Archive for January, 2010

January 21st, 2010

Obama sides with Volcker, finally, contra the Zombie Banks

Is Tiny Tim going to cry? Gonna get a spanking when he gets home to Broad and Wall tonight?

Poor Paul looks like he’s STILL not sure the Prez’ll give the word.

January 18th, 2010

Gitmo Sgt blows whistle: Prisoner “suicides” were murder

Major piece in February’s Harper’s. Hats off to them.

The center does not hold.

Obama has done nothing but talk on this.

January 14th, 2010

Kierkegaard:
The destruction of Jerusalem

Posted in Death, Reading by ed

He weeps over Jerusalem.

And yet the city was still standing in its glory, and the temple still held its head high, higher than any structure in the world.

And Christ Himself says, “If thou hadst known in this thy day the things which are for thy good!” But to this he adds, “Now they are hid from thine eyes.” In God’s eternal counsel its destruction is determined, and salvation is hid from the eyes of its inhabitants.

Was the generation then living more wicked than the foregoing generations to which it owed its life?

Was the whole nation corrupt, was there none righteous in Jerusalem, not a single one who could check God’s wrath?

No, its destruction was determined. In vain the besieged city looked in anguish for a way out, the army of the enemy crushed it in its mighty embrace, and no one escaped, and heaven remained shut and sent forth no angel except the angel of death which brandished its sword over the city.

Is this the jealousy of God, that He visits the sins of the fathers upon the children unto the third and fourth generation, in such a way that He does not punish the fathers but the children?

What answer should we make? Should we say:

“There have elapsed now nearly two thousand years since those days. Such a horror the world never saw before and never again will see. We thank God that we live in peace and security, that the scream of anguish from those days reaches us only very faintly. We will hope and believe that our days and those of our children may pass in quietness, unaffected by the storms of existence. We do not feel strong enough to reflect upon such things, but we are ready to thank God that we are not subject to such trials.”

Can anything be imagined more cowardly and more disconsolate than such talk?

Is then the inexplicable explained by saying that it has occurred only once in the world?

Or is not this the inexplicable, that it did occur?

And has not this fact, the fact that it did occur, the power to make everything inexplicable, even the most explicable events?

If once it occurred in the world that man’s lot was essentially different from what it ordinarily is, what assurance is there that this will not recur?

What assurance that this is not the true thing, and what ordinarily occurs is the untrue?

Or is the true proved to be such by the fact that it most often occurs?

And does not that really often occur which those ages witnessed?

Is it not what we all of us in so many ways have experienced, that what occurs on a great scale is experienced also in a minor degree?

“Think ye,” said Christ, “that those Galileans whose blood Pilate commanded to be shed were sinners above all the Galileans because they suffered these things?” It was a providential dispensation, you will say, not a punishment.

But the destruction of Jerusalem was a punishment, and it fell with equal severity upon the innocent and the guilty …

EITHER/OR – The Ultimatum

January 12th, 2010

Yoo tries to speak

Wow. Sounds like a little boy.

His bland loyalty to Daddy perhaps explains North Korea.

January 11th, 2010

The more things change …

Alfred Hitchcock presents …

… a fine elderly unemployed couple, about to be bounced out of their home, try to work things out.

… the trauma of losing your job.

January 10th, 2010

Gaza a year after
and then some

Ed Note: See comments below to follow events into 2011

M

1. Noam Chomsky talks about Gaza a year after the Israeli attack.

2. Meanwhile Israel complains because George Mitchell has threatened to cut off the cash trying to pressure Netanyahu — a precise echo of the Bush-Baker years.

3. And the Israeli general who once headed their nuclear weapons program says that Iranian nukes are seven years distant.

Team Obama this year has enacted a betrayal of the Cairo speech.

M

January 9th, 2010

Ye Olde Retirement Account:
Whither the Buck?

Posted in Money by ed

Since Pearl Harbor Day, everybody — everybody — in the money world has setting up for a dollar rally in early 2010, to correct the Buck’s big fall in 2009. The rally — or at least a snap of the dollar’s downtrend — began in December.

But recent US economic news has been mixed, with housing optimism again failing. And yesterday’s unexpected drop in the monthly Jobs report — when the whisper numbers, reported by Todd H at Minyanville, were as sunny as 100,000 jobs created, not the 85,000 lost in fact reported — has people scratching.

And has a lot of fat set-ups suddenly looking pale. If the dollar were to turn down here with any authority, it would touch off a panic sell. And gold would soar.

Here’s the past year for the DXY index, which measures the Dollar against the Euro, Yen, Pound, Swiss Franc, Swedish Kroner and … Aussie dollar, if memory serves.

You can see the year’s tumble, the upturn in December, and the flatline since, as people puzzled and waited for yesterday’s US job number — which sent the dollar down.

Also this past week, bad employment news in Europe and an unusual public disagreement in Tokyo enriched the currency picture.

The new Japanese Finance Minister on his first day loudly renounced his predecessor’s Strong Yen bias — but the next day the Prime Minister rebuked the new Finance guy.

Nevertheless, people seem to think the Japanese bank may begin to publicly intervene — buying dollars — to weaken the Yen, trying to recover the balance that was broken this past year as the Dollar tumbled. (A relatively weak Yen helps Toyota and Sony sell stuff to the corpulent American consumer.)

So. New employment weakness in Europe will promote a weaker Euro.

Tokyo wants a weaker Yen.

But the (mixed) weakness in USA economic numbers across the past month will also blunt the momentum that had been building at the Fed to raise its bank rates sooner than later, blunting the Dollar’s heavily anticipated rise.

So. The three big currencies seem ready to race each other to the bottom.

Makes it very difficult to guess or bet on the currency pairs (ie, to trade dollar versus euro, euro vs yen, dollar vs yen, etc).

But if all the central bankers are intent on keeping their currencies weak, it seems gold — despite the recent trend in thinking re the Dollar rebound — will benefit again this year.

So I got back into some gold yesterday in my retirement account (having sold out early December, on the report of the November employment numbers).

And may prove a bit early getting back into gold now, if indeed the Dollar bid of December holds a while longer. As always we shall see. The dollar was down yesterday, on the bad US employment news.

I also got into a Japan fund this week, inspired by the new Finance Minister. The chart here is inviting — for Japanese stocks have suffered of late, not like American, worse than Chinese. Thus obvious room for upside if the Strong Yen is truly dead. And Japan would serve as something of a hedge on my new gold bet if the dollar were to rock a bit skyward against the yen.

Am still 40% cash in the retirement account. Would like to get back in technology if the stock markets provide an opening (ie, go down) sometime. They’ve been up, generally speaking, since March last year — perhaps (another story this week) with direct help from Tsy and Fed, who may have been buying S&P Mini Futures on the sly (again).

(They began doing so in March 2003 to support the Iraq war. Fiendish. A great sickness. Free market capitalism? Don’t be silly.)

January 8th, 2010

Daniel Ellsberg re Obama /
Bell helicopters in Vietnam & Predator drones in Pakghanistan

Another in Sibel Edmonds’ Boiling Frog interviews on the National Security Apparat.

Very worthwhile — as they’ve all been. This is number 18. She’s leading one of the most important discussions around.

Ellsberg is measured in assessing Obama, and even so the judgments are bleak. Syncs well with my own black-biled broodings.

Touches on the political consequences of allowing high hopes to fail for lack of leadership. Ellsberg doesn’t mention the Carter-Reaganism dynamic, but what he says brings it to mind.

And he puts the puzzle of the escalation decision in clear terms, observing that neither the top Pentagon brass, nor NS Advisor Jms Jones (retired four-star general), nor Rahm Emanuel — with the fine DC instincts and his eye on the 2010 elections — were pusihng the escalation. (Nor Biden.) And some were on record against it.

Is Obama more of a militarist than Petraeus, whose recent interview in Newsweek shows a mind less than persuaded of any successful outcome over there? Where did the decision come from?

Westmoreland and LBJ

M

Recall Col. Flectcher Prouty’s history of the Pentagon’s war in Vietnam (which, note, began in 1965) — and which Prouty thinks began almost accidentally, with a big push by Textron and its lobbyists to get the Gov to start buying Bell “Huey” helicopters en masse.

As conglomerate Textron — then as now a major war supplier — was preparing a corporate takeover of Bell Helicopters, a guy from Yale working on Wall Street kept showing up at Prouty’s office atop the Air Force staff in the Pentagon — trying to sell the notion that tactical helicopters would revolutionize counterinsurgency ops …

The Air Force kept saying no. Finally somebody got to somebody on the Nat’l Security Council staff in the White House, and the order came across the river: Let’s buy some more helicopters — and let’s base them across the border from Laos, rather than where all the shootin’s going on. Yeah, let’s put them in Vietnam.

The Huey program was greenlighted — but under CIA auspices. Which perhaps rounds around to explain why a banker out of Yale was lead salesman.

The CIA had opened its first official spy store in Saigon in 1954 (post French defeat at Dien Bien Phu) but our involvement there reached back into the war, when the OSS helped to arm Ho’s nationalists against the Japanese. Some say that the same guys, now wearing CIA badges, including Ed Lansdale, were covertly on the ground again well before ’54, working again with locals but this time to oust the French.

However that may be, Prouty writes that each early CIA Huey base in Vietnam needed some 500 (if memory serves) pairs of Pentagon boots to provide pilots, maintenance, security and support.

And when the bases started drawing fire from local insurgents even more Advisors were needed to Keep the Peace.

Wasn’t long before 16,000 soldiers were in country, under CIA command, shooting at insurgents from behind barricades as the choppers bounced and bombed around the South as Lansdale & company tried to figure out how to win their hearts and minds.

Then, in late ’63, a new President took office persuaded that it was time to let the Pentagon clean house.

Obama and Stanley

M

The obvious parallel is the CIA’s drone campaign, based in Afghanistan, attacking Pakistan, which began under lame duck Bush-Cheney, August 2008, rather late — perhaps to be sure it was online fait accompli before the new prez came in.

The latter again brings to mind the Bay of Pigs — in particular the panicked revisions to the plan that went on between November 1960, when Kennedy shocked the planners by defeating Nixon, and January when he took office.

Steps were taken to downsize the scheme (quite consciously beyond hope of success) and to persuade the new White House team that the raid had been approved by Eisenhower (not so — rather, by VP Nixon, who headed the CIA oversight committee in Ike’s White House).

The raid came 70 days into Kennedy’s presidency. He wasn’t quick enough to choke it off, but deserves great credit for frustrating the prime motive by refusing its gambit — ie, refusing to send in the Marines to rescue the raid (and execute regime change).

And, of course, he never escalated with the Pentagon in Vietnam. That came after Johnson won his ’64 election.

Obama within weeks of taking office enlarged the CIA drone program.

And now, against the advice and/or instincts of Jones, Mullen, Eikenberry, even it seems Petraeus (four four-star generals) as well as VP Biden and CoS Rahm, he’s escalating the war.

Ellsberg pointedly compares Obama’s decision to that of Johnson (under whom and closely with he worked) in 1965 — and sadly laughs at the notion of turning on a dime and getting out in July 2011. The commitment, he insists, cannot but be anything but indefinite re both time and manpower.

More than puzzling. Why did subordinate Stanley McChrystal win this policy debate? Why was he even involved in it?

And what is the War Aim over there? I STILL don’t see one, and neither it seems does the senior brass.

Let’s see, who makes the Predator drone? Expensive little bombs ….. Who’s their anchor banker …?

In the Land of the Blind …

January 8th, 2010

Underwear Bomber foreseen in 2006

Posted in These United States by ed
The Daily Show With Jon Stewart Mon – Thurs 11p / 10c
Moment of Zen – Calvin Trillin’s Prediction
www.thedailyshow.com
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Political Humor Health Care Crisis
January 7th, 2010

An excuse to can Geithner?

Posted in Money, President Obama by ed

This story about AIG and 2008, although in essence not important, could be used by the White House to begin the business of easing Tiny Tim into the dumpster.

If the White House were so minded. No evidence yet that it is. Reactions worth watching.

January 6th, 2010

The Nation:
Blackwater and the Khost bombing

For files.

QUOTE

It’s just astonishing that given the track record of Blackwater, which is a repeat offender endangering our mission repeatedly, endangering the lives of our military and costing the lives of innocent civilians, that there would be any relationship,” Schakowsky said.

“That we would continue to contract with them or any of Blackwater’s subsidiaries is completely unacceptable.”

January 6th, 2010

Bomb Iran?
Report from Iron Mountain?

Big brain out of the Nat’l Security Apparat adds value re the difficulty of bombing underground:

“It complicates your targeting,” said Richard L. Russell, a former Central Intelligence Agency analyst now at the National Defense University. “We’re used to facilities being above ground. Underground, it becomes literally a black hole. You can’t be sure what’s taking place.”

Need a second opinion?

“Deeply buried targets have been a problem forever,” said Greg Duckworth, a civilian scientist who recently led a Pentagon research effort to pinpoint enemy tunnels. “And it’s getting worse.”

Laugh or cry or …?

January 5th, 2010

Namath: Family resemblance

Posted in Arts & Private Life by ed

This photo of Joe Namath and Bear Bryant, 1965, is so reminiscent of my family, both sides of which also hail (like Namath) from Pennsylvania, that it seems fit to file.

The Jets victory in 1969 remains a big memory, inseparable from my father. Ardent Jet fans in rural New Jersey.

January 5th, 2010

Money’s New Decade:
Tower of Babel,
Tuna or your House

Yesterday’s spectacular debut of the world’s tallest building — twice as tall (!) as the Trade Center towers were — in Dubai, whose related sovereign debt is number six on a recent list of Most Likely To Fails after its corporate sister pleaded poverty in December …

Leaves me speechless.

Floyd Norris managed to say something. Hear him, sigh.

And check out the business prospects for this white mammoth. Those prospects are nil, but Murdoch’s man closes with assurance that the “image of yesterday’s fireworks display” will surely mean alot to Dubai in years to come.

Meanwhile, farther east, into the creditor hemisphere, a single tuna sells for $177,000. In Japan. Our second biggest banker.

Back at the ranch, a prominent finance CEO today accused the Fed and Tsy of steadily buying stock futures during 2009 to ignite and prop the miraculous rally of March-November.

The money-management world is full of serious people who are certain this began in March 2003 — in an effort to support the (world?) war also set in motion that month by Bush-Cheney. “The Market That Will Not Go Down” then ran up despite news and experience in highly abnormal fashion until the weight of the credit crisis finally crushed it in October 2007.

Meanwhile, more mundanely, the media are full of forecasts for the year. Here is a quick summary of twelve prominent money minders, all foretelling doom as Obama cements his administration’s feet in the status quo ante on the finance front.

In same vein, the Times editors today forecasted doom for US real estate this year in light of Team Obama’s Do Nothing agenda.

Finance. Pakghanistan. Health Care. No Change We Need in any of these, and very little change at all.

Who would have thought, fourteen months ago?

“He went down with the ship.”

My own thoughts about the year ahead in the markets are almost entirely neutral, having been neutralized by the odd three years now past. The future is a mist and the postwar’s First World is as fragile as it has ever been. No reason for long-term confidence of any sort. Investments are all trades.

The stock market just had a fabulous, perhaps basically fraudulent, run, so one must be cautious. And yet if the combined forces, public and covert, of the Fed and Tsy and their international investors continue to juice the markets perhaps there’s some profit yet to be had in being long stocks.

My retirement account went all cash in early December, selling its gold fund FGLDX near peak (on the report of the November employment numbers, which juiced the dollar, breaking gold’s uptrend). Had already sold its China and Tech in May and summer (too early). And its energy by September. So the autumn was about 40% gold and 60% cash, until cashing out entirely in December.

Yesterday I stepped back in with some China. About 14% of the account. Rest is still cash.

Why China. Simply because it’s in a fundamentally sound position, bad news is less likely to appear here, or cash in reaction to flee from here, and the chart is somewhat more inviting than the others.

In my mother’s account of free cash I bought some CTL, the fourth-largest telecom in the US last time I looked, something of a takeover possibility, with a very healthy dividend and rather nice chart. I should have bought it before Christmas — had been watching — but was without an internet connection when the opportunity arose. I’m unhappy buying it here — 36.75 — but will be even less happy if it breaks out over $37, which bad news elsewhere is likely to make it do. The buy was a small lot, about a third of what one hopes to buy if things work out.

In short: I’m trying to get my head back in the morass.

Gold jumped the past two days as the dollar (which broke its downtrend late in the year) sank a bit — but then gold sold off this afternoon and its bulls seem flummoxed again, after 36 hours of unrestrained crowing.

The big news here is Friday’s December employment numbers, which will clarify the dollar (and thus gold) picture. I will be looking for the right time to get back into gold. Perhaps already missed the best time, but there’s plenty of upside left if the bull thesis has merit. Gold’s LONG-TERM prospects seem secure, up up and up as the postwar First World continues its descent into the maelstrom for wont of political will to regulate capital and large corporations.

But it’s not clear yet that the dollar’s late-year rebound is done. I tend to think not, and thus have done nothing. If Friday’s numbers are unexpectedly not bad, the dollar should resume its rise and the time to restock gold will have been pushed further into the future. If the numbers are unexpectedly poor, the dollar may roll over and gold go off again to the races.

Finally, if the dollar continues to rise, it will pressure american stocks down in general, although other factors may be countervailing.

Otherwise, there are certainly some inviting tech stories. But for now the macro picture outweighs in my mind any stock-picking enthusiasms, all of which will get funnelled into short-term trades or the trash.

This has been a poorly written report from a mind mostly elsewhere.

January 1st, 2010

Film: The White Ribbon
Crisis of the Old Order

Magnificent. Must see. Glorious black and white. Gloriously and utterly un-American. One recalls why, when we were young, people thought film was a serious art.

It’s a psychological whodunit, to begin. So it’s natural the reviews would focus on the puzzles. Even so …

Spoiler Alert. The rest of this is for people who’ve seen it already. Unless one cares not to preserve a fresh first viewing.

Even so, the lack of comment in the reviews on the treatment of social history is surprising. This is what struck my mind throughout, and seems upon further thought the Grund of the story, the spine of the script.

Confirmation here comes (after dozens of hints) rather late when the Baronness declares she is leaving the Estate, and indeed leaving Germany — and is taking her son, the family heir.

Thus dissolves the Baron’s household, the power atop the village social structure, and the employer of most of its people.

Why does the Baroness bail? Because she has fallen in love with a banker in Lombardy (ie Milan), who swept her off her feet with his energy and sophistication, and was good with the boy.

Thus the Gentry gives way to the Liberals — the industrialists and their bankers, the Capitalists, the Bourgeoisie beloved of Saint-Simon — atop the pile of struggling classes.

Each of the adult male characters speaks for a familiar estate/class of late feudal society. Only the Officer is missing. But his clamor can be heard at film’s end, as his day dawns in 1914.

The Doctor serves well as a representative of Modern Science:

– mistreating, after deeply exploiting, the pre-modern Midwife (his professional precursor in the Middle Age now vanishing). He despises her “stench” and finally wishes she were dead.

– abusing the trust and curiosity of his daughter because, as he explains to the Midwife, his passions are autonomous, ungovernable, beyond good and evil. Robert Oppenheimer comes to mind. Or How I Learned to Love the Bomb.

Whether the Doctor’s unexplained departure at story’s end marks him (and Modern Science) a monster or a black hero turns perhaps on whether one comes to feel he has adopted (acknowledged?) the Midwife’s retarded son or, prefiguring the Nazis, has euthanized him. That his own boys are named Adolph and Rudi (Hess?) puts a point on the question but doesn’t decide it.

And note, most broadly, that while the children of the Minister and the Doctor are in close congress, their fathers seem to exist in separate towns. Or ages. Like Christendom and its successor Modernity.

As for details, a dozen otherwise odd and/or disjointed events in the film find justification (beyond gratuitous thrill-making) and make simple sense when considered as social history or pathology.

E.g., the Minister’s suppression of his son’s sexuality. The boy’s face (on the poster above) says it all: One of these decades that kettle’s gonna blow.

His name is Martin. Dubbed, no doubt, by his earnest father in honor of Luther. But as quickly as that came to mind I thought of Martin Bormann. Portrait of the Sadist as a Young Man.

Also interesting, in this vein, is the crudely bon-vivant and violent Steward of the estate, occupying his position of petty power between the Baron and the Peasants. In southern Italy such pastoral players were the root of what blossomed, as Noble control faded, into the urban mafias.

And, indeed — the Steward has been cast (Josef Bierbichler) as a hulking dark and garrulous Italian type, utterly distinct in appearance and behavior from the reserved Saxons that populate most of the screen. In particular his joking with ladies about sex stands out. Are we are to guess he was hired from Uncle Eduardo’s estate in Lombardy? Perhaps to keep the increasingly restive Peasants in line?

The film compares, then, to Bertolucci’s 1900 (in essence, not style).

To The French Lieutenant’s Woman — though much more Fowles’ novel than the film.

And to Ivy Compton-Burnett, who across some 20 novels, all set in late Victorian mansions peopled by failing grownups and bitter, biting children, told an epic story of social decline and shifting class loyalties and behaviors.

Both Bergman and Dreyer of course also come to mind, for various reasons, re both style and concern to tell social history, even if one believes Fanny and Alexander were happy kids.

It seems, then, that A.O. Scott, in particular, missed quite a big boat here. He seems to have been mezmerized by the spectacular surface psychology — and thus left to complain that Haneke told a shallow story (oh so familiar in America) that blames the Nazis on “child abuse.”

On the contrary: The surmise of the narrator (the now-old Schoolmaster) that this story, even if less than perfectly true, may help explain what the kids went on to accomplish in their prime, working hard and playing hard, seems well supported: The dissolution of the Old Order, and the Blow in Sarajevo (the first war and its disastrous sequelae), gave the deviant Nazis an opening to power.

Thank goodness it couldn’t happen here, where a prosperous and populous Middle Class exercises sovereignty in a vibrant constitutional democratic — uh, hmmm …

Finally, no reviewer I’ve seen has suggested what, after two viewings, seems clear: the gentle, somewhat bumbling Schoolmaster, played by Christian Friedel, is intended to be understood as Jewish.

The kind features of his face, his distinctively dark hair, his distinctively broad education, all support this reading, but also:

– his bitchy chastisement by the Baronness about church music and the church calendar;

– the otherwise pointless evasion of his would-be father-in-law at the matrimonial negotiation, who remarks that the teacher’d be better off working in his father’s shop in town (where your kind belong); and

– at story’s end, the abrupt and monstrous dressing down he suffers from the Minister after suggesting that the latter’s children are sadistic criminals. Denounced as “repulsive” and threatened with prison, ordered to “get out” and never return, he timidly acquiesces.

Thus fails, too — when the Other challenges at a stroke both Bible and Blut — the structure of Assimilation.

That the Schoolmaster when young was a Jew well at home in Bismarck’s young nation-state casts new light on his opening sad hope of somehow explaining “what happened later” as an effect of the alienating contradictions of old Christendom and its dissolution under pressure of Modernity’s miracles and wonders.

“The world’s not going to collapse.”

Twice we hear this during the year the Schoolmaster is required to wait for his bride: a naive but golden girl from a nearby town, daughter of a straight-shooting German Arbeiter, the very best that society has to offer a man of the Schoolmaster’s station.

But then comes the news from Sarajevo, and the marriage — consummation of Assimiliation — doesn’t come off.

Instead the erstwhile groom goes to war, for the Kaiser. And afterward, he tells us, never returns to the baronial village, returning instead to his hometown, to take over his father’s tailor shop. Which leaves the tinkling of Kristallnacht in one’s ears as the story fades to black.

We first met the Schoolmaster with his arm around Karli, the retarded boy, framed in the schoolhouse door — as the gang of kids, somewhat distant, snidely look on and sneer. It’s difficult not to think here of the Third Reich’s select victims. The kids will go on to burn both books and teacher.


Click

January 1st, 2010

2009 in review

“A London taxi driver tied one end of a rope around a post and the other around his neck and drove away, launching his head from the car.
Sarah Palin published a book and Sylvia Plath’s son hanged himself in Alaska.
Scientists in San Diego made a robot head study itself in a mirror until it learned to smile.”

From the Yearly Review in Harper’s.