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Gender: Male
Hometown: Detroit, MI
Member since: Fri Oct 29, 2004, 12:18 AM
Number of posts: 72,733

Journal Archives

NASA in the social media era (cartoon)


Why Argentina Consistently, and Unapologetically, Refuses to Pay Its Debts

(Bloomberg) Argentina’s fight with foreign banks and bondholders is more than just business. It’s part of the national psyche, enshrined in a special museum at the business school at the University of Buenos Aires. The Museum of Foreign Debt is nothing fancy. There are a few flimsy panels plastered with grainy photos, dates, text, and graphs.

Oh, but the saga portrayed on those panels! Banks, bond investors, and the International Monetary Fund flood crooked regimes with overpriced credit. The Argentine economy collapses, and the people suffer. International markets are roiled. It happens time and time again. The story has all the emotions of a good tango.

Argentina has reneged on foreign debt obligations at least seven times, starting in 1827. The latest was in July 2014, when Argentina defaulted rather than give in to pressure from Paul Singer of Elliott Management. The fight with Singer has been going on for a dozen years, and the term vulture investor—rather esoteric in much of the world—is now pretty much universally known in Argentina. It’s so much on people’s minds that Buenos Aires toy stores carry a homegrown board game called Vultures, packaged in a box depicting a pair of the birds picking at a pile of dollars. “We planted the anti-vulture flag in the world,” President Cristina Fernández de Kirchner said in a speech in mid-May. “We gave a name to international usury and despotism.”

One May morning at the debt museum, guide Antonella Fagnano, a 21-year-old business major, describes Argentines’ attitude toward default. She pauses by a black-and-white photo of the late General Jorge Videla, who led a 1976 coup that ushered in a seven-year dictatorship. Successive presidents in that period loaded up on foreign debt to finance, among other things, the 1982 Falklands War with the U.K.

Today’s Argentina, Fagnano says, has no moral obligation to make good on debts like those. In fact, it would be wrong to pay. “Foreigners financed a lot of leaders, like these dictators. They didn’t do what they were supposed to do with the money, and left future generations the debt,” she says, shaking her head. “So, of course, you cannot allow that.” ...............(more)


Tom Tomorrow: Sparky's Inferno


‘Go to hell': Passenger booted off flight after confronting Texas governor over anti-gay views

Texas Gov. Greg Abbott was in New York promoting his home state of Texas, but maybe New Yorkers weren’t quite on board.

As he was boarding a flight home Tuesday night, a man approached him, shook his hand, then cursed him out because of Abbott’s vocal opposition to gay marriage.

“I hope you (expletive) go to hell because of your stance on gay marriage,” the 32 year old told him, later adding, “I’m going to see you on the plane,” according to the Austin American Statesman.

The man, who was not identified, was instead pulled off the flight and given a hotel room and a new flight departing Wednesday, the paper reported. The incident alarmed other passengers waiting to board flights at the Port Authority. Abbott was waiting with his family and staffers.

Abbott, who was the state attorney general before he was elected governor, has been a vocal opponent to same-sex marriage. ................(more)


Is Canada Next? Recession Is “Quite Contained”

Is Canada Next? Recession Is “Quite Contained”
by Wolf Richter • July 14, 2015

“In the current context, if you look at the growth numbers, the recession is effectively in the goods sector, it’s in the oil industry, it’s weak growth in manufacturing, weak growth in construction,” explained Kevin Page, Canada’s former parliamentary budget officer, a watchdog role charged with analyzing the state of the economy and government finances.

“It’s quite contained,” he told CBC radio, with an eerie echo of the Fed’s description of the US housing bust in the early stages of the Financial Crisis. There’s “still lots of growth in the service sector,” he said.

That’s what everyone is hoping. And it would just be a technical recession – two consecutive quarters of negative growth – rather than an official recession.

There wasn’t a lot of room for optimism. The economy shed 6,400 jobs in June, according to Statistics Canada, with gains in full-time jobs and losses in part-time jobs. The unemployment rate remained at 6.8%, same since February. But there are numerous indications that contractors, which do much of the work in the oil patch, are still working, but a lot fewer hours, and that this deterioration, in Calgary for example, hasn’t been fully captured by unemployment statistics.

“If you look at the job picture, it’s gotten progressively weaker through the summer,” Page said. “I think that would be a concern for the government and a concern for the overall strength of our economy.” ...............(more)


El Chapo (cartoon)


Micro-Apartments Are Coming to the Midwest

(Bloomberg) .......(snip).......

Micro apartments are still a new trend in the U.S.—Seattle, with about 3,000, probably has the largest market—so you can't read too much into what data do exist. But a study published last year by the Urban Land Institute (ULI) backs Grgurich’s assertion. Researchers found that units smaller than 600 square feet rented for $2.65 per square foot—54 percent more than apartments between 600 and 1,000 square feet and 81 percent more than apartments larger than 1,000 square feet.

Jon Durham, a partner at NoMi Developers in Kalamazoo, Mich., says he was motivated to work on a complex of 300-sq.-ft. apartments to fill what he sees as a void of housing that new college grads can afford. "We need it for the stay factor for our city," he says, adding that demand has been high. About half the apartments in the 47-unit complex, which includes some larger units, have been leased, even though construction won't be complete until next year.

“I’m reveling in it,” says Dylan Gorman, 22, who lives in one of Hubbell’s micro-apartments. He says that having a smaller space makes it easier to clean and that the building's community amenities, such as a fitness center and pool table, make up for having a smaller living area.

Not everyone loves it. The ULI study collected completed surveys from 110 micro-apartment renters, finding that they were less likely than traditional renters to be satisfied with the value they got for their money. That may be because of sacrifices made to accommodate smaller spaces. In Kalamazoo, Durham expects his micro-apartments to come with refrigerators and microwaves but no stoves. In Omaha, developer Dave Paladino is building about 80 micro units in a gentrifying neighborhood on the edge of the city’s core and trying to decide whether he can cram a washer-dryer into apartments as small as 230 square feet. "It feels like living in a closet," The Strangler reported on Seattle's burgeoning micro-apartment scene. ..................(more)


Billionaire Paul Singer: China Crash Is 'Way Bigger Than Subprime'

(Bloomberg) Hedge fund manager Paul Singer said that China’s debt-fueled stock market crash may have larger implications than the U.S. subprime mortgage crisis, echoing warnings from fellow billionaire money managers Bill Ackman and Jeffrey Gundlach.

“This is way bigger than subprime,” Singer, founder of hedge fund Elliott Management, said at the CNBC Institutional Investor Delivering Alpha Conference in New York in response to a question about China’s crash potentially affecting other markets. Singer said it may not be big enough to cause a global financial market conflagration.

China’s stock market has dropped from a June 12 peak wiping out almost $4 trillion in value in less than a month after investors who borrowed to buy shares had to unwind trades. Markets tumbled even as President Xi Jinping’s government ramped up efforts to stem the rout, including preventing share sales of companies.

The threat to markets from the country is a bigger concern to Ackman, who runs Pershing Square Capital Management, than Greece. .....................(more)


Charlotte Streetcar Begins Service on 1.5-Mile Run

NC: Charlotte Streetcar Begins Service on 1.5-Mile Run


July 14--Charlotte opened its first streetcar line in 77 years Tuesday morning with a ceremony highlighted with a spirited speech by former mayor and current U.S. Transportation Secretary Anthony Foxx.

The city held the event, which was moved because of rain, outside of the city's bus terminal. The streetcar opened to the public at 1 p.m.

"I never dreamed it would be anything like this. I'm overwhelmed," said Charlotte resident Cathy Mullins, who was on the streetcar's first public ride. "It doesn't seem like I'm in Charlotte."

She joined about 50 people, including media and city officials, on the first ride from Time Warner Cable Arena to Elizabeth. .......(more)


Odds Favor a Greece Deal Failure and Defacto Grexit

from Naked Capitalism:

Odds Favor a Greece Deal Failure and Defacto Grexit
Posted on July 15, 2015 by Yves Smith

The odds now favor the tentative deal struck over the weekend to “rescue” Greece, which many have correctly depicted as a brutal economic colonization of Greece by its lenders, coming unraveled. It’s hard to see how Greece could muddle through, given that a sketchy plan attribute to German Finance Minister Wolfgang Schuble over the weekend, that of a five-year temporary Grexit, was so obviously a napkin doodle rather than a plan as to be a negotiating chip and a taunt rather than a serious idea. But the lack of any alternative to the punitive plan that is starting to go pear shaped means that Greece would stumble into a Grexit utterly unprepared, with its banks unable to open at any foreseeable time in the future. That’s a game plan for utter catastrophe. If you think the unplanned Lehman bankruptcy was an unmitigated disaster, a Grexit would make that look like a walk in the park.*

Why does the deal now look to be in such dire shape? Unlike the earlier extended Greece v. everyone else impasse that went on for months, the underlying problem was that the two sides had no bargaining overlap between their positions and were conducting the negotiations in a media fishbowl. That made it impossible to find areas of mutual interest (having the new government improve Greece’s broken tax system, which only taxes the incomes of about 30% of the public, cracking down on oligarchs) and figuring out ways to come up with optical solutions on the issues where they were odds so each side could declare a victory.

The impediments now are what are informally called “too many moving parts”. It’s also one of the reasons that many people make bad calls about the likelihood of something succeeding, like a new venture.

If you ask someone who is starting a business and you ask them, “What are the odds this will work out?” you’ll almost certainly get answers well over 50%. Otherwise, why would they bother? But even if they tell you that it’s a slam dunk and they give you some very persuasive patter as to why the probability of winning is 90%, if you pick apart what has to happen, you can usually quickly ascertain why they’ve made a big overestimation. ................(more)


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