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.