das headline

I've written just one post relating to the brilliant Satyajit Das (and it wasn't much of a post, just a direct quotation), but oddly I still rank high on Google search for Satyajit Das. And I still get a lot of traffic from Satyajit Das searches.

So if your search for Satyajit Das brings you here, I'm sorry, I don't have much to add. Just buy his books and read his blog. They would have saved you, or made you, a ton of money over the past few years if you traded on the obvious implications flowing from them.

Side note: I have a friend named Satyajit Das. Total freaky coincidence, or is that like "John Smith" in India?

Debate-watching thoughts

I'd rather they run McCain's EKG on that ticker...

Old Del Mar

Bing Crosby's tune "Where the turf meets the surf" (now a Chamber of Commerce jingle), updated for current conditions:

Where the flies fill the skies
Down in old Del Mar
Take a plane
Take a train
Take a kayak

There is botox in every face
And lots of vacant retail space
Where the flies fill the skies
At Del Mar

Stop paying your mortgage immediately!

Back in May, I recommended that you stop paying your mortgage immediately.

That advice worked out pretty well, huh? You've already saved ten or twenty thousand dollars, and have you noticed that the bank is still not bothering you? Keep living rent-free. When the bank (or government) finally does get around to calling you, they'll be very nice and accommodative, and they'll negotiate a very nice principal reduction for you.

In Friday's Union-Tribune, economist Peter Schiff gives the same advice:
If you are a mortgage holder who is either struggling with crushing payments, bitter for having overpaid for your home during the bubble, or who has extravagantly refinanced when prices were rising, the government's landmark $700 billion bailout package has an important message for you: stop making your mortgage payments . . . immediately. Furthermore, if you believe that with some planning and sacrifice you may be able to meet your mortgage obligations, the government's message is clear: relax, don't bother.

While angry voters have labeled the package as a bailout for Wall Street, it is more akin to a “Get out of Jail Free” card for anyone who acted irresponsibly during the boom. Here's why.

Nobody likes foreclosure, least of all politicians. The new law clearly indicates that the government will make major efforts to reduce foreclosures through “term extensions, rate reductions and principal write-downs” of the troubled mortgages that it buys from the private sector. In other words, your new landlord will bend over backward to keep you in your home. The legislation telegraphs this by including a provision that extends until 2013 the exclusion of loan reductions from taxable income.

When a financial institution holds a mortgage, homeowners must live with the fear of foreclosure. Private institutions only have obligations to shareholders. In the case of a defaulting borrower, they will look to recover as much of their principal as possible. If foreclosure is their best option, they will take it in a heartbeat.

The government has no such obligations. Its only goal is to keep voters happy. After supposedly bailing out the fat cats on Wall Street, no politician wants to be accused of evicting struggling families. Once you understand this, all of your anxiety should melt away. Why pay your mortgage if foreclosure is off the table, and if you know that lower payments, and possibly a reduced loan amount, would result? A tarnished a credit rating is a small price to pay for such a benefit.

Read the whole thing. And then stop payment on that mortgage check you just mailed.

An ACORN in Every pot?

How about this? from here

..."the Freddie and Fannie Mae bailout bill which was done this August which I also voted against because that nationalized the mortgage industry, that bill, Barney Frank voted language in that bill this summer which hard wires $420 of a $100,000 mortgage to Acorn, La Raza and other organizations..."

"CONGRESSMAN CULBERSON: And it is forever. It bypasses -- I'm on the appropriations committee. It bypasses appropriations, bypasses the congress, it's in your closing documents. From this day forward we will all be paying 4.2% basis fee of $420 for every $100,000 mortgage in your closing papers. You'll have a new little line in there, a new fee that we're going to all pay to go straight to these affordable housing funds which the states then hard wire to La Raza, Acorn, groups like that."

Our "Exit Strategy"?

I stumbled on this "breezy" take on history, but I couldn't verify the supposed source. It's interesting, but I'm not sure about some of the details, like how the "average age of the world's greatest civilizations" was calculated:
About the time our original 13 states adopted their new constitution, in
1787, Alexander Tyler, a Scottish history professor at the University of
Edinburgh, had this to say about the fall of the Athenian Republic
Some 2000 years PRIOR “A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, which is always followed by a dictatorship.”

“The average age of the worlds greatest civilizations from the beginning of history, has been about 200 years. During those 200 years, these nations always progressed through the following sequence….
1. From bondage to spiritual faith;
2. From spiritual faith to great courage;
3. From courage to liberty;
4. From liberty to abundance;
5. From abundance to complacency;
6. From complacency to apathy; (lack of feeling, emotion, interest, or concern)
7. From apathy to dependence;
8. From dependence back into BONDAGE “


UPDATE: W.C. here. I've looked this up before and believe it to be bogus. That is, the concept is correct, but it was not said by Alexander Tyler.

Vote No on Del Mar's Proposition G - "The Garden"

It's not a garden. It's a strip mall. If you think we really need more strip malls anywhere in Southern California, you see the world much differently than I do.

And it's not as if Del Mar is short on retail space.

The Real McCain



A good question. Vote all of the bums out. Every incumbent (though I'll ask for special dispensation to vote for my Congressman, Brian Bilbray, because he voted against the Wall Street bailout).

Greenspan's Body Count: Wanda Dunn, The Little Old Lady from Pasadena

T-Dub sends this story:
Firefighters responded to a call in the 1000 block of North Wilson Avenue about 5 a.m. Monday, said Lt. John Dewar of the Pasadena Police Department. They found Wanda Dunn, 53, in a back bedroom, he said.

She had one gunshot wound, Dewar said. A gun was found nearby.

Dunn was transported to Huntington Memorial Hospital, where she was pronounced dead.

"We received reports that her home was in foreclosure and she was going to be evicted Monday, and that may have been the reason for the arson and the death," Dewar said. "It's very tragic."

...Neighbor Scott Harden, 36, said he had heard from others that Dunn was going to kill herself because she was going to lose her house. He said he also knew that she was apparently going to be evicted on Monday, "so I was on red alert."

Alan Greenspan, you're a sick bastard. Your Body Count now stands at fifty-two:

Wanda Dunn
Karthik Rajaram
Subasri Rajaram
Krishna Rajaram
Ganesha Rajaram
Arjuna Rajaram
Indra Ramasesham
Joe X
Isabelle Jarka
Robert Wagner
Lt. Michael Howe
John Roberts
Palmer C. White
Dianne Pittman White
Ed Boesen
Edwin F. Rachleff
Carlene Balderrama
Troy VanderStelt
Scott M. Coles
Dawn E. Armstrong
Thomas Lizotte
Jonathon Calvin "40-Cal" Jacques
Salvador X
Lupe X
Jade X
Little Boy X
Little Girl X
Kashmir Billon
Bill McMurtry

Lisa McMurtry
James Hahn
Raymond Donaca
Deanna Donaca
[redacted]
[redacted]
Michel Veillette
Nadya Ferrari-Veillette
Marguerite Veillette
Vincent Veillette
Mia Veillette
Jacob Veillette
Maurice Pereira
Natasha Pereira
Mark Achilli
Raed Al-Farah
Andrew Kissel
Rufus Shaw Jr.
Lynn Flint Shaw
Mr. Pierce
Walter Buczynksi
Marci Buczynski
Jason Washington

How About a Rent Ban Comrade?

So the foreclosure ban craze is going national. Comrade Dodd is proposing a ban on foreclosures for 90 days.

So my question is why don't renters deserve the same sort of relief? I mean sure it does take a while to get kicked out of a rented house but seriously, if we are the ones who are going to pay for those homeowners to stay in their homes, then the least they can do is give us a break as well.

I wonder - has their ever been a society who has canonized the stupid, the crooked and the irresponsible at the cost of the productive? I suppose we might be playing out Animal Farm, to keep the Orwell theme going.

Those with equity in their homes and those who rent are just a little less equal then those who are underwater with their mortgages.

King Louis Speaks Orwellian

Mish referenced a terrifying quote from Puppet GW that I encourage folks to check out:

The US Government is to spend up to $250 billion buying direct stakes in banks and other financial institutions under a controversial emergency plan which President Bush insisted today was "not intended to take over the free market but to preserve it".

In a related story people are being jailed not to remove their freedom but preserve it. Scary times ahead people.

The road to here

...in pictures.

Sell crazy someplace else; we're all stocked up here

I've previously mocked Fox Business as CNBC for morons, but they have a point here:



HT: T-Dub.

Careful with that axe, Eugene

The eggheads Paulson and Kashkari are about to announce direct taxpayer investments in Wall Street banks via preferred shares. As always, the devil is in the details:
The government will purchase preferred stock, an equity investment designed to avoid hurting existing shareholders and deterring new ones. Such shares typically don't come with voting rights. They will carry a 5% annual dividend that rises to 9% after five years, according to a person familiar with the matter. By investing in several big firms at once, the government hopes to avoid placing a stigma on any one firm for getting government help.

Warren Buffett got 10% perpetual preferred, plus tremendously valuable warrants, for investing in the cream of the crop, GE and Goldman Sachs. The taxpayers are getting 5% and no warrants (UPDATE: maybe token warrants?) for investing in the stinkier banks. That's a direct transfer of wealth from current and future taxpayers to Wall Street fatcats.

I suggested last week that the Paulson should lock in today's ultra-low interest rates on the liability side of the balance sheet by doing a massive 30-year Treasury auction. What he's doing now is the opposite: locking in ultra-low rates on the asset side of the balance sheet. Yes, the rate purportedly rises to 9% after five years, but that still may not be enough to compensate for one or two bank failures and/or long-run inflation. And can anyone doubt that the 9% rate will be renegotiated when the banks cry poverty and donate to Chris Dodd and Barney Frank's campaigns? Locking in low rates on assets takes inflation off the table and leaves default as the only solution to unsustainable government debt. Now, $250 billion of low-rate assets isn't enough to do it, but I suspect this is only the beginning.

Your California tax dollars at work

The lead sentence in an article by UC Irvine literary journalism senior Daniel Johnson:
Following a record setting 85-day stalemate over the state budget, the financial situation for California looks nearly as downtrodden as it did two weeks ago when state officials were seemingly still in a deadlock deciding the budget.

That's what you get for advertising on NPR

... you get NPR listeners as clients:

Man walks into Lieff Cabraser Heimann & Bernstein law office with fake bomb, upset about not appearing on The Price is Right.

I can't say I wasn't warned

They told me if I opposed the Wall Street bailout, the market would crash and wipe out my 401k.

I did and it did.

Get shorty

There are rumors of the exchanges working with the SEC to ban shorting. And I don't doubt that the government might start buying S+P futures. Be very careful with your shorts. This isn't a free, or fair, market.

What comes next

Let's take a pause from the frenzied trading (assuming you're already full on gold; if not, GLD and GDX are on sale this morning). Let's consider how this is all going to play out over the coming weeks, months, and years.

Stage 1: Paulson/Bernanke continue throwing ever greater amounts of money at the problem in increasingly radical and unprecedented ways. In addition to direct purchase of toxic waste and equities, don't be suprised to see direct government refinancing of mortgages or direct government issuance of new, low-rate mortgages to home buyers.

This may have the positive effect of downgrading The Second Great Depression to The Really Bad Recession. But it will also have the decidedly negative effect of destroying the government balance sheet.

Stage 2: As the recession deepens, job losses mount and business activity drops, cutting tax revenues and making debt service on the $11 trillion+ debt impossible. Uncle Sam becomes Casey Serin, and Treasury bonds are no-job, no-income, no-assets liar loans. The government faces two choices: default or the slow puncture of inflation. Inflation is probably the lesser of two evils, but it's no picnic, as Argentina, Zimbabwe, and Weimar Germany can attest.

How could we avoid this? Well, we could stop flushing the federal government down the toilet with the bad banks. Short of that, we could lock in today's unprecedented low Treasury rates by doing a massive 30-year auction. Once the suckers (China and OPEC) have bought at 4-5%, we could inflate our way out of this with 6-8% inflation.

A kooky substitute teacher, Mr. Dickson, once screamed, unprovoked, at an unsuspecting 6th grade class on the dangers of intraveinous drug use: "Don't you EVER stick a needle in your arm!" Likewise, I say to you today, "Don't you EVER buy a long-dated asset backed by the full faith and credit of the United States government!"

That's how I see it. What do you think?

Buy California Titanic bonds

I just heard Ahhnold in a radio ad urging people to buy California bonds. The pitch was not that they were a good value or a sound investment, but that it was a way to do your civic duty and support Kahleefornia.

Sorry Arnold, you're still spending as if the real estate bubble is in full swing, and you have absolutely no plan to get the budget under control. Some fool and his money might take one for the team, but not me.

Old invoices

I have clients with outstanding invoices, and/or checks in the mail coming to me. I've told them all, "better hurry up or the money won't be worth anything by the time I get it!"

If mail takes one week, what percentage will I be losing on those dollars as those 7 days tick by, I wonder...

October Fool's Day

We've got something to tell you: This blog is not a repository of angry right-wing hatred. Haaaahaahahaha! Oh that's too funny that you thought that for the last two weeks.

Look, there are cameras--there, and right there. Wave to the audience!

A Mercer Walnut Creek Update

Here at the WC we've been keeping track of an urban/suburban housing development in the heart of Walnut Creek (no relation), California, 25 miles from San Francisco. It's called the Mercer and the unintentional comedy is that they are advertising the sheekiest of city living in a suburban setting. So you are no where near the advantages that make SF unique but you get to pay SF prices. Oh and there's a $500 HOA fee.

This development has been complete for over a year now and still advertises that you better act quickly. And the poor bastards that did. See here...

Back in May this was the the advert:



And yesterday's advert:



Flex Credit?? Turns out that means - 'we're going to say the price is 445K when we actually mean its 415K.'

So if you got in in May at $530,000, you are already down 22%.

But act fast, prices like these are not going to last long!

Strange days indeed

Whoa, thought it was a nightmare,
Lo, it's all so true,
They told me, don't go walkin' slow
'cause devil's on the loose.

Better run through the jungle,
Better run through the jungle,
Better run through the jungle,
Whoa, don't look back to see.
Who can know what to expect from the markets when the Fed, Treasury, and SEC come out with radical, unprecedented policy changes on a daily basis? Strange days, indeed.

Well, I've told you once and I've told you twice: never listen to my advice. Nevertheless, following is my strategy.

Keep your head low. This is no time for heroes. Stay diversified, across equities, cash, and gold. Long bonds are for suckers at 4% when the government is promising to go all Zimbabwe on your ass. Even real estate looks good, if you can find a place where the fixed 30-year monthly payment is roughly equal to the rental income.

Chicago Police won't evict foreclosed- sued by mortgage companies

"My job as sheriff is to follow court orders, absolutely," he said. "But I'm also in charge of making sure justice is being done here and it is clear that justice is not being done here."

Chicago's chief of police is refusing to evict people from their foreclosed homes.

It seems the main concern is renters whose landlords are in foreclosure, but I don't think the Police are limiting their refusal to evict to those cases. The issue of those renters indeed seems like a valid concern and let's hope there can be some form of temporary protection for renters whose landlords haven't told them they're being foreclosed! Still....It seems that the police will not be participating in evictions of regular foreclosed home-owners themselves, and that's where the question of "Justice" arises. So, HE (the Sheriff) decides what the law is now?

An update: Mortgage companies are now suing the Chicago Police. I think we're going to be seeing all sorts of sticky questions like this, questions of how aggressively to enforce certain laws, how to fairly protect the people who are getting shafted (like those renters), and also the people/banks who are owed money or assets. We'll see judges who try to massage cases' outcomes in an effort to prevent either side from being irreparably hurt.

A few weeks ago, the Chicago Tribune's editorial board wrote a piece calling for a Cook-County (Chicago) Moratorium on foreclosures for 6 months-a year! One of their sentences was something like, "sure maybe a 90-day moratorium would be a more reasonable proposal, but it's just not long enough to be certain it would work. So we're calling for a 6 month to one year moratorium on foreclosures".

ACORN's HQ raided by FBI !

The socialist group ACORN's HQ in Nevada were raided by the FBI. They found, amongst other things, voter registration lists with such fake names as "Tony Romo" and "Terrell Owens". BTW, Obama was ACORN's trainer and also lawyer in previous election fraud cases, which they were CONVICTED on! HERE's the link.
If this is the beginning of a "look-see" into some of the roots of this housing/credit crisis, then when will the FBI be hitting up Dodd, Raines, Johnson, Paulson, Bush?

Oh, Additionally, a close Illinois cohort (named Larry D. Walsh) of Obama's ALSO had his office raided by the FBI last week! Did anyone even hear a word about this? Does Obama's "Ayers, Rezko, Walsh, Franklin Raines, Jim Johnson, Blagojevich, Frank Davis Marshal" list ever end?

Tony Rezko's sentencing has been delayed. It was to have taken place JUST before the election, but now will take place in December. Is this politics? Or is Rezko giving the Feds info on our corrupt governor Blagojevich? Well, the Fed prosecutor's office announced 2 weeks ago that they DO have enough info to Indict "Blago", but they will wait, and continue to amass evidence against him.
Do I have any "hope" that ANY of this information will make people think twice about Obama? No.

My humble opinion? I'm not considering this stuff as a "this party or that party" issue. It's a corruption issue. But I will add that, at this point, Obama seems to embody the very antithesis of my beliefs.

(Obama + Mainstream Media) - Investor's Biz Daily Article = CCCP

Here you can read an IBD article about Obama's good friend William Ayers's views on education (read: radicalization). He's a good friend of Hugo Chavez. Ayers's daughter actually works FOR Chavez!

An idea of what Ayers has in mind for America's schools was provided in his own words not 40 years ago when Obama was eight years old, but less than two years ago in November 2006 at the World Education Forum in Caracas hosted by dictator Hugo Chavez.

With Chavez at his side, Ayers voiced his support for "the political educational reforms under way here in Venezuela under the leadership of President Chavez. We share the belief that education is the motor-force of revolution. . . . I look forward to seeing how . . . all of you continue to overcome the failures of capitalist education as you seek to create something truly new and deeply humane."

Ayers told the great humanitarian Chavez: "Teaching invites transformations, it urges revolutions large and small. La educacion es revolucion." It is that form of socialist revolution that Ayers, and Obama, have worked to bring to America.

Ayers, now a tenured Distinguished Professor of Education at the University of Illinois, Chicago, works to educate teachers in socialist revolutionary ideology, urging that it be passed on to impressionable students.

As Stern points out, "Ayers and his education school comrades are explicit about the need to indoctrinate public school children in the belief that America is a racist, militarist country and that the capitalist system is inherently unfair and oppressive."

If Ayers was just another nutty professor, we'd be lucky. But he wields great influence in academic circles and has had Obama's ear. He's the author or editor of 15 books. Chicago's current mayor, Richard M. Daley, has employed Ayers as a teacher trainer for Chicago's public schools and consulted him on the city's education-reform plans.

Just last month, Ayers was elected vice-president for curriculum for the 25,000-member American Educational Research Association. AERA is the nation's largest organization of education-school professors and researchers.

In a recent interview on Fox News' "The O'Reilly Factor," Obama upgraded Ayers' status from "a guy who lives in my neighborhood" to "somebody who worked on education issues in Chicago that I know."

....

During Obama's tenure as Annenberg board chairman, Ayers' own education projects received substantial funding.

One of Ayers' descriptions for a course called "Improving Learning Environments" says a prospective K-12 teacher needs to "be aware of the social and moral universe we inhabit and . . . be a teacher capable of hope and struggle, outrage and action, teaching for social justice and liberation."

Dick Fuld Attacked

This is absolutely unacceptable! Dick Fuld was apparently ATTACKED, nah physically assaulted at the Lehman gym after they had announced their bankruptcy. This is unacceptable.

What would have been even more unacceptable is if Dick had been stabbed or worse shot. It is the not the fault of the CEO, who made hundreds of millions of dollars, that the company failed. IT’S THE SHORT SELLERS but that’s a different posting entirely.

Now I truly do not want this posting to encourage any employees or investors who have had their entire retirement savings wiped out, who are now unable to pay for their mortgage or food for their family, to rise up and take this matter into their own hands. People like Mozilo and Fuld deserve to be served like kings. They are true American heroes.

So people, if you see Mozilo, Fuld, or any of the other heroes of America in the gym, don’t assault them; bow to them. You are not worthy and thanks for picking up the bill....now go eat cake.

Just checking

Does Bill Miller still suck?



Yep.

Greenspan's Body Count: The Karthik Rajaram Family

It's official: Alan Greenspan bagged six more. While the early days of Greenspan's Body Count were dominated by people despondent over foreclosures, the carnage has expanded to people whose lives have been ruined by the global financial crisis resulting from the collapse of Greenspan's bubble. And this is the case of Karthik Rajaram:
The 45-year-old Porter Ranch financial manager who once made more than $1.2 million in a London-based venture fund had lost his job. His luck playing the stock market ran out. [...]

In a letter addressed to police, Rajaram blamed his actions on economic hardships. A second letter, labeled "personal and confidential," was addressed to family friends; the third contained a last will and testament, Moore said.

The letter to police voiced two options: taking his own life, or killing himself and his entire family. "He talked himself into the second strategy," Moore said. "That that would be the honorable thing to do."

Authorities believe Rajaram killed his family and himself after seeing his finances wiped out by the stock market collapse, according to a source familiar with the case, who spoke on condition of anonymity because the investigation is ongoing.

A humble request from W.C. Varones to future GBC victims: if you gotta go, don't whack the wife and kids.

Greenspan's Body Count now stands at fifty-one:

Karthik Rajaram
Subasri Rajaram
Krishna Rajaram
Ganesha Rajaram
Arjuna Rajaram
Indra Ramasesham
Joe X
Isabelle Jarka
Robert Wagner
Lt. Michael Howe
John Roberts
Palmer C. White
Dianne Pittman White
Ed Boesen
Edwin F. Rachleff
Carlene Balderrama
Troy VanderStelt
Scott M. Coles
Dawn E. Armstrong
Thomas Lizotte
Jonathon Calvin "40-Cal" Jacques
Salvador X
Lupe X
Jade X
Little Boy X
Little Girl X
Kashmir Billon
Bill McMurtry

Lisa McMurtry
James Hahn
Raymond Donaca
Deanna Donaca
[redacted]
[redacted]
Michel Veillette
Nadya Ferrari-Veillette
Marguerite Veillette
Vincent Veillette
Mia Veillette
Jacob Veillette
Maurice Pereira
Natasha Pereira
Mark Achilli
Raed Al-Farah
Andrew Kissel
Rufus Shaw Jr.
Lynn Flint Shaw
Mr. Pierce
Walter Buczynksi
Marci Buczynski
Jason Washington

Gallows humor

Paulson to Congress:
Now that it is clear how readily congress will fold to vague economic threats, Paulson intends to “figure out just how much more I can get away with.”

“In my next bill to save us all, I require the construction of a 150-foot gold—no wait, platinum—statue of myself wearing a cape, which will be placed on the National Mall,” said Paulson. “Every member of Congress must pray to this graven image before and after every session, or THE ECONOMY WILL BE DESTROYED BEYOND REPAIR.”

Greenspan's Body Count: Porter Ranch

The L.A. Times reports:
An unemployed financial advisor apparently despondent over his situation shot and killed his wife, his mother-in-law and three children before taking his own life in a gated community in Porter Ranch in the northwest San Fernando Valley, Los Angeles police said today.

[...]

Moore said police believe that the gunman killed them sometime after 6 p.m. Saturday, and said he left behind three letters indicating that he had carried out the killings. He said the gunman had worked previously for Price Waterhouse and Sony Pictures and "had attested to some financial difficulties," he said. "He had become despondent over his financial" situation.

It certainly sounds like a case of Greenspan's Body Count. We'll keep you updated as details come out.
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