Wednesday, November 30, 2011


Everyone's so busy today rejoicing over the news that the Fed is saving the world (even though they couldn't save America) that they're conveniently overlooking the burgeoning sh*tshow over in Iran. As is often the case, I've got a nagging feeling that people are making a mistake by doing so, and that they'll regret it later.

Nevertheless, I thought I'd take the opportunity myself to do a little bit of digging and research about Iran, since I'll readily admit that I know little to nothing about Iran generally (except its politics), or Tehran specifically. But this is really cool-looking, and not at all what I expected.

It seems that Iran has a fairly vibrant skiing scene, which really doesn't jive with my preconceptions of the country. Shows what I know, huh?

(h/t Paul Kedrosky)

Tuesday, November 29, 2011

Quote of the Week

For this week's Quote of the Week, I was incredibly tempted to give the honors to Judge Jed Rakoff, who refused to accept a settlement in a mortgage-related case against Citigroup ("prosecuted" by the SEC), on the basis that the merits of the case were not sufficiently understood to grant Citi immunity from future prosecution. In doing so, Judge Rakoff sternly rebuked the long-standing practice of fining banks for fraud rather than forcing them to face real prosecution, casting doubt on whether the banks will be able to continue escaping criminal liability for their actions.

Judge Rakoff's decision has faced a significant amount of scrutiny from people who think that the SEC "can't afford" to prosecute cases like these, because the cases are too expensive and the banks have such amazing legal resources. For exactly these reasons, it has long been my contention that the SEC cannot afford not to prosecute these cases.

For too long, the Feds have fallen into the settlement trap, allowing banks to simply incorporate these occasional (relatively small) fines into their business models as a standard cost of business. As a result, banks have promulgated various types of fraud for decades now, and this will continue unabated until the courts take notice and say "no more". This ruling could potentially be an important first step, and it's a dynamic that Matt Taibbi explores in more detail (and with great insight) in this video.

And yet, despite the potential importance of this ruling, it won't be my Quote of the Week this week. That's because earlier today, I came across an article that made me gasp, and not in a good way. In a broader article on food safety and the corners that many food manufacturers cut in order to sneak unsafe food into grocery stores and cafeterias, I came across this gem of a paragraph that almost makes me want to avoid all food that I didn't personally grow for myself. 


"The FDA allows up to 60 insect fragments per 100 grams of chocolate before the food is thrown out. Same goes for corn, which the agency deems suitable for consumption if it contains only one larvae that is larger than 3 millimetres. Pineapple doesn't get thrown out until it overtakes a 20 percent mold count."
                                - Daily Mail

Yuck. I've written (ranted) about the FDA here before, arguing that they typically seem to have the best interests of the food companies--rather than the consumer--in mind. I'll admit that I don't know everything there is to know about food production and/or food safety, but I can't imagine that any food company in the country actually considers these guidelines to be particularly stringent or difficult to meet. I'll just have to grow my own corn from now on, I guess...

[Daily Mail]

Twitter update

In case you're not following me over on Twitter (@CrimsonCavalier), here's what you've been missing. I haven't posted my tweets in a while, so there's a bunch of them...
  • Fantastic political cartoon: #supercommitteesforeveryone 
  • Has the U.S. gone British? Manufacturing jobs may never come back, regardless of our tough-guy stance against China.
  • The loss-leader model run amok: Why not give the turkeys away for free? Please, please buy my high-margin stuffing!
  • I must make this. And eat it all in one day.  
  • RT @pkedrosky: We need a word for people who can, by agreeing with you, make you wish you held a different opinion.
  • Oh, Groupon... Well, at least your stock's killing it, right? #shouldasoldtogoogle 
  • Dear NYC: this is a horrible idea. Learn from Dubai--if it can't work there, it won't work here.  
  • Hope you had a happy Thanksgiving... enjoy a nice slice of cherpumple to wash things down:  
  • A little overwrought, but a pretty interesting summary of how a pencil gets made... there's a lot going on there.  
  • Checking out for the weekend... Go Hoos, beat the Hokies. #badweektobeaturkey 
  • Careful with the Black Friday "statistics"... these aren't exactly statistically rigorous studies. #letsmakeupnumbers 
  • Even if I was excited about the BCS Title Game (I'm not), it's not played for weeks. If the Super Bowl was in mid-March, would anyone watch?
  • Harvard 27th in latest AP basketball poll... #soclosebutyetsofar 
  • Pumpkin mac & cheese is delicious... I highly suggest you try making it. I'm considering adding it to the Thanksgiving repertoire next year.
  • Moronic: Tebow for MVP? Please. He's been worse statistically than Kyle Orton. It's the D, stupid.
  • To those who still treat Hank Paulson like a hero: he was and is a thief and a fraud, and history will prove as much.  
  • Speaking of frauds, go get 'em Urban Meyer. You and Ohio State deserve each other. You're still a bad guy, man.  
  • Can't wait to see what a post-Chapt 11 American Airlines will look like. I expect more fees--can you say pay toilets?  
  • College students focus anger on Wall Street recruiting: If nobody else is hiring, it won't matter... #followthemoney 
  • Guns don't kill people, stupid people kill people. Arizona, you amaze me.  
I'd pay particular attention to the Hank Paulson piece (link here)--that guy's a fraud, and it kills me that some people still defend him. I'd also highly recommend the piece on the British manufacturing industry (link here) and the quick article about Groupon (link here), whose stock is tanking with good reason.

MF Global and moral hazard

I've been sitting on this post for nearly a month now, ever since ex-Goldman Sachs CEO (I told you, these guys are everywhere) and ex-New Jersey Governor Jon Corzine's firm, MF Global, went belly-up--and "misplaced" a bunch of client funds in the process. The repercussions of this collapse are widespread and still being felt throughout the financial markets, and it cannot be so easily dismissed as an isolated incident. 

There are two primary reasons that the collapse of MF Global is so important. First, the apparent theft of client funds threatens to undermine the confidence of a large set of players in financial markets, players who have a significant amount of leveraged capital at their disposal, and who therefore possess great power in the markets. If they no longer think their money is safe in their managed accounts, the effects of that confidence loss could be devastating.

But second, and perhaps more importantly, MF Global is the first major sign that the bank bailouts of 2008-09--whether through TARP, emergency Fed loans, or myriad other backdoor bailouts like failing to prosecute bank fraud of various sorts--didn't end the concept of "Too Big To Fail", but rather institutionalized it.

When TARP was first being considered, one of the chief concerns among those who opposed it (myself included) was that they would create massive moral hazard in the future, and that banks would continue to take outsized risks that threatened to harm our economy, knowing that the government would have their backs if those bets went wrong. By failing to punish the bad bets of the big banks, the government would only ensure more bad bets in the future, in essence guaranteeing that the financial crisis of 2008-09 would be repeated.

Until now, those concerns have been mostly theoretical, with no empirical evidence to support them. But now, with MF Global, we critics have our first piece of hard data to support our moral hazard argument. As evidence, consider the fact that MF Global, at the time of its collapse, was operating with a staggering 40-to-1 leverage ratio--even greater than that of Lehman Brothers at the time of its implosion in 2008.

The politically-connected Corzine (a top Obama fundraiser) clearly expected that the government would have his back if things went wrong at MF, and why wouldn't he? By bailing out the banking sector, it's clear that the government in essence rewarded the bad behavior, and that broker-dealers became even more bold in response. Corzine may have erred in his judgment (time will tell, but his judgment is pretty clearly lacking), but that doesn't make his actions or decisions any less important in a macro sense.

Think MF Global's high leverage ratio is a coincidence, or just one bad player? Think again--a recent study from the University of Michigan confirmed that bailed-out banks took on more risk than those that did not, showing that they failed to learn the lessons of their previous failures. Of course, that's realistically exactly what the Fed and Congress wanted--a rebubbling of the previous bubble, a resumption of the world "the way it was", rather than "the way it should be".

We may hear people here and there in the banking world bellyaching about Dodd-Frank and the "crazy" regulations that they're now subject to, but the truth is that nothing about our government's response to the financial crisis has done anything at all to prevent the next one. If anything, it's done everything possible to ensure the next financial crisis, and MF Global is Exhibit A in that case.

Dismiss the MF Global collapse as an isolated incident if you wish--many people did so with Bear Stearns in March of 2008, foolishly ignoring the risks until they smacked them upside the head in the fall of that same year. But for any who care in the least about the future financial security of our nation, you must recognize that MF Global has the federal government's fingerprints all over it. Thanks, TARP.

Monday, November 28, 2011

A quick rant about college football

It's a slow news day out here as we all finish digesting our Thanksgiving leftovers and watch the market inexplicably march higher, so I thought I'd take this opportunity to do a little ranting about this uniquely peculiar college football season.

I was a little busy watching my Wahoos get destroyed by their rival on Saturday, but when I woke up on Sunday morning I was bombarded with stories telling me that an Alabama-LSU rematch for the national title was essentially locked up. Good to know. I could've sworn we already saw that game, fell asleep for 5 hours and woke up to see that LSU had won, 9-6, at Alabama's stadium. Yawn. Why not try again and see if we can get it right?

Nevermind the fact that--as Stewart Mandel points out--Oklahoma State has a stronger resume in just about every regard, or that the very concept of a rematch lays waste to the BCS' claim that "Every Game Counts". And please ignore the fact that it's completely ludicrous that a team that couldn't even play for, let alone win its conference title is now a virtual lock for the title game, whereas an LSU loss in that very same SEC title game that Alabama couldn't qualify for... could knock them out of the national title picture. Huh? Yeah, I'm confused too.

And yet, championship game hijinks aren't the only screwy thing going on in college football right now, or that requires my ranting. You see, out west in the Pac-12 (formerly the Pac-10), things are getting even weirder.
To bowl or not to bowl? That is the question UCLA, the Pac-12 Conference and the NCAA will have to answer should the Bruins lose to Oregon on Friday in the Pac-12 title game. 
The Bruins (6-6) finished the regular season bowl eligible but would need to ask the conference to petition the NCAA for a waiver to play in a bowl game should they drop below .500. 
Yes, in a bizarre twist of fate, the team that slipped into the conference title game through the back door is now a 30-point underdog in that game and is very likely to lose bowl eligibility simply because it qualified for the Pac-12 title game. 
"It’s a unique situation," quarterback Kevin Prince said.
So if you're keeping track, that's two teams--LSU and UCLA--that could conceivably get penalized because they qualified for their conference title game (LSU better hope it doesn't lose to Georgia in the SEC title game, or else things are gonna get REALLY messed up over in BCS Land...), and one team (Alabama) that seemingly gets the benefit of the doubt no matter what.

Conferences love these title games because of the extra revenue they generate, but they're increasingly becoming a nightmare for the teams involved. In a system that's as screwed up as the BCS, playing games against tough opponents can only hurt you (unless you're Boise State, but let's leave that alone for now), and you therefore want to minimize them at all costs. And yet, winning a conference title now requires adding one more difficult game to the schedule, one more game that can easily cost you a chance at the ultimate goal of a national title.

What we essentially have here now, with the major conferences all moving toward conference title games, is a de facto playoff round--lose your conference title game, and you can kiss your national title hopes goodbye. However, in this case, a team like Alabama can counterintuitively "earn" a playoff bye simply by losing its regular-season home game to LSU.

Ironically enough, losing to LSU may have been the single best thing that Alabama could have done in order to ensure a berth in the national title game--and that, for lack of a better phrase, is seriously fucked up. If we're going to keep this current BCS system that refuses to include a playoff and insists on cherry-picking the top two teams, we have to remove the conference title games from the equation. Oh, we can keep playing the games, that's fine. But they need to be glorified exhibitions--we can't let them have any bearing whatsoever on who gets to play in the playo--excuse me, in the BCS title game.

And another thing... by the time Alabama does finally play in a game it didn't deserve to be in, it won't have played a game for OVER SIX WEEKS. No other sport in the world does that, and it's a big part of the reason that teams so often come out rusty and flat in the BCS title game. What if we played the World Series on Thanksgiving? Would anybody even watch? Why am I still talking?

Whatever. I hate the BCS. Give me a playoff. And let me enjoy watching meaningful college playoff games for the next 5 weeks, instead of garbage like the Idaho Potato Bowl and the Bowl. And please hurry--I'm getting tired of Nick Saban's smugness already.


Friday, November 25, 2011

Thanksgiving Clip of the Week

Obviously posts have been thin this week, as I've been celebrating the Thanksgiving holiday and enjoying myself in these last few days before a crying baby arrives in my house and makes everything else seem a little less important.

I hope you all had a great holiday, and I hope you enjoy these clips. Actually, I hope you're nowhere near a computer and that you're enjoying being around family, hanging out, and watching football. But I digress.

In sports-related videos this week, we had another great play by a wide receiver, an awesome play by Rajon Rondo that almost made me miss the NBA, and then a great parody video that reminded me that I really don't care about the NBA at all and am in fact glad they gave me an excuse not to watch ever again.

Alllllrighty, moving on, we had an interesting clip from Steve Forbes on U.S. monetary policy (Forbes is incredibly intelligent and insightful, even if he bores me--and everyone--to tears), and a really cool video from the New York Times about "Umbrella Man" from the JFK assassination. I'd never heard of Umbrella Man, but his story is really thought-provoking and is also a cautionary tale to conspiracy theorists everywhere (a group that I readily admit to occasionally being in).

But I'm in the giving thanks mode this week, so I'm gonna go with something that's just really cool and makes you appreciate the world we live in a bit. So while I never say this, blow this video up to full screen HD, and have some fun with it. It's a year's worth of time-lapse videos of the sky, all synced up in one mesmerizing mosaic. Watching the sun gradually rise and set on the various seasons is a pretty cool experience that I enjoyed immensely. Go Hoos.

Wednesday, November 23, 2011

Legalize it (sports betting edition)

As states and municipalities struggle mightily to close ever-growing fiscal gaps, the moral relativism that I first mentioned in this post and followed up on in this post is seemingly spreading like wildfire. It's clear that politicians are truly terrible at actually cutting spending (hello again, Super Committee), such that the only realistic solution is on the revenue side. Raising taxes is perhaps even more unpopular than cutting spending, so there's a tendency for politicians to get a bit... creative.

I long ago predicted that this "creativity" would take the form of legalization and/or liberalization of certain vices--alcohol, drugs, and gambling. Well, Virginia proposed privatization of liquor sales (a relaxation of its somewhat puritanical stance on alcohol), and California and the federal government both separately began to consider the issue of legalizing marijuana. And now, to finish off the triumvirate, here comes New Jersey (who else?) with a proposal to legalize sports betting.
This month, New Jersey voters passed a statewide referendum that allowed the state to legalize sports betting.
Over the next year, the state will continue its push for legalization by passing a bill into law and ultimately challenging the federal ban on betting in court.
New Jersey's reasons for legalizing betting are two-fold: they need any additional revenue they can get to close the state's budget gap, and they want to jumpstart the steadily declining Atlantic City tourism industry.
Yup... this was clearly inevitable. For what it's worth, I am personally excited about the prospects of a new Las Vegas on my coast. I've never been to Atlantic City (because I'm not 80 years old, and... I mean... New Jersey), but legalized sports betting might change that. But more so than that, I'm both amused and intrigued that politicians (and voters) would rather loosen the moral fiber of their community than loosen their pursestrings and pony up a few extra bucks of their own to close the fiscal gap.

People will seriously compromise all semblance of moral instinct when their financial self-interest is at stake. But then, Fox News already taught us that, didn't they?

[Business Insider]

Tuesday, November 22, 2011

Twitter update

Here's a summary of my recent posts over on Twitter (@CrimsonCavalier). If you're not following me, here's what you've been missing:
I'd pay particular attention to the open letter from an Army veteran (link here), as well as GE's 57,000-page tax return. I may be revisiting both of those topics here in the not-too-distant future.

Quote of the Week

The frontrunner for this week's Quote of the Week was Jon Stewart (always a Crimson Cavalier favorite), with his final punchline from this clip. After detailing Congress' utter failure to perform its most basic functions (hi, Super Committee), Stewart lampoons them for their apparent decision to declare pizza a vegetable--clearly a pressing matter of national security, and the subject of my tweet last week. Noting that this decision was an apparent kickback to the all-powerful frozen pizza lobby, Stewart determined that "it's not democracy, it's DiGiorno". Brilliant. Satire at its best.

And yet, it's not the Quote of the Week. This week, that honor goes to Rolling Stone's Tim Dickinson (how is it that Rolling Stone is suddenly the only hard-hitting journalistic outlet we've got left?), who penned an excellent article on "How the GOP Became the Party of the Rich". It's fascinating throughout (worth a read despite its length), but its true magic lies in its lead paragraphs. That's where Dickinson does a terrific job of pointing out the absurdity and relativism that is inherent in political debate today.

Let's not waste any more time. Let's let Dickinson do his thing.


The nation is still recovering from a crushing recession that sent unemployment hovering above nine percent for two straight years. The president, mindful of soaring deficits, is pushing bold action to shore up the nation's balance sheet. Cloaking himself in the language of class warfare, he calls on a hostile Congress to end wasteful tax breaks for the rich. 

"We're going to close the unproductive tax loopholes that allow some of the truly wealthy to avoid paying their fair share," he thunders to a crowd in Georgia. Such tax loopholes, he adds, "sometimes made it possible for millionaires to pay nothing, while a bus driver was paying 10 percent of his salary – and that's crazy."

Preacherlike, the president draws the crowd into a call-and-response. "Do you think the millionaire ought to pay more in taxes than the bus driver," he demands, "or less?"

The crowd, sounding every bit like the protesters from Occupy Wall Street, roars back: "MORE!"

The year was 1985. The president was Ronald Wilson Reagan.
                          - Tim Dickinson; Rolling Stone

Wow, I did NOT see that one coming. I've long lamented the fact that the Republican Party has taken a sharp turn away from its true "conservative" ideals, and that it now sells out aggressively to corporations and the Christian right, merely paying lip service to its original conservative principles.

No longer is the Republican Party the party of fiscal conservatism, regardless of what current party leaders might try to tell you. This is the party of the Bush tax cuts and of constant war-mongering, both of which have done more to increase our deficits and debt than just about any Democratic social program, ever. That they continue to religiously oppose tax increases is not indicative of fiscal conservatism--it's indicative of fiscal recklessness, which the party has quietly espoused for decades now.

That we can read the words of President Reagan--that great shining beacon of Republican conservatism--and easily mistake them for the words of President Obama, whom the Republicans reflexively label as "socialist" and "communist" (when they're not calling him a terrorist) is telling. Unfortunately, it's not telling a good story.

Our two-party system is irreparably broken, having devolved into a self-defeating us-versus-them competition/race-to-the-bottom rather than a cooperative effort to lead and govern. In Washington, diversity of opinion breeds not true compromise but utter contempt, and we all lose in the process. In this case, we seem to have lost sight of who we are, or used to be anyway. Rarely has the "big picture" been so out of focus in Washington--does anybody there see it at all anymore?

[Rolling Stone]

About what happened on Saturday

I didn't bother to hide my excitement here in the leadup to last weekend's Harvard-Yale game in New Haven. Harvard's bid for a perfect Ivy League season--in combination with the Patrick Witt saga--made for one of the more intriguing storylines in recent years, and I was disappointed that I couldn't be there like I am for most Games.

But as my friends were preparing for their tailgates outside Yale Bowl, piling into Lot D as they do in every odd-numbered year, things took an unexpected and tragic turn, one that would turn Harvard's blowout victory into a mere footnote.
A driver of a U-Haul truck carrying beer kegs through a tailgating area before the Yale-Harvard game Saturday suddenly accelerated, fatally striking a 30-year-old Massachusetts woman and injuring two other women, police said.
It's not clear why the driver sped up, New Haven Police spokesman David Hartman said. The truck then crashed into other U-Haul vans in the lot, an open playing field used for pre-game tailgating parties before Yale home games in New Haven. 
Needless to say, when this news first broke on ESPN's College GameDay, my heart leapt up into my throat. The accident took place at the entrance to the aforementioned Lot D, and things struck just a little bit close to home. I tailgate in that lot regularly, and I've even driven a U-Haul truck into it on multiple occasions in the past. When The Game is in New Haven, Lot D becomes a home away from home for me.

Not surprisingly, no word about the identity of the deceased woman was immediately forthcoming, and I was therefore left to worry and hope that none of my close friends were involved. Given how many people I know who fit the "30-year-old Massachusetts woman" description--and who would have been tailgating in that lot--it was a pretty unsettling afternoon, to say the least.

I was relieved to learn that I knew none of the victims (I use that word loosely, as I don't intend to indicate or assume that a crime was committed), and I then shifted my thinking to wondering what the aftermath of the incident might look like. And that, ultimately, is the focus of this post.

It seems inevitable that there will be some sort of policy response from the Yale athletic department, in the form of tailgating restrictions at future Games. There is always pressure on administration officials to "Do Something" in the aftermath of a great tragedy, even if that "Something" would have done little or nothing to prevent the original incident.

The battle lines were very quickly drawn in this story, even before any meaningful details of the matter had been determined. Nearly every article (including the NY Times story cited above) took great pains to mention that the U-Haul truck was "full of kegs", strongly implying that it was a relevant detail in the accident.

Despite the fact that the driver of the truck passed a field sobriety test, and that there are some indications that an equipment malfunction may be to blame, public opinion had already been shaped to the point that the victim's mother--still grieving and trying to sort out the facts--knew only that her daughter had been "hit by a U-Haul full of alcohol". Facts be damned, the Cliff Notes for this tragedy had already been written.

As we try to sort through this incident, one element that won't change is that "U-Haul full of kegs" will have been determined to be the cause of death, and this will be assumed to be relevant. Harvard has already banned both kegs and U-Hauls at its tailgates, and Yale seems almost certain to follow its lead. The lingering question is, will it matter?

Harvard first banned kegs at its tailgates in 2000, while I was a student there. The primary argument that I remember at the time--when keg bans were very much in vogue at Boston-area colleges--was that kegs were a "symbol of binge drinking", and that eliminating them would temper binge drinking. I called bullshit then, and I'm calling bullshit now. If you want a real "symbol of binge drinking", I'll show you a 9-dollar handle of bottom-shelf vodka. Popov was always a favorite; Aristocrat was a winner, too.

The irony of kegs--an irony lost on most administrators--is that while they may indeed have looked like a symbol of binge drinking, they were in fact the administration's best friend. Beer, with its high water content and low alcohol content, is in fact the alcoholic beverage least likely to directly result in alcohol poisoning. The administration should have been doing all they could to encourage the drinking of beer, and to discourage the drinking of cheap wine and rot-gut liquor.

Unsurprisingly to those who knew better, the keg ban was a disaster. In the first year of the keg ban (2002), alcohol poisoning cases skyrocketed, leading to calls from student newspapers to reverse the ban entirely for the next home Game. Some accommodations were indeed made, but not enough to turn back the clock entirely. From what I have learned and witnessed at recent Games in Cambridge, less drinking is happening on-site, and now much more drinking is happening off-site, away from the watchful eyes of Harvard and Boston Police.

Is this outcome safer, or better, for anyone? Almost certainly, it is not. Ironically, the safest outcome for all involved is for these students to drink tons of beer in the immediate presence of dozens of uniformed officers--drinking bottom shelf liquor, or drinking where nobody is watching, is dramatically less safe. But the one thing such a policy does accomplish is a decrease in the likelihood of a "Harvard student dies at tailgate" headline in the newspaper, one like we saw this weekend. Note that it does not dramatically increase the likelihood of a tragic incident--it only changes who gets the blame if and when it occurs.

Ultimately, I am confident (in a pessimistic way) that Yale will end up pursuing some sort of counterproductive policy in the near future, in the name of "Doing Something". Tragically, "Doing Something" very often means "making the problem worse" or "creating a new problem". That's how we ended up with the TSA in this country, radiating and/or groping all of us as we try to board airplanes. Are the airplanes--or U.S. citizens--any safer as a result? Who cares? We "Did Something", and that's our job as administrators--results be damned.

I think that the memory of the deceased woman deserves better than this kind of kneejerk reaction, just as I think that the memory of the 9/11 victims deserves better than the disaster that is the TSA. I do think that we need to examine just why it is that college students seem so intent on drinking to excess, and blaming the venue (Lot D) or the method (U-Hauls full of kegs) doesn't do anything to address the issue at the heart of the matter.

A woman is dead, and it is a tragedy. But we will only compound that tragedy if we use her memory as an excuse to Do Something Stupid. We may all look at this case and assume that "U-Haul full of kegs" was the problem, and that we need to eliminate U-Hauls full of kegs. But would the tragedy here--or the inherent risks involved, or the response to the tragedy--have been any different if these women had been hit by a Chevy Suburban full of bottom shelf vodka? What if it had been a Ford Taurus full of hot dog buns? The media treatment would certainly be different, even though it's easy to argue that the tragedy at its core is no different.

Here's hoping that sanity prevails here, and that we can all in fact learn something and make real progress, rather than spinning our wheels for the benefit of newspaper headlines. Unfortunately, history indicates that the "Do Something" outcome is infinitely more likely. Sad.

[NY Times]

Monday, November 21, 2011

Goldman rules the world

I've never exactly tried to hide my feelings about Goldman Sachs (see here, here, here, and... you know what, there's a lot of it), but I've gotta hand it to them--they're experts at expanding their global domination. While you were sleeping, it turns out Goldman's been busy completely taking over Europe.

I've already mentioned here before (in this blog post) that there's a ridiculous revolving door between Goldman Sachs and Washington, to the point where it's literally impossible to determine where Goldman ends and the federal government begins. Now, it seems that the revolving door dynamic has jumped across the Atlantic, and gone to work on the European governments, one by one. Per The Independent:

The author (Stephen Foley) goes on to write that:
Even before the upheaval in Italy, there was no sign of Goldman Sachs living down its nickname as "the Vampire Squid", and now that its tentacles reach to the top of the eurozone, sceptical voices are raising questions over its influence. The political decisions taken in the coming weeks will determine if the eurozone can and will pay its debts – and Goldman's interests are intricately tied up with the answer to that question.
Simon Johnson, the former International Monetary Fund economist, in his book 13 Bankers, argued that Goldman Sachs and the other large banks had become so close to government in the run-up to the financial crisis that the US was effectively an oligarchy. At least European politicians aren't "bought and paid for" by corporations, as in the US, he says. "Instead what you have in Europe is a shared world-view among the policy elite and the bankers, a shared set of goals and mutual reinforcement of illusions."
This is The Goldman Sachs Project. Put simply, it is to hug governments close. Every business wants to advance its interests with the regulators that can stymie them and the politicians who can give them a tax break, but this is no mere lobbying effort. Goldman is there to provide advice for governments and to provide financing, to send its people into public service and to dangle lucrative jobs in front of people coming out of government. The Project is to create such a deep exchange of people and ideas and money that it is impossible to tell the difference between the public interest and the Goldman Sachs interest.
Now, I'd be going a little too far if I were to suggest that Goldman deliberately brokered deals that saddled these incompetent governments with too much debt so that they could later roll into town when the inevitable crisis hit and "save" the governments with their financial genius, thereby ensuring that their devilish plan of taking over the world would proceed on schedule... wouldn't I? That is far-fetched, right? Wait, is it? Jesus, I don't even know anymore...

I've gotta say, if this is indeed all part of an evil master plan (and you know what, even if it isn't), I really just have to hand it to them--these guys are good. Welcome to the Goldman universe.

[The Independent]

Friday, November 18, 2011

More well-deserved praise of Patrick Witt

I first wrote about Yale quarterback Patrick Witt's tough decision to withdraw from the Rhodes Scholarship process earlier this week, and now Deadspin has taken on the issue and heaped praise on Witt (at the expense of the Rhodes committee).
Yale quarterback Patrick Witt withdrew his application for a Rhodes Scholarship this week, after the Rhodes committee informed him that he would have to skip the Harvard-Yale game to attend his scholarship interview. quoted the American Secretary for the Rhodes Trust, Elliot F. Gerson as saying, "We have candidates every year miss games for the interview."
And so here we have yet another parable about sports and academics and the degeneration of priorities—but not Witt's. Witt did the right thing, or the best thing he could do, when confronted with intransigent prigs and weasels.
Gerson, in speaking with ESPN, emphasized that the Rhodes is an "academic award," not—"despite some popular perception of it"—an award for scholar-athletes. This is doublespeak, at best...
Gee, where did that popular perception come from, that sports is integral to being a Rhodes Scholar?... Here's what [scholarship benefactor Cecil Rhodes' will] had to say:
My desire being that the students who shall be elected to the Scholarships shall not be merely bookworms I direct that in the election of a student to a Scholarship regard shall be had to
(i.) his literary and scholastic attainments
(ii.) his fondness of and success in manly outdoor sports such as cricket football and the like
(iii.) his qualities of manhood truth courage devotion to duty sympathy for the protection of the weak kindliness unselfishness and fellowship
(iv.) his exhibition during school days of moral force of character and of instincts to lead and to take an interest in his schoolmates for those latter attributes will be likely in after-life to guide him to esteem the performance of public duty as his highest aim.
... But set aside Cecil Rhodes's specific, strong endorsement of "manly outdoor sports." Times do change. (Rhodes also wanted to create a secret society to unify the world under an all-powerful British Empire.) What about the other criteria the American Rhodes Trust says it wants? "Devotion to duty." "Unselfishness." "Instincts to lead."
The Rhodes Trust says that Witt should have ditched his responsibilities as the starting quarterback, abandoned his teammates in their biggest game of the year, and flown off to pursue an individual reward. This would have demonstrated that he had the proper character to be a Rhodes Scholar.
Amen. As hard as it is for me to praise a Yalie (and as much as I'd like to see Witt lose tomorrow), he undoubtedly made the only choice that he could have given his commitments and responsibilities as a teammate. The Rhodes committee deserves at least some of the scorn that it is receiving for its intransigence--and as I previously noted in my original post, if the committee has any true commitment to its founder's cause, it will remember and reward Witt's decision in the future.

It's rare these days to see a person actually stand up for his principles and sacrifice his personal goals for those of a team (particularly when the team is technically playing for nothing but pride), and I think that deserves to be praised. Sometimes the tough decisions are the most important ones to get right, even when the right decision may force us to make sacrifices in the short run. Over the long term, Witt's loyalty will be rewarded--even if it's not the Rhodes committee that rewards it.


Thursday, November 17, 2011

Twitter Summary, Day 2

If you're still not following me on Twitter (@CrimsonCavalier), now would be a good time to start. Either way, here's what you've been missing:
A little of this, a little of that. I'm a particular fan of the Wells Fargo declaration of a new standard retirement age--I'd love to laugh at their idiocy, but it just might be the most honest thing a banker has said in years.

    Clip of the Week

    Wow, where to start this week? Yet another loaded week for clips...

    Let's start over in the world of sports, where wide receivers decided to have a little fun this week. First it was Arkansas receiver Jarius Wright with an insane catch in the college ranks, then Chiefs receiver Jon Baldwin decided to show Jarius up by letting him know how the pros do it (side note: why is it that the two best plays of the NFL season--this being the other--both got called back for questionable penalties?). And just to wrap things up, Bills receiver David Nelson decided to make us all feel a little awkward by sprinting down the sidelines to give his touchdown ball to his Cowboys cheerleader girlfriend.

    From American football, we segue over to European "futbol" (but played in America) for this crazy goal from Portland Timbers midfielder Darlington Nagbe (it's old, but it's nuts). There's also this great buzzer-beater from the college basketball world, as well as this gentle reminder that Bruins defenseman Zdeno Chara is 12 feet tall.

    But enough about sports. We're all about hardcore news here at the Cavalier (ha!), so let's send it over to the Daily Show for their take on the Penn State debacle and a hard-hitting exposé on the terrible plight of ugly people in our nation. There's also Funny or Die's excellent parody of Bank of America, which would be a lot funnier if it wasn't just a little bit too accurate.

    Had enough yet? Well, I'm not done. This Christmas commercial may or may not have brought a tear to this future father's eye (even though it's not even Thanksgiving yet), and this stupid squirrel video may or may not have made me laugh to the point of crying. And this video almost made me miss living in New York--almost.

    But despite all that good stuff, you all know that I'm a sucker for things that mesmerize me. And this week, nothing mesmerized me more than this really cool music video for the song "Against the Grain", by indie artist Hudson

    Our ridiculous news cycle

    There are times when I look at the dynamics in our current news cycle and just throw up my hands and laugh. Since the advent of the 24-hour news cycle, there has been a steady relaxation of what constitutes "news"--there has to be, because at the end of the day, there's just not enough real hard news to actually fill 24 hours of TV and radio (not to mention internet) airtime.

    As a result, more and more "rumor" and "speculation" is being reported as news, with little effort to retract those rumors on the back end when they prove to be false. To see how ridiculous this rumor-as-news dynamic can get, look no further than injured Colts quarterback Peyton Manning, who has been all over the news lately despite doing... exactly nothing.

    With the Colts struggling mightily to an 0-10 record in Manning's absence, there has been wide speculation that the Colts may tank the season in order to secure the first overall draft pick, widely expected to be Stanford quarterback Andrew Luck--a potential replacement for Manning upon his eventual retirement. Given that speculation (remember, we're technically at two levels of speculation--or "expectation"--already), ESPN reporter Adam Schefter idly wondered whether the quarterback-starved Washington Redskins might then be interested in trading for Manning--you know, if the Colts indeed got the first pick, and indeed drafted Luck, and indeed thought he could start right away. You still with me?

    Well, somewhat inevitably, the folks in the blogosphere took this one and ran with it, and before long we ended up with this:

    Oh boy. Of course, this isn't the first time we've seen the internet run wild with an original item, turning it into something completely different. In fact, the internet version of "telephone" has a long and storied history, and I've remarked on it here and here. Even my main man Thomas Jefferson hasn't been able to avoid getting dragged into the mess that is the internet news cycle.

    But of course, our news cycle wasn't done with Peyton Manning just yet. Not content with simply naming him as the next ex-Redskins quarterback, our friends on the internet also felt the need to link Manning with the recently-vacated Ole Miss head coaching gig--never mind the fact that Peyton has shown no interest in retiring, let alone starting a coaching career, any time soon.

    All of this would be at least slightly less ridiculous if we hadn't also read--less than two weeks ago--comments from Colts owner Jim Irsay that indicated that Manning might even be able to return to playing this season. From returning this season, to being traded to the Redskins, to coaching his little brother's alma mater--all in the short space of two weeks, in which he did nothing but rehab. Yup, this is our news cycle.

    This guy is awesome

    I want to eat this guy for Thanksgiving--I think I'd enjoy that much more than the usual turkey, especially now that I know that basically 100 percent of turkeys in this country are created through artificial insemination (who knew turkeys were sex-starved?).
    An incredible electric-blue lobster has been saved from the dinner table after it was spotted at a fish market and rehomed.
    The striking crustacean was found by stunned fishermen off the east coast of Scotland and displayed for sale at a fish market in London.
    However, fishmonger Rex Goldsmith thought the stunning lobster was too nice to eat and bought it before handing it over to researchers at the Natural History Museum.
    Scientists at the museum believe the European lobster, traditionally a much darker shade of blue, hatched out with the unusual colour due to a rare genetic variant.
    Whatever the reason, this guy is seriously trippy. Apparently, when cooked, he turns red just like any other lobster--and, presumably, tastes delicious with a side of drawn butter.

    [Daily Mail]

    Wednesday, November 16, 2011

    Twitter Summary, Day 1

    I promised I'd occasionally re-post my Twitter posts up here on the main blog, and for those of you who aren't following me yet (@CrimsonCavalier), here's what you've been missing.
    • Dear NBA... It's not as easy as you think to get your fans back. Love, MLB & NHL. #collegehoopsisbetter
    • Price of T'giving dinner is up 13% over last year, largest increase in two decades. Thanks, Fed. #transitoryinflation 
    • Happy American Censorship Day! Important stuff if you agree with the U.N. that internet access is a human right.
    • Awesome, Mark Cuban rules. #figureitoutNBA RT @killagroove: #MarkCuban My Views on Corporate Taxes .
    • In golf, it's always all about Tiger... Can't wait for the Presidents Cup.
    • Always loved Drew Bledsoe, and I've gotta hand it to the man: he knows how to do retirement. Skiing, wine, why not?  
    • What a college football playoff would look like if we had one (we never will):  
    Like I said, mostly quick hitters that didn't quite deserve their own blog post. If you read nothing else, read the Censorship Day link--it's the one thing that I probably could've turned into a full post, if I'd been in the ranting mood today.

    So, follow me on Twitter. Or don't. I'll be posting either way...

    On veganism and global warming

    Earlier today, Freakonomics tackled an issue that I've long been interested in--the role that our relentlessly carnivorous society plays in contributing to global warming. I've already been aware of the counter-intuitive finding that cows generate more environment-damaging greenhouse gases than cars, planes, and trains combined (a staggering 18 percent of gases come from livestock), but this piece takes that line of reasoning even further.
    There’s not a single person who’s done more to fight climate change than Bill McKibben. Through thoughtful books, ubiquitous magazine contributions, and, most notably, the founding of (an international non-profit dedicated to fighting global warming), McKibben has committed his life to saving the planet. For all the passion fueling his efforts, though, there’s something weirdly amiss in his approach to reducing greenhouse gas emissions: neither he nor will actively promote a vegan diet....
    As a recent report from the World Preservation Foundation confirms, ignoring veganism in the fight against climate change is sort of like ignoring fast food in the fight against obesity. Forget ending dirty coal or natural gas pipelines. As the WPF report shows, veganism offers the single most effective path to reducing global climate change.
    The evidence is powerful. Eating a vegan diet, according to the study, is seven times more effective at reducing emissions than eating a local meat-based diet. A global vegan diet (of conventional crops) would reduce dietary emissions by 87 percent, compared to a token 8 percent for “sustainable meat and dairy.” In light of the fact that the overall environmental impact of livestock is greater than that of burning coal, natural gas, and crude oil, this 87 percent cut (94 percent if the plants were grown organically) would come pretty close to putting out of business, which I’m sure would make McKibben a happy man.  
    The post goes on to speculate as to several reasons why McKibben and have not done more to promote veganism--much of the thesis is that it wouldn't generate much publicity, and thus isn't an "efficient" use of time--but the question still lingers. Why do we spend so much time worrying about oil and gas, and yet so little time thinking about our food and how we get it? At least on the surface, it would seem like eating would be a more important issue than transportation, but that doesn't seem to jive with the public discourse.

    I have to say here that I'm an unabashed meat lover, and I'd have a tough time going to a fully vegan diet (although, as a cook, I'm also continually amazed at how much complexity of flavor can be generated when you've got real, good, fresh produce at your disposal--and a bunch of olives, garlic, and peppers). But it's also clear that the developed world's meat addiction might in fact be an even greater indulgence than gas-guzzling SUVs, both in terms of its long-term impacts on public health and in terms of its environmental impact.

    Meat is an inherently inefficient food source, both to produce and to digest, but it's also deeply--and possibly inextricably--ingrained in our culture. It's staggering to recognize that the majority of corn and soy that is grown in the world is used not to feed people, but to feed farm animals, and even more astounding that these same animals consume 80% of the antibiotics sold in the United States--which isn't exactly a good thing from a public health perspective.

    With all of these potential drawbacks to our public health and the environment, it's frankly shocking that the meat issue is so infrequently mentioned. Will the national conversation ever shift from our oil addiction to our meat addiction? I doubt it, but at the same time I sort of have to wonder why not.


    "Real" value vs. perceived value

    Clip of the Week isn't until tomorrow, but that doesn't mean I can't post a video clip here today, right? Okay, cool. Besides, this one's a bit longer than the typical Clip of the Week fare, checking in at just over 15 minutes.

    It's a TED talk from ad executive Rory Sutherland (Ogilvy & Mather), who gives a very insightful and wickedly funny speech about the differences between "real" and perceived value--and when they can in fact be interchangeable. It's one of the more entertaining TED talks I've seen, and I think it asks some tough questions about our current culture of consumerism. Worth a watch for sure.

    To be fair, over the long term any product or concept does need to have some real value in order to survive, but that doesn't make perceived value any less important in the mind of the consumer. I wonder how often any of us thinks about how easily our perceptions can be shaped.

    (h/t Barry Ritholtz)

    Tuesday, November 15, 2011

    Follow The Crimson Cavalier on Twitter

    After much deliberation and internal debate (seriously, I avoided Twitter like the plague for a long, long time), I've decided to launch a Crimson Cavalier Twitter account (@CrimsonCavalier). There's a lot of stuff that I come across in my internet travels that isn't quite worthy of a full blog post--or that I can't totally devote the time to fleshing out into a full post--but that I still think is worth sharing. That's what I'll use Twitter for.

    If you, like me, still harbor a deep resentment of Twitter and all that it represents, I'll occasionally post a summary of recent tweets here on the main blog so that you don't miss out. This new development shouldn't impact the frequency or content of my posts here, so have no fear--my Twitter will be a supplement, not a replacement.

    So, follow me: @CrimsonCavalier. Should be great times. See you out there.

    Quote of the Week

    I've always loved watching football at every level, but I pretty much hate football culture. Ultimately, football culture is a big part of the reason I chose never to play football growing up, opting instead for the equally weird but much less self-congratulatory culture of baseball. I've always rolled my eyes at the idiotic insistence of football players on drawing war analogies (it's only cool when George Carlin does it), the incessant chest-thumping and celebrating by players and coaches alike, and the general taking-oneself-too-seriously attitude of all those in the game.

    And then, of course, there are the commentators--the gratuitious "this guy" usage of Jon Gruden, the grammatically disastrous repetition of "than what" from Troy Aikman, and whatever the hell Merril Hoge is talking about.

    But most of all, I think what drives me crazy about football culture... is the fact that they can't stop saying the word "football". Football players make football plays in football games. Gotta take care of the football. We need to do a better job of running the football. Guys, we get it. The name of your game is football. But can we just call your ball a "ball", like everyone else does?

    I guess not. This weekend, Ravens head coach John Harbaugh may have set a new record, explaining his team's terrible loss to the Seahawks by saying the word "football" nine times in 30 seconds. Not an easy task. Take it away, John...

    This week's QUOTE OF THE WEEK 

    "You play better football, you win football games like that. And that goes to all of us, that's what we have to do, we have to coach better, we have to play better, and we'll win those three football games. But, you know, we've won some other football games that people didn't expect us to win, against some really good football teams. So, tie the psychology together on that for me, you know? But I don't have time to be looking at that, we're going back to football. And we'll study the football as a football team, we'll have our answers in-house, we'll have our answers that will be football-related answers, and we'll come out and we'll play on Sunday."
                            - Ravens head coach John Harbaugh
    Yes, and remind me again what it is that you'll be playing on Sunday? My memory is bad, you'll have to help me out here... oh, that's right. Football.

    Monday, November 14, 2011

    Tough choices

    As you are all certainly aware by now, given the close attention that is paid to Ivy League football these days, my alma mater clinched the league title on Saturday with a convincing victory over Penn. Yeah, I know, old news, right?

    But as any fan of Ivy League sports knows (you know you're out there), a league title means nothing to Harvard if they lose to Yale, and vice versa--if you play for the Crimson or the Bulldogs, "The Game" is the only one that really matters. As evidence of that fact, look no further than Yale quarterback Patrick Witt.
    Two weeks after becoming a Rhodes Scholarship Finalist, Yale quarterback Patrick Witt ’12 made the decision to play against Harvard in The Game on Saturday rather than attend his finalist interview for the Rhodes Scholarship.
    Witt officially announced on Sunday that he had withdrawn his application for the Rhodes Scholarship, giving him one last chance at beating Yale’s archrival. If he had chosen to stay in the running for the Rhodes, Witt would have had to travel to Emory University in Atlanta for the interview, which was to begin at 8 a.m., just four hours before the Bulldogs’ kickoff against the Crimson at noon in New Haven.
    “I will be playing in the Yale-Harvard game this Saturday,” Witt said in an official press release. “My focus this week is solely on preparing for The Game alongside my teammates and coaches.”...
    The senior signal caller received the official notification regarding his finalist status on Oct. 31, two days after leading the Elis to a 16–13 victory over Columbia.
    Since then, Witt’s dilemma has gained the attention of national media outlets including ESPN and Bloomberg. A week ago, Witt was featured on NBC Nightly News with Brian Williams and said on national television that it wouldn’t feel right to leave his teammates to fend for themselves.
    This isn't the first time that a college football player has faced this sort of dilemma--Florida State safety Myron Rolle interviewed for and won a Rhodes scholarship three years ago, but was able to make it back to College Park, MD for the second half of his team's night game against Maryland. Witt didn't have that choice given the noon kickoff, and his role on the Yale team is of course much more central than Rolle's on those Seminoles.

    Torn between loyalty to his teammates and his own personal ambitions, Witt ultimately chose the former. It probably doesn't hurt matters that Witt will be eligible to apply for a Rhodes scholarship again next year (and the year after), whereas this will be his last opportunity to play in "The Game". Either way, for those who doubt the importance that Ivy League athletes place on their sports, Witt's difficult choice should give some perspective. Despite the lack of "official" stakes--Yale has no chance of winning the league title, Harvard has no chance of losing it--pride plays a central role in this decades-old rivalry (side note: Yale has lost the last four Games, has won only one Game since 2000, and has won only one home Game since 1993... so yeah, they want this one badly).

    I'll of course be rooting against Yale this Saturday, but I have to respect Witt's dedication to his team, and I hope the Rhodes committee takes that dedication into consideration if and when Witt re-applies in the future. Of course, given that the committee was apparently unwilling to reschedule his interview to accommodate his conflict, that consideration is far from a given.

    [Yale Daily News]

    Friday, November 11, 2011

    More fun with Europe

    Europe is always good for a laugh, right? Let's go back to that well once again to see why that whole region is completely screwed, this time courtesy of Businessweek.

    (h/t Barry Ritholtz)

    Thursday, November 10, 2011

    Clip of the Week

    Some weeks, I don't have much material to work with. Other weeks, like this one, I've almost got too much. It's a nice problem to have... and I don't even need to resort to sports highlights, either.

    For those of you who identify with the Occupy Wall Street crowd (or who just really love Jimmy Stewart), you'll appreciate this video--even if you don't, it's probably still worth a view. Sticking with the financial/economic theme, there's also SNL's clever take on the European debt crisis, as well as Jon Stewart's amazing takedown of the recently-disgraced Jon Corzine (former head of Goldman Sachs, former governor of New Jersey, and now architect of America's latest financial firm collapse). The Corzine issue is really worth a longer post here, and I may act on that in the days to come (stay tuned).

    In other news, Legos are cool, but drugs are bad. No, really, drugs are bad. If you haven't had enough of Halloween yet (it's Christmas season now!), this is a pretty clever Halloween costume to keep in mind for next year. And, as always, Mike Tyson cracks me up.

    But while all of those clips were great, there's only one clip that made me shake my head and say "I could never do that... and even if I could, I still wouldn't". With that, I give you extreme surfer Garrett McNamara, attempting to set a world record for the highest wave ever surfed. If I walked down to the ocean and saw waves like that one, you can bet I'd be running the other way... I certainly wouldn't be grabbing a surfboard.