Qty Change Open $ Change Close $ Current Price Symbol Name Market Value Cost Basis Cost per Share P/L $ P/L $ per Share


1 ($5.08) ($4.65) $23.55 AAPL 07/17/2010 230.00 C CALL APPLE INC$230 EXP 07/17/10 $2,355.00 $3,209.70 $3,209.70 ($854.70) ($8.55)

-1 ($4.65) ($4.40) $15.85 AAPL 07/17/2010 240.00 C CALL APPLE INC$240 EXP 07/17/10 ($1,585.00) ($2,390.25) $2,390.25 $805.25 ($8.05)

15 $0.22 $0.22 $2.21 PG 08/21/2010 60.00 P PUT PROCTER & GAMBLE $60 EXP 08/21/10 $3,315.00 $3,176.15 $211.74 $138.85 $0.09

Sub-Total $4,085.00 $3,995.60* $89.40*

Cash $59,016.48

Total $63,101.48

Natural Gas Guru: Cramer's List From Three Weeks Ago (June 6th)

(c) 2010 F. Bruce Abel

Here's the Cramer list mentioned in my just-previous blog "Cramer is Good -- Until He's Not."

Remember, he said "Stay out of the market until this list has been satisfied."

Natural Gas Guru: Cramer Yesterday: "These six things (was four things last Wednesday, see my earlier blog) must occur before we should buy common stocks again:

1. fine print on financial regulation
2. Spanish bank stabilization
3. lower unemployment
4. Oil Spill resolution
5. confirmation of China's soft landing
6. Euro holds"

In U.S. Bailout of A.I.G., Forgiveness for Big Banks - NYTimes.com

In U.S. Bailout of A.I.G., Forgiveness for Big Banks - NYTimes.com: "Even after the New York Fed released a list of the banks made whole in the bailout, it continued to resist disclosing information about the actual bonds in the deals, including codes known as “cusips” that label securities. “We need to fight hard to keep the cusips confidential,” one New York Fed official wroteon March 12, 2009.
Regulators said they wanted confidentiality because they did not want investors trading against the government’s portfolio. Others dispute that, saying that Wall Street insiders already knew what bonds were in the portfolio. Only the public was left in the dark."

One Day by David Nicholls - Trade Paperback - Random House - Read an Excerpt

One Day by David Nicholls - Trade Paperback - Random House - Read an Excerpt: "'No kids, just three divorces, and it's a Friday in July and you're heading off to some house in the country and in the tiny boot of your hover car are tennis racquets and croquet mallets and a hamper full of fine wines and South African grapes and poor little quails and asparagus and the wind's in your widow's peak and you're feeling very, very pleased with yourself and wife number three, four, whatever, smiles at you with about two hundred shiny white teeth and you smile back and try not to think about the fact that you have nothing, absolutely nothing, to say to each other.'"

Second chance for the American elm - The Globe and Mail

Second chance for the American elm - The Globe and Mail: "The cloning technology used in the Guelph research has been around for years, but there was little funding available to see if it could help the elms. The $400,000 cost is being covered by a private family charity, the Gosling Foundation.
“There is a lot of emotional connection with these trees,” said Susan Gosling, co-founder of the foundation. “They are stately and elegant and so beautiful.”"

Editorial - Who Will Fight for the Unemployed? - NYTimes.com

Editorial - Who Will Fight for the Unemployed? - NYTimes.com: "But today’s deficit hawks — many of whom eagerly participated in digging the deficit ever deeper during the George W. Bush years — are not interested in the sane approach. In the Senate, even as they blocked the extension of unemployment benefits, they succeeded in preserving a tax loophole that benefits wealthy money managers at private equity firms and other investment partnerships. They also derailed an effort to end widespread tax avoidance by owners of small businesses organized as S-corporations. If they are really so worried about the deficit, why balk at these evidently sensible ways to close tax loopholes and end tax avoidance?"

Editorial - Who Will Fight for the Unemployed? - NYTimes.com

Editorial - Who Will Fight for the Unemployed? - NYTimes.com: "The situation cries out for policies to support economic growth — specifically jobless benefits and fiscal aid to states. But instead of delivering, Congressional Republicans and many Democrats have been asserting that the nation must act instead to cut the deficit. The debate has little to do with economic reality and everything to do with political posturing. A lot of lawmakers have concluded that the best way to keep their jobs is to pander to the nation’s new populist mood and play off the fears of the very Americans whose economic well-being Congress is threatening."

Cramer's Good -- Until He's Not

(c) 2010 F. Bruce Abel

Lost another $1100 followng Cramer from last week.  In the teeth of his sweeping "list" of three weeks ago he got edgy to recommend specific buys again and began saying that each bad item in his list of (bat-on-the-shoulder musts) was getting so good that he was taking it off the list.  Then last week he had specific Apple-related stocks that the money managers would "be desperate to load up on before June 30" and other one other that had doubled in the year.  Now in fact it looks like the money managers are desperate not to show any stocks being held June 30th.  We'll see after tomorrow's close.  But I'm out of three stocks I bought, for a loss of $1100.  I switched my Procter July puts into Augusts, but I'm behind on them too, even after this down day today.  But my thinking on Procter is independent from what happened in China or Europe this week.  I'm sticky wicket. (phonetic)

Cramer's gotten too unbalanced.  Maybe he's been away from money management too long.  Or maybe he misses his "princess" or whatever he called his wife when they were (trading) together.  She saved his bacon more than once in a trading crash crisis, by his own admission.

Having said the above, Cramer is still awesome.  Just human, that's all.

Ratigan, A Business Journalist Turned Anti-Banker - NYTimes.com

A Business Journalist Turned Anti-Banker - NYTimes.com: "Mr. Ratigan does not just have a point of view, he has a point — one that he repeats relentlessly and feverishly, sometimes with props like buckets and Monopoly money. To hear Mr. Ratigan tell it, the American people are being held hostage by a banking system that acts like a government subsidized casino. His analogy: “My mother is paying taxes to the government. The government is giving her money to the banks. The banks are gambling like they’re watching ‘Fast Money.’ But my mother didn’t sign up for that.”"

Here's Why The Volcker Rule Really Could Crush The Banks' Hedge Fund Businesses

Here's Why The Volcker Rule Really Could Crush The Banks' Hedge Fund Businesses: "On Friday, after it was announced that banks could only invest 3% of their capital into hedge funds, under the proposed financial reform bill, John Carney at CNBC argues that in fact this would prove to be a massive boon to the banks. For one thing, banks are mainly interested in hedge funds for the management fees, not so much for the upside appreciation directly"

Monday FX Brief: Stimulate or Retrench -- Seeking Alpha

(c) 2010 F. Bruce Abel

According to Cramer us "pajama traders" key off the Euro to decide whether to buy or sell the American stock market.  So here's today's report on the Euro after the G-20 meeting in Toronto over the weekend, which Krugman says was so devastatingly bad, and I agree.

By the way, if the Euro is up on a given day then the pajama traders buy the American market, right?


Monday FX Brief: Stimulate or Retrench -- Seeking Alpha: "Euro – The euro is a little weaker at $1.2336 this morning as investors are swift to side with a long dollar position on account of the apparent likelihood that fiscal stimulus will stroke the growth nerve-endings and help lengthen the recovery process. However, as German Chancellor Angela Merkel pointed out, thus far the stimulus measures have done little to alleviate the rate of U.S. unemployment. And without addressing Europe’s fiscal shortcomings, the spiral would continue to drag the Eurozone lower. The euro weakened against the Japanese yen to ¥110.28 and also against the British pound to 81.94 pence."

Everything Relates to Everything Else

(c) 2010 F. Bruce Abel

As readers of this blog know, I am ego-central, personified.  (As i believe everyone is.) My belief is that everything in my life relates to everything else, and of course it all revolves around me!

Case in point:  am talking to Neil Bortz at Owen's baseball game in early June.  He's telling about the conversion of the Metropole Hotel downtown -- into a luxury hotel, I believe.

So last Wednesday I am interviewing a key witness for a case.  We meet at Sophia's.  Turns out he is the head of security at the Metropole Hotel.  And there's quite a story bubbling up within my case and with this fascinating witness.

Trysts and turns: Hearts overwhelm heads in love - The Globe and Mail

(c) 2010 F. Bruce Abel

A book review and then a comment by a reader of that review.  None of it is written by me.


Trysts and turns: Hearts overwhelm heads in love - The Globe and Mail: "“.....he had had an affair with an enlisted woman. A week earlier, he was fined $3,500 for accidentally discharging his firearm.”
_______________________________________________

Thanks for my laugh of the day, Mr. Brown. I must confess, I had previously missed the humorous connection between the 2 events."

Trysts and turns: Hearts overwhelm heads in love - The Globe and Mail

Trysts and turns: Hearts overwhelm heads in love - The Globe and Mail: "Lady Fraser doesn't gloss the hellish pain of “the dog days of divorce,” but she has a historian's long view. Scandal felt like a midnight of the soul, but she knew it was not midnight at all, but dawn. When a reporter referred to the “allegedly passionate playwright,” Lady Fraser advised her lover to sue: “What's alleged about it?”"

Moral authority helps Canada score major win on bank tax - The Globe and Mail

Moral authority helps Canada score major win on bank tax - The Globe and Mail: "As for the second risk: it’s easy to forget, because they have been praised so lavishly in the past 18 months, that Canadian financial executives are not immune to groupthink, and that they, like bankers in all countries, have occasionally made multibillion-dollar mistakes. There was the commercial real-estate disaster of the early 1990s, and the telecom lending bust that struck TD in the early 2000s, and the stumbles of Manulife Financial (on stock market bets) and Canadian Imperial Bank of Commerce (on credit market bets) in the last crisis. Both were able to raise the capital they needed to survive it, allowing Canada to claim bailout-free status. But there was an element of good fortune, as well as good crisis management, in that."

Sticking the public with the bill for the bankers’ crisis - The Globe and Mail

Sticking the public with the bill for the bankers’ crisis - The Globe and Mail: "Last week, The Globe and Mail published a fascinating article about the origins of the G20. It turns out the entire concept was conceived in a meeting back in 1999 between then finance minister Paul Martin and his U.S. counterpart Lawrence Summers (itself interesting since Mr. Summers was at that time playing a central role in creating the conditions for this financial crisis – allowing a wave of bank consolidation and refusing to regulate derivatives)."

Op-Ed Contributor - The Triumphant Decline of the WASP - NYTimes.com

Op-Ed Contributor - The Triumphant Decline of the WASP - NYTimes.com: "Yet, after the ideals of meritocratic inclusion gained a foothold, progress was remarkably steady and smooth. Take Princeton University, a longtime bastion of the Southern Protestant elite in particular. The Princeton of F. Scott Fitzgerald was segregated and exclusive. When Hemingway described Robert Cohn in the opening of “The Sun Also Rises” as a Jew who had been “the middleweight boxing champion of Princeton,” he was using shorthand for a character at once isolated, insecure and pugnacious. As late as 1958, the year of the “dirty bicker” in which Jews were conspicuously excluded from its eating clubs, Princeton could fairly have been seen as a redoubt of all-male Protestant privilege."

Krugman - The Third Depression - NYTimes.com

(c) 2010 F. Bruce Abel

Hooverism rampant.  I happen to agree with Paul Krugman.

Op-Ed Columnist - The Third Depression - NYTimes.com: "So I don’t think this is really about Greece, or indeed about any realistic appreciation of the tradeoffs between deficits and jobs. It is, instead, the victory of an orthodoxy that has little to do with rational analysis, whose main tenet is that imposing suffering on other people is how you show leadership in tough times."

Op-Ed Columnist - Are Cells the New Cigarettes? - NYTimes.com

Op-Ed Columnist - Are Cells the New Cigarettes? - NYTimes.com: "One Swedish study that followed young people who began using cells as teenagers for 10 years calculated a 400 percent increase in brain tumors. But as Nathaniel Rich recently pointed out in Harper’s, studies about cellphones’ carcinogenic potential all contradict one another, including those involving children."

Vampire Squid Wrapped Around the Face of Humanity

The Great American Bubble Machine Rolling Stone Politics: "The first thing you need to know about Goldman Sachs is that it's everywhere. The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money. In fact, the history of the recent financial crisis, which doubles as a history of the rapid decline and fall of the suddenly swindled dry American empire, reads like a Who's Who of Goldman Sachs graduates."

The Great American Bubble Machine | Rolling Stone Politics

The Great American Bubble Machine Rolling Stone Politics: "The bank's unprecedented reach and power have enabled it to turn all of America into a giant pump-and-dump scam, manipulating whole economic sectors for years at a time, moving the dice game as this or that market collapses, and all the time gorging itself on the unseen costs that are breaking families everywhere — high gas prices, rising consumer credit rates, half-eaten pension funds, mass layoffs, future taxes to pay off bailouts. All that money that you're losing, it's going somewhere, and in both a literal and a figurative sense, Goldman Sachs is where it's going: The bank is a huge, highly sophisticated engine for converting the useful, deployed wealth of society into the least useful, most wasteful and insoluble substance on Earth — pure profit for rich individuals."

Op-Ed Columnist - The Age of Nancy - NYTimes.com

(c) 2010 F. Bruce Abel

Normally Gail Collins is ironic but I believe she's serious about Nancy Pelosi, and this piece turns me favorable toward Pelosi.

Op-Ed Columnist - The Age of Nancy - NYTimes.com: "She has been around a long time and must have known that from the start. But she pushed anyway. Pelosi is an idealist working in the practical now. She genuinely sees her party as a vehicle for good and her pragmatism is not the least bit cynical. She is the most powerful woman in the country, the most fearless person on Capitol Hill and on track to be one of the most productive speakers in history.
I don’t know about you, but that kind of knocks me out."

Herbert - Worse Than a Nightmare - NYTimes.com

(c) 2010 F. Bruce Abel

The truth? You can't stand the truth.  Well, Herbert may give it to us anyway.

Op-Ed Columnist - Worse Than a Nightmare - NYTimes.com: "We’re like a compulsive gambler plunging ever more deeply into debt in order to wager on a rigged game. There is no victory to be had in Afghanistan, only grief. We’re bulldozing Detroit while at the same time trying to establish model metropolises in Kabul and Kandahar. We’re spending endless billions on this wretched war but can’t extend the unemployment benefits of Americans suffering from the wretched economy here at home.
The difference between this and a nightmare is that when you wake up from a nightmare it’s over. This is all too tragically real."

Cincinnati.Com | Cincinnati Enquirer | Paul Daugherty »

Cincinnati.Com Cincinnati Enquirer Paul Daugherty »: "Think about it: Amateur Athletic Union programs sweep up the most promising players just as they are getting started and have them playing 80 games a summer when they should be developing their skills. By high school, they are serving two masters: their school team and their club team. Different coaches, different teammates. Where does their loyalty lie? When it’s all about getting to “the next level,” what do teammates matter?
College is a one-and-done experience, or two years at most, for pretty much any player with realistic N.B.A. aspirations. If a player sticks around any longer, he starts hearing talk that there must be something wrong with him."

How Lehman Got Its Real Estate Fix - NYTimes.com

How Lehman Got Its Real Estate Fix - NYTimes.com: "Mr. Walsh, who wore rumpled Brooks Brothers suits and could be painfully awkward in front of crowds, was one of Lehman’s biggest profit producers. Former Lehman executives say Richard S. Fuld Jr., the bank’s chief, relied on Mr. Walsh to bankroll the firm’s swanlike transformation from a second-tier bond trading shop into a full-service investment bank. Former members of his unit, who requested anonymity because they were concerned about being swept up in lawsuits and investigations surrounding Lehman’s collapse, say it generated more than 20 percent of Lehman’s $4 billion in profits at the peak of the real estate boom in 2006."

BP market losses hit $100 billion on spill cost fears - Yahoo! Finance

BP market losses hit $100 billion on spill cost fears - Yahoo! Finance: "'A heavy inversion of both credit yield and equity volatility suggests the market is concerned about a near-term credit event around BP,' they said in a note."

Oh! Canada!

(c) 2007 Rebecca Abel Worple and owenemma.com

(c) 2010 F. Bruce Abel

I'm adding the blog "abovethelaw" as on of my favorites, largely because lawyers can write!

http://abovethelaw.com/2010/06/law-firm-survey-confirms-all-the-depressing-stuff-you-already-knew-about-the-business-of-biglaw/#more-23599

No Hot Air

No Hot Air: "Chevron gets shale
Last week in the FT Chevron were sounding doubtful about shale in being the last holdout oil major not investing in shale.
Meanwhile, beyond the fast-growing world of shale-gas dealmaking, an interesting one to watch is Chevron, one of the few energy giants to voice strong caution. In fact, the energy giant’s CEO John Watson recently remarked that the “price tag is too high” for shale-gas projects to warrant the investment."

With five Wildcats in the first round, John Calipari solidified his spot as No. 1 NBA talent groomer - ESPN

With five Wildcats in the first round, John Calipari solidified his spot as No. 1 NBA talent groomer - ESPN: "'I'm not trying to be bragodocious but if you're a player with pro potential where do you want to go?'' Calipari said. 'Not long ago it was Florida and then it was Duke and then North Carolina. Right now it's Kentucky. I'm not saying I prepare a kid better than someone else but I was told by NBA folks that it's easier to evaluate your guys because you let them play.''"

Op-Ed Columnist - The Renminbi Runaround - NYTimes.com

Op-Ed Columnist - The Renminbi Runaround - NYTimes.com: "So what comes next? China’s government is clearly trying to string the rest of us along, putting off action until something — it’s hard to say what — comes up.
That’s not acceptable. China needs to stop giving us the runaround and deliver real change. And if it refuses, it’s time to talk about trade sanctions."

Cramer -- What Does He Mean by Pajama Traders?

(c) 2010 F. Bruce Abel

A careful watcher of Cramer realizes that his sudden references to pajama traders is huge.  They are highly-negative references, which raises the question of exactly who is his audience.  This is a fundamental question.

I will be expounding on this on this blog.

Cramer's Mad Money - The Pajama Game (6/17/10) -- Seeking Alpha

(c) 2010 F. Bruce Abel

"Ludicrous." This concept of ludicrous "Pajama" traders is newish with Cramer.  Read further. Wait just a minute! Can he be serious that there are enough of them -- I'm one -- to match the really active hedge funds that are trading off milisecond-actions?

He needs to do a lot more on this topic to fully flesh it out.


Cramer's Mad Money - The Pajama Game (6/17/10) -- Seeking Alpha: "Cramer said the 'pajama game' was responsible; traders who sit at home in their pajamas with their laptops and trade at a furious pace with the wrong information. Double and triple-leveraged ETFs only exacerbate the problem.
Cramer has spoken before about the problem of high frequency trading which now comprises 80% of trades compared to 30% 4 years ago. False information can make unsustainable rallies given the intensity of trades. For instance, traders started buying because the CurrencyShares Euro Trust (FXE) seemed strong, but the euro was stronger only because of bad news on the home front.
It doesn't help to be the voice of reason when trades are made in a flash. Unfortunately, for now at least, the fate of stocks “rests in their ludicrous hands,' said Cramer."

Skin Deep - The Long Wait for More-Effective Sunscreen Labels - NYTimes.com

Skin Deep - The Long Wait for More-Effective Sunscreen Labels - NYTimes.com: "She had a colleague bring her back a Mustela spray from France that uses Tinosorb M, an ingredient that protects against a broad range of UVA rays but is not approved for use in American sunscreens. To replenish her supply, Ms. Kuo plans to order from Tubotica.com. “Frankly, the shipping rates are high from Europe,” she said. “I find it very inconvenient to order online.”
But she added, “I also covet the European ratings. I find a lot of American sunscreen brands are not exactly directly misleading in their labels, but they have labels that can be misconstrued.”"

SPORTS OF THE TIMES; Long Shot - New York Times

SPORTS OF THE TIMES; Long Shot - New York Times: "Until the N.B.A. draft, it was easy to dismiss Bol as an exaggerated outgrowth of the Akeem Abdul Olajuwon miracle, a giant from Africa learning the American game while in college. But Olajuwon is emphatically uptown compared to Bol; the rugged and well-fed Olajuwon comes from a large, well-educated family from Lagos, the sprawling capital of Nigeria, whereas Bol is a nomad raised six hours from Khartoum, who received scant nutrition and education in his early years."

Cincinnati.Com | Cincinnati Enquirer | Paul Daugherty »

Cincinnati.Com Cincinnati Enquirer Paul Daugherty »: "Meanwhile, you have to figure 2 local prospects are sweating basketballs right now. Especially L. Stephenson. Nobody who knows says Born Ready should have left UC. If he’s not a first-rounder and can’t make a name for himself early, he’s in trouble. Second-round, end of bench guys are not hot properties in the NBA. They get a couple years’ pay, then very possibly find themselves out of the league. Former X guy Derrick Brown could be facing that situation this season.
Jordan Crawford’s reviews from scouts have been kinder. But he also needs to go in the first round to have any lasting security. The draft is tomorrow night."

Cincinnati.Com | Cincinnati Enquirer | Paul Daugherty »

Cincinnati.Com Cincinnati Enquirer Paul Daugherty »: "Some people at the “Big Willie” studio “described the tapings as a fiasco,” according to Robert Feder, long-time Chicago media critic.
Tribune CEO Randy Michaels – who hired Cunningham at WLW-AM in 1983 – was “personally urging Cunningham to abuse and berate his unwitting guests,” Feder wrote. “One segment featured the humiliation of a grossly overweight woman who was forced to get on all fours and eat like a dog. Another featured parents of child beauty pageant contestants who found themselves blind-sided when they were suddenly attacked by Cunningham.”
Normally, TML doesnt comment on other local media types, some of whom are friends. And really, beyond the above, what’s left to say this time? Only that Cunningham has made himself rich by doing this sort of thing on occasion. Also, by either (1) pandering to or (2) insulting the intelligence of the people who listen to him. Those who defend the guy evidently have no idea he thinks they’re all schmucks. It’s not good enough to say it’s just radio “shtick”. That doesnt excuse the way the guy treats people.
There’s a lot of money, apparently, in taking your audience for fools. You’d be surprused at how many hosts treat every segment like a prank phone call. I’m just not sure how a guy can feel good about himself as he laughs all the way to the bank.
BTW, I get a kick out of people who think Cunningham is “controversial.” His daily right-wing diatribes are in lockstep with the majority thinking around here. There’s nothing at all controversial about the guy."

South Korea’s great escape - The Globe and Mail

South Korea’s great escape - The Globe and Mail: "The biggest differences between South Korea and Japan can be found at the top of these two traditionally hierarchical societies. When Mr. Lee was elected in February, 2008, the Japanese government was led by Prime Minister Yasuo Fukuda. Two years on, Mr. Lee is still in office and getting warm applause from the business community for the timely introduction of the stimulus package that was by some measures the largest in the OECD, accounting for 6 per cent of gross domestic product last year. Over the same stretch, Japan has gone through three prime ministers since Mr. Fukuda, with the latest, Naoto Kan, warning his country may soon face a debt crisis akin to the one that has hammered Greece."

Fat Fingers

(c) 2010 F. Bruce Abel

This from a favorite blogger of mine.

http://mybesttime-mybesttime.blogspot.com/2010/06/fat-fingers.html

Op-Ed Columnist - What’s Second Prize? - NYTimes.com

Op-Ed Columnist - What’s Second Prize? - NYTimes.com: "It is not about the way. It is about the will. I have said this before, and I will say it again: The Middle East only puts a smile on your face when it starts with them. The Camp David peace treaty started with Israelis and Egyptians meeting in secret — without us. The Oslo peace process started with Israelis and Palestinians meeting in secret — without us. The Sunni tribal awakening in Iraq against pro-Al Qaeda forces started with them — without us. When it starts with them, when they assume ownership, our military and diplomatic support can be a huge multiplier, as we’ve seen in Iraq and at Camp David."

George Soros sees fall of financial system ‘as we know it’ - The Globe and Mail

George Soros sees fall of financial system ‘as we know it’ - The Globe and Mail: "The Canadian dollar (CAD/USD-I0.96-0.01-1.15%) also surged, popping above 97 cents U.S. at one point though it closed just shy of the mark at 96.97 cents, up 1.21 cents. As the loonie was rising, strategists at BNP Paribas SA advised investors to buy into the loonie given Canada’s better prospects, according to Bloomberg News, going so far as to say that the country’s monetary and fiscal policy suggests “the making of a reserve currency.” Said the BNP analysts: “The end benefit for Canada is the rising credibility of the central bank as it correctly anticipated the subprime crisis and presided over a stable banking system. The Harper government is also moving ahead with the removal of emergency G-20 crisis measures.”"

George Soros sees fall of financial system ‘as we know it’ - The Globe and Mail

George Soros sees fall of financial system ‘as we know it’ - The Globe and Mail: "Michael Babad
Globe and Mail Update
Published on Thursday, Jun. 10, 2010 3:46PM EDT

Last updated on Monday, Jun. 21, 2010 10:49AM EDT

These are stories Report on Business is following today. Get the top business stories through the day on BlackBerry or iPhone by bookmarking our mobile-friendly webpage.
Soros sees Act II
Renowned investor George Soros says Europe’s financial troubles means the world has “just entered Act II” of the financial crisis. “The collapse of the financial system as we know it is real, and the crisis is far from over,” Mr. Soros told a conference in Vienna. 'Indeed, we have just entered Act II of the drama, when financial markets started losing confidence in the credibility of sovereign debt. Greece and the euro have taken center stage, but the effects are liable to be felt worldwide.“
Among his other comments:
“We find ourselves in a situation eerily reminiscent of the 1930s. Keynes has taught us budget deficits are essential for counter-cyclical policies, yet many governments have to reduce them under pressure from financial markets. This is liable to push the global economy into a double-dip.”
'The simplest case of a purely financial bubble can be found in real estate. The trend that precipitates it is the availability of credit; the misconception that continues to recur in various forms is that the value of the collateral is independent of the availability of credit.'
'Credit-default swaps (CDS) are particularly dangerous"

George Soros sees fall of financial system ‘as we know it’ - The Globe and Mail

George Soros sees fall of financial system ‘as we know it’ - The Globe and Mail: "Soros sees Act II
Renowned investor George Soros says Europe’s financial troubles means the world has “just entered Act II” of the financial crisis. “The collapse of the financial system as we know it is real, and the crisis is far from over,” Mr. Soros told a conference in Vienna. 'Indeed, we have just entered Act II of the drama, when financial markets started losing confidence in the credibility of sovereign debt. Greece and the euro have taken center stage, but the effects are liable to be felt worldwide.“"

Germany could cause euro collapse: Soros - The Globe and Mail

Germany could cause euro collapse: Soros - The Globe and Mail: "Chancellor Angela Merkel unveiled plans earlier this month for €80-billion ($107-billion) in budget cuts over the next four years – a package she hopes will bring Germany’s structural deficit within European Union limits by 2013.
“Right now the Germans are dragging their neighbours into deflation, which threatens a long phase of stagnation. And that leads to nationalism, social unrest and xenophobia. Democracy itself could be at risk,” Mr. Soros said.
“Germany is globally isolated ... Why don’t they let their salaries rise? That would help other EU states to pick up.”"

Safety-First Tips Honed in South Africa | Globaltrekkers Travel Stories, Articles and Travel Photos

Safety-First Tips Honed in South Africa Globaltrekkers Travel Stories, Articles and Travel Photos: "Safety-First Tips Honed in South Africa"

homed in on - definition of homed in on by the Free Online Dictionary, Thesaurus and Encyclopedia.

(c) 2010 F. Bruce Abel

Who exactly was Pliny the Elder?

Not exactly a definition of "homed in."

homed in on - definition of homed in on by the Free Online Dictionary, Thesaurus and Encyclopedia.: "'Mid pleasures and palaces though we may roam,'
'Be it ever so humble, there's no place like home.'
'Home, home, sweet, sweet home!'
'There's no place like home! There's no place like home!' [J.H. Payne Clari, the Maid of Milan]
'Home is where the heart is' [Pliny the Elder]
'Home is the place where, when you have to go there,'
'They have to take you in' [Robert Frost The Death of the Hired Man]
Proverbs
'East, west, home's best'
'An Englishman's home is his castle'"




Oh, give me a home where the buffalo roam


Where the deer and the antelope play

Where seldom is heard a discouraging word

And the skies are not cloudy all day

Home, home on the range

Where the deer and the antelope play

Where seldom is heard a discouraging word

And the skies are not cloudy all day



How often at night where the heavens are bright

With the light of the glittering stars

Have I stood there amazed and asked as I gazed

If their glory exceeds that of ours



Home, home on the range

Where the deer and the antelope play

Where seldom is heard a discouraging word

And the skies are not cloudy all day



Then give me a land where the bright diamond sand

Flows leisurely down to the stream

Where the graceful white swan goes gliding along

Like a maid in a heavenly dream



Oh I would not exchange my old home on the range

Where the deer and the antelop play

Where the seldom is heard a discouraging word

And the skies are not cloudy all day

Where Thoreau Lived, Crusade Over Bottles - NYTimes.com

(c) 2010 F. Bruce Abel

Is it "honed in" or "homed in?"

Where Thoreau Lived, Crusade Over Bottles - NYTimes.com: "She researched and homed in on bottled water, finding that millions of plastic bottles were disposed of daily and that most were not recycled. While most opponents of bottled water have sought piecemeal change, like getting government agencies to stop buying it, Mrs. Hill wanted her affluent, erudite town to take a bolder step."

Editorial - Cutting Off the Unemployed - NYTimes.com

Editorial - Cutting Off the Unemployed - NYTimes.com: "Back in session for nearly three weeks, the Senate still has not acted. That means that 900,000 jobless workers have already lost their benefits, a number that will swell to an estimated 1.6 million people if an extension is not passed by the July Fourth holiday. Lost benefits — the average check is $309 a week — deprives struggling Americans of cash they need for buying food, paying the rent or mortgage and other essentials."

Sponsors begin shunning France team - The Globe and Mail

Sponsors begin shunning France team - The Globe and Mail: "Meanwhile, fast-food company Quick decided over the weekend to stop using an advertising film featuring Mr. Anelka and Procter & Gamble Co. (PG-N61.10-0.20-0.33%) said it was dropping a television campaign for its Pringles crisp brand that featured the expelled player."

Op-Ed Contributor - Blow Up the Well to Save the Gulf - NYTimes.com

Op-Ed Contributor - Blow Up the Well to Save the Gulf - NYTimes.com: "The idea of detonating the well already has serious advocates. A few people have even called for using a nuclear device to plug the well, as the Soviet Union has done several times. But that would be overkill. Smartly placed conventional explosives could achieve the same results, and avoid setting an unacceptable international precedent for the “peaceful” use of nuclear weapons."

The Anosognosic’s Dilemma: Something’s Wrong but You’ll Never Know What It Is (Part 2) - Opinionator Blog - NYTimes.com

The Anosognosic’s Dilemma: Something’s Wrong but You’ll Never Know What It Is (Part 2) - Opinionator Blog - NYTimes.com: "One such patient . . . hit by left hemiplegia has largely maintained her intellectual and affective faculties, for many months. She remembered past events well, was willing to talk, expressed herself correctly, her ideas were sensible; she was interested in persons known to her and asked about new people . . . No hallucinations, delirium, confusional state, confabulation. What did contrast with the apparent preservation of intelligence of this patient was that she seemed to ignore the existence of a nearly complete hemiplegia, which she had been afraid of for many years. Never did she complain about it; never did she even allude to it. If she was asked to move her right arm, she immediately executed the command. If she was asked to move the left one, she stayed still, silent, and behaved as if the question had been put to somebody else."

From the British Blog No Hot Air

Jun 21, 2010


Natural Gas Storage

The WSJ describes here a new, and to the non-expert, rather obvious way of producing and storing gas: Keeping it in the ground.



Because thanks to gravity gas flows out of the ground, until now it's been hard to modulate up or down. It comes out of the hole in the ground and although it declines over time, it's hard to switch it on or off. This causes bizarre economic outcomes, because demand for gas is seasonal. Which explains why there is gas storage. If it was possible to have enough gas wells to deal with one in 40 year demand levels, which it is, it wouldn't work because there would soon be so much gas that it would either go to waste, or actually get flared off as it is in Nigeria and Iraq. There is another issue in that much conventional gas is associated with oil production and if the gas isn't released then the oil can't be pumped either. Which explains why the actual cost of production of gas can actually be negative. Back in the days when North Sea oil was $25 or so, it was estimated that some gas landing at St Fergus in Scotland from North Sea associated oil fields had a cost of minus 4 pence per therm, in the days when the spot price was about 10 pence.



Some people use a similar theory to explain how Qatar can produce gas so cheaply, in that the true prize is Gas to Liquids for fuel. Gasoline or Diesel derived from gas is the true money-spinner according to that theory, and natural gas is a by product that technically the Qataris should pay people to ship away and burn.



Two big swing fields in Europe can be modulated up or down to reflect demand, Groningen onshore Netherlands and Morecambe Bay off shore Lancashire NW England. Both fields by the way are very close to possibly big shale plays.



Shale, as Art Berman likes to tell people declines rapidly, to 80% of it's opening peak within 18 months allegedly. Berman says that this makes shale uneconomic at less than $7-8 MMBTU. I say a lot of people disagree with him. But in Louisiana's Haynesville shale, they may have discovered ways of defying gravity in that they can choke gas:



Natural gas producers are choking back production from wells in the Haynesville Shale, a prolific natural gas-bearing rock formation in Texas and Louisiana, as a way of boosting the overall efficiency and life span of those wells.



The technique represents an important shift in the exploitation of gas from the dense sedimentary rock formations known as shales. Frenzied development flooded the natural gas market last year with, shale gas and the recession cut deeply into natural gas demand, pushing prices to a 7 1/2-year low last September. Now more measured growth from shales could help mitigate future gas gluts and allow for more orderly development of these gas-rich assets.



More orderly development will mean more orderly prices:



We are trying to optimize the reservoir," Kelleher said, noting that the company is trying to come up with the best "economic case" for the Haynesville shale. Devon will drill as many as 30 shale wells in the Haynesville area this year.



Companies have used other techniques to slow production from these fields such as drilling wells without completing them so they can bring production online at a later date and, perhaps, at better commodity prices.





A throwaway at the end here, which shouldn't have been. This could change the economics of gas (and storage) for both better and good:



Producers are starting to think about using these producing assets as a surrogate for storage," said Rusty Braziel, managing director for BENTEK Energy, which tracks energy-market data. Braziel notes that these techniques have an added advantage of allowing companies to manage through volatile swings in natural gas prices.



Surrogate for storage. Disruptor for prices.

See it -- Charlie Rose

After many months, I turned on Charlie Rose last night. Tilda Swinton on Charlie Rose. You don't need to pay close attention to appreciate his interviews with people he loves. 

Natural Gas Guru: Charlie Rose

Natural Gas Guru: Charlie Rose: "From Christopher Buckley, on Charlie Rose a year ago, describing his dad William F. Buckley:

[Christopher] 'I found this quote by Carlyle: 'Let me have my own way exactly in everything and a sunnier and more pleasant creature does not exist.''"

Faustus Makes a Deal - Readers' Comments - NYTimes.com

Faustus Makes a Deal - Readers' Comments - NYTimes.com: "Phil in the mountains of KyushuJapanJune 22nd, 20104:38 amCute, but you ignore the deepest reason Americans stay the way they are.

Americans – all too many – have been deeply trained to think in and to follow the habits of all their sociopathic corporations.

Americans know entities like BP-U.S., Goldman-Sachs, Halliburton, Enron, and Blackwater/Xe all have staff who appear human – talking like humans, wearing clothes like humans, going to yacht races like humans, and taking perks and bonuses for themselves and bribing senators, representatives, and regulators like humans. But these corporate types have all got about as much humanity in them as those Supreme Court justices who recently declared human all piles of money lawyered into the de-personalized fictions known as corporations."

Mad Money Recap | Nightly Recap for: Monday, June 21, 2010

Mad Money Recap Nightly Recap for: Monday, June 21, 2010: "So what do these money managers who were caught leaning the wrong way… and only have 7 days to morph from a bear to a bull … what do they do? How do they look like they got it right? Even though we know that they got it wrong… pretty simple… the kind of recipe, the play book, I know it, I own it… they buy the winners… the stocks that have taken the market by storm this quarter… stocks that their investors, even the most clueless investors, know are on fire… so let me give you the big money playbook that you would not get from anybody else… because I managed money for about 30 years… I am talking about what these fund managers who bet wrong will now buy to look right… and I think these winners will start soaring higher after today’s disappointing session."

Mad Money Recap | Nightly Recap for: Monday, June 21, 2010

Mad Money Recap Nightly Recap for: Monday, June 21, 2010: "Jim: One day, we will learn that it almost never pays to reach for stocks… every time the market opens up huge.. we need to trim some of our losers… not buy our winners… and today was no different… not at all... with the Dow closing down 8 points, after being as high as 144... and the S&P, just as disappointing… closing by a hair after trading up 1.2% right at the opening bell… disappointing for those who cannot resist buying… even when the news is as good as China… bending to our will and making a currency change that allows us to make more money… selling into the world’s most populous market… but buying stocks up will always be a suckers game… cause it is just plain stupid."

Op-Ed Columnist - When Greatness Slips Away - NYTimes.com

Op-Ed Columnist - When Greatness Slips Away - NYTimes.com: "We’ve got all kinds of sorry explanations for why we can’t do any of the things we need to do. The Democrats can’t get 60 votes in the Senate. Our budget deficits are too high. Rush Limbaugh or Glenn Beck might object."

I Love Meredith Whitney

(c) 2010 F. Bruce Abel

On CNBC now.  I love her not just because I have puts, which will decrease because of the China thing this weekend.

And not just because she looked pretty good walking in and mounting her chair (poor taste of CNBC to show this angle).

She talks a clear book.  Absolutely refreshing.

Baseball Question

Last night on Sunday Night Baseball Joe Morgan was critical of Boston's Mike Cameron turning for the dogout when the second baseman was circling under his infield fly with a runner on first and one out. In light of the infield fly rule, which was never mentioned, I wondered why they were critical of Cameron. And I also wondered why they did not mention the infield fly rule. And I wondered why the infield fly rule was not called by the umpire. I TIVO'd the segment and then Googled the infield fly rule. Can you define the infield fly rule?

A Pacemaker Wrecks a Family's Life - NYTimes.com

A Pacemaker Wrecks a Family's Life - NYTimes.com: "When bioethicists debate life-extending technologies, the effects on people like my mother rarely enter the calculus. But a 2007 Ohio State University study of the DNA of family caregivers of people with Alzheimer’s disease showed that the ends of their chromosomes, called telomeres, had degraded enough to reflect a four-to-eight-year shortening of lifespan. By that reckoning, every year that the pacemaker gave my irreparably damaged father took from my then-vigorous mother an equal year."

A Pacemaker Wrecks a Family's Life - NYTimes.com

A Pacemaker Wrecks a Family's Life - NYTimes.com: "It was a case study in what primary-care doctors have long bemoaned: that Medicare rewards doctors far better for doing procedures than for assessing whether they should be done at all. The incentives for overtreatment continue, said Dr. Ted Epperly, the board chairman of the American Academy of Family Physicians, because those who profit from them — specialists, hospitals, drug companies and the medical-device manufacturers — spend money lobbying Congress and the public to keep it that way."

Mad Money Recap | Nightly Recap for: Friday, June 18, 2010

Mad Money Recap Nightly Recap for: Friday, June 18, 2010: "That is why tonight I have got a new one… spent a lot of time on it… worked on it for the last month as a matter of fact… I am urging you to take a look at MarkWest Energy Partners LP (MWE)… I know that it is speculative Friday, this is not a speculation name… this is a new name though and it has got a gigantic 8% yield… MarkWest is at its high… in part because of the BP tragedy.. anything related to natural gas took off this week… because the country sees the writing on the wall… hey, this deep water drilling, we are going to drill shallow… and what is shallow? Natural gas… only costs a couple of million bucks to hit pay dirt there… and I think that is what is going to drive MarkWest higher."

Sports of The Times - Business of College Basketball Tempers Excitement - NYTimes.com

Sports of The Times - Business of College Basketball Tempers Excitement - NYTimes.com: "The A.A.U. circuit does not encourage the sense of discipline or obligation that players presumably receive during their high school seasons.
“You don’t have to even go to high school,” Rob Murphy, a Syracuse assistant and a former A.A.U. coach, said. “You can play A.A.U. ball, you don’t need a 2.0, you don’t have to get up and go to class. On game day, you don’t have to make sure you attend every class or you can’t play in that game at 4 o’clock or 7 p.m. You just kind of practice and travel.”"

Sports of The Times - Business of College Basketball Tempers Excitement - NYTimes.com

Sports of The Times - Business of College Basketball Tempers Excitement - NYTimes.com: "Most programs in this N.C.A.A. tournament, from Gonzaga and St. Mary’s to Syracuse and Kentucky, rely on A.A.U. affiliations for a supply of talent."

Bending Shot Caps a Blistering Charge for Woods - NYTimes.com

Bending Shot Caps a Blistering Charge for Woods - NYTimes.com: "It was a little white orb tracking in the direction of the hole, but it arrived more like a signal from somewhere far away. Tiger Woods, standing hundreds of yards away and improbably behind and beneath a tree, had made his return to major championship golf."

Joe Barton III : Rich - Clean the Gulf, Clean House, Clean Their Clock - NYTimes.com

Op-Ed Columnist - Clean the Gulf, Clean House, Clean Their Clock - NYTimes.com: "When Joe Barton, the ranking Republican on the House Energy and Commerce Committee, revived Rand Paul’s defense of BP last week by apologizing on camera to Hayward for the “tragedy” of the White House’s “$20 billion shakedown,” the G.O.P. establishment had to shut him down because he was revealing the party’s true loyalties, not because it disagreed with him. Barton was merely echoing Michele Bachmann, who labeled the $20 billion for gulf victims a “redistribution-of-wealth fund,” and the 100-plus other House members whose Republican Study Committee had labeled the $20 billion a “Chicago-style shakedown” only a day before Barton did."

Op-Ed Columnist - Wishing Will Make It So - NYTimes.com

Barton II: Op-Ed Columnist - Wishing Will Make It So - NYTimes.com: "This week, Barton became the star of another hearing, which was convened to grill Tony Hayward, the chief executive of BP. The rosy-cheeked Englishman had the kind of dopey sullenness you might find in an underachieving student at the Hogwarts detention room. But Barton seemed smitten, and he apologized to BP for the president’s “shakedown” of the company for a $20 billion fund to compensate the people of the gulf for the effects of the spill. This is perhaps not the stupidest remark any elected official has ever blurted out, but possibly the dumbest that ever came in the form of a prepared statement.
Every Democrat in Washington did the happy dance. The party could not point out too often that if the Republicans took control of the House, Barton would be leader of the House energy committee."

California on 'verge of system failure’ - The Globe and Mail

California on 'verge of system failure’ - The Globe and Mail: "Arnella Sims has seen a lot in her 34 years as a Los Angeles County court reporter, but nothing like this.
Case files piling up by the thousands, phones ringing off the hook, forced midweek courthouse closings and occasional brawls as frustrated citizens queue for hours to pay parking fines.
“People think we’re becoming a Third World country,” said Ms. Sims, 55. “They don’t understand.”
It’s a story that’s being repeated all across California – and throughout the United States – as cash-strapped state and local governments grapple with collapsed tax revenues and swelling budget gaps. Mass layoffs, slashed health and welfare services, closed parks, crumbling superhighways and ever-larger public school class sizes are all part of the new normal."

How did Obama morph into Bush? - The Globe and Mail

How did Obama morph into Bush? - The Globe and Mail: "Back on Inauguration Day, Barack Obama walked on water. There was nothing this man couldn’t do! As the world huzzahed (I did, too), I wondered how long it would take for him to become as reviled as the guy he replaced. Now we know.
Today, Mr. Obama is bogged down in an unpopular war, with vastly unreliable local partners who are corrupt beyond belief, in a place that experts say will take at least 20 years to stabilize. He has found that personal diplomacy doesn’t matter much in foreign policy, because no matter what you say, everyone will hate America anyway. Everybody’s dumping on him for failing to impose peace in the Middle East. Meantime, he can barely conceal his contempt for the media."

The man who’s tutoring Bill Gates … - The Globe and Mail

The man who’s tutoring Bill Gates … - The Globe and Mail: "For example, take the notion (heavily promoted by Al Gore) that we could wean ourselves off fossil fuels in a few years if only we really wanted to. This is about as realistic as the notion that we could fly to the moon on gossamer wings if we really wanted to. Some day it may be possible – but not any time soon. “We are structurally cooked,” he recently explained. “Every new technology takes 40 to 50 years before it captures the bulk of the market. As of today, there are no clean-energy technologies that can replace fossil fuels on a large scale.”"

Where Gulf Spill Might Place on the Roll of Disasters - NYTimes.com

Where Gulf Spill Might Place on the Roll of Disasters - NYTimes.com: "Oil spills, too, seem to be judged more by their effect on people than on the environment. Consider the Lakeview Gusher, which was almost certainly a worse oil spill, by volume, than the one continuing in the gulf.
In the southern end of California’s San Joaquin Valley, an oil rush was on in the early decades of the 20th century. On March 14, 1910, a well halfway between the towns of Taft and Maricopa, in Kern County, blew out with a mighty roar.
It continued spewing huge quantities of oil for 18 months. The version of events accepted by the State of California puts the flow rate near 100,000 barrels a day at times. “It’s the granddaddy of all gushers,” said Pete Gianopulos, an amateur historian in the area.
The ultimate volume spilled was calculated at 9 million barrels, or 378 million gallons. According to the highest government estimates, the Deepwater Horizon spill is not yet half that size."

Mad Money Recap | Nightly Recap for: Thursday, June 17, 2010

Mad Money Recap Nightly Recap for: Thursday, June 17, 2010: "But, if the dollar amount seems too high to you, remember... you can use deep-in-the-money call options, from far out months, to control more stock and limit your downside. It's a strategy that I explain in Getting Back To Even, the ultimate handbook for the choppy and technically-driven market. Steve Jobs holds the cards for what platforms he has out there. And there's nothing wrong with that. Apple's not stifling innovation. It's fueling it... destroying value at the competitors, in order for it to create value for their shareholders... which is why I think you should be one!"

Mad Money Recap | Nightly Recap for: Thursday, June 17, 2010

Mad Money Recap Nightly Recap for: Thursday, June 17, 2010: "Not only have the men in pajamas hijacked our market with their high-speed trading, they're screwing up! They're betting on the wrong thing! They don't even care! They're keying off the wrong darn data. But, as long as the pajama party is in control, using charts to make millions of trades, that make no sense, based on false indicators... you need to know that the fate of many of your closing stock prices rests in their ludicrous hands. Until we return the market back to its rightful owners, we are going to have to learn the 'pajama game'... because unfortunately, like it or not, lower prices or bizarrely higher ones like we had today... it's the game we're in."

Mad Money Recap | Nightly Recap for: Thursday, June 17, 2010

Mad Money Recap Nightly Recap for: Thursday, June 17, 2010: "For a brief moment, I thought about turning off my news ticker entirely, and putting the sacrosanct TV on mute. It wouldn't have mattered anyway. There was just this curly-haired BP guy, telling a bunch of Congressmen that he wasn't in on the decision to do anything about anything... presumably, even (for) the clothes he wore, or maybe even what he had for breakfast... Anyway, I could have turned off that guy, and replaced the 200 stock symbols I have on my computer, with just this... with just the FXE, which is the ETF (i.e., exchange-traded fund) that represents the euro... and that rallied hard today.

That was all you needed. That's right. Just delete everything... so I could think like one of the pajama party, furious traders, who trade like it's going out of style, off the charts only, and buy all sorts of stocks, the S&P, when they see the FXE go up... not when they see good news... not when they see bad news."

Joe L. Barton

(c) 2010 F. Bruce Abel

Thank you Joe L. Barton.  You have saved the 2010 November election.  ABR.  Stands for Asian Development Bank where my daughter Genny works.  But for today and this season it stands for "Anything but Republicans." 

BP is Not Like PB

(c) 2010 F. Bruce Abel


BP is not like PB.  BP is a driller and spiller; PB was the coach of the Cleveland Browns and Cincinnati Bengals.

Oil is Not Like Natural Gas

This quote from the best-known writer on geology of our country (and also a writer for the New Yorker):






Natural gas is to oil as politicians are to statesmen. Any organic material whatsoever will form natural gas and will form it rapidly, at earth-surface temperatures and on up to many hundreds of degrees. ... "You get natural gas as soon as anything drops dead." For oil, the requisites are the organic material and [a] thermal window [of 50-150 degrees centigrade over millions of years]. John McPhee, In Suspect Terrain, N.Y. Noonday Press, 1991, p.55

Why “Living Wills” Fail « The Baseline Scenario

Why “Living Wills” Fail « The Baseline Scenario: "Higher regulator salaries might be nice, to make them more resistant to bribery for one thing, but they’re not necessary to generate some improvement — they just need to have the mindset that their regulatory role is useful and important. It’s not their job to make the industry happy, it’s their job to make the industry safe whether the industry likes that or not.
…All of which works fine until you get another anti-government ideologue in office, which is another way of saying that no governmental structure is proof against sabotage by its own leadership and ultimately, the responsibility for these particular failures of government rests with the electorate."

Art Review - Artist in Retreat - ‘Late Renoir’ in Philadelphia - NYTimes.com

Art Review - Artist in Retreat - ‘Late Renoir’ in Philadelphia - NYTimes.com: "“I am of the 18th century,” he said, thinking of Rococo masters like Watteau and Boucher. He pulled back from his Impressionism, way back. He underwent a revolution in reverse, a personal return to order, and to an order he’d never really left behind.
Timing was a factor in this shift. By the mid-1880s he was starting a family. He was also traveling and catching up on art history. Raphael in Rome knocked him flat, as did Velázquez in Spain. Back home at the Louvre he re-experienced the Baroque of Poussin and Rubens. Greek sculpture hit like a depth charge."

Art Review - Artist in Retreat - ‘Late Renoir’ in Philadelphia - NYTimes.com

Art Review - Artist in Retreat - ‘Late Renoir’ in Philadelphia - NYTimes.com: "It came to be called Impressionism, and it rejected much of what the establishment stood for: traditional craft, a fixed course of training, aesthetic decorum. The new art favored brushy color over draftsmanly line, scenes of contemporary life over historical and mythological themes. Out went Arcadian nymphs, in came modern women in store-bought hats."

Art Review - Artist in Retreat - ‘Late Renoir’ in Philadelphia - NYTimes.com

Art Review - Artist in Retreat - ‘Late Renoir’ in Philadelphia - NYTimes.com: "Timing was a factor in this shift. By the mid-1880s he was starting a family. He was also traveling and catching up on art history. Raphael in Rome knocked him flat, as did Velázquez in Spain. Back home at the Louvre he re-experienced the Baroque of Poussin and Rubens. Greek sculpture hit like a depth charge."

Loonie’s star keeps getting brighter - The Globe and Mail

Loonie’s star keeps getting brighter - The Globe and Mail: "Although Canada’s export-dependent economy typically links its dollar to crude prices, since January crude has fallen 5.5 per cent while the loonie has appreciated 2.6 per cent relative to the greenback. Conversely, the S&P 500 and the dollar are moving almost in tandem."

Op-Ed Columnist - That ’30s Feeling - NYTimes.com

Op-Ed Columnist - That ’30s Feeling - NYTimes.com: "Suddenly, creating jobs is out, inflicting pain is in. Condemning deficits and refusing to help a still-struggling economy has become the new fashion everywhere, including the United States, where 52 senators voted against extending aid to the unemployed despite the highest rate of long-term joblessness since the 1930s."

Ohio State Recruits Spain for Drum Majorette to Dot the "I" in Script Ohio

(c)2010 F. Bruce Abel

Gordon Gee announced the signing of a Majorette from Barcelona to lead the Ohio State Band out on the field for all games the next four seasons. Type in "Barcelona" within this blog and see second item down (third, now, since this blog has the word "Barcelona" too).

Better yet I'll create a new Label and call it "Barcelona."

Demanding Buyers Hinder the Housing Market - NYTimes.com

Demanding Buyers Hinder the Housing Market - NYTimes.com: "“We see buyers who must have learned their moves from the World Wrestling Federation,” said Glenn Kelman, chief executive of the online broker Redfin. “They think the final smack-down occurs at the inspection, where the seller will be reluctant to refuse any demand because the alternative is putting the house back on the market as damaged goods.”"

Op-Ed Columnist - The Boring Speech Policy - NYTimes.com

Op-Ed Columnist - The Boring Speech Policy - NYTimes.com: "We wanted him to declare war on the oil companies! Every day it becomes clearer that these guys are even more feckless than we imagined. At the ritual Congressional lashing of C.E.O.’s this week, we learned that none of the major oil companies have any idea how to control a spill like this, and that their faux plans for handling one in the gulf were made up of boilerplate so undigested that several had sections on protecting walruses — mammals that have not been seen in the area since the Ice Age. “It’s unfortunate that walruses were included,” admitted Exxon Mobil’s chief.
The way things have been going, you can’t be too careful. If the portents keep piling up, it’s easy to envision a headline like: “Lone Tourist in Pensacola Eaten by Visiting Walrus Herd.”"

Op-Ed Columnist - Letter From Istanbul - NYTimes.com

Op-Ed Columnist - Letter From Istanbul - NYTimes.com: "Finally, there is a vacuum inside Turkey. The secular opposition parties have been in disarray most of the decade, the army has been cowed by wiretaps and the press has been increasingly intimidated into self-censorship because of government pressures. In September, the Erdogan government levied a tax fine of $2.5 billion on the largest, most influential — and most critical — media conglomerate, Dogan Holdings, to bring it to heel. At the same time, Erdogan lately has spoken with increasing vitriol about Israel in his public speeches — describing Israelis as killers — to build up his domestic support. He regularly labels his critics as “Israel’s contractors” and “Tel Aviv’s lawyers.”"

Mad Money Recap | Nightly Recap for: Wednesday, June 16, 2010

Mad Money Recap Nightly Recap for: Wednesday, June 16, 2010: "Jim: Not a great day, not a terrible one… Dow Jones up a tad… S&P 500 Index, break even.. thanks to the usual climatic issues… a stronger price of oil, Euro only a tad weaker, terrible housing starts… but we expected that… I am going to break form, I am going to do something a little different today… I am going to use the top of this show to help write the speech that I would have given last night if this country ever makes the, some would say unfathomable, catastrophic error, of letting me anywhere near the Oval office… this is the speech that Obama should have made about the oil spill… the horrible oil spill and what we can do about it."

Op-Ed Columnist - Letter From Istanbul - NYTimes.com

Op-Ed Columnist - Letter From Istanbul - NYTimes.com: "The first vacuum comes courtesy of the European Union. After a decade of telling the Turks that if they wanted E.U. membership they had to reform their laws, economy, minority rights and civilian-military relations — which the Erdogan government systematically did — the E.U. leadership has now said to Turkey: “Oh, you mean nobody told you? We’re a Christian club. No Muslims allowed.” The E.U.’s rejection of Turkey, a hugely bad move, has been a key factor prompting Turkey to move closer to Iran and the Arab world."

The Baseline Scenario


--------------------------------------------------------------------------------
They’re Just Irrational?

Posted: 14 Jun 2010 07:41 PM PDT

By James Kwak

Don’t get me wrong: I like behavioral economics as much as the next guy. It’s quite clear that people are irrational in ways that the neoclassical model assumes away, and you can’t see human nature quite the same way after hearing Dan Ariely talk about his experiments on cheating. But I don’t think cognitive fallacies are the answer to everything, and I don’t think you can explain away the myriad crises of our time as the result of them, as Richard Thaler does in his recent New York Times article.

Like many people, Thaler wants to write about the parallels between the financial crisis and the BP oil leak. For Thaler, the root cause of both crises is that “people in general are not good at estimating the true chances of rare events, especially when human error may be involved” — catastrophic market seizures in the first case, catastrophic oil rig explosions in the latter case.

I have no doubt that it is true that people have problems estimating the chances of certain rare events.* But to stop there is to whitewash the sins of the companies and the executives who created these crises.

First, it doesn’t do to say that ordinary people are irrational in making ordinary everyday decisions, and therefore we have to accept that companies will be irrational in making big decisions — like, say, whether to drill holes in the Earth’s crust a mile under the ocean. As they say, people make big bucks to make these decisions, and we expect them to use a little more reasoning than the kind we evolved on the African grasslands.

The problem isn’t that people have cognitive biases in assessing unlikely events. When you’re dealing with a big company like Citigroup or BP, you have many people applying lots of clever thinking to these problems. The problem is that there is a systematic bias within these companies against certain assessments and in favor of others. That is, the guy who shouts, “Danger! Danger!” will be ignored (or fired), and the guy who says, “Everything’s fine, the model says disaster can strike only happen once every hundred million years” will get the promotion — because the people in charge make more money listening to the latter guy. This is why banks don’t accidentally hold too much capital. It’s why oil companies don’t accidentally take too many safety precautions. The mistakes only go one way. You have executives assessing complex situations they don’t even begin to grasp and making the decisions that maximize their corporate and personal profits. (Is BP’s CEO going to give back years of bonuses now?)

On top of that, it isn’t even true, as a matter of fact, that the companies involved failed to estimate the risk of disaster. In a recent Fresh Air interview, Abrahm Lustgarten discussed three internal BP memos, written in 2001, 2004, and 2007, each of which warned that the company’s culture of inattention to safety — “a consistent emphasis of profits over production over safety and maintenance and environmental compliance,” in Lustgarten’s words — was creating a high degree of risk. The problem wasn’t cognitive fallacies; it was that BP employees were almost certainly falsifying internal inspection reports because of pressure to let production go forward.

This isn’t inability to quantify the likelihood of unlikely events; this is willfully looking the other way.

Thaler also wants to make the point that regulators are incapable of understanding the complex technologies involved, whether in finance or in oil exploration. But while this is undoubtedly true to an extent, it also misses the main point.

The most frightening part of Lustgarten’s interview has nothing to do with BP. It’s about the use of hydraulic fracturing (or “fracking,” apparently with no intended reference to Battlestar Galactica) to drill for natural gas. In fracking, a mixture of water and chemicals is injected underground under extremely high pressure to break up rock formations and release trapped natural gas bubbles. According to Lustgarten, there is no scientific understanding of what happens to those chemicals — many of which are toxic — and whether they end up in our drinking water. Yet the Energy Policy Act of 2005 forbids the EPA from regulating fracking under the Safe Drinking Water Act — by simply stipulating, without proof, that the chemicals are removed after being used, and therefore there is nothing to regulate.

If this reminds you of the Commodity Futures Modernization Act, it probably should. How could this happen? You should listen to the interview because I’m working from memory, but basically the EPA (this is under Bush and Cheney, remember) negotiated the deal with Halliburton and the other gas exploration companies. The EPA agreed to the stipulation, and hence the exemption for fracking, and in exchange the drillers agreed to stop using benzene (or diesel fuel, of which benzene is a component) as a fracking chemical. Years later, however, we now know that the exploration companies simply continued to use benzene as a fracking chemical.

This is what happens when you have a weak regulatory agency crippled by pressure from above (and political appointees who are opposed to regulation) and a private sector that simply does whatever it pleases in pursuit of profits. It’s not individual irrationality; it’s power, pure and simple. Free market economics has already whitewashed enough egregious corporate behavior. Let’s not repeat that mistake with behavioral economics.

* I have always been puzzled, however, by the fact that sometimes people say we underestimate certain unlikely risks, like financial meltdowns, but sometimes people say we overestimate certain other unlikely risks, like dying in a plane accident or a tornado.





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Spain becomes new euro flashpoint - The Globe and Mail

Russia begins buying Canadian dollar, Spain becomes new euro flashpoint - The Globe and Mail: "Spain is fast overtaking Greece as the flashpoint for Europe’s debt crisis. Rumours related to Spain, immediately denied today, sent the euro temporarily tumbling while the country’s borrowing costs hit a fresh record. Separately today, the Financial Times reported that Spain’s banks are borrowing record amounts from the European Central Bank, with €85.6-billion in borrowing last month the highest since the launch of euro zone in 1999.
“Rumours were rampant in the overnight session that Spain was negotiating a €250-billion credit facility with the U.S., IMF, and EU,” said BMO Nesbitt Burns economist Benjamin Reitzes. “That hit the euro, which fell nearly a cent on the report, while equities were sold briefly as well. The rumour was quickly denied, and frankly seems ridiculous, as the U.S. is extremely unlikely to a major participant in any European loan deal. Moreover, a loan facility already exists ... so why create a separate package? Spain is planning €3.5-billion in 10 and 30-year auctions tomorrow, and the manner in which they are received by markets will be watched closely. Nerves are already fragile on negative stories over Spain's banks.”"

Russia begins buying Canadian dollar, Spain becomes new euro flashpoint - The Globe and Mail

Russia begins buying Canadian dollar, Spain becomes new euro flashpoint - The Globe and Mail: "Michael Babad
Published on Wednesday, Jun. 16, 2010 7:17AM EDT

Last updated on Wednesday, Jun. 16, 2010 8:00AM EDT

These are stories Report on Business is following today. Get the top business stories through the day on BlackBerry or iPhone by bookmarking our mobile-friendly webpage.
Russia buys Canadian dollars
Russia has made good on a plan to add the Canadian dollar to its international reserves. Alexei Ulyukayev, the first deputy chairman of the country’s central bank, said after an event hosted by Bloomberg News last night that “we have added the Canadian dollar but haven’t yet begun operations” with the loonie. He told the news agency the central bank is also considering adding the Australian dollar.
Russia has said it is overhauling the makeup of its reserves amid extreme volatility of currencies such as the U.S. dollar and euro. At the same time, the Canadian currency is gaining in stature and popularity given the country’s strong economic and fiscal standings relative to its peers. There has been talk of the loonie gaining reserve currency status, though observers say it can’t truly hold that position given the limited nature of its trading."

"The energy sector also will be in the spotlight as President Barack Obama gave a nationally televised address blasting BP , calling for the oil giant to set up an independently administered escrow account to pay claims from the Gulf of Mexico oil spill. Obama also talked of the need for more renewable energy.
Obama is meeting with BP chairman Carl-Henric Svanberg Wednesday morning with the escrow account and the company's dividend payments the focus of attention. Shares of BP were down 4% in pre-open trading, and its credit-default swaps have widened noticeably, indicating the market is increasingly betting the firm will default on bond payments."

No Hot Air's Nick Grealy is UK's Bruce Abel

(c) 2010 F. Bruce Abel

I've been following No Hot Air for a year now.

No Hot Air: "Quick link here from Hill & Knowlton, one of world's largest PR agencies, mentioning a recent meeting with them:
Yesterday I met leading energy blogger Nick Grealy over a coffee to discuss all matters energy as well as the shale gas phenomenon. Nick writes a blog called appropriately, ‘No Hot Air’. Interestingly, Nick has blogged about shale gas, perhaps more than anyone else – certainly in the UK at least. According to Nick, shale gas is an energy source where the ‘reality outstrips the hype’. It’s clear that shale gas companies in the States as well as the global energy majors are investing vast amounts in Europe in what they perceive as a game changer as well as what Nick terms a ‘bridge fuel’ for future. Hugely interesting.
Thanks to H+K for their kind words, and their open mind."

Time and Trade

Status Symbol Action Qty Venue Price TIF Qty Filled At Trade Type Curr Trigger Price Order # Time Sec Type

Filled PG 07/17/2010 57.50 P Buy to Open 20 SmartEx 0.36 Day 20 at 0.36 Primary 18153589 09:50 6-15-10 (EDT) Opt

Contingent PG 07/17/2010 57.50 P Sell To Close 20 SmartEx Market GTC Trailing Stop 09:50 6-15-10 (EDT) Opt
Contingent PG 07/17/2010 57.50 P Sell To Close 20 SmartEx Market GTC Profit Exit 3.36 09:50 6-15-10 (EDT) Opt

Filled AAPL 07/17/2010 250.00 P Buy to Open 1 SmartEx 8.05 Day 1 at 8.00 Primary 18151484 09:48 6-15-10 (EDT) Opt

Contingent AAPL 07/17/2010 250.00 P Sell To Close 1 SmartEx Market GTC Trailing Stop 09:48 6-15-10 (EDT) Opt
Contingent AAPL 07/17/2010 250.00 P Sell To Close 1 SmartEx Market GTC Profit Exit 11 09:48 6-15-10 (EDT) Opt

From the Executive Summary by Jenner & Block

On January 29, 2008, Lehman Brothers Holdings Inc. (“LBHI”1) reported record
revenues of nearly $60 billion and record earnings in excess of $4 billion for its fiscal
year ending November 30, 2007.2 During January 2008, Lehman’s stock traded as high
as $65.73 per share and averaged in the high to mid‐fifties,3 implying a market
capitalization of over $30 billion.4 Less than eight months later, on September 12, 2008,
Lehman’s stock closed under $4, a decline of nearly 95% from its January 2008 value.5
On September 15, 2008, LBHI sought Chapter 11 protection,6 in the largest bankruptcy
proceeding ever filed.7

Mad Money Recap | Nightly Recap for: Tuesday, June 15, 2010

Mad Money Recap Nightly Recap for: Tuesday, June 15, 2010: "In other words, this is a mile that I regard as being a mile wide and a quarter inch thin… which can end on a dime… we used to have rallies… fundamentally based rallies… they were great, good news came out… people went bolden to buy… the market traded up to what is known as supply… people would buy stocks all the way up until we found sellers… people wanted to take profits… or people would say listen, my stock is up $2, I want to sell.. that is how the market used to work… it is now how this market works… now we buy stocks until some technical level is triggered… and then the shorts come in and buy stocks because the technical level got triggered… meaning there are people betting against the market… maybe because of last night miserable close… remember, it was down in the last 20 minutes… or maybe they accurately predicted that the data and earnings… Best Buy, Empire, Europe… would be bad… and that would bring out sellers… so they shorted the market… and then the sellers did not show up… or right now we buy stocks until the ultra ETF’s… those financial products of mass destruction… come in… we sell stocks… but today the ETF sellers took the day off in the last 20 minutes.. . they were there yesterday, what happened today?"

Mad Money Recap | Nightly Recap for: Tuesday, June 15, 2010

Mad Money Recap Nightly Recap for: Tuesday, June 15, 2010: "Plus, overseas, it seems more and more likely that Greece is going to default… hey, a few weeks ago that would have caused us to be down 500... now we are ?… I mean come on, that should roll back every bit of the ground that this market has made up… ugly, horrible, right? All bad news… how much should we have been down today, maybe 200? Maybe we should have been down 400? You know it and I know it… yet we rallied… the good Euro… whatever… you know what? I am calling this a bad rally… that is right… I know that sound oxymoronic but I do not care… this market has now become more depressing than Ethan From… as even the good days are now bad days."