July 23, 2012 archive

Jul 23

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Jul 23

On This Day In History July 23

Cross posted from The Stars Hollow Gazette

This is your morning Open Thread. Pour your favorite beverage and review the past and comment on the future.

Find the past “On This Day in History” here.

Click on images to enlarge

July 23 is the 204th day of the year (205th in leap years) in the Gregorian calendar. There are 161 days remaining until the end of the year.

THE GREAT COMET OF 1997. Above, the bright head of comet Hale-Bopp, called the coma, is pointed towards the Sun. The coma is composed of dust and gas, masking the solid nucleus of the comet made up of rock, dust and ice. Photo taken by Jim Young at NASA’s Jet Propulsion Laboratories Table Mountain Observatory in March 1997.

The comet was discovered in 1995 by two independent observers, Alan Hale and Thomas Bopp, both in the United States. Hale had spent many hundreds of hours searching for comets without success, and was tracking known comets from his driveway in New Mexico when he chanced upon Hale-Bopp just after midnight. The comet had an apparent magnitude of 10.5 and lay near the globular cluster M70 in the constellation of Sagittarius. Hale first established that there was no other deep-sky object  near M70, and then consulted a directory of known comets, finding that none were known to be in this area of the sky. Once he had established that the object was moving relative to the background stars, he emailed the Central Bureau for Astronomical Telegrams, the clearing house for astronomical discoveries.

Bopp did not own a telescope. He was out with friends near Stanfield, Arizona observing star clusters and galaxies when he chanced across the comet while at the eyepiece of his friend’s telescope. He realized he might have spotted something new when, like Hale, he checked his star maps to determine if any other deep-sky objects were known to be near M70, and found that there were none. He alerted the Central Bureau of Astronomical Telegrams through a Western Union telegram. Brian Marsden, who has run the bureau since 1968, laughed, “Nobody sends telegrams anymore. I mean, by the time that telegram got here, Alan Hale had already e-mailed us three times with updated coordinates.”

The following morning, it was confirmed that this was a new comet, and it was named Comet Hale-Bopp, with the designation C/1995 O1. The discovery was announced in International Astronomical Union circular 6187.

Jul 23

Undertakers

Crossposted from The Stars Hollow Gazette

Small Business Owners, Job Creators.

Randy Wray: Why We’re Screwed

L. Randall Wray, Naked Capitalism

Monday, July 23, 2012

A century ago Veblen analyzed religion as the quintessential capitalist undertaking. It sells an inherently ephemeral product that can not be quality tested. Most of the value of that product exists only in the minds of the purchasers, and most of that value cannot be realized until death. Dissatisfied customers cannot return the purchased wares to the undertakers who sold them-there is no explicit money back guarantee and in any event, most of the dissatisfied have already been undertaken. The value of the undertaker’s institution is similarly ephemeral, mostly determined by “goodwill”. Aside from a fancy building, very little in the way of productive facilities is actually required by the religious undertaker.

But modern finance has replaced religion as the supreme capitalistic undertaking. Again, it has no need for production facilities-a fancy building, a few Bloomberg screens, greasy snake-oil salesmen, and some rapacious traders is all that is required to separate widows and orphans from their lifesavings and homes. Religious institutions only want 10%; Wall Street currently gets 20% of all the nation’s output (and 40% of profits), but won’t stop until it gets everything.



And that is just the start. They also place tens of trillions of dollars of bets on derivatives whose value is purely “notional”. The thieves get paid when something goes wrong-the death of a homeowner, worker, firm, or country triggers payments on Death Settlements, Peasant Insurance, or Credit Default Swaps. To ensure that death comes sooner rather than later, the undertaker works with the likes of John Paulson to handpick the most sickly households, firms and governments to stand behind the derivative bets.



The top four US Banks hold $171 Trillion worth of derivative deals like this. Derivatives are really just bets by Wall Street that we will get screwed-it is all “insurance” that pays off when we fail. Everything is insured-by them against us.



You see, all the top financial institutions are dens of thieves, and thieves know better than to trust one another. So lending to fellow thieves has to be collateralized by safe financial assets-which is the traditional role played by Treasuries. But there were not enough of those to go around so Wall Street securitized home mortgages that were sliced and diced to get tranches that were supposedly as safe as Uncle Sam’s bonds. And there were not enough quality mortgages, so Wall Street foisted mortgages and home equity loans onto riskier borrowers to create more product.



Suddenly there was no collateral behind the loans Wall Street’s thieves had made to one another. Each Wall Street thief looked in the mirror and realized everything he was holding was crap, because he knew all of his own debt was crap.



And that is why we are screwed.

I see two scenarios playing out. In the first, we allow Wall Street to carry on its merry way, as the foreclosure crisis continues and Wall Street steals all homes, packaging them into bundles to be sold for pennies on the dollar to hedge funds. All wealth will be redistributed to the top 1% who will become modern day feudal lords with the other 99% living at their pleasure on huge feudal estates.



In the second, the 99% occupy, shut down, and obliterate Wall Street.

Jul 23

Muse in the Morning

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Muse in the Morning


Tunnel

Jul 23

LIBOR- Not a Theory

Crossposted from The Stars Hollow Gazette

Banks Caught Up In Libor Scandal Seek Group Settlement

By: David Dayen, Firedog Lake

Friday July 20, 2012 7:04 am

As regulators and law enforcement officials around the world begin to dig into the Libor scandal, the 15 or so banks who know they’re responsible for the massive rate-rigging are trying to limit the damage. That’s right, it’s time for another round of: let’s have a global settlement!



Reuters did add that regulators would like the idea of a global settlement because they would get to have a big press conference and announce a headline number, and I think that’s right. We saw the appeal of that in the foreclosure fraud settlement.

Yves Smith @ Naked Capitalism

Dudes, we gave you a link last week from Sky News saying the same thing!

Exclusive: Banks in Libor probe consider group settlement – sources

By Katharina Bart and Diane Bartz, Reuters

2012/07/19


A group agreement would appeal to financial watchdogs because they would be able to announce a headline-grabbing figure, showing that they were dealing firmly with the banking industry’s misdemeanors, a banker told Reuters on condition of anonymity.

Earlier this year, five top U.S. banks negotiated a $25 billion settlement with the U.S. Justice Department and other federal and state agencies to resolve allegations of mortgage services abuses.



However, if they were able to reach a group settlement it would enable them to share the pain of negative publicity.



Analysts have estimated that the scandal could cost the industry between $20 billion to $40 billion, further damaging a sector that is struggling to work its way through the aftermath of the 2007-2009 financial crisis, economic downturns in Europe and the United States, and increased regulatory demands.

Told you so

Exclusive: Push For Libor Settlement

Mark Kleinman, City Editor, Sky News

Wednesday 11 July 2012

Investors believe that an industry-wide settlement will be necessary if other banks are to avoid a clear-out of their top executives, although one mitigating factor which might assist those who get fined for Libor-rigging is likely to be the fact that many of them have changed their top management since the periods under investigation.

“A drip-feed of Libor-related fines would be hugely damaging to investors with large exposures to international banks,” one leading shareholder told me.

Of course, it’s the view of many that banks which are found guilty of such an important offence as manipulating the rate of Libor should sack those responsible and that they should face further punishment under the law.

Hah hah hah.

Jul 23

Cartnoon

On dark weeks The Daily Show and The Colbert Report post mashups.  This week’s are from TDS on 8/22/11 and are the oldest I can find.  Should you happen on any earlier examples I’d be delighted to know about them.

The Correspondents Explain – Political Parties – The Two-Party System (2:40)

Jul 23

Late Night Karaoke

Jul 23

Pique the Geek 20120722: More on Carbon

Last time we started our series on carbon, and I now expect it to run for four installments.  Amongst many other properties, carbon is unique in having more allotropic forms than any other element.  Also known as allotropes, these are pure elements with radically different properties.  The term is reserved only for elements, the term for compounds being polymorphs.  An allotrope is a subset of a polymorph.

There is also another distinction:  for an element to have an allotrope, it must exist in the same phase.  Thus, solid lead and molten lead (and lead vapor) are not allotropes, but rather different phases of a given element.

Before we concentrate on carbon, let us consider oxygen.  In the gaseous phase, it has two allotropes, O2, normal molecular oxygen, and O3, also called ozone.  For an element as reactive as oxygen, normal molecular oxygen is remarkably nonreactive (wait a few weeks), but ozone is extremely reactive.  But both are just composed of oxygen atoms.

Jul 23

Today on The Stars Hollow Gazette

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Jul 23

Mitt And His Fellow Vulture Capitalists See Venezuela As a Threat: It Is. by Justina

The likely Republican presidential candidate and quintessential vulture capitalist, Mitt Romney, chided President Obama for not being sufficiently fearful of Venezuela’s socialist president, Hugo Chávez Friás last week.  In the conservative Daily Telegraph Mitt is quoted as saying:

“The idea that this nation, this president, doesn’t pose a national security threat is simply naive and an extraordinary admission on the part of this president to be completely out of touch with what is happening in Latin America,” Romney said of Chavez in an  interview Wednesday with Fox News.

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Yes, socialist Venezuela, the country which was recently ranked the 5th happiest in the world, following four social democratic countries, presents a threat to Mitt’s vulture business model and his support base, who largely come from the 92,000 wealthy individuals who sequester their wealth in “tax havens” such as Switzerland the Cayman Islands. (See rt. com  for its report on “The Price of Off Shore Revisited”.

After President Chavez was elected to office in 1998, Venezuela has had currency controls in place to prevent its national wealth from being looted and sent to extra-territorial banks, a model which defeats the efforts of would-be off shore tax evaders in Venezuela.  Other countries have allowed themselves to be systematically raped of their needed tax revenues.

Venezuela also jailed its criminal banksters for speculating with their depositors money.  Here, Mitt, you would likely be in jail for creating tax-evading investment vehicles in the Cayman Islands.  No, socialist Venezuela, under President Chavez, is definitely not a vulture-capitalist friendly country.  That is why it is now thriving.