Links 11/15/09
TSA is secretly watching you LA Times (hat tip DoctoRx)
An Old West Crime Makes a Big Comeback NBC Dallas-Fort Worth (hat tip reader John D)
Cryptographic voting debuts MIT News (hat tip reader John D)
Manhattan Institute Says “New York must declare a financial emergency” Michael Shedlock
Medical workers balk at mandatory flu vaccines Reuters
Krugman Misses the Point about Kurzarbeit Peter Dorman. This is short and VERY important.
U.S. watchdog: Need way to unwind troubled firms Reuters. I’m a big Warren fan, but this is a motherhood and pie statement that is unworkable, at least as she is framing it. The idea for having a resolution is that that is presumed to be (as she states) a way to avoid forcing the firms to downsize. This is just incorrect.
There is no way a resolution authority can operate absent massive structural changes in the financial services industry. The firms are too interconnected. The network is the computer. The debt markets are now an integral part of the credit process, which is turn is essential to modern capitalism, and hence cannot be permitted to fail. Why is this so hard to understand? This fantasy plays into the industry’s hands.
How do you resolve a Citigroup, with $500 billion in unsecured foreign deposits? You either backstop those (politically unacceptable in the US after letting IndyMac, etc. unsecured depositors take big losses) or you let them suffer, which means other foreign banks are likely to see withdrawals of their unsecured deposits. Or how do you resolve a Lehman, with a massive London operation, over 100 corporate entities around the globe, and derivatives books that were a complete mess? And you have the further political and practical problem that Uncle Sam has to fund their balance sheets as they are being wound down (the same issue came up with the RTC, which required some $50 billion of working capital funding from Congress).
Antidote du jour (hat tip DoctoRx, via the LA Times):
A white-handed gibbon from the Sao Paulo Zoo Foundation eats monkey-friendly ice cream — a frozen fruit wedge on a string. Temperatures rose to 86 degrees Fahrenheit this week in Sao Paulo, Brazil, and the zoo fed its gibbons and black-faced spider monkeys these frozen treats for sweet relief.
November 15, 2009
