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Weakend condition

July 25, 2009

Blowing bubbles seems to be the best way to describe the state of the nation lately in these dogged daze of summer. With politics, economics, news of the day – all hot air and back room manipulations with exchange of favors that render regular people powerless. I recognize this place I am headed, this place of withdrawl, cynicism and apathy.
America has jumped the shark.

In response to the belief that that status quo will prevail, I find myself searching for alternatives, even if they seem utopian or unattainable.

I stumbled across a school of economic thought called “Parecon” which is short for Participatory Economics. It is based on the work of political activist Michael Albert and radical economist Robin Hahnel. It seems to have a sort of anarcho-socialist foundation with environmental, multicultural, feminist tendencies. I’ve found several articles on line to pursue. I’ll report back when I’ve read further.

32 Comments leave one →
  1. Stemella permalink*
    July 25, 2009 6:23 am

    Speaking of sharkjumpers, Mamz has scored big on his sportsblogs this year, raising $7 million in capital from Comcast for his venture. All the more dinero with which to grease those wheels of future fortunes and influence.

    Their offices are on G St, just four blocks from K. And here is their filing of notice of exempt offering of securities with the SEC related to that $7 mill. transaction.

    • cometman permalink*
      July 27, 2009 6:23 am

      Huh. Never could figure out what all the fuss was about these sports blogs of his. I’ve never heard anyone mention them ever except in the context of ‘Hey the twerp that runs Klub Kumquat made some sports blogs’. Just found the main page for them and it looks like it’s just a blog for every professional team plus some others for college teams. The first thing that I noticed on the main page was how you could advertise on them. Guess it’s more of the same business model – the reader provides all the content and Moolah-tits gets all the cash. The guy does seem to know how to market himself – I googled “red sox blogs” and his was the first to come up even though I’ve never heard of it before.

      But I did find another Red Sox blog that I’m going to have to start reading – The Joy of Sox! Here’s how the guy touts himself:

      Joy of Sox, the only blog that offers both Red Sox coverage and far-out left wing conspiracy theories in one convenient package.

      How could I have missed this one before – the guy likes the right team and he has a very similar political blogroll as my own. So I guess I have to say thanks for posting about lil’ markos – it made me find something good ;)

      • Stemella permalink*
        July 27, 2009 7:05 am

        That blogroll for the Sox sites is pretty funny.

        I particularly liked these names:

        Wicked Pissa Dude
        Peace Love and Lots of Sox
        Misery Loves Company ;)

        I’m glad Mamz vicariously led you there. That’s the cool thing about the intertubes, the tendrils and offshoots can take you to surprising places!

  2. triv33 permalink
    July 25, 2009 8:43 am

    Why am I not surprised? Comcast is run by Satan’s minions. Bastards are the reason I still have limited access to my beloved Phillies games.

  3. Stemella permalink*
    July 26, 2009 10:13 am

    Here is a very good new series of videos about the current state of politics and economics by Warren Pollack. There are several 6-8 minute vids. Hattip to Zero Hedge for sharing them. Much of what he discusses is familiar, we’ve been discussing the content all along, but he does provide a helpful outline or frame and talks about some solutions. One of his heroes is Bucky Fuller. He gets a star for that in my book.

    Here’s the intro to the series:

  4. Stemella permalink*
    July 26, 2009 10:17 am

    Regarding some of our potential overlords of the human variety:

    In the card game called Old Maid we played as kids, the loser was the one who ended up with the “Old Maid” at the end of the game. For the past decade, the Chinese sent us “stuff” and we sent them dollars in the form of electrons. They in turn invested those dollars in our debt so we could buy more stuff. It was a form of vendor financing.

    And now the Chinese have apparently decided to pass the Old Maid of the dollar on to other parties, who will sell them their assets for dollars. Seriously, did anyone not think they would do this? Massively selling the dollar, which so many conspiracy-theory types keep saying they will, was never really a rational option. But using those dollars to acquire productive assets? Very smart, very rational. If you figure out what they want to buy and get there first, there are profits to be had. Attention should be paid.

    $2.2 trillion in reserves and growing can cover a lot of economic sins and bad bank loans. It can buy time for the companies with too much production capacity in China to find new customers. Will it be a smooth ride? Of course not. There will be a lot of bankrupt companies and a lot of angst among the entrepreneurial class. That is part of the process. But in five or ten years, China will be larger and stronger than it is today.

    Count on it.

    That being said, is it likely China will pull the world out of its current slump? Not for a while. China is just 7% of global GDP. Even if they grow at 8%, that only adds 0.5% to global growth, and it is likely that we will see global GDP shrink by 2.7% in 2009.

    From The Return of Muddle Through: Can China Lead the Global Recovery?

    • cometman permalink*
      July 27, 2009 6:37 am

      Good article. The part about stockpiling copper was pretty interesting too.

  5. Stemella permalink*
    July 26, 2009 9:42 pm

    It is getting rough out there in globalized capitalist domination land. They’re getting fucked up Toddy.

    Killing of China steel plant boss halts sale

    The privatisation of a state steel group has been scrapped after an executive was beaten to death by workers angry at the threat to their jobs from a takeover of their company, according to a Hong Kong rights group.

    The violent riot in north-east China late last week involved up to 30,000 workers, a reminder of the ongoing sensitivity about lay-offs from state companies in industries targeted for consolidation.

    And in Kuwait, a financier accused of flaud by the SEC was found dead of apparent suicide.

    Braikan was the chief executive of Al Raya Investment. which is 10 percent owned by Citigroup Inc, and had been at the center of a financial scandal that erupted last week.

    “It’s very sad news. This crisis has seen a lot of people in the Gulf and across the world fall from grace, and each person is different in terms of their ability to handle pressure,” said Mohammed Yasin, chief executive of Dubai-based investment bank Shuaa Securities.

    • cometman permalink*
      July 27, 2009 7:03 am

      Is it just me or have there been more large angry mobs in China lately? Probably won’t be the last one either – the other article about China you posted seems to indicate turmoil as China adjusts to lower consumption from the US while trying to increase their domestic markets. Sounds like more layoffs will be inevitable there at least in the short term until they develop their own markets.

      It’s somewhat heartening to see that the massive censorship in China hasn’t killed the human spirit. Despite the fact that the Chinese try to block a lot of information the government considers subversive, including attempts to eradicate mentions of the Tienanmen Square massacre, people still seem to understand when they’re getting the shaft.

      • Stemella permalink*
        July 27, 2009 7:13 am

        There was recent unrest with the Uyghurs, which seems to be a common theme with the empires, repressed ethnic groups rabble rousing as the tectonic plates of power shift. Another thing has been the huge number of deaths due to earthquakes relating to really shitty construction (also mentioned in that other article).

        So you weren’t imagining the recent gatherings of mobs.

  6. cometman permalink*
    July 27, 2009 7:16 am

    Why oh why do I continue to read anything I find on the big web portals like MSNBC and Yahoo? I know the articles there are geared towards the lowest common denominator, I’ll start to hear my neurons snapping from the stupid as soon as I start reading, the article will have changed two or three times between posting a link and checking back, and I’ll likely never learn anything important. But when I see a headline like Fed’s Bernanke Launches Charm Offensive I can’t help myself. Do NOT click on it – it really isn’t worth it ;) Two pages of dreck that doesn’t tell you a damn thing – just that Bernake held a “town hall” meeting (presumably one where he’s pre-assured the audience won’t throw anything harder than a Nerf at him) and that he had to hold his nose as the bailout funds were dished out. That’s it. No mention of any other details and then a bunch of quotes from wingnuts like Michele Bachman and Jim Bunning. The whole thing is about how using tactics different from Greenspan might help Bernanke keep his job – what he actually said seems to be irrelevant and not worth mentioning, much less questioning for accuracy. Just more kabuki.

    • cometman permalink*
      July 27, 2009 11:30 am

      Here’s a much better article about Big Ben’s Traveling Dog & Pony Revue. The article gets into much more detail about what Bernanke actually said and mentions that yes, it was a hand-picked audience he spoke in front of. It also mentions that PBS Newshour will air the meeting in three 20 minute segments starting tonight so you can hear Bernanke’s weasel words for yourself.

      • cometman permalink*
        July 27, 2009 11:54 am

        And this video goes a long way toward explaining why Bernanke felt the need to take his show on the road. Looks like there’s quite a bit he doesn’t know about the half a trillion dollars he handed out to foreign banks.

        • Stemella permalink*
          July 27, 2009 6:59 pm

          Related to that magical mystery tour the TARP money took, read Greenwald on that very subject:

          The war being waged on the TARP watchdog’s independence

          Barofksy’s clashes with administration officials have intensified of late. Last week, he issued a report documenting that the actual amount of taxpayer money theoretically put at risk in the bank bailout — once Federal Reserve, FDIC and other programs are counted — is $23.7 trillion, not the widely cited figure of $700 billion, a report that prompted attacks from the White House and Treasury on his credibility. Separately, Barofsky has continuously disputed White House claims that it’s impossible to account for what has been done by banks with the TARP funds.

          ~snippety snip~

          Most significant of all, and obviously due to Barofsky’s truly independent oversight efforts, the Obama administration is now attempting to induce the Justice Department to issue a ruling that Barofsky’s office is not independent at all — but rather, is subject to, and under the supervision of, the authority of Treasury Secretary Tim Geithner. By design, such a ruling would completely gut Barofsky’s ability to compel transparency and exercise real oversight over how Treasury is administering TARP, since it would make him subordinate to one of the very officials whose actions Congress wanted him to oversee: the Treasury Secretary’s.

          Time to send in the Humboldts

  7. cometman permalink*
    July 27, 2009 7:52 am

    Since we are collectively having such a difficult time figuring out how to fix some of the complicated problems facing our nation, maybe it’s time to appeal to a more rational authority and ask an ant.

    In a study released online on July 22 in the journal Proceedings of the Royal Society: Biological Sciences, researchers at Arizona State University and Princeton University show that ants can accomplish a task more rationally than our – multimodal, egg-headed, tool-using, bipedal, opposing-thumbed – selves.

    “This paradoxical outcome is based on apparent constraint: most individual ants know of only a single option, and the colony’s collective choice self-organizes from interactions among many poorly-informed ants,” says Pratt, an assistant professor in the School of Life Sciences in ASU’s College of Liberal Arts and Sciences.


    The authors’ insights arose from an examination of the process of nest selection in the ant, Temnothorax curvispinosus. These ant colonies live in small cavities, as small as an acorn, and are skillful in finding new places to roost. The challenge before the colony was to “choose” a nest, when offered two options with very similar advantages.

    What the authors found is that in collective decision-making in ants, the lack of individual options translated into more accurate outcomes by minimizing the chances for individuals to make mistakes. A “wisdom of crowds” approach emerges, Pratt believes.


    “Typically we think having many individual options, strategies and approaches are beneficial,” Pratt adds, “but irrational errors are more likely to arise when individuals make direct comparisons among options.”

    Somebody ought to mention this the next time the argument that single payer health care would limit people’s choices. I don’t think most people really like having to figure out how sick they are likely to get and then picking from a myriad of insurance options that make it extremely difficult to tell whether anything will actually get paid for once you get to the hospital. Getting an axe removed from your forehead isn’t like picking out a new shirt at the store. Most people just want to get fixed as quickly as possible when they get sick – they don’t want to browse around first.

    The article also mentions that this research could lead to new methods for robotics and artificial intelligence. Sciencedaily also had this article on new breakthroughs in bacterial computing.

    US researchers have created ‘bacterial computers’ with the potential to solve complicated mathematics problems. The findings of the research demonstrate that computing in living cells is feasible, opening the door to a number of applications. The second-generation bacterial computers illustrate the feasibility of extending the approach to other computationally challenging math problems.

    These two articles remind me of a lot of sci-fi I’ve read in recent years (Dan Simmons, Vernor Vinge) where somebody decides to put latent biological computing capacity, ie your unused gray matter, to better use. Results are not pretty for those accustomed to having, or at least thinking they have, free will :) The Brave New World is closer than most people think.

  8. cometman permalink*
    July 27, 2009 8:01 am

    Elliot Spitzer ramps up the rhetoric.

    Advocating in favor of a House bill to audit the Federal Reserve, Spitzer said: “The Federal Reserve has benefited for decades from the notion that it is quasi-autonomous, it’s supposed to be independent. Let me tell you a dirty secret: The Fed has done an absolutely disastrous job since [former Fed Chairman] Paul Volcker left.

    “The reality is the Fed has blown it. Time and time again, they blew it. Bubble after bubble, they failed to understand what they were doing to the economy.

    “The most poignant example for me is the AIG bailout, where they gave tens of billions of dollars that went right through — conduit payments — to the investment banks that are now solvent. We [taxpayers] didn’t get stock in those banks, they didn’t ask what was going on — this begs and cries out for hard, tough examination.

    “You look at the governing structure of the New York [Federal Reserve], it was run by the very banks that got the money. This is a Ponzi scheme, an inside job. It is outrageous, it is time for Congress to say enough of this. And to give them more power now is crazy.

    “The Fed needs to be examined carefully.”

    You’d think somebody in DC would listen to this guy since he is an insider and knows what he’s talking about. He’s never been about trying to take down the system – just making sure it’s run on the up-and-up. But of course nobody will listen because he doinked someone who wasn’t his wife and that’s only OK if you’re a republican.

  9. cometman permalink*
    July 27, 2009 8:39 am

    Very good article from Chris Hedges about the inane “Don’t worry be happy” corporate culture that companies try to shove down their employees’ throats. Definietly worth reading the whole thing. Here are a couple excerpts:

    The driving ideology of corporate culture is a blind faith in the power and virtue of the corporate collective. All quotas can be met. All things are possible. Profits can always be raised. It is only a question of the right attitude. The highest form of personal happiness, we are told, is when the corporation thrives. Corporate retreats are built around this idea of merging the self with the corporate collective. They often have the feel of a religious revival. They are designed to whip up emotions. Office managers and sales staffs are given inspirational talks by sports stars, retired military commanders, billionaires and self-help specialists like Tony Robbins who tell them, in essence, the impossible is always possible. And when this proves not to be true it is we who are the problem. We simply have to try harder.

    The belief that by thinking about things, by visualizing them, by wanting them, we can make them happen is magical thinking. The purpose, structure and goals of the corporation can never be questioned. To question, to engage in criticism of the corporate collective, is to be obstructive and negative. We can always make more money, meet new quotas and advance our career if we have enough faith. This magical thinking is largely responsible for our economic collapse since any Cassandra who saw it coming was dismissed as “negative.” This childish belief discredits legitimate concerns and anxieties. It exacerbates despair and passivity. It fosters a state of self-delusion. And it has perverted the way we think about the nation and ourselves.

    One disgruntled employee hits the nail on the head with this comment about vapid meetings and ridiculous training sessions:

    “The purpose of the meeting was, her euphemisms aside, to push merchandise and services onto customers that they didn’t want. I believe it’s called upselling,” he said. “She wanted us to talk about our positive customer service experiences. Most of us struggled with this, as nearly all of our experiences with customers and the company had been extremely negative and stressful.”

    I had to endure many of these types of meetings when I worked for WAMU. Sometimes I just brought a good book to read before filling out the evaluation sheet at the end telling them what a stupid waste of time the meeting had been. A few were OK though, like the one that explained the details of the DOS based computer system which allowed me to refund fees to customers that the bank was trying to steal without having to ask a manager for help. My favorite was a class called “Turning obstacles into opportunities” which was supposed to teach all of us underpaid employees how to market the bank’s products to customers and convince them to say “yes” instead of “no” when we offered them a checking account that had a higher minimum balance than they had money. That one was held early on a Saturday morning and I decided to turn the obstacle of dragging my hung over ass into a boring bank meeting on my day off into the opportunity to sleep in for a few extra hours. Went in on Monday and told my manager that I had already learned how to do what the class was trying to teach :P

    • Stemella permalink*
      July 27, 2009 12:31 pm

      Clearly you are a non-conformist. Mr. Cometman. :) When I was a grad student I took several MBA courses as part of one of my minors and we did one of those all day corporate simulation/role playing deals to try out different management styles. Not being a full MBA major I was assigned to a lesser role, a peon basicially, but who had access to useful cross departmental information. It was so fucking boring that I decided to sabotage my company by passing some information on to a few people that turned into wild fire rumors that got the CEO fired before the day was done. I learned some good lessons from the experience. 1. I would never work for a major corporation. 2. The real work got done by the peons and many peons knew more than the Execs regarding operations. 3. The corporate “culture” needed to be destroyed! Viva Zapato!

      The other thing related to the article is that there was an NPR story within the last several months about a study, which measured the happiness of nations. Not sure if it’s the same study Hedges links to. The conclusion of the study was that trappings of the Western consumer culture radically decreased the happiness index for the cultures of lesser developed countries. Tools, technology, medicines, all great – but bring on the Levis and Coca Cola and everything turns to shit with jealousy and onset of crime over things/personal possessions that was minimal before.

      Oh, and this part?

      This ideology condemns all social critics, iconoclasts, dissidents and individualists for failing to seek fulfillment in the collective chant of the corporate herd. It strangles creativity and moral autonomy. It is about being molded and shaped into a compliant and repressed collective. It is not, at its core, about happiness. It is about conformity, a conformity that all totalitarian and authoritarian structures seek to impose on the crowd.

      Sounds just like klub kumquat to me :)

      • cometman permalink*
        July 27, 2009 1:24 pm

        Hey nice work in getting the CEO fired in just a few hours! Maybe you should have gone corporate – you might have done a lot of good, slashing the highest paid from the corporate payroll on a daily basis :P

        And that last part made me think of ‘Subdivisions’ by Rush – CONFORM OR BE CAST OUT! Do I need to bust out some more Rush vids???

  10. cometman permalink*
    July 27, 2009 11:20 am

    Another good article from Bruce Dixon at Black Agenda Report on Obama’s health plan – Is the Obama Health Care plan Really Better Than Nothing?

    Under the Obama plan, we’re told, employers will have to insure their employees or pay into a fund that does it for them. Individuals will be required under penalty of law to buy private insurance policies and for those that can’t afford it or prefer not to use a private insurer there will be something called a “public option.” This “public option, the story goes, is bitterly fought by the bad guys because it will make private insurers accountable by competing with them, forcing them to lower their costs. Both the president’s backers and opponents agree that the whole thing will be fantastically expensive, and the president proposes to fund it with cuts in existing programs like Medicaid which pay for the care of the poorest Americans and a tax on those making more than $300,000, later raised to $1 million a year.

    The “public option” has that magic word “public” in it, and that’s reassuring to progressives and to most of the American people. Taxing the rich is a popular idea too. So if you rely on corporate media, the administration, or some of the so-called progressive blogs to identify the players and keep the score, it seems a pretty clear case of President Obama on the side of the angels, battling the greedy insurance companies, Republicans and blue dog Democrats to bring us universal, affordable health care.

    That whole picture has about as much reality as the ones the same corporate media and most of the same politicians drew for us about Iraq, 9-11, weapons of mass destruction and some people over there who wanted us to free them. Iraq and the White House were and remain actual places, and there really is a problem called health care. But the places, problems and solutions are very different from the bubble of fake reality blown around them.

    What sustains this fake reality is the diligent suppression from public space of any viewpoints, observations or proposals to Obama’s left. As long as the illusion that nobody has a better idea, that the only choice we have is Obama’s way or the Republicans’ way can be maintained, the crooked game can go on.

    I need to start checking in with BAR more often again – they have some good articles and they don’t skimp on the rhetoric either.

    • Stemella permalink*
      July 27, 2009 11:57 am

      Bill Moyers’ Journal on Friday came to similar conclusions. I highly recommend watching it here

      Here’s a written summary

      and here is another piece on Healthcare reform and lobbyists also from Moyers.

      • cometman permalink*
        July 27, 2009 1:26 pm

        Thanks for the Journal link. I’ll make sure to watch it on the computer later.

    • triv33 permalink
      July 27, 2009 4:35 pm

      He keeps talking public option, but really, he sold us out long ago. He might have bothered to mention that he changed his mind about mandates.

      The biggest news from yesterday’s interview: President Obama has changed his position from the campaign trail and now believes that health care insurance should be mandated for all Americans, with a hardship exemption.

      Dr. LaPook: Ultimately, philosophically, do you believe that each individual American should be required to have health insurance?

      President Obama: I have come to that conclusion. During the campaign, I was opposed to this idea because my general attitude was the reason people don’t have health insurance is not because they don’t want it, but because they can’t afford it. And if you make it affordable, then they will come. I’ve been persuaded that there are enough young uninsured people who are cheap to cover, but are opting out. To make sure that those folks are part of the overall pool is the best way to make sure that all of our premiums go down. I am now in favor of some sort of individual mandate as long as there’s a hardship exemption. If somebody truly just can’t afford health insurance even with the subsidies that the government is now providing, we don’t want to double penalize them. We want to phase this in, in a way that we have time to make sure that coverage is actually affordable before we’re saying to people “go out and get it.”

      I remember the part in his speeches where he told us if we liked our current coverage we got to keep it, I just don’t remember the part about how if we didn’t, that was tough shit, we were going to be mandated to keep it and fined if we didn’t.

      • Stemella permalink*
        July 27, 2009 7:09 pm

        I remember him making such a huge distinction between himself and Hillary Clinton regarding those mandates. I have a mandate I’d like Hopey Squobama to meet. It is called the social contract to uphold the Constitution of the United States, something he’s supposed to be privy to.

        At this point I’m prepared to accept the concept that I will very likely be medically uninsured in the long run and that it is very likely that I’ll never see Medicare or Social Security. It sucks being at the tail end of the biggest generation in this country’s history. I will learn not to be afraid of death; I’m getting there bit by bit.

        • cometman permalink*
          July 28, 2009 9:51 am

          You could read some Kazantzakis – he’s pretty good in the learning to laugh in the face of death department. “Freedom or Death” is a really good one, and sometimes it’s called “Captain Michaelis“. You may have to get it through a used bookstore though – that’s where I found a copy.

          Personally, I’m still planning on having my consciousness uploaded into the great server in the sky :P

  11. Stemella permalink*
    July 27, 2009 10:26 pm

    On upcoming meetings between Chinese officials, the Elvin and Shillary from Baseline

    Secretary Geithner’s China Strategy: A Viewer’s Guide

    According to official previews (i.e., the apparent contents of background briefings given to wire services), the economic topics are China’s concerns about the value of the dollar (i.e., their investments in the U.S.) and the amount of debt that the U.S. will issue this year.

    This is absurd.

    China decided to accumulate over $2trn worth of reserves, most of which they are presumed to hold in dollars. No one compelled, suggested, or was even particularly pleased by their massive current account surplus (peaked at 11% of GDP in 2007, but still projected at 9.5% of GDP for 2009). We can argue about whether this surplus – arguably the largest on modern record for a major country – was intentional or the result of various policy accidents.

    Irrespective of underlying cause, any country that runs such a current account surplus is implicitly taking a great deal of currency risk – China was in effect deciding to take the biggest ever official long-dollar position. The idea that the US government should spend time reassuring them is somewhere between quaint and not good strategy.


    Treasury’s concern is not really the value of the dollar – particularly as they would like a bit of inflation at this point; again, if it’s China’s fault that the real value of our debts falls, that might play (or spin) well in Peoria. Instead, Treasury’s concern is the large amount of debt that they/we are trying to issue.

    If China is worried about the future value of our debt in renminbi, then Treasury will have to pay higher long term interest rates. But, as Treasury and the White House have been emphasizing, what really matters for our long-term fiscal solvency is bringing Medicare and associated costs under control. Any strategy that relies instead on indefinitely low long-term interest rates is illusory – and any investor who thinks we will be like Japan in this regard is in for some disappointment.

    The real issue for discussion this week should be China’s current account surplus and the pressing actions needed to bring this under control.

    • cometman permalink*
      July 28, 2009 9:59 am

      Hmmmm. I wonder if his assessment that Treasury isn’t concerned with the value of the dollar is entirely accurate. I definitely don’t think the banks would be happy with it and Treasury seems to do whatever the banks want these days. If we see inflation, that means it will be easier for people to pay off their current loans meaning less real money for the banks. IIRC, that was one of the beefs that William Jennings Bryan had in his Cross of Gold speech I mentioned a while back – he was advocating for some inflation because it would help out farmers and lots of other people pay off their debts easier and the bankers fought his proposals tooth and nail.

  12. Stemella permalink*
    July 27, 2009 10:44 pm

    The jolly fucking rogers, all five of them

    About 80% of the derivative assets and liabilities carried on the balance sheets of 100 companies reviewed by Fitch were held by five banks: JP Morgan Chase, Bank of America, Goldman Sachs, Citigroup, and Morgan Stanley. Those five banks also account for more than 96% of the companies’ exposure to credit derivatives.

    and check this out, speaking of corporate culturetude, the Exxon Temple of Oily Worship is derivative free, generating it’s own internal market forces like some beast with tapeworms of symbiotic indigestion.

    The firm’s analysts reported that perhaps “the most surprising information coming from our review of energy companies” was that Exxon Mobil — the biggest U.S. energy company — had no derivative exposure at the end of the first quarter. Instead, the company appears to rely on what’s called natural hedges — countervailing trends within the corporation itself — to manage potential risks. The report cited Exxon’s 2008 10-K:

    “The corporation’s size, strong capital structure, geographic diversity and the complementary nature of the upstream, downstream and chemical businesses reduce the corporation’s enterprise-wide risk from changes in interest rates, currency rates and commodity prices. As a result, kes limited use of derivative instruments to mitigate the impact of such changes. The corporation does not engage in speculative derivative activities or derivative trading activities nor does it use derivatives with leveraged features.”

    • cometman permalink*
      July 28, 2009 10:14 am

      I’ve heard similar figures before about the big banks being the ones holding the vast majority of the crap which is why it pisses me off to no end to see so many smaller banks failing as we prop the big ones up. The jackals that should have gone under can now get even bigger feasting on the remains of their erstwhile competitors. I think it was in a survey sent out of Barofsky’s office where some of these banks responded that they had used the TARP money not for its intended purpose but to make acquisitions instead.

  13. Stemella permalink*
    July 28, 2009 8:11 am

    On the consistent wrongness of Ben Bernanke in the lead up to the crash

    • cometman permalink*
      July 28, 2009 10:32 am

      One thing that strikes me watching vids of this guy is what a timid little man he is. He seems very fidgety, almost like he’s waiting for someone to call him on the bullshit he knows he’s spewing.

      The part the really frosts me is him pooh-poohing any potential housing bubble because well, real estate prices have never taken a huge dive in the past. Common sense could tell you that the drastic rise in housing prices was unsustainable and you only needed two numbers to figure it out- how much does a house cost and how much do you make. When the prevailing wage starts to be too small to afford any of the houses on the market in the area, then something has got to give. And any fool could tell you it wasn’t going to be big companies starting to shell out more in wages to their employees. When we started shopping for a house a few years back it was obvious to me that very few people in my area, including myself, could really afford the asking prices on the vast majority of the houses around here. It was obvious that prices would have to come down at some point and they did, and that’s when we bought. And yet somehow none of the titans of finance could see this coming. Rrrrrrrrrr.

      Anyhow, here’s a little comic relief from some freakshow who really likes Ron Paul’s balls tearing into Bernanke.

      • Stemella permalink*
        July 28, 2009 3:01 pm

        oh my god. Is that Donkeytail? I think it is. Oh fuck. too much. the ball size comparison is beyond the beyond. I’m going to post this for Pinche, since he has in fact been spanked by Ron Paul. :)

        Thank you. I did laugh and am still laughing.

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