Assorted Links 2/28/10 Archives

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Assorted Links 2/28/10

• Capitol Hill Workshop, March 3-5, 2010
• Speechwriting: Preparing Speeches and Oral Presentations, March 12, 2010
• Is Inflation Coming? - "Mr. Market doesnt seem to think so. The WSJ reports on the first auction of 30 year TIPS (Treasury Inflation Protected Securities) in nearly 10 years. The Journal thinks the auction was weak; I read it as Mr. Market doesn't see much prospect for a period of the kind of inflation some are warning about.
  . . .
  So based on the 30 year conventional bond yield of 4.731% and the TIP yield of 2.229% one gets an inflation forecast by Treasury bond market participants of 2.44%. Interestingly, that is very close to the Fed's long term inflation target of 2.5%.
  
  I generally pay great respect to the message that Mr. Market is sending. Certainly a lot more than to those 'buy gold inflation is coming' ads on TV and radio."
• Small Planes and Lone Terrorist Nutcases - "On the face of it, Joseph Stack flying a private plane into the Austin, TX IRS office is no different than Nidal Hasan shooting up Ft. Hood: a lone extremist nutcase. If one is a terrorist and the other is a criminal, the difference is more political or religious than anything else.
  
  Personally, I wouldn't call either a terrorist. Nor would I call Amy Bishop, who opened fire on her department after she was denied tenure, a terrorist.
  
  I consider both Theodore Kaczynski (the Unibomber) and Bruce Ivans (the anthrax mailer) to be terrorists, but John Muhammad and Lee Malvo (the DC snipers) to be criminals. Clearly there is grey area.
  
  I note that the primary counterterrorist measures I advocate -- investigation and intelligence -- can't possibly make a difference against any of these people. Lone nuts are pretty much impossible to detect in advance, and thus pretty much impossible to defend against: a point Cato's Jim Harper made in a smart series of posts. And once they attack, conventional police work is how we capture those that simply don't care if they're caught or killed."
• Obama to deliver health care The Chicago Way - "President Barack Obama will star in his very own televised entertainment spectacular on Thursday -- let's call it Federal Health Care Kabuki Theater.
  
  The Republicans wanted to dance. Now they'll have to step lightly. They were foolish to get trapped in his so-called summit on national health care. Or did they actually think they could outperform the skinny fellow from Chicago?
  
  The president is taking this one last chance to push his health care agenda, which by his own estimate will cost about $1 trillion over 10 years. That's money America doesn't have, but he could probably just print some more.
  
  Obama will be in his element, talking and lecturing, the law professor framing the debate. He'll spend hours being seen as reasonable. The Republicans will balk and the president will shrug. He'll sigh and say he tried to reason with them but they refused.
  
  Then once the cameras are turned off, he'll take out the baseball bat and explain how things get done The Chicago Way.
  . . .
  Americans won't know exactly what's in that federal health care bill that will change our lives. We won't know how much it will cost us, or which insiders get rich, until after it's all done.
  
  Naturally, the insiders will know. And after it becomes law, they might let the rest of us in on it.
  
  That doesn't sound much like a man transcending the politics of the past, does it?
  
  It sounds as if The Washington Way is just like The Chicago Way."
• China Said to Purchase Remainder of IMF Gold Sale - "The bullion banks can use paper gold to manipulate pricing around key events like this week's options expiration in the short term. They are powerful, and have many friends, their demimonde, who will help them to spin the facts, place opinion pieces, and resurrect old studies, to convince a gullible public once again that their promises are good, that their paper riches are wealth. This is the essence of the shaping of public opinion, the hidden persuaders, the not always subtle propaganda campaigns that so often pass for news these days.
  
  But the international currency regime is changing, and the developing countries are choosing to protect their reserves in traditional ways. For the first time in over twenty years the central banks have become net buyers of gold.
  
  The wealthy are buying physical silver and gold in anticipation of a dislocation in the structure of the existing international currency regime, no matter what they might say publicly to reassure the markets. This we know. Whether this is the most prudent thing to have done only time will tell, since there are a range of possible outcomes, and probabilities. But change is in the wind; the time of reckoning approaches and the accounts will be tallied and settled."
• The Future of Money: It’s Flexible, Frictionless and (Almost) Free - "The banks and credit card companies have spent 50 years building a proprietary, locked-down system that handles roughly $2 trillion in credit card transactions and another $1.3 trillion in debit card transactions every year. Until recently, vendors had little choice but to participate in this system, even though -- like a medieval toll road -- it is long and bumpy and full of intermediaries eager to take their cut. Take the common swipe. When a retailer initiates a transaction, the store’s point-of-sale system provider -- the company that leases out the industrial-gray card reader to the merchant for a monthly fee -- registers the sale price and passes the information on to the store’s bank. The bank records its fee and passes on the purchase information to the credit card company. The credit card company then takes its share, authorizes all the previous fees, and sends the information to the buyer’s bank, which routes the remaining balance back to the store. All in all, it takes between 24 and 72 hours for the vendor to get any money, and along the way up to 3.5 percent of the sale has been siphoned away.
  
  In the earliest days of credit cards, those fees paid for an important service. Until the late 1950s, each card was usually tied to a single bank or merchant, limiting its usefulness and resulting in a walletload of unique cards. But when BankAmericard -- later renamed Visa -- offered to split its fees with other banks, those banks began to offer Visa cards to their customers, and merchants began accepting Visa as a way to drive sales. Meanwhile, Visa and rival MasterCard -- as well as distant competitors American Express and Discover -- used their share of the fees to build their own global technological infrastructures, pipes that connected all the various banks and businesses to ensure speedy data transmission. For its time, it was a technologically impressive system that, for a price, brought ease and convenience to millions of buyers and sellers.
  
  But today, vendors are seeing fewer benefits from paying those fees, even as credit card companies have jacked them up over the years."
• Goodwin Liu on the Second Amendment - "Boalt Hall Associate Dean Goodwin H. Liu has been nominated to serve on the 9th Circuit Court of Appeals. Some readers and Senators may be interested in his viewpoint on Second Amendment and other constitutional issue related to firearms policy. So here’s an excerpt from his article Separation Anxiety: Congress, The Courts, And The Constitution, 91 Georgetown Law Journal 439 (Jan. 2003). Liu’s co-author on the article is Senator Hillary Rodham Clinton. The article is based on a 2002 speech that Senator Clinton presented at Georgetown, sponsored by the American Constitution Society. Senator Clinton and Professor Liu criticize recent Supreme Court decisions declaring two federal gun control laws unconstitutional:"
• Pro-life leaders say Pelosi lied, again, on federal abortion funding - "House Speaker Nancy Pelosi wrapped up today's White House Health Care Summit with a characteristically confrontational lecture in which she rebuked House Minority Leader John Boehner for saying the Obamacare proposal approved by the Senate and as modified recently by the White House provides public funding for abortions.
  
  'I think it’s really important to note, though, and I want the record to show, because two statements were made here that were not factual in relationship to these bills,' Pelosi said. 'My colleague, Leader Boehner, the law of the land is there is no public funding of abortion and there is no public funding of abortion in these bills and I don't want our listeners or viewers to get the wrong impression from what you said.'
  
  Pelosi's assertion brought immediate responses from pro-life leaders who claim the Senate bill indirectly uses federal tax dollars to fund abortion services provided through new Community Health Centers established by the legislation.
  . . .
  Under the Senate health care bill that will be the main bill Obama and Democrats push through Congress, there is no ban on abortion funding. While some states can opt out of funding abortions under the plan, taxpayers in other states will be forced to pay for them, Johnson said."
• The case against college - "College degrees are overrated, writes Ramesh Ponnuru in Time. While college graduates earn more, that’s partly because those who complete a degree are smarter, on average, than those who don’t. Sending not-so-smart people to college simply boosts the dropout rate.
  . . .
  College-prep programs may be too hard for vocationally oriented students. In some cases, what passes for college prep is too easy. 'College- and career-ready' is the new mantra. We need to define 'career ready' in a way that will guide high school instruction for the kids who prefer moola moola to boola boola."
• Prof. Bernanke Instructs Congress--Again - "This deficit spending problem 'is not 10 years away, it affects the markets today,' Bernanke replied to a question to Rep. Ed Royce (R-Calif.), the only person on the [House Financial Services] committee who appears to not be a few peas short of a casserole, upon which committee chairman Barney Frank (D-Mass.) cut off this line of questioning."
• What to Expect in November - "[Alan I. Abramowitz's] model has a result that will startle many of our readers: Republicans will pick up 37 House seats in November. That is remarkably close to the 40 seats the GOP needs to take outright control of the House."
• Pictures of a Market Crash: Beware the Ides of March, And What Follows After - "There are a fair number of private and public forecasters with whom I speak that anticipate a significant market decline in March. As you know I tend to agree, but with the important caveat that we are in a very different monetary landscape than the last time the Fed engaged in quantitative easing, the early 1930's.
  . . .
  Although one cannot see it just yet in the fog of corrupted government statistics, the economy is not improving and the US Consumers are flat on their back, scraping by for the most part, except for the upper percentiles who were made fat by the credit bubble, and are still extracting rents from it.
  
  There are still far too many otherwise responsible people who are not taking the situation with the high seriousness it deserves."
• Federalism and the Akaka BillFederalism and the Akaka Bill - "There is also a second potential federalism problem with the Akaka bill. By authorizing the creation of a tribal government for native Hawaiians, Congress is carving out a new sovereign entity within the territory of the existing state of Hawaii. It’s far from clear that Congress has the power to do such a thing under the Constitution. Article IV, Section 3 of the Constitution states that 'no new States shall be formed or erected within the Jurisdiction of any other State; nor any State be formed by the Junction of two or more States, or Parts of States, without the Consent of the Legislatures of the States concerned as well as of the Congress.' The new Hawaiian tribal government may not have powers great enough for it to count as a 'State' within the meaning of Article IV. Still, the federally mandated creation of a new sovereign entity within the boundaries of an existing state is constitutionally dubious. It is not authorized by the enumerated powers of Congress."
• World's Smallest Political Quiz - "Take the Quiz now and find out where you fit on the political map!"

• Odeon Cinemas Admit The Experience At Their Theaters Is So Bad It Can't Compete With Your Home Theater - "We've seen this before, but it's still really incredible. The Odeon movie theater chain is apparently refusing to show the new Alice in Wonderland film, directed by Tim Burton, in the UK, Ireland and Italy, because Disney is (smartly) trying to shorten the "window" between the cinema release and the DVD release. Basically, what Odeon is admitting here is that it knows the experience of going to its theaters is so bad that it simply can't compete with watching the movie at home. This is a rather stunning admission by Odeon and probably should make you think twice before going to any Odeon theaters."
• Superwoman syndrome fuels pill-pop culture - "Almost 6 percent of American women, that's 7.5 million adult women, report using prescription medicines for a boost of energy, a dose of calm or other non-medical reasons, according to the latest numbers from the National Institute on Drug Abuse.
  
  'Many may not consider what they're doing abuse because they're using a prescribed drug,' says Susan R.B. Weiss, chief of NIDA's Science Policy Branch. 'Many of these medications are being taken as performance-enhancers.'
  
  While street drug use has been declining in recent years, prescription drug abuse has been up since the 1990s.
  
  The trend seems to be partly driven by more and more women popping pills. While men make up the majority of abusers of street drugs, including meth, cocaine and heroin, women are just as likely to abuse prescription pills as men."
• Rep. Souder And The Denso Distraction - "News that the FBI had raided three Japanese supplier companies in the Detroit area came in the middle of yesterday’s epic Toyota hearings, adding to the day’s chaos and misinformation. The FBI said clearly at the time that Denso, Tokai Riko and Yazaki were raided as part of an antitrust investigation, which we now know [via Reuters] involves alleged cartel activities in the wiring harness supply market, and involves European firms like France’s Leoni as well. Despite the fact that Denso and Yazaki are cooperating with investigators, and that the US raids appear to be in support of an EU investigation, Rep Mark Souder (R-IN) took the opportunity to connect the Denso raid with the Toyota recall hearings in shameless style. And all to help clear the name of the US-based supplier CTS, which has been blamed for the sticky pedal recall, which just so happens to be in Rep. Souder’s district."
• Wheat Ridge High School Class of 1970 - "The reonion committee is working away planning the 40th reunion the weekend of August 13-15, 2010. Wheat Ridge, Colorado WRHS1970.com"
• Common Market Food Co-op - "Common Market Food Co-op was a 'new wave food co-op' located at 1329 California Street in Denver, Colorado, from 1975 - 1980. It started as a buying club at the University of Denver in the late 1960s, and for a few years prior to moving to the old Safeway at 13th and California Streets, Common Market operated out of a small storefront on Champa Street."
• Bad Check Scams Expanding and "Improving" - "whatever you think you know about cashier’s checks and certified checks being secure simply doesn’t apply any more. Some forged bank checks are so good that you cannot distinguish them from the real thing simply by looking at them. Please make sure that your staff, your colleagues, your clients and your friends understand this.
  . . .
  A new wrinkle is the scammer calling other professionals (like real estate agents) to get the names of local lawyers and then using that person’s name when they contact the lawyer to give them more credibility. A referral from a local businessperson isn’t going to be a scammer, right? There are reports of this fraud expanding and that is why this is a good topic for a law firm client newsletter. A person who is trying to sell a house might hear from a foreigner who is going to move to the state and wants to buy the house. They send a large certified check as a deposit and then a few days later note that a tragedy has occurring preventing them from moving. They ask the person to return part of the deposit, keeping a nice portion for their trouble.
  
  While we have typically seen these checks in the mid six figures, Dan notes that the amounts are becoming lower to make them seem less suspicious. Let’s face it. Stealing $50,000 ten times a year is a pretty good living for a thief."
• Some Philosophy of the Gym - "I spent my lunch hour today at the gym across the street from my office. It’s a simple, compact affair, heavily economized in its use of space, split into three roughly-equal sections of weights, floor mats, and an aerobics area. The walls are heavily mirrored and it has three scales in different locations, at least two more than could be required by any practical consideration. Every weekday, the gym swells for the morning, lunch and evening rushes, as hundreds of my colleagues and coworkers pour into the sweaty, crowded, clanking dungeon.
  . . .
  OK, sure. I’ll buy the health explanation from the 40-year-old who spends a half hour on the treadmill, three times a week. Maybe they do some light weights too, because their doctors told them it was a good idea. I think they’d be better off, physically and spiritually, going hiking with their friends, tobogganing with their kids, or having sex with their spouses, but I will at least grant that they are trudging away to extend and improve their lives. The question then becomes: How fractured, lonely, and atomized has our society become, that the most popular form of exercise is the monotonous, low-intensity self-torture that goes on under the soul-sucking fluorescent lights of GoodLife Fitness? Activities that make your heart pump faster are not hard to find. Dreary hours on the exercise bicycle are the norm because we have chosen to make it so. Because we are sick, and for whatever reason our desire to connect with other people is so weak that we prefer a solitary workout over game of touch football.
  . . .
  Regardless of their motivation -- sex appeal, an unhealthy desire to be unnaturally healthy, or just the need to distract themselves from an otherwise boring, lonely and unconnected life -- the characters in the gym are a uniquely depressing bunch, shackled by sweatbands and malaise."
• N.Y. Firm Faces Bankruptcy from $164,000 E-Banking Loss - "Karen McCarthy, owner of Merrick, N.Y. based Little & King LLC, a small promotions company, discovered on Monday, Feb. 15 that her firm’s bank account had been emptied the previous Friday. McCarthy said she immediately called her bank -- Cherry Hill, N.J. based TD Bank -- and learned that between Feb. 10 and Feb. 12, unknown thieves had made five wire transfers out of the account to two individuals and two companies with whom the McCarthys had never had any prior business."
• Nicholas Kristof on toxins and autism - "Kristof doesn't note that identical twins both are autistic ninety percent or more of the time (conditional on one of the twins being autistic), yet the concordance is much lower for fraternal twins. That militates in favor of genetic explanations, although the mechanics of transmission are poorly understood. It's wrong to cite genetics as explaining one-quarter of autism cases or to imply that genetics do not explain three-quarters. There are recent studies which look for correlated genes across autistics and find less than overwhelming results and perhaps this is what he has in mind. More accurately, there is a common problem with finding "simple" genetic markers for traits which are very likely or even certain to be genetic. The degree of correlation across genetic patterns we can find should not be taken as a measure of how many autistic cases -- or any other condition -- can be explained by genetics.
  . . .
  Cross-sectional studies, spanning decades of age groups, suggest a roughly constant rate of autism, even when environmental toxins are changing considerably over those lengthy time periods. Plenty of other studies relate autism clusters successfully to non-toxin factors, such as parental education or supply-side services or standards of diagnosis.
  
  There are likely well over 50 million autistics in the world and most of them have not had significant exposure to the cited toxins. While there are some plausible heterogeneities within autism, it is necessary to ask whether 'genes *or* toxins' is one of those and probably it is not."

• MagicJack dials wrong number in legal attack on Boing Boing - "Gadget maker MagicJack recently lost a defamation lawsuit that it filed against Boing Boing. The judge dismissed its case and ordered it to pay us more than $50,000 in legal costs.
  
  The Florida-based VOIP company promotes a USB dongle that allows subscribers to make free or inexpensive phone calls over the internet. I posted in April 2008 about its terms of service--which include the right to analyze customers' calls--and various iffy characteristics of its website.
  
  We had no idea that it would file a baseless lawsuit to try and shut me up, that CEO Dan Borislow would offer to buy our silence after disparaging his own lawyers, or that MagicJack would ultimately face legal consequences for trying to intimidate critics.
  
  At several points in the process, we could have taken a check and walked away: as it is, the award doesn't quite cover our costs. But we don't like being bullied, and we wanted the chance to tell anyone else threatened by this company what to expect.
  . . .
  We would not agree to keep the actual legal dispute confidential under any circumstances. However, we offered not to publish details of our legal costs or their settlement if Borislow would donate $25,000 to charity. MagicJack, however, offered to pay our legal bill only if we'd agree to keep the whole dispute confidential; when we refused, Borislow wrote that he would 'see us in court.' Nonetheless, we're happy with the outcome. The irony for MagicJack is that the proceedings are public record, so the silence it sought was effectively worthless."
• Netflix Paid Los Gatos $2.5 Million in Sales Tax in 2009 - "The Los Gatos Observer reports that Netflix paid $2.5 million in sales tax in 2009."
• What Am I Doing Here? Tall Buildings and High Anxiety in Las Vegas - "A note on Las Vegas nomenclature: It’s gaming, not gambling. Gambling is a foolish activity that can only end in tears. Gaming is harmless entertainment. Please keep them straight.
  . . .
  Survived 'Viva Elvis® by Cirque de Soleil™,' billed as “a harmonious fusion of dance, acrobatics, and live music.” It is not harmonious. It is an assault on the senses. Feel slightly guilty that I had my fingers jammed in my ears for the entire show with one of CityCenter’s PR reps sitting next to me.
  . . .
  The lobby of the Mandarin Oriental smells like fancy soap, and the Sky Bar has panoramic views. But I start to feel claustrophobic and duck out of the event. For a certain type of person, Vegas is a non-stop party. For me, it induces a kind of persistent low-grade anxiety. There’s something dystopic about the place generally, and CityCenter is starting to feel like the world of Blade Runner come to life. I head back to my room, shut the black-out curtains and lie in bed. More people commit suicide in Las Vegas than in any other city in the United States.
  . . .
  Am I the only person not entranced by the Bellagio fountains? They’re visually impressive and a technological feat, fine, but it’s hard for me to enjoy anything accompanied by the schlocky music of Elton John.
  . . .
  Ditch the tour to head out to the Strip so I can buy a souvenir for my daughter. (A small stuffed animal in the Aria gift shop goes for $68.) Walk down to the New York New York complex, which has an air of squalid desperation. How it will survive with CityCenter and other new developments competing for business is beyond me. A friend quips that the only way they could fill the place is 'if they reenact 9/11 every morning.' No comment.
  . . .
  Drinks at Prime Meats, in Brooklyn, with my wife. Realistically, this place is as much an artifice as anything on the Strip, a re-imagining of a 19th-century saloon, complete with polished bar, antique typography, Edison bulbs. Why, then, does it feel so much more honest? Because its aesthetic is filtered through a contemporary sensibility? Because it seems a natural part of a vibrant neighborhood? Is this all bullshit I invent to make myself feel more comfortable? Could the real problem with Las Vegas -- my real problem with Las Vegas -- be that its commercial imperatives are simply too transparent?"
• Ten Things I Learned While Trading for Victor Niederhoffer - "6.) Warren Buffett. Victor is not a fan of Warren Buffett. This forced me to look at Buffett in a whole new way. Is Buffett a value investor? What other tricks of the trade has Buffett used over the years? I ended up reading every biography of Buffett, going through four decades of SEC filings, and pouring over not only his Berkshire letters but his prior letters from his hedge fund days (1957-1969). The result was my book, 'Trade Like Warren Buffett.'
  . . .
  9.) Keep Life Interesting. Victor surrounds himself by games and the people who enjoy them. When I knew him, he took regular checkers lessons, played tennis every day, and has some of the oddest collections I’ve ever seen. He stands out on a crowded city street and seems to spend part of each day seeking out new and interesting experiences. He often asked me what I’d been reading and if it was trading related he was disappointed. Trading is ultimately a window into the psyche of the world at that moment."
• “Tin Whiskers” Implicated In Unintended Acceleration Problems - "A number of articles have appeared implicating tin whiskers as a potential source or complicating factor in Toyota’s (and other manufacturers’) unintended acceleration issues. The phenomenon of tin whiskers, a crystalline metallurgical phenomenon involving the spontaneous growth of tiny, filiform hairs from a metallic surface, can cause short circuits and arcing in electric equipment. First discovered in phone switching equipment in the 1940’s, the addition of lead to tin solder largely eliminated the problem. But the push to eliminate lead from electronic assemblies has led to a nasty re-growth of the pesky whiskers."
• It's The Execution That Matters, Not The Idea - "For years we've tried to explain the difference between ideas and execution, and how lots of people have ideas (in fact, many have the same ideas entirely independently), but without good execution, those ideas aren't really worth much at all. This point comes up a lot in the debates we have over the patent system -- with patent system supporters often overvaluing the idea part, and grossly underestimating the importance of execution. Often this is because they've never built a real business, and don't realize how little an initial idea plays into the final product. The two are often oceans apart. But stopping others from executing well (or forcing them to fork over a ton of money) just because they executed well where you did not? That doesn't seem like encouraging innovation or promoting progress at all."

February 28, 2010 09:17 AM    Caught Our Eye