Showing posts from March, 2013

He is risen!

... even, especially, for those of us who are fallen.

Happy Easter to current and future believers.

Ivy League snobbery: justified?

You make the call.

(click twice to enlarge)

Shootout at the Lone Jack Corral: Vilkin says Upton drew first

Ooops... meant to send you here.

Words of Wisdom from the Grave

...updated for 2012/2013.

Miss you Bill

From beggar-thy-neighbor to bugger-thy-saver

Bill McBride at Calculated Risk agrees with Zimbabwe Ben when he says that today's money-printing orgy isn't a case of "beggar-thy-neighbor."

Zimbabwe Ben:
Indeed, the decline in the value of the pound after 1931 was associated with a relatively early recovery from the Depression by the United Kingdom, in part because of some rebound in exports. However, according to this view, the gains to the depreciating country were equaled or exceeded by the losses to its trading partners, which became less internationally competitive--hence, "beggar thy neighbor."The idea behind beggar-thy-neighbor is that by devaluing your currency, you make exports cheap and imports expensive, and steal manufacturing jobs from your trading partners.

We have been using the phrase "global competitive devaluation" here for years, but McBride and Zimbabwe Ben have a point. There's nothing "competitive" in this clubby cabal of money-printing central bankers. They …

Gretchen Morgenson: government which has proven itself incompetent at pricing mortgage risk to continue indefinitely in the business of pricing mortgage risk

The inertia of central planning:
[...] the future of housing finance in this country seems to be coming down to two taxpayer-backed concepts. One is the status quo, with Fannie Mae and Freddie Mac continuing to back the vast majority of mortgages. The other is a newly conceived public guarantor with some of the same problems that got Fannie and Freddie into trouble.

Let’s begin with the status quo. The taxpayer rescue of Fannie and Freddie in September 2008 has cost $137 billion so far. While this has been paid down from an initial $187.5 billion, taxpayers aren’t likely to get their money back anytime soon. Last fall, the regulator charged with overseeing Fannie and Freddie estimated that the taxpayer bill for the companies could be $200 billion by the end of 2015. Remember when University of Wisconsin professor Menzie Chinn mocked Sarah Palin for calling Fannie and Freddie "too big and too expensive to the taxpayers?"  Who's the idiot now?
[The alternative plan's] …

Rand Paul was right!

"Pilot program targets teen drivers" - headline, San Diego Union-Tribune, March 23, 2013

CNBC imitates Varones, Part Deux

The notion that Bernanke's ZIRP is theft from savers is catching on.

This morning, Joe Kernen joins the party. Steve Liesman, as usual, denies reality.

WalStreetPro2 - Limey Edition

Back in the day, around 2008 or 2009, a brilliant hillbilly from North Carolina going by the nom de plume WalStreetPro2 emerged as a beacon of rational and extremely valid thought regarding the wool that is being pulled over our eyes by the corporate and political elite. We linked him here. He's unmasked his anonymity and now has a Youtube page under his own name Kevin Rowland. We highly recommend a view of his analysis, but definitely have the kids leave the room before enjoying. I'll take Rowland over Liesman any day of the week.

But the reason we bring up his excellent video commentary is not for a stroll down memory lane but because an apparent English disciple has emerged that just might be Bloomberg TV to Kevin Rowland's CNBC. Behold an English cabby's take on the Cyprus Job, and beware of the language for those with sensitive ears.

CNBC imitates Varones

Over the weekend, we tweeted to CNBC's lovely and talented Michelle Caruso-Cabrera:

The link was to this post.

This morning, Michelle said this:
You know what I thought you were going to say, Rick? The commentary on Twitter was, we have confiscatory issues here in the United States. It's zero percent interest rates.
The whole discussion is worth watching if you have the time. Steve Liesman has a rare moment of sanity.

Think Cyprus can't happen here? It already did.

There's two bulls standing on top of a mountain. The younger one says to the older one: "Hey pop, let's say we run down there and f*** one of them cows". The older one says: "No son. Lets walk down and f*** 'em all".                          - Robert Duvall in Colors

The world was shocked this weekend to learn that the European Union would fund the bailout of Cyprus by confiscating the assets of ordinary bank account holders.  Core Europeans and Americans no doubt comforted themselves that such a confiscation could never happen here.  They would be wrong.  In fact, it already has happened here.

What occurred this weekend in Cyprus was a theft from responsible savers to benefit irresponsible banks.  Small depositors get screwed while bank bondholders (largely other banks and large institutions) get made whole.  Which, it turns out, is exactly what has happened in the U.S. the past five years.

Bank CD rates were around 4% in 2008.  Since that time, the Fe…

EU orders Cyprus to confiscate citizens' bank accounts

... as a condition for the latest bailout.

The law will be passed over the weekend and 6.75% to 9.9% of depositors' wealth will be stolen before the banks open on Tuesday.

On the question of whether a similar levy could be applied if Spain or Italy were to request bailout, Eurogroup President Dijsselbloem responded, “the situation in Cyprus with the specifics of the banking size and structure has led to this specific package and these instruments, full-stop.” Asked specifically whether he could rule out a deposit levy in a subsequent bailout in another country, Dijsselbloem replied, “It’s not being discussed at all, there is no reason to even discuss it, so I won’t discuss it or speculated on it. We have a very specific, very complex situation which we’ve had to deal with in a way that is leading to a very fair way of sharing the burden, and that’s the package that we have agreed here”.
We've said before that the dollar, like any fiat currency, is a medium of exchange, not a st…

Hutzler 571

If you're unfamiliar with the collection of Amazon reviews for the Hutzler 571, enlighten yourself.  Following is the contribution of our friend Charlie McDanger.

Hutzler 571 Banana SlicerPrice: $2.4845 used & newfrom$0.01
6 of 6 people found the following review helpful Showrooming? Guilty as charged., March 10, 2013 This review is from: Hutzler 571 Banana Slicer (Kitchen) I have to admit, I'm not the type to make a serious purchase without examining a product for myself. I mean, can I really trust the 3,183 people who reviewed the Hutzler before me? Most of them aren't even Amazon Verified Purchasers--I may be stupid but I'm not crazy.

So, instead of purchasing sight unseen, I went down to the banana slicer store and asked to see the Hutzler. Obviously they don't keep the 571 out in the aisles with all the others; you have to get the clerk to unlock the display case. And I'd be lying if I didn't tell you they watched me like a hawk. I'm not the type …

Obama: the central planning will continue until innovation improves

It turns out somebody should have watched the State of the Union speech. Obama proposed yet another bad, Soviet-style, central planning program to fix the economy.

Roll Call:
At a closed-door meeting between President Barack Obama and House Democrats, [Michigan Democratic Rep. Dan] Kildee introduced himself as a freshman, to which Obama said, “Wow, you’re really classing up the place then.”

Kildee then proceeded to ask what one person described as a somewhat “long-winded” question about the importance of creating jobs for his economically distraught district.

“I can tell you’re a freshman because you didn’t pay much attention to the State of the Union,” Obama joked. “I talked about that.”

Amid the resulting laughter, House Democratic Caucus Chairman Xavier Becerra of California then offered to provide Kildee a printout of the speech.

Obama was referring to his $1 billion proposal for 15 manufacturing “innovation centers,” the details of which are still somewhat hazy.Because nobody does…

Ha ha! Good thing we are nothing like Argentina! Those guys are screwed!

John Mauldin summarizes a conversation with Argentine Senator Juan Carlos Romero:
Argentines don’t want to hear bad news (does anyone?). Monti gave the Italians bad news, and he only got 9% of the vote. The bureaucracy is out of control in Argentina, and it just keeps growing and creating costs. There are too many subsidies to certain businesses. And, as a result of votes during the last crisis, power is now concentrated in the presidency and a few key positions. There are not the checks and balances we are used to between branches of government in the States. Both major parties voted to nationalize pensions. Government benefits and subsidies are given to a large number of people, who then vote for more government benefits.

“In Argentina, we have the ability to make the same mistake many times, and nothing happens to change things. Why? Because there is a pervasive belief that the state can provide all that people need: jobs, welfare, everything.” Perhaps, he mused quietly, that attitu…

Is ripping off its readers in the Stockpickr contest?, founded by business entertainment TV personality Jim Cramer, has been a slow-motion train wreck for more than a decade, destroying shareholder wealth with cumulative losses of $184 million.

But is also ripping off its readers?

The W.C. Varones blog has received a complaint from a reader who alleges that contest winners are being stiffed by  A repeat winner of the weekly Stockpickr contest claims to have followed all the rules, been notified that he was a winner, sent in a notarized prize claim form, and never received his cash prize.  Subsequent weekly contest wins did not receive acknowledgement by's product manager responsible for the Stockpickr contest did not respond to a request for comment.

Because they eat too much

Thought for the day: Keynesian folly

Over on Econbrowser, there's another discussion about how weak economies are a result of not enough government spending.

This is a recurring theme, central to the prescriptions of uber-Keynesians like Paul Krugman and his acolytes in government (though Keynes himself would likely have been horrified at 10% GDP deficits or running large, recurring deficits years after a crisis).

The problem is that the Keynesians are slaves to absurdly simplistic macroeconomic models that don't consider the impact of central planning decisions on the behavior of people and businesses in an economy. Their model sets GDP growth as the goal and states that government spending is a direct input to GDP growth. Obviously, then, the prescription will always be for more government spending to increase GDP growth!

But the Keynesians' models, and the Keynesians themselves, consider little, if at all, the impact of central planning on misallocation of resources, market incentive effects, or price si…

Get some

Am I the only one who thinks this is an unfortunate ad layout? (Via LA Clippers' Facebook page)

President Allowed to Kill You Without Due Process

It's just a pathetic fact that this democracy is dying.

The Democratic president wants to be able to kill you based on his "intelligence" and all those voters that voted for him are totally ok with that. I mean sure had GW’s Attorney General responded with the exact same letter as below we would have seen protests all over the country, which I think is appropriate. But since it’s their guy doing the killing they have no problem.

We are ruled by despots because the majority of the population have the intellect of children. They have the capacity for responsibility of pet dogs. This is terrifying: Dear Senator Paul,

On February 20, 2013, you write to John Brennan requesting additional information concerning the administration's views about whether "the President has the power to authorize lethal force, such as a drone strike, against a U.S. citizen on U.S. soil, and without trial."

As members of this Administration have previo…

Greenspan's Body Count: Roger Wagner, Carolyn Wagner, John Conrad Wagner

This is not the first student debt case on Greenspan's Body Count. There was Thomas J. Fuchs, Jason Yoder, and Otis Beckford. But today's episode of Greenspan's Body Count combines student debt with patricide for financial gain a la Ernest Scheringer.

Meet John Conrad Wagner, a heavily indebted and underemployed lawyer, who was found dead in his Philadelphia home after apparently shooting his mother to death over Christmas in her Florida home.

Oh, and that father-son hiking trip in 2011 where his father "fell" off a cliff... yeah, that's suddenly looking a little suspicious.

"We'll never know his motive," said Marion County Sheriff's Capt. Robert Sandlin. "What is our opinion? Financial. He had a lot of student loans that were outstanding."
A little friendly advice from W.C. to parents of student debtors: put a murder clause in your will where if you die in suspicious circumstances, the kid gets nothing. And make sure the kid kno…

Soccer World Cup - We Like Fatties

Soccer is most obviously not immune to the politically absurd with no better example then the lastest out of Brazil regarding their preparations for the 2014 World Cup. Of course....
WC special seats to be set aside for obese

SAO PAULO -- The 2014 World Cup in Brazil is set to be the first to offer special seats for obese fans.

The seats will be offered to conform to Brazilian legislation, although international supporters will also be entitled to them. FIFA told The Associated Press on Monday that it will be the "first time tickets for obese people are offered at a FIFA event."

The tickets will also be available for the upcoming Confederations Cup, the World Cup warm-up tournament that will be played in Brazil from June 15-30.


The Arena Castelao in the northeast city of Fortaleza has 1,675 seats from its total of 63,903 made available for people with disabilities, 120 of those for obese fans, according to the Brazilian government. bolding ours

Being disgustingly fat to t…

Health Care for Dummies

This is actually a very good explanation of the basic problem of our health care system, a problem that ObamaCare did nothing to fix, and in fact made worse.

The Daily Show with Jon Stewart
For those with more than a two minute attention span, the full Time article is here.

Greenspan goes to England

We don't credit Greenspan's Body Count with debt-related deaths in other countries.  Even if Alan Greenspan led the global debt bubble by example, foreign central banks and governments could have, and should have, been wise enough not to follow.

Nevertheless, this story from the UK provides a useful reminder of the tragedy of a debt-funded consumer culture.

A new study has revealed that the suicide rates are soaring across the UK with money worries pushing many people over the edge.

The study commissioned by the charity Papyrus, which aims to prevent suicide among young people, highlights the fact that cuts to mental health services and aggressive debt collecting are among major factors aggravating the situation.

It cited the tragic death of a young boy aged just 23 as an instance, noting that “the boy took his own life writing his final words on the back of a bank statement after racking up a 3000 pound overdraft and a five thousand pound student debt”.

According to lat…

Happy Sequester Day!

Yes, it is a truly tiny baby step toward fiscal responsibility, but even that's worth celebrating given what we usually get from these clowns in Washington.

Watch Obama's stunning flip-flop in the video below. He goes from threatening to veto any bill that undoes the sequester to acting like these tiny cuts are the end of the world.

I think what happened here is that the insular Obama believed some caricature of the Republicans that military spending cuts were like Kryptonite to them. Now that the Republicans say, "Fine, bring 'em on," Obama is running around with his hair on fire trying to do anything to avoid his own sequester.