Still More On Bear Stearns

Here are three quotes from Aftershocks of a Collapse, With a Bank at the Epicenter:

More so than other firms on Wall Street, Bear had encouraged its employees, from secretaries to top executives, to be long-term holders in the company’s stock, and the employees own over 30 percent of the company.

“My life has been flushed down the drain,” said one person. There was talk Monday that with their life savings nearly depleted, some executives had moved quickly, putting their weekend homes on the market.

But to most Bear employees, many who face the prospect of not only losing their jobs but of a retirement without savings, such a thought is perhaps too elusive to contemplate.

Huh? How can this be? I could retire on what these guys make in one year. Look at this quote from The Evolution of an Investor about former stockbroker Blaine Lourd:

Still, he was a 29-year-old earning $200,000 a year, and he was, as he puts it, "ramping up the lifestyle." Rival firms noticed his success: He left Bear Stearns for Dean Witter, which would later become Morgan Stanley. Blaine’s business grew to the point where he became somewhat famous. Name a prominent director or big-time movie star, and there was a fair chance that Blaine Lourd was giving her financial advice. He lived near the beach in Malibu, drove fancy cars, and indulged an expensive taste for young women who had moved to Los Angeles to become movie stars. He routinely ranked in the top 10 percent of revenue producers for whichever firm he happened to be working for. In his best years, he grossed more than $1 million. His father had been right: His persuasiveness and ability to get people to like him went far on Wall Street.

Bear Stearns mostly hires college educated “smart” people. So why were these people not smart enough to follow a basic investing rule that has been pounded into every American brain since the collapse of Enron? You know the rule I mean: “Diversify.” I simply can’t believe that everyone (except for the lower paid employees who do all the actual real work) who works at Bear Stearns doesn’t have substantial amounts of money stashed away in something other than Bear Stearns stock. Get real.

Also, it goes without saying that all these “smart” people at Bear Stearns were ignorant of the first two rules of investing:

1. Don’t lose money.
2. See rule number one.

Greed is not good.

My Recommendations To Bear Stearns

Honesty is the best policy. I recommend that Bear Stearns implement a policy of honesty and full disclosure. The first thing they should do is change their ticker symbol from BEAR to BS. Next, change their name to Bull… Well, you get the idea.

All I want is the truth.

Bear Stearns Fiasco

George W. Bush hates sick children, but he loves rich bankers. Actions speak louder than words. He has vetoed health insurance for children who need it, not once, but twice. He can’t or won’t find money for helpless children, but he is all too happy to open the government coffers for millionaires and billionaires who screwed things up because of their own greed and incompetence. How does he get away with something like this? JP Morgan Chase is taking over Bear Stearns with help from the federal government. How much more of this insanity do we have to put up with?

If Bear Stearns were to go under who does it hurt? Rich people. Rich people who were so dumb that they invested their money there. Read The Evolution of an Investor if you don’t believe that previous sentence. It is about former stockbroker Blaine Lourd and it contains this gem:

The older brokers in the office all threw around Buffett's name, so Blaine did too. Buffett was useful because everyone knew who he was and everyone thought he had made his money picking stocks. Blaine was picking stocks just like Buffett but using different criteria. The traders in New York would accumulate a block of shares, driving the price up, and then get brokers like Blaine to unload the shares quickly at the higher price—whereupon the price would, often as not, fall. "Seven months in at Lehman, I was one of the top rookie producers," Blaine says, "but every stock I bought went down." His ability to be wrong about the direction of an individual stock was uncanny, even to him. At first, he didn’t understand why his customers didn’t fire him, but soon he came to take their inertia for granted. "It was amazing, the gullibility of the investor," he says. "When you got a new customer, all you needed to do was get three trades out of him. Because one of them is going to work. But you have to get the second one done before the first one goes bad."

It wasn't exactly the career he’d hoped for. Once, he confessed to his boss his misgivings about the performance of his customers' portfolios. His boss told him point-blank, "Blaine, you're confused about your job." A fellow broker added, "Your job is to turn your clients' net worth into your own." Blaine wrote that down in his journal.

I don’t know anyone rich enough who could even consider investing at Bear Stearns. This is from Bear Stearns own web site:

At Bear Stearns, we have been helping high-net-worth individuals and families build and manage their wealth for over fifty years.

Bear Stearns is a company whose former CEO spent time playing golf and bridge rather than working. This same CEO refused to bail out Long-Term Capital Management in 1998.

From JPMorgan close to deal for Bear Stearns at Forbes.com:

The funds' collapse and subsequent problems in the credit markets called into question Bear Stearns ability to manage its own risk and the leadership ability of then-Chief Executive James Cayne. Critics of the company said Cayne spent too much time away from the office last year playing golf and bridge as the problems unfolded.

Cayne is the same executive who refused to let Bear Stearns provide support as part of a Federal Reserve Bank-led plan to rescue Long-Term Capital Management in 1998. His reticence was said to deeply anger some of his fellow Wall Street CEOs, and the episode came up every time Bear was reported to be in trouble in recent months.

Tonight on the Nightly Business Report a video clip of George W. Bush was shown with him saying, “Our financial institutions are strong.” Clueless George, lying George. Does George Bush know the definition of the word "strong." Because Bear Stearns sure ain't it. As long as George W. Bush remains in office I will be mad as hell. The problem is I still have to take it because no one will impeach him. The way things are going he will surely destroy this country of ours before his term is up.

How much more damage do we have to suffer before George W. Bush is thrown out of the White House?

I Am Glad I Am Not A Member Of Congress

After reading Dems Play FISA Right (Again?!) by Mike the Mad Biologist, my head hurts.

Eliot Spitzer, George W. Bush And "Ethical Perversity"

Outrage and calls for impeachment. For Eliot Spitzer, not for George W. Bush. Why? This is the “Ethical Perversity” of our troubled times. I have posted about this previously, specifically in My Thoughts On The Eliot Spizter Prostitution Scandal and in I Plead Guilty. Now, thanks to Rabbi Michael Lerner we have a name for it: “Ethical Perversity.”

I learned about Rabbi Michael Lerner and “Ethical Perversity” from alias Bruce. I like Bruce’s blog more and more with every new post from him. Here is Bruce on “Ethical Perversity”:

What else to call it when one politician is brought down in national disgrace for the hypocrisy and illegality of his dealings with a high-priced prostitution operation, while another politician lies the nation into an illegal war that kills tens of thousands, condones torture, and shreds the Bill of Rights, all to nary a peep about high crimes and misdemeanors?

Years ago George Orwell noted in Animal Farm that “some are more equal than others.” Unfortunately this is all too true in the real world as well as the fictional world of a novel. We desperately need accountability to be applied equally. The most powerful and rich among us should not be spared.

And speaking of the most powerful and rich among us. Why are they allowing the Bush administration to basically abolish the Fourth Amendment? They are the ones who could most effectively put a stop to things like immunity for telecom companies and revisions of the FISA laws. Did Bush go after Spitzer for political reasons? If he did, what’s to say that you won’t be next?

Bush, Thy Name Is Idiot

George W. Bush, during a video conference with military briefers in Afghanistan:

I must say, I'm a little envious. If I were slightly younger and not employed here, I think it would be a fantastic experience to be on the front lines of helping this young democracy succeed. It must be exciting for you...in some ways romantic, in some ways, you know, confronting danger.

Excuses, excuses. Age and employment have not kept many other Americans out of Afghanistan and Iraq.

And yes, Georgie, it really would be fantastic if you were serving on the front lines. Prince Harry did it, why not you?

More Of The Bush Legacy

George W. Bush’s life has been one of dodging accountability and being rewarded for incompetence. If he had not become president the rest of us could probably tolerate this. However, he did become president. And worse, he has allowed the practice of dodging accountability and reward for incompetence to spread. And it has spread, not only through his entire administration, but beyond, into the military and business worlds. This is George Bush’s legacy. It is not the legacy of a great leader.

George W. Bush is kind of hung up on his legacy and how history will judge him. George W. Bush is so arrogant that he thinks history will judge him in a positive light. I think history will judge him the way that most people in the entire world judge him right now. As a loser. As a terrible president. In my opinion, part of the Bush legacy will be one of not holding anyone accountable. Including himself.

Responsibility and accountability would go a long way toward fixing many of the messes we now find ourselves in. Holding people accountable now will help to prevent future messes. It’s called a deterrent. It seems that some of the people in power need a deterrent to help them do the right thing, otherwise greed takes over, and they mess everything up for the rest of us. CEO’s are not held accountable for our current economic mess. They are instead rewarded with huge retirement packages, and the companies they messed up are given government bailouts. This is accountability? Bush and Cheney are not being held accountable for Iraq, Katrina, the debt, the deficit… They should both be impeached.

Giving corporations immunity from lawsuits is not accountability. Shame on Rep. Steve King (R-IA) for suggesting that telecom companies should receive retroactive immunity from lawsuits. Sunlight is the best disinfectant. Let the Justice Department do its job. The people need more information about what is going on, not less. Power to the people, not to the Bush regime and the Military-Industrial Complex.

After 9/11, Congress appropriated $1 billion in federal emergency money to contractors and subcontractors working at or near Ground Zero. They were to use the funds “to set up a new insurance company to cover potential claims.” This insurance company, however, is now refusing to settle claims filed by firefighters and cleanup crews over illnesses caused by unsafe working conditions; the contractors claim they have immunity from any lawsuits.

Moreover, as we have seen in Iraq, guards from the private security contractor Blackwater have escaped punishment after killing 17 Iraqis in a Baghdad shoot-out and killing a top Iraqi politician’s bodyguard on Christmas Eve 2006.

More than anything, King’s argument shows why telecoms should not be granted immunity.

Grievances need to be heard and dealt with in a fair and just way. Immunity effectively stops this process. President Bush and Rep. King do not believe in liberty and justice for all. President Bush has even gone so far as to mock the concept of justice when he recently sang: “Down the lane I look and here comes Scooter; Finally free of the prosecutor.” They do not believe that rich and powerful people should be held accountable for their actions. They are unpatriotic and Un-American.

The worst part of all of this is how it affects those of us who are not rich and powerful. There are those of us who try to do the right thing as we go about our daily lives. We work at our jobs and try not to cheat other people. We try to provide for our families and abide by the laws of our community. And we are the ones who are being screwed by Bush and King and those like them. We are the ones being punished for doing nothing wrong. Yet the ones who have done wrong suffer no punishment and are even being rewarded in some cases. Ironic, isn’t it? Outrageous is perhaps a better word for it. Yet there is little or no outrage from those watchdogs of our community, the mass media. Because of greed at the top of our business community people at the bottom are losing their homes and their jobs. Because of greed people like the firemen mentioned above are losing their health and their lives. We sorely need accountability and responsibility across the entire spectrum of American life. Without it, we will just continue in the downward spiral that the Bush administration has encouraged and accelerated.

Bush And Cheney Are Not Above The Law

Representative Robert Wexler responds to Attorney General Mukasey's letter to Congress claiming administration officials have the right to ignore Congressional Subpoenas:

What The World Needs Now Is Guns Sweet Guns

Here’s Mike The Mad Biologist:

Defense spending increases faster than inflation, while discretionary spending--including biomedical science--has the pie 'grow smaller.'

This is the context in which science policy is made. There is no science fairy that places research funds under your pillow. Research requires appropriations. And for those who argue that private companies and foundations will pick up the slack in basic research, you're very, very wrong. In my previous job, I spoke pretty frequently with people in drug companies and foundations, and they will not fund most basic research. It's about as realistic as a herd of magickal ponies funding basic research.

So if ScienceDebate 2008 happens, will anyone ask the candidates about this?

Yeah, I didn't think so, either...

For some reason reading Priorities: Guns or Biomedical Science? inspired me to bastardize the old Jackie De Shannon song What The World Needs Now Is Love Sweet Love:

What the world needs now is guns, sweet guns
They’re the only thing that there's just too little of
What the world needs now is guns, sweet guns,
No not just for some but for everyone.

Lord, we don't need another poet,
There are poets and songwriters enough to rhyme
There are authors and journalists enough to write,
Enough to last till the end of time.

What the world needs now is guns, sweet guns
They’re the only thing that there's just too little of
What the world needs now is guns, sweet guns,
No, not just for some but for everyone.

Lord, we don't need another teacher
There are teachers and professors enough to show
There are scientists and researchers enough to probe
Oh listen, lord, if you want to know.

What the world needs now is guns, sweet guns
They’re the only thing that there's just too little of
What the world needs now is guns, sweet guns,
No, not just for some but for everyone.

No, not just for some, oh, but just for everyone.

The City Of Satan

It is hard for me to believe, but John “The Tri-Bomber” McCain and I agree on something. Not long after I wrote: “If there really is a devil, it must be Bush” I found this post on ThinkProgress which tells us that McCain thinks Washington, DC is the “city of Satan.”

Maybe The Inmates Should Take Over The Asylum

Sometimes I think that all economists, CEO’s and politicians are total idiots. Do they know anything at all? How can someone run Bear Stearns into the ground? It boggles the mind. Hey, I can destroy a huge company as well as the next guy. Where’s my multi-million severance package? Where is my bailout from Dubya and Ben?

The Federal Reserve invoked a rarely used Depression-era procedure Friday to bolster troubled Bear Stearns Cos. and said it will provide even more help to combat a serious credit crisis.

Brownie, oops I mean Ben, your’re doing a heck of a job:

The action won praise from the administration, with President Bush saying that Fed Chairman Ben Bernanke was "doing a good job under tough circumstances."

I’m sure that hearing this kiss of death from Bush really made Bernanke’s day.

Today Is Pi Day

So go eat some pi:

The rough ratio of pi 3.14 gives us the date for Pi Day. March 14, or 3/14 in American dating style, makes sense for a celebration of this famous constant.

Coincidentally, Pi Day is also the birthday of Albert Einstein, who no doubt knew more than a little about pi.

George Bush And The Busharoos Hit YouTube With A Bullet

You didn’t think they’d use an olive branch did you? I can’t decide which is more disgusting: that Bush thinks his presidency (which includes 9/11, Katrina and Iraq) is a big joke or that the stupid, immoral audience laughs at this. The audience obviously sees a clothed president instead of the naked emperor he really is.

Yes you're all gonna miss me, The way you used to quiz me, But soon I'll touch the brown, brown grass of home.

I spent my days clearing brush
I clear my head of all the fuss
But the fuss you made over harriet and brownie
Down the lane I look and here comes Scooter
Finally free of the prosecutor

Yes you're all gonna miss me, The way you used to quiz me, But soon I'll touch the brown, brown grass of home.

And then I wait and look around me
At the oval walls that surround me
I realize I was only dreaming
For there's Condi and Dick, my old compadre,
Talking to me about some oil rich Saudi,
But soon I'll touch the brown brown grass of home."

Yes you're all gonna miss me, The way you used to quiz me, But soon I'll touch the brown, brown grass of home.

That old White house is behind me,
I am once again carefree,
Don't have to worry 'bout a crisis in Pyongyang.
Down the lane I look, Dick Cheney is strolling
With documents he'd been withholding,
It's good to touch the brown brown grass of home."

If there really is a devil, it must be Bush. Under his watch: millions are losing or are about to lose their homes, our economy stinks, we occupy a country we invaded illegally spending an obscene amount of money there every second, 47 million Americans including 8 million children have no health care… The list goes on and on, it really does seem endless. But to Dubya and his minions it’s all a big joke. Yet, I’m not laughing, I’m SCREAMING!

If Natalie Maines criticizes Bush's singing will he send her to Gitmo?

FoxNews vs The Rest Of The World

PZ Myers Is God

Oh, wait a minute, Eric Clapton beat him to it. I still like the way PZ Myers writes, even if he isn’t a deity. If you are curious, try these on for size:

Friction-free morning

Which brings me to my big complaint: I get up early in the morning, and I step outside, and the sidewalks are all these beautifully smooth sheets of ice; it's like a Zamboni has gone down the streets of Morris, polishing everything.

Rare hyperbole

It's more like a meeting of the mindless. Ben Stein has had a friendly meeting with that old fraud, Ken Ham, and apparently they were perfect for each other.

Now blind in two senses

Or, more likely, that if you mail all your money to a preacher, you'll get rich.

Chris Hedges wastes everyone's time

And what about the atheists? Are there utopian dreamers among us? Sure, but not many — it's hard to be too optimistic when you're a minority surrounded by glib believers in balderdash. I think we tend to be realists: humanity has done fairly well for itself, and has potential to do better, but human nature is not a perfect ideal, nor is it perfectable, and we're always going to have conflict and compromise. The question is whether we're going to resolve those conflicts with reason, or with tribalisms and superstition.

And Here I Thought The Answer Was Sex

What women want ... in a car

Susie Gharib And President Bush

I usually watch The Nightly Business Report on PBS every evening. On Wednesday Susie Gharib interviewed George W. Bush and asked him questions about the economy. In her lead-in to the interview Ms. Gharib said:

President Bush told Nightly Business Report today that he would like to see a stronger dollar. His comments came as the dollar hit a new low against the euro. It now takes $1.55 to buy one euro. The president said one way to stem the dollar's slide is to “send signals to the world that overseas money is welcome in the United States.”

I watched The Nightly Business Report on Thursday evening and was amused during Susie Gharib’s interview with Robert Hormats when she said:

That's what I wanted to ask you. Is there a point where the dollar is just too low because it's been on a steady decline for the last almost seven years?

We all know who has been the president for the last seven years, don’t we? If he has been sending “signals that overseas money is welcome in the United States” for the last seven years, it hasn’t been working. If he hasn’t been sending “signals that overseas money is welcome in the United States” for the last seven years, then why hasn’t he been? It has to be one or the other. Either way, it is just another sign of Bush’s gross incompetence, and another sign of journalists giving him an easy time and not calling him on the stupid things he says.

While I watched the interview on Wednesday it seemed like Bush was making some sense, at least some of the time. However, he did say something that seemed very strange. Here is the excerpt:

GHARIB: I'd like to talk to you a little bit about sovereign wealth funds.

BUSH: Sure.

GHARIB: You know, we're becoming more and more dependent on foreign capital and some of it is coming from these sovereign wealth funds. Do you think that they're making a positive contribution, especially in this current climate, or do you see risks that they're using money for a political agenda?

BUSH: Well, first of all, it's our money. And a lot of the time -- and therefore I think it makes sense for us to encourage them to reinvest in our country. Secondly, we have got policy in place to make sure that they don't reinvest in industry that have got significant national security concerns attached to them. And so my answer is, absolutely we ought to welcome the capital back. It makes no sense not to welcome the capital back.

GHARIB: But a lot of people are very worried that America is for sale.

BUSH: Right.

Does Bush have a functional brain? How can he possibly say that foreign money is “our money?” Am I missing something here? Why didn’t Susie Gharib call him on this point? Of course by answering her question in this way he is dismissing the whole point of the question. He gets away with stupid stuff like this because no one calls him out on it. Why the hell not? We in the United States have the most overpaid and lame reporters on earth.

Also, if it is really "our money" then why do we need "policy in place to make sure that they don't reinvest in industry that have got significant national security concerns attached to them?" This is one huge freakin' contradiction. How does Bush get away with this kind of thing? He does this kind of thing all the time and reporters usually give him a pass. Why?

I just want to point out that this is not meant to be an attack on Susie Gharib specifically, but the media in general. However, I do wish Ms. Gharib would have challenged some of Bush’s lame statements.

CNN.com Headline Of The Day

Tori Spelling on cheating

U.S. Soldiers Are Still Dying In Iraq

Rocket Attack Kills 3 U.S. Soldiers in Iraq

Public Is Less Aware of Iraq Casualties, Study Finds

The presidential candidates, the mass media, and the president all seem to think that the economy is more important than people dying in Iraq.

Let’s not forget them.

A Symphony Of Lies