Thanksgiving's Full Moon

Things have been mighty busy around here. And a little sad.

There's talk that Chicago might survive without its O, but I'm skeptical.

And 47-year-old Demi Moore showed up on the cover of W looking like this:

Image credit: Huffington Post

(Or did she?)

I tried to remedy things with Gretchen's decadent mashed potatoes recipe, loaded with butter and grated white cheddar cheese. But alas, I skimped on the sage.

Senior moment begat senior moment as I began weighing my options for the new year: start a cupcake business or audition for the Real Housewives of Muskogee?

What better way to settle this debate, I thought, than crash the White House State Dinner? The Prez could give me tips on cupcakes and being on reality TV.

Image credit: Samantha Appleton/White House

Things were really coming together.

The Secret Service turned our car away initially, but I was undeterred. My determination unmatched by any crasher in recent history, I hopped out of the car, waved to Brian Williams, and brazenly blended into a line of black-tie pedestrians.

Mandel Ngan/Agence France-Presse — Getty Images

My sari dazzled even the coldest of those uniformed SS men. Girl friends, I was in!

Exhausted from a night of hobnobbing with Obama and that crazy pit-bull Rahm, I hopped into my trusty Escalade to take a drive, to clear my head. Except it was 2:25 AM.


BAM! Damn! I hit a fire hydrant, followed by the neighbor's tree.

And ever since, the troopers have been knocking. But I'm not talking. No way.

A Panicked Press Swings the Palin Pendulum Back?

(AP)

What's this? After months of punching the Palin bag, is the main stream media streaming the other way?

Hells bells! They're not even jumping on her latest malaprops -- Palinisms, you might call them.

"Those are back-assward ways of trying to fix the economy" -- Interview, Barbara Walters.

(Oops. I spoke too soon. Time Magazine spotted it, too.)

"My guttural instinct is kind of like a mama grizzly bear." Interview, O'Reilly.

Oh, really? Oh, hun!

But yes, it would appear that indeed the media is drifting back in Palin's direction. And in the face of her staggering book sales, it's no wonder.


After all, these fickle, fair-weathered friends don't want to miss the bus. Wall Street would be wise to take heed. The shamelessly faithless media have hedged their bets better than Goldman, for heaven's sake.

Alrighty then.

Here's the latest media round-up:

Scott Martelle: "Will Sarah Palin's 'Going Rogue' Boost Her Political Fortunes?"

Wow. Would this query have ever been posited before now?

Rex Murphy: "Obama Inspires; Palin Connects".

Oof! Now that's a big Obama "ouch" in the face of his Asian-trip no-bounce.

Kate Zernike: Enthusiasm for Palin, and Echoes of 2008 Divide.

Those damn mid-terms are rearing their scary heads.

Jon Meacham: Why Palin Matters to Obama -- And to You.

Grrr, again. GD those mid-terms!

But the best, the most fickle and feckless, I have saved for last.

Maureen Dowd: "Visceral has Its Value." Or, "'V' is for Visceral."

Dowd's money quote for the conservatives? "She [Palin] nurtures her grass roots while Obama neglects his."

Oh my.

Now, make no mistake, lest there be some misunderstanding, as invariably there is. I could no more disown Sarah Palin than I could embrace cannibalization. Now then, am I perfectly clear?


Still, as Rex Murphy noted in his "Palin Connects" piece, empty vessels don't draw rabid attacks, much less the vociferous maulings of the so-called vassal Palin that we've seen these past few days.

Will the GOP continue to eat itself from the inside out?

Who knows, man, who knows?

I wonder, though. I do wonder. And worry, of course.

But whichever side you're on, don't look to the press for illumination.

Dear Mr. Holder

Dear Mr. Holder,

I watched you testify yesterday before Congress. You were there to defend your decision to try Khalid Sheikh Mohammed ("KSM") and his four co-defendants in one civilian trial in Manhattan.

But you completely failed to address your critics' concerns. I hope this was deliberate and not from a deficit in your intellect.

First, you said we can safely and securely prosecute KSM and his co-defendants in one big civilian trial because we've prosecuted criminals in federal courts for years. "We know can do it because we've done it before," so goes your argument.

But we have not done it before. No prior attack on American soil even approaches the carnage and terror of 911. To claim that any other federal criminal trial could compare to this one is not only specious, it's frighteningly insensitive.

Not a single 911 terrorist has been tried on the issue of guilt or innocence in a civilian court. Much less have we tried five 911 terrorists all together, in the same trial in a civilian court in Manhattan.

Next, you asserted that we can protect classified information under the Classified Information Procedures Act ("CIPA"). Not so fast, Mr. Holder.

I read your Department's summary of the CIPA, and I am not at all convinced. This provision stood out in particular:

CIPA is a procedural statute; it neither adds to nor detracts from the substantive rights of the defendant or the discoery[sic] obligations of the government. Rather, the procedure for making these determinations is different in that it balances the right of a criminal defendant with the right of the sovereign to know in advance of a potential threat from a criminal prosecution to its national security. (emph. added)

Next, you claimed with a straight face that KSM will have "no more of a platform to spew his hateful ideology in federal court than he would have in a military commission."

This statement defies all logic.

Then you pointed out that KSM ranted in a military commission last year. His statements were "heavily covered in the media," you said, "yet few complained at that time that his rants threatened the fabric of our democracy."

No one is making such a histrionic complaint today, Mr. Holder.

Rather, we are complaining that a civilian trial will give KSM and the other four terrorists a microphone to the world. Al Jazeera will broadcast KSM's every utterance. A more revolting spectacle is hard to imagine.

You are either very stupid or very shrewd. My guess is the latter. Since you cannot logically defend your decision, you deliberately ignore the cogent arguments against a civilian trial or stand them on their head.

You said, for instance, "I'm not scared of what KSM has to say at trial, and no one else needs to be afraid, either."

Where did that come from?

No one is "scared" of what KSM will say at trial.

We're scared for the jurors, though, who will have to be sequestered, and guarded at all times. How long should they be guarded after the trial, Mr. Holder?

We're scared for the prosecutors who will need round-the-clock security during the trial and for years afterward.

We're scared for the witnesses; their names will surely be reported by the media without regard to their safety. Confidential informants may be confidential no more.

And what of the victims, forced to recount their terror, forced to re-live those horrifying moments, and subjected to rigorous cross-examination, on the world stage.

More importantly, we're scared because the Obama Administration has foolishly decided that terrorists who attack New Yorkers and people on airplanes get more rights than if they attack a military target on foreign soil. What perversity.

As Lindsay Graham rightly queried, must our soldiers now Mirandize every enemy upon capture? Should they stop firing in the middle of battle to make sure a piece of evidence remains admissible by a proper chain of custody?

Because after all, the soldier in battle cannot know whether his prisoner will be tried in civilian court or by a military tribunal. God forbid we botch a capture or the collection of evidence and allow an enemy to go free.

Further, we are appalled that you would suggest the eight-year delay in trying these terrorists is the fault of the prior administration. "For eight years, justice has been delayed for the victims of the 9/11 attacks," you said. "No longer. No more delays. It is time, it is past time, to act."

What a bunch of hooey that is, sir. Defense lawyers ran the constitutionality of military tribunals up and down the appellate flag pole for years, as you well know. Indeed, a few of these lawyers now work for you. Legal maneuverings are to blame for the delays, not the Bush Administration.

Finally, in a dramatic flourish, you said, "We need not cower in the face of this enemy." But we are not so easily fooled by your attempt to recast the arguments and paint your detractors as unpatriotic cowards.

To say we are cowering "in the face of this enemy" because we argue against a federal trial is sophistic. Or manipulative. I'm not sure which is worse.

No, we are cowering in the face of this Administration's ineptness, and your own.

"I'll See You in New York with my Lawyer"

When Khalid Sheikh Mohammed was captured by U.S. troops, guess what he said? "I'll see you in New York with my lawyer."

What hutzpah! Except he was dead-on.

Trying KSM in New York City does something -- a huge thing -- most of the media isn't covering:

Target soldiers? Get tried in military tribunals, and treated as a war criminal.

Target civilians? Get tried in civilian courts, with all the rights and privileges afforded an American citizen.

If you were a terrorist, which target would you choose?

Here's the full WSJ article: Holder's Al Qaeda Incentive Plan

"Getting Worse More Slowly" and Other News You Can Use

You know, sometimes it's just hard to believe anything the government says:



Check out these Ben Bernanke clips from 2005-2007, in which he assures us that all is well. "Lullaby and goodnight, go to sleep all good citizens . . . . " Video, courtesy of Mish's blog. (Nerd reader challenge: what's the highest gold quote you see in this montage and what is it trading for now? Bwahahaha).

Here's what Bernanke said today, in case you're interested. The executive summary: it was a lot of meaningless "on the one hand, on the other hand" hedging stuff.

Although in a profound burst of clarity, Bernanke confidently declared, "The best thing we can say about the labor market right now is that it may be getting worse more slowly."

Turning now to the jobs "saved" and "created" by the taxpayers stimulus package, ABC News reports that, "Recovery.gov lists hundreds of millions spent and hundreds of jobs created in congressional districts that don't exist."

Aack! It's not like the "recovery.gov" website isn't well funded. Hells bells, the General Services Administration spent 18 million dollars of our taxpayer dollars from the stimulus package to upgrade the fancy website.

But fret not. The government is focused on more than rehabilitating its recovery.org website. It has our breasts in mind, too.

A U.S. government task force says the mammogram guidelines from the American Cancer Society should be tossed. The ACA guidelines call for too many mammograms, so says the government. Using a cost-benefit analysis, we ought to wait until age 50 to start mammography screening. And even then, it should only be done every other year.

Oh, and self-administered breast exams? Forget it. Not effective.

This announcement was, of course, met with vehement disagreement. From Foxnews.com: "This is one screening test I recommend unequivocally, and would recommend to any woman 40 and over," said Dr. Otis Brawley, the American Cancer Society's chief medical officer. The government stance "is essentially telling women that mammography at age 40 to 49 saves lives, just not enough of them," he said.

Seeing "U.S." linked with anything called "Preventive Services Task Force" gives me the willies. Check out this article in the Wall Street Journal today, called "The Rationing Commission." (And lest you leap to an unfounded conclusion, I am indeed in favor of health care reform. Just not Pelosi's, which does nothing to "bend the arc" on rising costs).

On an unrelated note, I've mentioned commercial real estate a lot lately. But today, I've got a different sort of nugget for you. Although not a happy one, it's starting to make the rounds on the econo-blogs and I thought you might want a head's up. After all the holiday cocktail-party season is upon us.

The premise is that at least fifty percent of companies bought by private equity in the easy-money days will go broke in 2012 through 2015, leading to steep declines in employment and a whole lot more foreclosures.

Can you say . . . "W-shaped recovery"? I might describe it as a convulsive, psychedelic one, but there's no letter in the alphabet for that.

Josh Kosman, author of the book, "The Buyout of America: How Private Equity Will Cause the Next Great Credit Crisis," was interviewed by the Wall Street Journal last month, although not a lot of attention was paid to it. This month, though, the WSJ reviewed his book and it's now being picked up by the more widely-read media.



Alrighty then.

Cheers! And glad tidings to all!

The Trouble With Tribbles . . .

Greetings, Sports Fans. Welcome to this weekend's bipolar Star Trek flashback.

When I see this:

(Photo credit: AFP.)

and . . . this:
I think of this:

and remember . . . this:



One tiny roar.

One effete mandarin collar.

R.I.P., oh mighty O.

Socialized Debt and Privatized Profit

Goldman Sachs has been getting a lot of coverage lately. Just how did this giant rise up from the ashes of derivatives unscathed? How did JP Morgan and Morgan Stanley survive to thrive? A big part of the answer is credit default swap contracts.

So let's briefly revisit credit default swaps. I loan you money to buy a house. But you're a newly-minted masseuse with few clients and two kids. Plus, you're not putting any money down.

While I'm willing to bet on you (because I make a ton of money up front), I'm still worried you might bail. Or maybe I want to sell your loan to an unsuspecting pension fund in Iceland. If so, I'll need your loan to be triple-A rated.

How do I get your crappy loan highly rated so I can sell it? Or protect myself if I decide to hold it? Easy. I buy "insurance." It's called a "credit default swap," sold by outfits like AIG. If you don't pay, AIG has to cover it. With a CDS, now I can sell your loan or hold it. Whatever happens, I'm covered. I've hedged my bets.

The trouble began when mortgage defaults started happening in massive numbers. That is to say, when housing prices, surprise, surprise not, stopped rising and began falling.

AIG, the major player who'd written all this "insurance" had to cover a bunch of bad mortgages, and cover them fast. But it couldn't because it simply didn't have the money. AIG gobbled up the "premiums" on these default swaps but never set aside any reserves.

This should have never occurred. But it's happened before and the government has always stepped in and bailed the banks out. So the banks were certain the government would be there for them this time, and they were right. Still, their behavior is no less disgraceful.

Imagine walking in to a Las Vegas casino and worrying whether, when you turned in your chips, the house had enough money to cash you out. Would you stay and bet or leave?

If you did stay and bet, as Goldman and JP Morgan, et al. did, would you expect the taxpayers to cash in your chips if the casino went broke? (Now you know what "moral hazard" means.)

That scenario is precisely what occurred in our financial markets; "casino" an apt metaphor (casino credit to Dylan Ratigan who coined it). Investment banks (the gamblers, or counterparties) made bets on subprime mortgages with AIG. AIG was the casino, the "house."

When it became clear that AIG couldn't cash in the chips, gamblers started running for the door. Worse still, the gamblers who'd bet in AIG's casino were also mini-casinos themselves. They, too, had written "insurance" policies, trading credit default swaps with their fellow players.

Who held what? Who owed what to whom? How much was owed? No one knew. Counterparty panic set in and the government feared the entire financial system would collapse. Geithner, then president of the New York Federal Reserve, and Hank Paulson took over AIG's negotiations with its derivatives gamblers.

The two held a secret meeting and decided that you and I should pay off every gamble at 100 cents on the dollar in exchange for . . . nothing.

The taxpayers, Geithner and Paulson decided, would stand in the shoes of AIG and become the insurers of these bad credit default swaps. Even though the gamblers knew, or surely should have known, they were making suspect bets in a wobbly casino.

What's more, Geithner's and Paulson's unseemly and exceedingly close ties to these big banks makes their decisions in the AIG and bank bailouts all the more appalling, shocking even.

Today those banks are today posting record profits and paying themselves the highest bonuses ever.

But our children will be paying the price for the government's purchase (and guaranties) of these radioactive debts for decades to come, and not just in the form of higher taxes. There's a psychological component our children feel from this depression, too, and they'll ultimately have less access to higher education, lower wages, and fewer job opportunities.

Our children will pay because the politicians in D.C., headed up by Treasury Secretary Timothy Geithner, did things like pay AIG's gambler creditors 100% on the dollar with our money and issue blanket guarantees to the banks, while at the same time they screwed GM's creditors to the wall.

How, and under what authority, I'd like to know, did Congress and our Commander-in-Chief appoint themselves the country's top-dog bankruptcy judge?



Meanwhile our own country's bankruptcy looms. We still don't know how much we're on the hook for, because the Federal Reserve won't tell us. And since Ron Paul's "audit the Fed" bill was shot down, we probably never will. The TARP Inspector General says he's really not sure, but the absolute worst case? 23 TRILLION, give or take a few.


The bailout of AIG and the other banks was nothing more than a cash infusion from taxpayers into the casino. We covered billions on the bets of Goldman and JP Morgan and so on. And we gave them billions of dollars directly, in return for virtually nothing. They're still at the craps table, gambling our taxpayer dollars.

It's like we're casino waitresses, hoping to get by on tips while the high-rollers have been taken care of. For them, everything's been "comped" and they're making more money than ever. Hell, even their bets are comped with the taxes we're paying on our tips.

When D.C. politicians allow the banks to make unfettered bets with our money and our children's futures, we need to start paying attention. Because more bailouts are on the way.

Early commercial loan defaults are forming white caps on our next big wave to hell. And there is a credit default swap market for these mortgages, too.

Wall Street made bad gambles and our government decided that you and I should pay for their mistakes. Now it's business as usual on Wall Street while the rest of America chokes on 10.2% unemployment, record foreclosures, and more pain to come. Thousands upon thousands of dollars in increased taxes we will be forced to shoulder.

The Democrats' "stimulus" spending and bank bailouts are an unmitigated disaster yet the bailout just keeps going and going. The banks' debt has been socialized but their profits remain privatized. It's outrageous. And the bad guys are still in charge.

And all of this before we even begin to factor in the costs for cash-for-clunkers, an $8,000.00 first-time home-buyer credit, universal health care and cap and trade. But the bought-off pols in Washington tell us not to worry, that we can handle it. It's a twisted version of "Yes, we can."

I say no, we can't.

When the Dems tagged Republicans "the party of 'No,'" they did them a favor. Frugal is sexy these days, and the party of "No" is looking better and better.

One Trillion for Six Million? Shag Me, Baby!

Greetings. I'm trying to get a handle on Pelosi's new health care bill, but of course I haven't had time to read the bill in its entirety.

And, hells bells. Congress refused to make public the last version that floated around their hallowed halls. They said it was "too complicated" for us common folk to comprehend.

Of course, they're right. A public weigh-in on what the D.C. Einsteins are up to is ludicrous. Pipe down, people of the Sunday covered-dish-supper crowd; hush up, all you Fox & Jacobs and trailer-park people. Government knows best.

Besides, Pelosi's bill weighs in at some 1,990 pages. Delving into this behemoth is way too daunting a prospect. Stacked end to end, I think it's longer than my bed.

But here are some key points that give me pause:

* According to the independent Congressional Budget Office ("CBO'"), Pelosi's plan will cost $1.05 trillion.

* Pelosi says her plan will cost $894 billion.

But there's no need to get persnickety here. What's a billion among friends? $1.05T vs. $894B is close enough for government work.

* Pelosi's plan claims to cover 36 million Americans who do not now have health insurance.

Alrighty then.

The Pelosi plan will spend $1 trillion to cover 36 million people.

Let's do the math:

$1T divided by 36M equals $ X.

Now, I'm no pocket-protector-wearing Ivy-League quant. But something is wrong with this picture. Very wrong, indeed. Because X would appear to be a mighty large number.

And in fact X is a whopping $27,777.77 per newly-covered person.

But wait, keep reading. Because that $27k per head looks to be significantly higher. According to the CBO, the number of folks who will sign up is more like 6 million.

* Yep. The CBO estimates that only 2% of Americans under the age of 65 would use the "public option." (At 65 it's a moot point because you're covered by Medicare).

This two percent amounts to about six million people. $1T divided by 6 million? Is $166,666.00 per person. Good God almighty.

* Half of Pelosis's trillion dollar health care bill will allegedly be paid for by Medicare cuts. But did you know that year after year, Congress abates the statutory cuts to Medicare that are already enacted into law?

So although the law may call for cuts, Congress hasn't let the cuts go through since 2003; instead it has always suspended them. The docs have a powerful lobby.

Why should we have any confidence Congress will act differently this time?

* The other half of the $1 trillion will be paid for by taxing upper-income earners.

But guess what? You don't have to be an Ayn Rand acolyte to realize that when people are overtaxed, they stop working as hard. Or, they might hire a more expensive accountant.

* And here's a nugget for you: No state will be eligible for any federal "malpractice reform" funds under Pelosi's bill if the state's laws put any limits on attorney compensation or damage awards in malpractice cases.

This is completely nonsensical. Without capping attorney's fees or damages, what is malpractice reform then, anyway? And what about existing statutory malpractice caps? Will the states be forced to repeal them in order to get funding for alternatives to malpractice litigation?

* When Obama said "our plan" doesn't cover abortions, he wasn't referring to the plan being circulated by Congress. No, he meant his own plan -- a plan that has never been written. The point here is not where you stand on government-funded abortion. It's the Administration's slipperiness.

All I'm asking is that he speak truthfully, with no more hair-splitting, "what is the meaning of 'is'?" semantics.

* There is a serious question whether a federal requirement that every person purchase health insurance is even constitutional.

And if it is unconstitutional, what then? As Ann Althouse points out, what will we do, unravel the massive unweildy plan? At that point, all the king's horses and all the king's men couldn't put the existing system back together again.

And no, a health insurance mandate is not, despite what you've heard, the same as requiring automobile insurance. Not at all.

First of all, automobile insurance laws require that you carry insurance to pay the other guy's damages, not your own. Second, it's not actually mandatory. If you choose not to drive a car, you don't have to buy it.

Invariably the auto insurance analogy is raised by the Dems whenever some rational person points out that the penalty assessed against those who don't buy health insurance is a tax. "No! No!" they adamantly reply. "It's no different that requiring auto insurance." Ha.

This is the worst justification for mandated health insurance that I've seen yet.

* When Obama says "our plan" won't cover illegal aliens? Well, maybe, maybe not. It's not well-settled law at this point. But there's no question that children of illegal aliens who are born here must be covered by the plan, just as they have right to attend U.S. schools.

In short, the Democrats' claims are so wobbly, and sometimes so blatantly false, that I have no trust or confidence in this new 2000-page Pelosi plan.

And tempted as I am to launch into a long and boring discussion of Congress's powers under Commerce Clause, suffice it to say its powers are limited.

Instead I'll close with these must-read links:

"The Worst Bill Ever" -- an excellent and thorough editorial in today's Wall Street Journal.

Pelosi Plan Makes Millions of People Pay Fines -- a sourced analysis by the Heritage Foundation.

"We're Governed by Callous Children" by Peggy Noonan.