Distribution of Wealth

Religion & Recession

"No Atheists in Foxholes and Other Myths of the Recession" -- a quick, easy read about the association between church attendance & the economy.

This is why spending cuts are hard.

In case you can't read the type. The graph on the left is percent of respondents wanting to cut spending in a given category. The graph on the right is the actual spending, as a percent of the proposed 2010 budget.

From Sullivan

Barney Frank Hates Pink. Heh.

Barney Frank got irritated with the Code Pink ladies who were messing with his financial chat.

UNC System Budget Cuts

Under the possible 7% UNC System budget reduction, here are proposed reductions to some of the schools. (Keep in mind that these proposed reductions are meant to sound horrible and untenable...if there is a 7% budget cut, other things will probably go instead.)

UNC:
Eliminate 267 positions, including 107 faculty positions
372 courses not offered. Reduction in enrollment of 3400 students
Reduction of housecleaning

UNCG:
Eliminate 109 positions, including 59 faculty positions
Reduction of 275 class sections, totaling about 7500 class seats
Limiting advising and tutoring

That is bleak.

The housing market is unbelievably bleak in Detroit. In 2008, it was cheaper to buy a car than a house in Detroit. In the first half of the year, the median house price was comparable to a decent new car: $19,448. (The picture below is through June 2008).



In October, it was still headed south: $18,513. (See 4th paragraph.)


For the month of December 2008, the median price of a home sold in Detroit: $7500. There are no missing zeros in that number. It is cheaper to buy a house in Detroit than it is for an in-state student to attend UMich for a year ($10,848, plus fees).

Slipping in Earmarks

A bunch of senators who got all high and mighty about the stimulus bill and its "pork" like a little bacon themselves, including Richard Burr (NC). Burr's earmarks reached $1.3 million. In total, 28 Senators who voted No on the stimulus bill added earmarks. See the full list here. (Thanks to Left In Alabama for the tip.)

Nobody reads academic papers

Sixteen years ago, two economists wrote a paper calling "Looting" that explains, and predicted, our current economic crisis. If only someone read those things BEFORE it mattered. Full NYTimes article here.

When Bad Things Happen

Good post from Slog. If you don't read the whole thing, skip to the bottom about GM declining an additional $2 billion that it no longer needs. Good for them.

Responses to Dire Warnings of Imminent Danger, posted by Jonathan Golob

1. In the best way we can, in the face of no viable alternatives beyond doom.

From NOAA:

NOAA’s National Weather Service has issued a report that analyzes forecasting performance and public response during the second deadliest tornado outbreak in U.S. history. The report, Service Assessment of the Super Tuesday Tornado Outbreak of February 5-6, 2008, also addresses a key area of concern: why some people take cover while others ride out severe weather.
....
In reviewing the public response, the team found that two-thirds of the victims were in mobile homes, and 60 percent did not have access to safe shelter (i.e., a basement or storm cellar). The majority of the survivors interviewed for the assessment sought shelter in the best location available to them, but most of them also did not have access to a safe shelter. Some indicated they thought the threat was minimal because February is not within traditional tornado season. Several of those interviewed said they spent time seeking confirmation and went to a safe location only after they saw a tornado. Many people minimized the threat of personal risk through “optimism bias,” the belief that such bad things only happen to other people.

2. Willed ignorance in the face of growing danger, in service of greed.

From the Boston Globe:

The federal agency that insures bank deposits, which is asking for emergency powers to borrow up to $500 billion to take over failed banks, is facing a potential major shortfall in part because it collected no insurance premiums from most banks from 1996 to 2006.

The Federal Deposit Insurance Corporation, which insures deposits up to $250,000, tried for years to get congressional authority to collect the premiums in case of a looming crisis. But Congress believed that the fund was so well-capitalized - and that bank failures were so infrequent - that there was no need to collect the premiums for a decade, according to banking officials and analysts.

Now with 25 banks having failed last year, 17 so far this year, and many more expected in the coming months, the FDIC has proposed large new premiums for banks at the very time when many can least afford to pay. The agency collected $3 billion in the fees last year and has proposed collecting up to $27 billion this year, prompting an outcry from some banks that say it will force them to raise consumer fees and curtail lending.

3. Manipulate and lie, to temporarily cover your ass.

From NakedCapitalism:

Readers may recall that during Lehman's demise, a pitched battle was underway between some short sellers, epitomized by David Einhorn of Greenlight Capital. Einhorn raised questions about Lehman's financial statements, specifically, inconsistencies and rosy looking valuations. The struggle became weirdly per[s]onalized, as Lehman sought to burnish the image of charmismatic CFO Erin Callen, as contrasted with the presumed to be evil company wrecking Einhorn. Of course, if the real performance (as opposed to what the reports said) was as bad as Einhorn's line of inquiry suggested, it was management that had done the company-wrecking, but that level of detail is often lost on CNBC.

And one of the regular features of the Lehman versus its detractors affair was leaks to the media, leaks of a sort that even if the firm had done it in a way that it had plausible deniability, were clearly intended to reach outside parties, particularly the media.

Now let us turn to Citi. Recall what transpired, per the Wall Street Journal:

Citigroup Inc. was profitable in the first two months of 2009 and is having its best quarter in a year and a half, Chief Executive Vikram Pandit said in an internal memo aimed at boosting employee and investor confidence in his struggling bank.

Yves here. This is simply stunning. The Journal says up front a supposed internal memo was in fact intended to reassure investors.
....
Dunno about you, but this looks to me like a bald faced attempt to manipulate the stock price, and it certainly worked.

Updated:

Well, the Citigroup thing might also be a little pump-and-dump scam! From Bloomberg:

Four Citigroup Inc. executives who bought the bank’s stock last week generated a $2.2 million paper profit within nine days, regulatory filings show.

The executives, including director Roberto Hernandez, benefited as the company’s stock climbed 47 percent from March 10 through yesterday’s close of markets, after Chief Executive Officer Vikram Pandit said in a memo that the bank is having the best quarter since 2007. Their buying spree was the first by bank insiders since Jan. 14, filings show.
...
Pandit wrote in the internal memo March 10 that the company was profitable in January and February, leaving him “encouraged with the strength of our business so far in 2009.” The comments triggered Citigroup’s biggest one-day percentage gain since Nov. 24, spurring global markets.

And, for those of you who bitched about the relatively tiny US automaker bailout:

General Motors, which has borrowed $13.4 billion from the federal government since December to keep itself out of bankruptcy, said on Thursday that it had withdrawn a request for an additional $2 billion that it thought was needed to stay alive through the end of this month.

Jon Stewart takes on CNBC

It begins:

The Daily Show With Jon StewartM - Th 11p / 10c

CNBC Gives Financial Advice

Daily Show Full Episodes
Important Things With Demetri Martin

Political Humor
Economic Crisis

It continues:

The Daily Show With Jon StewartM - Th 11p / 10c

In Cramer We Trust

Daily Show Full Episodes
Important Things With Demetri Martin

Political Humor
Economic Crisis

It's still funny:

The Daily Show With Jon StewartM - Th 11p / 10c

Basic Cable Personality Clash Skirmish '09

Daily Show Full Episodes
Important Things With Demetri Martin

Political Humor
Economic Crisis

When your bank fails.

An interesting 60 minutes piece on what happens when banks fail. The FDIC swoops in & tries to make you feel good about it.


Watch CBS Videos Online

hahahaha

Take that, Fox News.

Stimulus Bill

After all that haggling, it looks like what Obama asked for in the first place:

But as a deal emerged from the tumultuous negotiations of the past two days, the bill followed remarkably closely to the broad outline that Obama had painted more than a month ago. The overall cost is just $14 billion more than his original top-end target, while the portion of tax cuts comes to 36 percent, only slightly below his initial goal. (Washington Post)

Hahahaha

Mass. Rep. Somebody or Another rips those nasty bank CEOs a new one. It's all very enjoyable. (Except maybe for the part where he says he would put one penny in their banks...doesn't that seem like a dangerous thing for a public official to say? Like something that might set off a bank run?)

Slate tells Obama how to sell stimulus

Joan Walsh over at Slate tells Obama how he has to sell the stimulus plan.

We're not just socialists! We're Communists! Coming to get you!!!

Glenn Beck is an idiot. See below where he shows how we've already gone down the socialist road straight to full-on communism, comrades. I particularly enjoy when he claims that requiring institutions WHO TAKE GOVERNMENT ASSISTANCE to make some concessions is communist and good capitalist have no business telling people what to make. I mean, I would argue that it would be MORE socialist to not give the money with strings attached. The assumption would then be that they'll do right with the money, because it's for the greater good.

Southern Baptists are struggling.

The Southern Baptists are reporting 20-year lows of new baptisms. I guess people don't like to get all wet during these troubling economic times.

Economy woes

Our economy sucks, but so does China's. They can't turn us into their minions just yet.

Economic Prophet

Here's a video of Peter Schiff (via Daily Dish) predicting the current economic crisis for the past two years. Watch how they laugh.

Too Big to Fail; Too Big to Save

Oh crap. (via The Daily Dish)