Yearly Archives: 2008

The Dark Shadow

Posted on by
Reply

From SPIEGEL….

Lilian Engelmann never thought she would see neo-Nazis on her block. The young art curator works in a gallery in the trendy district of Mitte, a neighborhood in central Berlin. Her neighbors include an international cinema, designer hat store, Vietnamese restaurant and — as of last February — a store called Tönsberg, which sells clothing popular among right-wing extremists.

“By coming here, the neo-Nazis tried to come into the center of society,” Engelmann told SPIEGEL ONLINE. Once local residents and shopowners learned that Tönsberg planned to sell the clothing brand Thor Steinar, they organized against the store. The group led by Engelmann and other shopowners called itself the “Mitte Initiative Against the Far Right,” and mounted regular protests.

These people are only going to grow in strength and numbers. Contrary to what some people say, Germany never manged to lay a good moral foundation for a free society. The same could be said of many other countries in Europe.

No one is Safe

Posted on by
Reply

From Jeff Matthews Is Not Making This Up….

So the odds are good that Buffett himself is not breaking a sweat over his own stock’s 40% decline since his late September cavalry-to-the-rescue investment in Goldman Sachs.

After all, who knows more about Berkshire than Warren Buffett?

Still, somebody out there is indeed breaking a sweat about Berkshire, and not just the company’s stock. Credit default swaps in Berkshire—insurance against a default by Berkshire—have been climbing ever since the market began its September swoon, and suddenly spiked in the last few days.

In the end of the world as we know it, even Berkshire is not a safe haven. Although to be fair, people are mostly worried that it is going to lose its AAA rating. Not go bankrupt per say.

Hooray for Freedom

Posted on by
Reply

From Reuters…

Online dating service eHarmony has agreed to create a new website for gays and lesbians as part of a settlement with a gay man in New Jersey, the New Jersey Office of the Attorney General said on Wednesday.

From later on in the same article….

eHarmony was founded in 2000 by evangelical Christian Dr. Neil Clark Warren and had ties with the influential religious conservative group Focus on the Family.

Enough Said.

Small is sometimes better

Posted on by
Reply

From the Washington Monthly….

Broadway Federal’s story isn’t exceptional. Easily overlooked amid the crisis of big banks today, small-scale financial institutions are, for the most part, holding steady—and sometimes even better than steady. According to FDIC data, the failure rate among big banks (those with assets of $1 billion or more) is seven times greater than among small banks. Moreover, banks with less than $1 billion in assets—what are typically called community banks—are outperforming larger banks on most key measures, such as return on assets, charge-offs for bad loans, and net profit margin.

One reason community banks are doing so well right now is simply that they never became too clever for their own good. When other lenders, including underregulated giants like Ameriquest and Countrywide, started peddling ugly subprime mortgages, community banks stayed away. Banking regulations prevented them from taking on the kind of debt ratios assumed by their competitors, and ties to their customers and community ensured that predatory loans were out of the question. Broadway Federal, for its part, got out of single-family mortgages when they stopped making sense. “A borrower comes and asks, ‘Do you do interest-only, no-down-payment, option ARMs?’ ” recalls Hudson, with a chuckle. “No!” The bank focused instead on expanding its reach to niche borrowers, such as local churches.

This brought to mind something that the Governor of South Carolina said in a recent Wall Street Jouranl editoral called “Don’t Bail Out My State”…

Community bankers tell me that they are now at a competitive disadvantage for being careful about who to lend to, because others that were less disciplined will get a federal bailout.

Is This For Real?

Posted on by
Reply

From Epoch Times…

It began on September 3, 2007, when the early morning sun caught the rust-stained hull of a 1,700-ton cargo ship as it slowly steamed into the busy Mediterranean port of Tartous in Syria. From its mast flew the flag of South Korea and the stern plate identified the al-Hamed as being registered in Inchon, one of the country’s major ports.

Watching the ship manoeuvring into its berth from a distance was a man with the swarthy skin of a Kurd or one of the Marsh Arabs of Iraq. He was fluent in both their languages as well as some of the dialects of Afghanistan. He was, in fact, a Turkish-born Jew who had eschewed the life of a carpet seller in the family business in Istanbul to go to Israel, serve in its army as a translator and finally achieve his life’s ambition to work in Mossad.

Fifteen years later, he was recognised as one of its most brilliant operatives. In that time, he had operated in a dozen countries under as many aliases, using his linguistic skills and chameleon-like characteristics to observe and be absorbed into whichever community he had been sent.

Now, for the moment, he was code-named Kamal with a perfectly faked Iranian passport in his pocket. Mossad’s chief, Meir Dagan, had stressed to him the importance of his mission: to confirm the role of al-Hamed in the dangerous relationship which the Syrian regime of Bashar al-Assad had formed with North Korea.

The whole piece has more detail about Israel’s raid on Syra’s nuclear site than I have seen anywhere else. Somebody is either making things up or talking about things they should keep quite about. (H/T The Belmont Club)

This Man Knows How To Trash Talk

Posted on by
Reply

From the Wall Street Journal….

Over the past decade, the capital destruction by GM has been breathtaking, on a greater scale than documented by Mr. Jensen for the 1980s. GM has invested $310 billion in its business between 1998 and 2007. The total depreciation of GM’s physical plant during this period was $128 billion, meaning that a net $182 billion of society’s capital has been pumped into GM over the past decade — a waste of about $1.5 billion per month of national savings. The story at Ford has not been as adverse but is still disheartening, as Ford has invested $155 billion and consumed $8 billion net of depreciation since 1998.

As a society, we have very little to show for this $465 billion. At the end of 1998, GM’s market capitalization was $46 billion and Ford’s was $71 billion. Today both firms have negligible value, with share prices in the low single digits. Both are facing imminent bankruptcy and delisting from the major stock exchanges. Along with management, the companies’ unions and even their regulators in Washington may have their own culpability, a topic that merits its own separate discussion. Yet one can only imagine how the $465 billion could have been used better — for instance, GM and Ford could have closed their own facilities and acquired all of the shares of Honda, Toyota, Nissan and Volkswagen.

Ouch.

An unenforceable order

Posted on by
Reply

From Danger Room…

The Defense Department’s geeks are spooked by a rapidly spreading worm crawling across their networks. So they’ve suspended the use of so-called thumb drives, CDs, flash media cards, and all other removable data storage devices from their nets, to try to keep the worm from multiplying any further.

Why don’t they just order everyone to stop using a computer? Maybe there is something I am missing, but this seem really stupid. They would be better off shutting their network down if they are that scared.

Dow Jones Closes Below 8000

Posted on by
Reply

From Yahoo Business….

Wall Street hit levels not seen since 2003 on Wednesday, with the Dow Jones industrial average plunging below the 8,000 mark amid a dour economic outlook from the Federal Reserve and worries over the fate of Detroit’s three automakers.

A meaningless number. Posted here only for those who missed it. More interesting is this chart from Calculated Risk comparing the current stock market crash to other historical crashes.

Has the Mandate From Heaven Been Taken Away?

Posted on by
Reply

From the Telegraph…

Thousands of rioters used axes, chains, stones and iron bars to attack police, smash local government offices and set fire to cars after a protest in western China went out of control.

From later on in the same article…

Provinces around the country are reporting a surge in strikes, alongside other stand-offs as laid-off factory workers protest over unpaid wages.

The clashes in Wudu, a part of the city of Longnan in the poor province of Gansu, began on Monday. Longnan is not far from the border with Sichuan, the heart of the earthquake zone.

Residents living in temporary shelters after their homes had been demolished to make way for a government development project were joined by thousands of others.

They had been promised the new development would improve local living standards, but that was thrown into doubt when it was confirmed the local government was itself relocating elsewhere.

By Tuesday, crowds had grown to 2,000 according to state media, and several times that according to witnesses, who said a fire engine sent to put out fires started by the protesters was itself hijacked.

Hand-to-hand fighting followed as police used tear gas to try to disperse the crowds.

The New York Times has more.

There have been many riots in China. But they seem to be growing more common. At this rate they will be a real issue soon.