Saturday, May 06, 2006

U.S. banking system of the future?


Is it time to start reading up on the history of the Weimar Republic circa 1923, when Germany pretty much set the standard for the textbook example of hyperinflation? We Americans, both individually and collectively, have been spending money we don't have, borrowing like there's no tomorrow. Gas prices keep skyrocketing? Keep spending and keep borrowing. War costs headed towards the $1 trillion total mark? Keep spending and keep borrowing. But what if the lenders pull the plug? Is it time to start measuring the wheelbarrow in the garden with your mind's eye to anticipate how many Big Macs (or maybe just Small Fries) you'll be able to buy by filling it with inflated greenbacks?

Billmon, who knows his way around the financial industry, takes note of rapidly rising gold prices, is reminded of the 1970s inflationary binge, which followed another big war nobody wanted to pay for, and wonders what's ahead.
The missing guest at the disco party, at this point, is the Consumer Price Index -- although I wouldn't try telling that to the average middle-class American motorist. Still, despite the sticker shock at the pump, so-called "core" inflation -- that is, excluding energy and food prices -- has remained amazingly low, considering that the commodity markets are acting as if U.S. dollars are about to turn into 1923 German reichmarks.

It just must might happen one of these days. Traditionally, the price of gold has been a pretty good barometer of confidence in the greenback -- gold holding the original trademark on the brand name "money." (Gold: it's what's for dinner.) Which in many ways makes the gold rush of 2006 a more interesting and potentially significant economic phenomenon than $3-a-gallon gas.
What does it all mean? Trouble, probably.
One way to put it is to say that the insiders in charge of the world's only superpower are going massively short their own stock -- have been for years. What's more, management is starting to talk about launching another hostile takeover, once again financed with junk bonds. Some of the non-voting shareholders have decided it's time to lighten up their portfolios.
Excerpts don't do the posting justice. Go take a look.

Today’s spelling lesson -- gosling vs. gossling


At least Friday's abrupt, end-of-the-week exit of Porter Goss from CIA provided a little spelling lesson. Note what a difference the extra "s" makes: Goslings are soft and cuddly. Gosslings, not so much.
Ret. Col. Wayne Allard says on MSNBC that Goss and "his henchmen" at the CIA were called "the gosslings."
Another of the gosslings -- Kyle "Dusty" Foggo -- has told colleagues he’s leaving next week, says the WaPo, while positioning the sudden shakeup as due to Goss being an inept leader who was outmaneuvered by John Negroponte. The Wall Street Journal is a little more explicit about what is driving Friday’s developments.
Friday, people with knowledge of the continuing Cunningham inquiry said the CIA official, Kyle "Dusty" Foggo, is under federal criminal investigation in connection with awarding agency contracts.
Josh Marshall provides a measured backgrounder on the unfolding Cunningham and Hookergate connections. Sploid is a little more outspoken. And brings in the spooky-sounding "Book & Snake" connection from the outgoing spy chief’s days at Yale. He doesn’t mince words, as you’ll find when you run your mouse over the photo in his post. Just take you completely over the top, here’s more about Yale’s numerous secret societies, which almost seem to exist just to provide every Bush kid a club of his own, including Uncle "Bucky." (Goss was there, in Psi Upsilon, too.)

Thursday, May 04, 2006

Moussaoui verdict a reminder of why we have juries

The New York Times found the Moussaoui verdict surprising. Were they perhaps a bit too close to the prosecution's viewpoint?
The verdict, calling for life in prison, seemed to surprise most people in the courtroom, notably Justice Department prosecutors who had relentlessly urged the jurors that Mr. Moussaoui should be executed for his role in the attacks.
The print version of the paper (which you can click to enlarge here) went further, introducing the element of surprise right into the deck beneath the headline.
Surprise Verdict Rejects Execution
-- Defendant Claims Victory
But the verdict should not have come as a surprise. Since this U.S. district courthouse opened in 1998, jurors there have never sentenced a defendant to death. And in this case, the jury clearly felt there were mitigating factors in his violent childhood and family history of mental illness, his relatively minor role and the testimony of some 9/11 survivors against imposing the death penalty. In view of all this, and above all, the fact that Moussaoui was sitting in jail on September 11, the jury was unwilling to put him to death just so the Bush administration could say they had executed someone in connection with 9/11.

Bruce Shapiro underscores the essentially political nature of this trial.
Anyone who feels that the Moussaoui verdict somehow cheated justice should also consider the fact that an individual with genuine, direct criminal responsibility for the 9/11 conspiracy is in US custody yet the Justice Department has no intention of bringing him to trial. For three years the Bush Administration has held and interrogated Al Qaeda's Khalid Sheikh Mohammed, in secret prisons, unindicted, untried and unrepresented--at least in part to avoid revealing details of his probable torture.

It's a bizarre paradox: While expending vast resources in an unsuccessful bid for the death penalty against a marginal Al Qaeda volunteer, the Administration has done everything possible to keep the plot's main architect out of court. That would be as if the Allied judges in Nuremberg devoted themselves to SS corporals while never letting Hermann Goering near the courtroom.
The terrorist attacks in 2001 were unspeakably outrageous. But the anger directed by some commentators against the jury is misplaced. The jury did its job. Outrage should be directed against an administration that, nearly five years later, has yet to hold a single major conspirator responsible.

Wednesday, May 03, 2006

Regarding the pain of others

The title is from Susan Sontag’s last book, a meditation on the modern condition of being linked to the world by images of terror and disaster but insulated from feeling the pain they portray.

This lack of feeling is what most troubled me about “The Last Days of Muhammad Atta,” the Martin Amis story that appeared in the New Yorker recently and will be published in Britain as part of a book of short fiction in September. I posted about Amis interjecting what seemed an anti-Islamic canard about Muslims not being able to tell the difference between raisins and virgins. But even more, I disliked the lack of empathy for anyone in the story. It seemed the literary equivalent of going back to a train wreck, not only to gawk at the wreckage, but also to compete for attention with the victims by doing flashy acrobatics on the sidelines.

Leah, at Ashcan Rantings, has a personal connection to 9/11 and is also unenthusiastic.
I think this story was published in The New Yorker (which usually has excellent writing) due to its controversial topic and not its merits. Either that or the editors forgot to read it.
Anniversaries being such natural marketing hooks, the temptation for publishers to evoke the memory of 9/11 will be irresistible. I only hope that some of what is published comes closer than Amis did to the achievement of Haruki Murakami after tragedy twice struck his native Japan more than a decade ago.

The year 1995 was to Japan what 2001 was to the U.S., and it prompted the same kind of national soul-searching. First Mother Nature leveled the city of Kobe in a disastrous quake that killed 5,000 and left 300,000 homeless. Two months later, the religious group Aum Shinrikyo staged the Sarin gas attack in the Tokyo subway. While it only killed 12 people, it injured some 6,000 and traumatized millions more.

Murakami returned to Japan from abroad, dropped everything and spent months interviewing subway attack survivors as well as members of Aum. The result was “Underground,” a masterpiece and his first work of nonfiction, written with a novelist’s compassionate eye. Fiction took longer, but five years later he published “After the Quake: Stories.” The short stories in this collection eloquently address the emotional aftermath of the earthquake. Told with the iconic simplicity of dreams or fables, the stories don’t directly address either the subway attack or the Kobe tragedy, but they are haunted by the author’s emotional response to both events.

The difference between the stories of Amis (who has done some terrific work in the past) and Murakami? Amis creates a flat and lifeless caricature. Murakami memorably evokes real people. They could be people we know.

Slight difference of opinion on Guantanamo

Amnesty International today charged that torture and inhumane treatment are ''widespread'' in U.S.-run detention centers in Afghanistan, Iraq, Cuba and elsewhere.
It said that while Washington has sought to blame abuses that have recently come to light on ``aberrant soldiers and lack of oversight,'' much ill-treatment stemmed from officially sanctioned interrogation procedures and techniques.
This came after U.S. officials said, in effect, they’d love to let many of the detainees go but are continuing to hold them for their own good.
A long-running effort by the Bush administration to send home many of the terror suspects held at Guantanamo Bay, Cuba, has been stymied in part because of concern among United States officials that the prisoners may not be treated humanely by their own governments, officials said.
Can both statements be true at the same time? Ask George Orwell.

Tuesday, May 02, 2006

Weighing in on “information laundering”

Interesting citation (if you scroll down to the end of a long story) in Lawrence K. Altman’s story in today’s NYT about the crisis of credibility in peer-reviewed scientific and medical journals:
Journals have devolved into information-laundering operations for the pharmaceutical industry, say Dr. Richard Smith, the former editor of BMJ, the British medical journal, and Dr. Richard Horton, the editor of The Lancet, also based in Britain.
Compare this passage from Smith’s “Medical Journals Are an Extension of the Marketing Arm of Pharmaceutical Companies” in PLoS Medicine:
“Journals have devolved into information laundering operations for the pharmaceutical industry”, wrote Richard Horton, editor of the Lancet, in March 2004.
The Times article conflates what Horton wrote (in “The Dawn of McScience,” New York Review of Books, March 2004) with Smith’s quote from Horton’s article, to construct a single joint, indirect quote.

This started out as a post on the meme of “information laundering,” which I think is a concept with legs. But now that I’ve quoted Smith quoting Horton on “information-laundering operations,” I’m beset with curiosity as to whether I can expect to find another joint citation in the Times, something like this:
Journals have devolved into information-laundering operations for the pharmaceutical industry, say Dr. Richard Smith… and Dr. Richard Horton … and Madison Guy, the blogger at Letter from Here, based in Madison, Wisconsin.
I’ll return to information laundering, but first I have to check the latest citations in the New York Times…