Saturday, December 01, 2007

Banker Rhymes with Wanker

Two videos that are a bit amusing, regarding loans and bailouts.

First, one.


And another.


Mr. Bernanke: Don't lower rates. Wankrupt the stupid bankers.

Worst First Dance Ever?

"So, I went to a wedding...and a dance broke out!"

I think this was Fundman's wedding, right?

Okay, maybe not. But...what were these people doing?
They had clearly practiced. And they were seriously shaking.
The bride's dress top can barely contain her...her...her enthusiasm.

(Nod to Anonyman, who asks, "Why did they do this in public? Why did they record this,? Why did they pay thousands of dollars for an audience to be there for it?")

Could Chavez actually lose??

So far, Hugo has won every election he's put in front of himself, so on the surface it would seem like he'd easily win tomorrow's referendum on his reforms (which boil down to making him a virtual dictator for life). However, there is some late info suggesting that he may have actually, finally overreached.

The inimitable Boz presents opinion poll numbers showing that a majority disapprove, but among likely voters, it's extremely close. Even the WaPo has noticed as well.

Few associates had been as loyal to President Hugo Chávez as the governor of the coastal state of Sucre, Ramón Martínez. And few are now more determined to defeat Chávez as he campaigns for constitutional changes that, if approved by voters on Sunday, could extend his presidency for life.

Chávez, 53 and in his ninth tumultuous year in office, was until recently predicted to win a referendum that would permit him to run for 8office indefinitely, appoint governors to federal districts he would create, and control the purse strings of one of the world's major oil-producing countries.

But Martínez and a handful of others who once were prominent pillars in the Chávez machine, have defected, saying approval of 69 constitutional changes would effectively turn Venezuela into a dictatorship run at the whim of one man. They have been derided by Chávez as traitors, but their unimpeachable leftist credentials have given momentum to a movement that pollsters say may deliver Chávez his first electoral defeat.

"The proposal would signify a coup d'etat," said Martínez, 58, whose dapper appearance belies his history as a guerrilla and Communist Party member. "Here the power is going to be concentrated in one person. That's very grave."

Pollsters in Caracas say Venezuelans increasingly agree -- even those who continue to support the president but say the proposed overhaul of an eight-year-old constitution goes too far.

Datanalisis , a respected Caracas polling firm that earlier this month was predicting a Chávez win, said that 48 percent of respondents in an opinion survey last week said they would vote "no" to the constitutional amendments, compared with 39 percent who expressed support, polling director Luis Vicente León said.

"In those three weeks, what's happened is, the people have been sensitized," León said. "What happened is, he presented a reform the people don't like."

Datanalisis accurately predicted Chávez victories in past elections, including last year's presidential election, in which he won a second six-year term by an overwhelming margin. León said the president's vigorous campaigning in these last few days is closing the gap. "It all depends on the capacity to mobilize," he said, "and we know who has that capacity."

The government has embarked on an all-out crusade, including a barrage of television ads and political rallies, with Chávez giving three or more speeches each day. When the day is done, Chávez appears on Mario Silva's "The Razor Blade," a talk show on government television, where he expounds well into the night. His face stares down from billboards and placards with the word "Sí," adorning balconies and windows.

I guess I am cynical enough to feel that this is a 1988 PRI in Mexico situation: If it looks like your candidate is losing, unplug the computers counting the votes and declare victory in the morning. That is to say, whatever the actual vote, I think it's likely Chavez will declare victory and move on.

Friday, November 30, 2007

That's What I'm Talking about!

Mr. C. Dolan:

Mr. Ainge's Celtics expressed my concerns far more eloquently than I ever did in my
recent letter.

CELTICS 104, KNICKS 59

(And this in a game where KG took 5 shots and scored 8 points!)

Thursday, November 29, 2007

Does poor Economic Performance help Cause Civil War in Sub-Saharan Africa?

Yes and No (what else would you expect from economists?)!


Are civil wars partly caused by low economic growth? And do democratic institutions attenuate the impact of low growth on the likelihood of civil war? Our approach to answering these questions exploits that international commodity prices have a significant effect on income growth in Sub-Saharan African countries. We show that lower income growth makes civil war more likely in non-democracies. This effect is significantly weaker in democracies. So much so, that we do not find a link between growth and civil war in countries with democratic institutions. Our results therefore point to an interaction between economic and institutional causes of civil war.


The full paper by Bruckner and Ciccone is here.

An Open Letter to Charles Dolan

Hi Chuck. Listen, I know it's not easy having a loser son (just ask my dad, he'll tell you), and I know you have been busy trying to take Cablevision private for 10 billion or so, and I know the Knicks payroll is just chump change to you, but.......

Chuck you gotta do something about that kid of yours and what he's done to the Knickerbockers!! Sure, everybody's got to do something and better he screws up the Knicks than one of your real businesses, but there's got to be a limit.

Look at it this way Chuck. Danny Ainge is not exactly the sharpest tool in the shed. He's a chucker, a biter, and pretty much a loser. But even he has figured it out in Boston. Not that the Celtics are the be all and and end all, not that the solution there is very long term. But they are in the top of the Atlantic, winners of 8 out of their last 10, whilst your boy's toy is already 7 games behind them, losers of 8 of their last 10. I'd point out that the Celtics payroll is "only" 75 million compared to the Knicks' 89 million, but I know that you'd walk by 14 mil on the sidewalk without bothering to bend over and pick it up (just not worth your time, it's only Zach Randolf's salary).

I guess it's sweet how you indulge Jimmy's boycrush on Isiah and all, but maybe just give the two of them $50 million each and unlimited multiple trips around the world airline tickets (or maybe their own plane and pilot) and get someone who knows and cares about basketball in the executive offices of the Ga-den.

Wednesday, November 28, 2007

I hate myself for loving this

I shouldn't post this. But...who would ever have done this?

Dumb ass of the year award

Add to My Profile | More Videos

(Nod to Bayou Jack. He writes: "Guys rule! And, no woman would think this is funny, which PROVES that guys rule." True dat, BJ)

The unstoppable American consumer?

The power of the KPC gift guide keeps showing up in the marketplace. Monday was "Cyber Monday", the online equivalent of last week's brick and mortar "Black Friday" and sales were up 21% from last year.

Some details:

While the first Monday after Thanksgiving kicks off the online holiday shopping season, it's not the busiest day for retailers, according to comScore.

Last year, the busiest online shopping day was Wednesday, Dec. 13, generating $667 million in sales. The Monday after Thanksgiving was actually the 12th busiest day in terms of sales for the 2006 holiday period.

Nevertheless, the first Monday after Thanksgiving, known as Cyber Monday, represents the first big sales surge, as consumers return to their office and click on their computers to shop. ComScore said that Monday's sales results represented an 84 percent jump from the average daily online spending totals during the preceding four weeks.

More than $10.7 billion has been spent online from Nov. 1 through Nov. 26, marking a 17 percent gain from the corresponding days last year, comScore said.

Cool. I guess Daniel Gross was right.

Don't Bring a Knife to a Gun Fight

Fundman sends this link.

I don't know the answer. If you have kids, a gun in your house
is far more likely to kill your own kid, through accident or play.

We have several guns, but they are locked in a cabinet, with trigger locks inside that. I couldn't possibly get to them in time to defend myself against a home invasion.

If I didn't have kids, tho, I'd probably have a handgun.

Tuesday, November 27, 2007

Get a Sack

From Betsy's Page: the ugliest bride I have ever seen.

Endorsement #457 for Ron Paul

Hookers for Paul: An odd endorsement...Who can come up with the best joke about this?

Example:

Nevadans for Paul: Westward, Ho!

(I didn't say it was a GOOD example)

(Nod to CG)

Thank you, folks. I'll be here all week

The Putincrats are gearing up for a big big vote this Sunday for his party United Russia.

In the push to get out the vote, the absentee ballot has become a popular new tool.

A teacher in St. Petersburg said the school administration told staff members to get absentee ballots from their neighborhood polling stations ahead of the election. They are to vote together Sunday at a polling station at the school.

"They didn't tell us necessarily to vote for United Russia, but you can read between the lines," said the teacher, who was willing to give only her first name, Yelena, out of fear of being fired.

Similar accounts have been given by teachers, doctors, factory workers and others around the country. Some have said they were warned they would lose their jobs if they did not comply.

Hundreds of people have called an election hot line to complain about the use of absentee ballots, the Central Elections Commission said in a summary of the complaints posted on its Web site.

Some complaints came from hospital patients, who said they had been threatened with early discharge if they did not produce absentee ballots.

"It is unbelievable. The use of bureaucracy is on an unprecedented scale," said Marina Dashenkova of Golos, an election-monitoring group. "People are complaining that their bosses are forcing them to take absentee ballots and vote for whom they say."

The use of absentee ballots in this way is new, she said, and kills two birds with one stone for the Kremlin: By getting absentee ballots, people are registered as voting even if the votes are never cast, boosting turnout; and when they vote under the supervision of bosses they are likely to vote "correctly."

People also have complained of being required to round up a certain number of votes for United Russia. Yelena, the St. Petersburg teacher, said she was told to compile a list of five relatives or friends.

More than anything, this reminds me of the old Yakov Smirnov joke:

"In America you can always find a party. In Russia, the party finds YOU!"

Case Closed

Almost a year ago, a Penn econ prof Rafael Robb's wife was beaten to death in their home. A month later, the professor was charged with the murder and his attorney said he would be pleading not guilty.

Yesterday however, Robb pleaded guilty to voluntary manslaughter in the case and is expected to serve (what to me seems an incredibly light) 4.5 - 7 year sentence (another report on the story is here).

The circumstances seem somewhat contradictory. On the one hand:

Robb, 57, said Monday that he got into an argument with his wife about a trip she was taking with their daughter and whether they would be returning in time for the daughter to return to school.


"We started a discussion about that. The discussion was tense," Robb said. "We were both anxious about it. We both got angry. At one point, Ellen pushed me. ... I just lost it."

"It's a classic heat-of-passion killing," said Montgomery County District Attorney Bruce Castor.

On the other hand though:

Detectives believed the scene had been staged to look like a burglary. The murder weapon - a grab-rail exercise bar that had not yet been installed, Robb said - was not found.


Robb was an expert in game theory, a complex melding of psychology, human behavior and economics - all aimed at determining what one's adversary will do next. With that background, police said, Robb probably thought he could outsmart them.

To a certain hideous extent, given that the crime was so heinous and that original charge was murder while the final plea was for "only" voluntary manslaughter and a light sentence, I guess he kind of did.

Brainwashed!

I just realized that the gubmint has been pulling the wool over my eyes. Found out in the New York Times of all places, where Stephanie Coontz asks why the State is in the marriage business. And that is a very good question indeed; sad that I never questioned it before.

From the article it seems like the US States got into the marriage business for reasons of racism/eugenics:

The American colonies officially required marriages to be registered, but until the mid-19th century, state supreme courts routinely ruled that public cohabitation was sufficient evidence of a valid marriage. By the later part of that century, however, the United States began to nullify common-law marriages and exert more control over who was allowed to marry.

By the 1920s, 38 states prohibited whites from marrying blacks, “mulattos,” Japanese, Chinese, Indians, “Mongolians,” “Malays” or Filipinos. Twelve states would not issue a marriage license if one partner was a drunk, an addict or a “mental defect.” Eighteen states set barriers to remarriage after divorce.

and now it's all about control; you can't get your "benefits" if you don't have the government papers.

As Nancy Polikoff, an American University law professor, argues, the marriage license no longer draws reasonable dividing lines regarding which adult obligations and rights merit state protection. A woman married to a man for just nine months gets Social Security survivor’s benefits when he dies. But a woman living for 19 years with a man to whom she isn’t married is left without government support, even if her presence helped him hold down a full-time job and pay Social Security taxes. A newly married wife or husband can take leave from work to care for a spouse, or sue for a partner’s wrongful death. But unmarried couples typically cannot, no matter how long they have pooled their resources and how faithfully they have kept their commitments.



Monday, November 26, 2007

Tax Law Test for "Abode"

One of the cool things about knowing a lot of lawyers is that one realizes that "the law" is a silly concept. No such thing, no way.

There is "the statute," but often that tells you too little, or too much.

This is more true in taxes than in other areas, as far as I can tell.

But sometime I am still surprised. Here is Joe Craven, on the concept of "abode."

Where is one's abode, for tax purposes? Joe is able to say more than "I don't know." The answer is, "NO ONE knows." The statute doesn't say. You have to guess.

Given all the folks working in the Middle East, trying to serve their country, or even just trying to make a buck...well, WTF? WTFingF?

I reproduce Joe's last section in full:

A Potential Storm of Cases May be Brewing

As these US Citizens come home and prepare returns claiming the exclusion of their income earned abroad while living in Iraq and Afghanistan, there could emerge a firestorm of confrontation between those taxpayers and the US government. Unless the courts move toward a test that is more focused on defining “abode” as the place where, for the time being, a taxpayer exists to meet the conditions of the daily life encounter outside the US, our jurisprudence will continue to focus on location of houses and other assets, family, voting registration, licenses and the like. The fact that citizens are thoroughly investing their lives in another country for and with another people may be of little significance if the test for a taxpayer’s abode is not modified.


Fix this, for heaven's sake. The IRS can't fix. The courts MIGHT be able to fix it, but that is chewing gum and bailing wire. The STATUTE. Fix the STATUTE, Congress. The Dems say they can't do much to help the troops. Do THIS. No one is stopping you. Just give a clear definition.

Trent Lott: Retired, or Just Tired?

Duke put out a "news tip" this afternoon, on Trent Lott's possible retirement.

Tremendously insightful, I'd say. You'll like it.

Dog Bites Man

Duke fires head coach Ted Roof.

His record was 6-45, in four seasons.

Interestingly, the single key difference was....a kicker. Duke would have won at least six more games in the last two years if they could kick a freakin' field goal, or extra point.

Coach K, on Duke football, in the Sporting News:

"...Men's basketball coach Mike Krzyzewski -- widely considered the public face of the university -- to urge Duke's administration to act quickly, one way or another.

"Whatever happens ... let's make quick decisions," Krzyzewski said after his team's victory over Eastern Kentucky on Sunday. "You support Ted, let's give him an opportunity to grow and don't let this linger. Something's going to happen otherwise, then do that. But we need to do that. And then we need to develop an attitude that we can win here, which we can. Duke football can win.

"You have to start out believing you can win," he added. "Our goal, for any sport, Duke should not play a sport where our goal is to be competitive. We shouldn't field a team for that. We should field teams only where our goal is to win with class and dignity. If it's to be competitive, then we shouldn't fund that program. ... Duke should be competitive in everything. For a championship, not just to compete."


Um....look, I'm a UNC fan, so I'm biased. UNC should be able to field a football team that goes .500, and at least competes for a bowl berth. Not BCS, but something. I don't see how Duke can hope to do that. We have 5,800 undergrads. You need 80 football players to have a team. That's 1.4% of the entire student body, playing football.

I Love Me! Now Buy My Stock.....

It's All about Me: Narcissistic Chief Executive Officers and Their Effects
on Company Strategy and Performance

Arijit Chatterjee & Donald Hambrick, Administrative Science Quarterly, September 2007, p351-386 (not yet published!)

Abstract:
This study uses unobtrusive measures of the narcissism of chief executive
officers (CEOs)--the prominence of the CEO's photograph in annual reports,
the CEO's prominence in press releases, the CEO's use of first-person
singular pronouns in interviews, and compensation relative to the
second-highest-paid firm executive--to examine the effect of CEO narcissism
on a firm's strategy and performance. Results of an empirical study of 111
CEOs in the computer hardware and software industries in 1992-2004 show that
narcissism in CEOs is positively related to strategic dynamism and
grandiosity, as well as the number and size of acquisitions, and it
engenders extreme and fluctuating organizational performance. The results
suggest that narcissistic CEOs favor bold actions that attract attention,
resulting in big wins or big losses, but that, in these industries, their
firms' performance is generally no better or worse than firms with
non-narcissistic CEOs.


Sometimes, studies come up with EXACTLY what you would expect. Having an ubermensch as a CEO, or maybe just someone who perceives himself as THE ubermensch, couldn't have a net positive effect on mean earnings. If it did, firms would hire ubermenschen until, at the margin, the net bump was competed away by idiotic ubermenschen who weren't CEO material, but were well suited to be university chancellors.

But, since you can't tell which ubermenschen actually have some talent, or maybe which ones are going to get lucky by taking high-risk strategies, the variance of returns should be higher. And they are.

Still, should a firm hire an ubermensch? Sure, the entertainment value, and the new entries for DILBERT cartoons, make it worthwhile. At least, it's worthwhile for people who don't own stock in that firm. The amusement value is a public good.

Mad Money: Don't Do It

"Does Mad Money make the market go mad?"

John Neumann & Peppi Kenny, The Quarterly Review of Economics and Finance, December 2007, Pages 602-615

Abstract:
Empirical studies of numerous popular investment advisory services find
statistically significant abnormal returns at the time of their broadcast or
published investment recommendations. Our analysis of returns and trading
volume around stock recommendations aired on charismatic host Jim Cramer's
Mad Money program reveals statistical evidence of response to both his buy
and sell opinions, with most of the full-day return following an on-air buy
recommendation captured by that day's opening price. Trading strategy
analysis suggests that individuals with limited funds should be wary of
short-term trading to exploit the show's suggestions, while professional
investors may be able to exploit buy picks with a contra strategy.


Why do people watch this show? More importantly, why would they expect to be able to make money by acting on Jim's advice?

Now, sure, if I could get the names of the companies Jim is going to hawk, the morning BEFORE he hawks them, that would be useful. In fact, KPC volunteers to provide that public service: Jim Cramer, email us before you go on the air, and we will post your "buy" and "sell" recommendations. After we drop a dime to the ol' broker.

Sunday, November 25, 2007

Sorry Nouriel, but that's the power of KPC!

At the start of Black Friday, we posted a gift guide and sent our readers out with instructions to "disappoint (uberbear) Nouriel Roubini". Well the results are in and retailers racked up sales of around $10.3 billion (which is 8.3% higher than last year, almost double the expected growth rate).

In a prepared response, spokesbears for Roubini pointed out that the sales figure was "only 9.5 billion Canadian Loonies" and that Americans "still should not buy any green bananas".

[please note that while I am making up all the stuff in the previous paragraph the strong holiday sales figures are real]