Unreal

From The Deal Breaker (H/T Marginal Revolution) ….

$$$ Bank of America is buying Merrill, the WSJ reports. The deal values the company at $44 billion, or $29 per share, a significant premium from Friday’s market price. Everyone is perplexed by the premium. But if it is, as some have reported, an all stock deal and BofA shares take a significant hit in the wake of the news, the final price and the premium could be much lower.

Update: CNBC’s Charlie Gasparino says the government forced Merrill to sell itself.

$$$ On CNBC they are saying that AIG has asked the Federal Reserve for some kind of emergency bridge loans. Can the Fed lend to an insurance company?

$$$ Federal Reserve is dramatically expanding its emergency lending program. It’s now going to take all sorts of collateral, including equity.

Welcome to the Future

From the American Thinker….

In May 2008, 64-year-old retired school bus driver Barbara Wagner received bad news from her doctor. She found out that her cancer, which had been in remission for two years, had returned. Then, she got some good news. Her doctor gave her a prescription that would likely slow the cancer’s growth and extend her life. She was relieved by the news and also by the fact that she had health care coverage through the Oregon Health Plan.

It didn’t take long for her hopes to be dashed.

Barbara Wagner was notified by letter that the Oregon Health Plan wouldn’t cover her prescription. But the letter didn’t leave it at that. It also notified her that, although it wouldn’t cover her prescription, it would cover assisted suicide.

After Wagner’s story appeared in the Eugene Register-Guard, the Oregon Health Plan acknowledged that it routinely sends similar letters to patients who have little chance of surviving more than five years, informing them that the health plan will pay for assisted suicide (euphemistically categorized as “comfort care”), but not for treatment that could help them live for months or years.

(h/t American Digest)

Will fuel supply shortages last into October?

From the Oil Drum….

Where is our gasoline and diesel supply headed? Even before Ike hit, quite a few areas of the US were starting to see gasoline shortages. The impact of Ike can only make shortages worse. Most likely, it will take refineries at least a week or two to get production back to normal levels after a storm of this type, considering the impacts of electrical outages and flooding. In this article, I will examine some of the issues that seem to be involved. Based on my analysis, fuel supply shortages are likely to last well into October, and are likely to get considerably worse before they get better.

It’s to early to be sure what the effects are going to be yet. But the south is already seeing shortages. As this piece from the AP says….

Fears of supply shortages, and actual fuel-production disruptions, resulting from Ike’s lashing of vital energy infrastructure led to pump price disparities of as much as $1 a gallon in some states, and even on some blocks.

Late Saturday the U.S. Minerals Management Service said there were two confirmed reports of drilling rigs adrift in the central Gulf of Mexico.

Compounding the jitters and higher costs for gasoline retailers was the fact that some big refineries along the Gulf Coast had been shut for nearly two weeks following Hurricane Gustav. Power outages caused by Ike threatened to keep millions of gallons of gasoline output idled for at least several days.

The price of regular gasoline soared as high as $4.99 a gallon in Knoxville, Tenn. on Saturday, up from $3.66 a day earlier.

In Florida, the attorney general’s office reported prices as high as $5.50 a gallon in Tallahassee and said it had received 186 gouging complaints.

This article from the Houston Chronicle suggest that things may be better then the Oil Drum fears.

Playing Chicken

From the New York Times….

But Mr. Paulson and Mr. Geithner made it clear to the company, its potential suitors and to the meeting participants on Friday that the government has no plans to put taxpayer money on the line. The government is deeply worried that its actions have created a moral hazard and the Federal Reserve does not want to reach deeper into its coffers. Instead, Mr. Paulson and Mr. Geithner insist that Wall Street needs to come up with an industry solution to try to stabilize Lehman Brothers and calm the markets.

Still, some of the other Wall Street banks, facing billions of dollars in losses themselves, have resisted this approach. They argue that Lehman Brothers overreached and brought its current troubles on itself. If there are no bidders for Lehman Brothers, these banks say they can collect their collateral and liquidate the troubled firm’s assets. In this high-stake game, they may also be trying to call the government’s bluff, knowing that if push came to shove, it would provide financial support.

I wish that Mr. Paulson and Mr. Geithner would let Lehman’s Brothers fail. But their past performance does not give me hope.

How can you tell when a politician is lying?

When their lips are moving, they are lying. This from RIA Novosti…

Russian President Dmitry Medvedev dismissed speculation on Friday that his country would not have enough natural gas for European consumers and pledged to launch new fields if the market grows.

“It is amusing to hear statements that Russia will not have enough gas for supplies to Europe…This is not so,” Medvedev told a Valdai International Discussion Club meeting.

Medvedev also said that the country’s plans to develop energy cooperation with Asian states would not adversely affect energy supplies to Europe.

Talk is cheap. The investment needed to secure future gas production is not. So far, their is no sign that the Russians are spending the necessary money to keep their exports from going down.

Maybe they got cause and effect mixed up

From The News….
…..

SCIENTISTS have discovered that going veggie could be bad for your brain – with those on a meat-free diet six times more likely to suffer brain shrinkage.

Vegans and vegetarians — such as Heather Mills — are the most likely to be deficient because the best sources of the vitamin are meat, particularly liver, milk and fish.

Vitamin B12 deficiency can also cause anaemia and inflammation of the nervous system.