So Begins the April Fools Hilarity
It's already April 1st down under, and Google Australia has ushered in this year's crop of online gags with the faux-launch of the stupendous gDay™ (with MATE™) Future Search.
Search tomorrow’s web, today!
Google Australia has introduced a new feature, enabling you to search content on the internet before it is created.
The core technology that powers gDay™ is MATE™ (Machine Automated Temporal Extrapolation).
Using MATE’s™ machine learning and artificial intelligence techniques developed in Google’s Sydney offices, we can construct elements of the future.
Google spiders crawl publicly available web information and our index of historic, cached web content. Using a mashup of numerous factors such as recurrence plots, fuzzy measure analysis, online betting odds and the weather forecast from the iGoogle weather gadget, we can create a sophisticated model of what the internet will look like 24 hours from now.
We can use this technique to predict almost anything on the web – tomorrow’s share price movements, sports results or news events. Plus, using language regression analysis, Google can even predict the actual wording of blogs and newspaper columns, 24 hours before they’re written!
Laments one beta user:
“This is old news. I read about this announcement yesterday on Google.”
Update: Speaking of TechCrunch, did you hear that Michael Arrington is suing Facebook for $25 million?
I'm already sick of April Fools Day.
The Quarter Is Dead. Long Live the Quarter.
Well, after weeks and weeks of nauseating volatility, pocked with occasional hemorrhages and bouts of panic, investors finally have a reason to smile.
The first quarter of 2008 is over.
So just how ugly was it? Well, our year-to-date performance is certainly looking less hideous than it was a few weeks ago. The major stock indices have rallied back as much as 4-5% since their lows on March 10th. Still, historically speaking, it's been an unattractive few months.
The Dow Industrials, Nasdaq Composite, and S&P 500, are down 7.5%, 14.1%, and 9.9% year-to-date, respectively. It was the worst quarterly performance for each index since 2002. And to put it in the appropriately bleak context, the S&P 500 did worse than 94% of the quarters in its 58-year history. The Nasdaq's Q1 underperformed 92% of its historical quarters. And the Dow fared worse than 88% of its prior quarters.
What's worse, first quarters aren't supposed to be so calamitous. Comparing Q1 2008 to prior Q1s, you find that - with the exception of 2001 - the S&P and the Nasdaq had their worst showings in history. The Dow Industrials (which has been around a lot longer than the other indices) has underperformed the latest quarter a handful of times, but on average, only about once a decade.
Looking back on the last 40 years of 1st quarters, it's readily apparent that this was an exceptionally
So what, if anything, does history tell us about 2nd quarters, in years with cruddy 1st quarters? Nothing good, for the most part. In years that kicked off with dismal 1st quarters, 2nd quarter performance tended to lag nearly 1.0 percentage point behind typical 2nd quarter performance (averaging 2.0% for both the Dow and S&P 500, compared to 2.9% and 2.8%, respectively, across all 2nd quarters).
The Nasdaq Composite turns out to be the exception to this trend. Since its inception in 1971, the more volatile, tech-heavy index actually tends to follow bad 1st quarters with significantly better-than-average 2nd quarters (averaging a quarterly gain of 5.4%, compared with its overall average 2nd quarter gain of 3.4%).
That's not to say we're necessarily about to embark on a strongly tech-bullish quarter. But (with limited historical exceptions), it doesn't get much worse than the one we just closed out.
New Black Panther Thug Tries Hand At Hate Mail, Basic Locution
With predictably hilarious results.
Who Broke the Internet?
Yahoo works, as does Yahoo Finance, but not Yahoo Mail. Hot Air works, but it's slow and it's not loading correctly. Ameritrade also works, so if you want to dump some e-commerce stocks after hours, go nuts. Amazon and eBay are both still with us. Google-owned YouTube is responding and "transferring data", but the site isn't loading. Facebook seems to be working normally. Ditto for IMDb.
This blog is also not working (though happily Typepad is), so I can post, but you can't read. If you're reading this, the problem has presumably been solved.
Update: Scratch that. This blog is apparently working after all. So if you are reading this, let us know if you're encountering similar outages.
Update: Blackberry email is working again - might've been unrelated, but it was a first. I had three bars, but outgoing messages resulted in the menacing X, meaning transmission failed.
Update: I managed to get the Hot Air post to load. Allah (who's also in NYC) wonders if it's a New York-centric problem. And from the comments below, Sonny informs us he's not having these problems in California.
Anyway, as we apply the duct tape to the windows and prepare to spend the evening clutching shotguns in our rocking chairs, we may as well set about the speculation. Terrorists, hacker fire sale, the Goracle proving he can both giveth and taketh away, or Skynet becoming self-aware?
Update: Hot Air commenters have checked in from Kansas, Minnesota, and Pennsylvania, reporting interweb normalcy. Situation here is unchanged. The outage is now about two hours old.
Update: Allah also wonders if it's an RCN problem. He and I are both suffering RCN subscribers and it wouldn't completely floor me to learn they're near the root of the problem. Still, the fact that I can access many of the working sites with no slowdown (and the non-working sites not at all) seems to suggest it's not an ISP issue.
Any NYC readers out there not using RCN who are able to access the problematic sites?
Update: From the comments, we've got a New Yorker not far away experiencing no issues. Situation here unchanged.
Update: 9:30 pm: everything suddenly all better.
Interestingly, another commenter from Chicago who also suffers from RCN subscribership was having the same problems.
Update: From the comments, B Mitchell forwards a status update from RCN. A "fiber cut" in DC, "effecting (sic) backbone traffic. You may experience a lack of ability to reach some internet sites. All DC metro customers are expriencing a loss of long distance service and loss of internet services."
No Need To Distance Himself, He's Already Far Away
Over the past couple of weeks, Barack Obama has continually tried to distance himself from his radical pastor, Rev. Jeremiah Wright. Obama tells ABC’s "The View" today:
I'm not vetting my pastor. I didn't have a research team during the course of 20 years to go pull every sermon he's given and see if there's something offensive that he's said.
This is contrary to his previous comments on his knowledge of Rev. Wright’s sermons:
Did I know him to be an occasionally fierce critic of American domestic and foreign policy? Of course. Did I ever hear him make remarks that could be considered controversial while I sat in the church? Yes.
Recall that this is the same Rev. Wright who presided over Obama's wedding, baptized his children, and even blessed his Chicago home. If that is not enough, Barack took the title of his best-selling book, "The Audacity of Hope," from one of Wright's sermons.
Obama made no attempt to distance himself from his long-time pastor until the American public became aware and concerned about his affiliation with the radical preacher. Had he really been genuinely offended by any one of Rev. Wright’s many belligerent rants, he had plenty of other spiritual options.
Courtesy of Obama’s publicly released 2006 Form 1040, we know his home address to be 5046 S Greenwood Ave, Chicago, IL 60615-2806. The Trinity United Church of Christ is located eight miles away. However, there are at least ten closer United Church of Christ (UCC) parishes. In fact, three UCCs are within a mile away of his home—that’s walking distance. Obama had to have a good reason to drive past these churches Sunday after Sunday on his way to Trinity and Rev. Wright.
The fact is Obama wasn’t sincerely concerned about his friendship with Wright until it began to hurt him politically. Now he is continually contradicting himself as he tries to find a position that justifies his long-time connection with this radical figure.
A while back, I added "YouTube Most Viewed" to my feed reader, in the hopes that it would generate the occasional postable frivolity. It's taken a while for one to show up, but it was worth the wait.
Possibly the best 5 minutes you'll waste all day.
Governor (D) Indicted
The governor of Puerto Rico and at least 12 others, including members of his campaign finance committee, were indicted in San Juan in the culmination of a three-year investigation into the governor's campaign finances, according to the U.S. Attorney's Office on the island.
Gov. Aníbal Acevedo Vilá is expected to turn himself in Friday to face a variety campaign related crimes: conspiracy to violate election laws, making false statements, wire fraud, program fraud, conspiracy to defraud the IRS and filing a false tax return.
Acevedo, a member of Puerto Rico's Popular Democratic Party, is in the midst of a reelection campaign.
Tentative congratulations are in order for Senator Clinton, as this party superdelegate had publicly endorsed Barack Obama. If Acevedo loses his convention vote, it'll offset the one Hillary lost when Eliot Spitzer resigned in disgrace.
(HT: Hot Air)
I've never typed these word in this order before, but there's a great post at Daily Kos today, put up by the proprietor himself.
Such is the strange reality in which we find ourselves, with a Democrat electorate torn increasingly in twain by a well-funded, protracted primary fight. The Kossacks (independent thinkers that they are) have lined up squarely behind their post-racial Messiah and have therefore begun pumping out some occasionally poignant anti-Hillary material.
I'm going to go ahead and excerpt nearly all of it (with some emphasis added), in part so you don't have to get your browser dirty traipsing through moonbat headquarters, and in part because the post itself consists nearly entirely of excerpted material anyway.
As First Lady, she helped pass the Family and Medical Leave Act [...]
Actually, Hillary had been First Lady for 16 days when the bill passed. And while her White House schedule shows plenty of meetings on NAFTA, none dealt with the FMLA.
You know who "helped pass" the family leave act? Chris Dodd.
1986 Senator Chris Dodd introduced the Parental and Medical Leave Act on April 9, 1986, to provide job security and health insurance protection to working parents who must take leave to care for family members (newborn or adopted child; seriously ill child, spouse or elderly parent).
1987-98 Reintroduced the Parental and Medical Leave Act. The bill was brought to the Senate floor in October 1988, but was later shelved in the face of a Republican filibuster and a veto threat from President Reagan.
1989-90 Reintroduced as the Family and Medical Leave Act on February 2, 1989 and August 3, 1990. The measure passed the Senate unanimously on June 14, 1990, but was vetoed by President Bush on June 29, 1990. The House failed to override the veto on July 25, 1990.
1991-92 Reintroduced the Family and Medical Leave Act on January 24, 1991. The bill passed the Senate by a two-thirds vote of 65-32 on October 2, 1991.
1993 The Family and Medical Leave Act of 1993 passed both houses and was the first bill signed into law by President Clinton. FMLA provides job security for millions of Americans by providing up to 12 weeks unpaid leave per year to care for a family member.
Even those who slept through the 90s have begun to realize in recent weeks that Hillary Clinton is a very special kind of liar. Pathological, congenital, compulsive - whatever the appropriate classification, she's managed to appease any lingering doubt about her complete disregard for the truth or the trust of the American people, thanks to whoppers about landing in Bosnia under sniper fire and Chelsea jogging around the World Trade Center on the morning of 9/11. You'd expect more from a woman named for the intrepid Edmund Hillary.
Clinton's candidacy is based primarily on her increasingly untrustworthy recollection of her role in a cherry-picked collection of the non-scandal-ridden events in her husband's White House. Isn't it time we all acknowledge she's the candidate of neither experience nor judgment, and begin the great national conversation on Barack Obama's lack of experience and judgment?
No One Mourns the Wicked
Based on new revelations following new prostitution ring busts, Ashley Dupre is beginning to look like Eliot Spitzer's Paula Jones - just the tip of a much larger, discreet and totally classy, exotic iceberg. (HT: JWF)
Disgraced former Gov. Eliot Spitzer has been identified as a long-standing client of a second high-priced call-girl ring, The Post has learned.
The ex-governor regularly patronized Wicked Models, the Manhattan-based operation taken down Tuesday, according to financial documents and other evidence unearthed in a yearlong prostitution investigation, law-enforcement sources said.
At the center of the new ring is Kristin "Billie" Davis, a busty bottle blonde who hails from a [r]ough-and-tumble California trailer park. She has a reputation for hard-partying, shameless self-promotion and a rumored 10,000-name-long client list.
Davis' alleged multimillion-dollar empire was smashed by city vice cops as she made plans to skip town. Prosecutors say she netted some $2 million last year by pimping out ladies of the night for as much as $1,000 an hour through four Web sites.
Davis, 32, pleaded not guilty to money laundering and promoting prostitution in Manhattan Supreme Court yesterday and was held on $2-million bail. She faces 15 years in prison if convicted of running the ring, which also allegedly operated the Madison La A'mour and New York Body Miracle agencies.
The cynic in me (tragically jaded by revelations that the puritanical, prosecutorially merciless chief law enforcement official of New York State would (allegedly) so flagrantly trample state and federal laws) feels regrettably compelled to assign non-zero odds to the possibility that the ex-Governor might have been assisting Billie in her preparations to skip town.
After all, she wasn't just Spitzer's madam, according a truly gifted euphemist.
A source said Davis personally serviced Spitzer.
"She personally interfaced with Spitzer a number of times" since 2003 before she became a madam, a source close to Davis said.
Associated Press: Making Mountains Out Of Divots
Nearly two months ago, the Commerce Department released its advance estimate of GDP growth for the fourth quarter of 2007. It was a disappointing 0.6%, but at least it was positive, temporarily quieting those who had insisted a deep and merciless recession had already taken hold.
Last month, in the first revision to that measurement, 4Q GDP growth was left unchanged at 0.6%. Today, in the third and final estimate, we learn that the growth rate was actually...
Not only was the number unchanged from two previous estimates, it was exactly what economists were expecting (a fact the article bothers to mention in the 6th paragraph). That makes this morning's headline from the AP Economics desk all the more quizzically alarmist:
Economy Nearly Stalled in 4th Quarter
Economy Nearly Sputtered Out at End of 2007, Probably Faring Worse Now
In fact there was some unexpected (and, one might say, therefore more newsworthy) economic news today, in the form of initial jobless claims. Analysts expected last week's number of 375,000 to drop slightly to 371,000. The actual decline was more than twice as steep, with initial claims for the week ended March 22nd totaling 366,000.
Despite stock futures jumping in early trading, in part in response to net positive new data, the hand-wringers at the AP give the encouraging employment news only the most cursory, caveated mention.
In another report, fewer people signed up for unemployment benefits last week, although that didn't change the broader picture of a deteriorating jobs market. The Labor Department said jobless claims fell by 9,000 to 366,000, a better showing than many economists were forecasting. Still, unemployment is expected to rise this year given all the problems clobbering the economy.
It's true that unemployment is expected to rise (by a few tenths of a percentage point), but that's largely due to the fact that unemployment is so far below its long-term average rate (4.8% vs. 6.1%), that just a dab of mean reversion would cause it to tick up.
Stocks are now trading lower, but given crummy sales figures from Oracle last night, oil prices jumping in response to the bombing of an Iraqi pipeline, and stocks' strong performance in recent days, it seems unlikely that investors are pulling their hair out over this morning's economic data as much as the disquieted Associated Press would have you believe.
Paul Krugman's Steaming Pile Of Irony
Paul Krugman, professional economic gloomsayer and New York Times columnist has something truly flabbergasting to say about the role of the clueless prognosticator in modern society. (HT: Marginal Revolution)
The age of the anti-Cassandra
Reading some of today’s news, it suddenly struck me: we’re living in the age of the anti-Cassandra.
Cassandra had the gift of prophecy — she saw, correctly, what was coming — but was under a curse: nobody would believe her.
Today, our public discourse is dominated by people who have been wrong about everything — but are still, mysteriously, treated as men of wisdom, whose judgments should be believed. Those who were actually right about the major issues of the day can’t get a word in edgewise.
Krugman, of course, by virtue of his Times pulpit, is able to get plenty of words in edgewise, which (in an irony certain to be lost on the author) validates his own thesis.
Case in point, Krugman has predicted economic recession in each of the last six years.
That's 24 consecutive fiscal quarters (we're actually up to 25 now, and 26 if we keep our heads above water for the next 6 days) without a single reading of negative growth, despite Krugman's perennial prophecies of wreck and ruin around every corner.
Getting back to the central point of the professor's article though, what's most astounding about Krugman's body of work is that it illustrates - perhaps better than any other's - that a career in economic pontification can not only survive, but thrive in the modern media spotlight, despite (or perhaps thanks to) consistent and egregious errors, so long as that systematic variance tends in a media-friendly direction.
It's not a new phenomenon that credit for accurate predictions greatly outweighs discredit for inaccurate ones (people continue to pick through Nostradamus' zillions of predictions so they can breathlessly present a few that vaguely resemble modern events). But it's genuinely astounding that the media's undisputed heavyweight champion of the asymmetry of prediction consequences should recognize this phenomenon without the faintest hint of self-awareness.
Update: QandO (linked above) has compiled an updated catalog of Krugman's wackiest econo-boogedy-speak lo these 6+ prosperous years, as well as assorted rebukes to this latest fantastic bout of self-inflicted irony.
Put Away the Matches, Your Home Isn't Worthless Just Yet
The big economic data point of the day is the January index of home prices. The report, published by Standard & Poor's (pdf), showed U.S. home prices in 10 major metropolitan markets falling 11.4% from January 2007 to January 2008.
(Some media outlets are phrasing the news in a way that suggests prices declined 11.4% during the month of January, which is misleading. Prices fell 2.3% from December to January and 11.4% over the last twelve months.)
Still, the 11.4% decline represents a record drop over the 21 years such data have been collected and therefore warrants some appropriately solemn recognition. And indeed, the news cast something of a pall over yesterday's cheerier report that existing home sales accelerated unexpectedly in February. The continued erosion in home prices isn't spectacular news for home owners who bought into the housing peak in mid-2006, but even following this latest slide, prices are no worse than they were in early 2005, at which point they'd nearly doubled in just five years.
At the risk of belaboring an obvious point, nearly doubling in five years is a big deal. From 2000-2005, home price appreciation vastly outstripped inflation, stocks, college tuition, and even the price of gasoline. Even after the net sideways move in home prices from 2005 to 2008, housing still sits head-and-shoulders above the other measures, with the recent exception of gasoline.
The chart below illustrates the relative price change in U.S. home prices, versus the S&P 500, retail inflation (CPI), gasoline's price-at-the-pump, and average tuition and fees at 4-year colleges (year 2000 = 100).
You're still not convinced. "Home prices are supposed to rise," you protest. "We were counting on the kind of appreciation we saw from 2000 to 2006 to continue apace indefinitely, so this ~15% correction is genuinely devastating and ruinous."
And you may have a point, at least concerning those who over-bought at the 2006 peak and banked on uninterrupted, indefinite double-digit appreciation. But long-term trends in home prices offered no particular justification for that admittedly appealing fantasy. A buyer looking at $100,000 worth of home in early 2000 might (based on this same S&P data series) have expected that home to be worth $133,000 today, appreciating at a nominal rate of roughly 3.6% per year, as observed between 1987 and 2000.
Imagine his surprise to learn that the same $100,000 home had instead rocketed to $196,000 between 2000 and 2008 (appreciating at the much swifter rate of 8.8% per year), even after the devastating and ruinous collapse in home prices.
Make no mistake - the 11.4% twelve-month decline is steep. And there may be more weakness on the way. But U.S. home prices had soared like few other asset classes in recent years and most home owners are still significantly better off than they were at the beginning at the decade. That may be of little consolation to those who made highly leveraged purchases at the height of the bubble, but for anyone who bought a home at least three years ago, bought more recently but isn't planning to sell immediately (and can afford the mortgage they undertook), or is in the market to buy a home now, the roof is hardly caving in.
Turn On Your Blog Lite
De minimus blogging will continue through tonight, when I return from a brief Easter getaway. Bad timing, I know, what with the big Bear news and the ebullient market reaction. Normal posting to resume tomorrow.
Submitted for your deliberation in the mean time, in light of today's upswing (following on last week's turbluent, but net upward gyrations): did the market find a reliable bottom on March 10? By that date, all the major stock indices were down by double digits year-to-date. Since then, they've clawed back roughly half that distance (about 800 points on the Dow over those two weeks).
That being said, the general stock ugliness that began last October has seen two similar bear market rallies along the way. Over two weeks in November-December, the Dow climbed nearly 1,000 before plunging 1,750. From there, it mounted another two-week rally of nearly 800 points, before shedding nearly 1,000.
The shape of this newest rally is looking fairly similar to the winter fake-outs (and has continued a pattern of lower highs and lower lows). So is this time different? A chart-watcher might be looking for us to break through the February highs (still a couple hundred points above us) before putting too much faith in the March 10 bottom. But if and when that opinion begins to spread, there ought to be a lot of sidelined money (not least of which has been riding out the storm among ever more buoyant commodities like oil and gold (and, apparently, uranium)) ready to rush back into stocks.
That'd be a nice event to be out in front of, which is what brings us to the question in question. March lows: market turning point or another false bottom?
Veeramuthu "Kali" Kalimuthu: 2008's NYC Subway Hero
Veeramuthu Kalimuthu -- or Kali – is a mechanic at Columbia University. His recent actions make him a hero in the truest sense of the word. ... At around 5 p.m. that day he headed to the downtown No. 1 train at 116th Street in Morningside Heights to go home to Jamaica.
A man had fallen onto the tracks from the opposite platform, all the way on the other side of the station.
"People were getting their cell phones out trying to call the police, somebody's got to help him and then I looked over and I saw the gentlemen Kali jump down, hop over the rails," said witness Ed Dijoseph, who brought Kali's story to CBS 2 HD.
Kali made it across three sets of tracks, and knew about the three third rails, which are electrified with 600 volts -- enough to push a 400-ton train.
Just getting to the man was hard enough, but once he got to him he had to deal with the fact that the victim was a good 30-40 pounds heavier than he was. Kali is just 5-foot-5 and 150 pounds. Add to that the fact that at 5 p.m. rush hour trains come through that section of track every three minutes.
"He was trying to lift the guy up, but he was struggling because the guy who fell was bigger than him," Dijoseph said.
With the help of someone on the platform, Kali hoisted the guy up.
"I think within a minute after he got the man up the train heading Uptown came by," Dijoseph said. "If Kali hadn't moved him I truly … I really believe that the train would've killed him."
Early last year, Autrey wound up with some very decent loot following his dramatic subway save (in which he jumped to the tracks and lay on top of a man suffering convulsions, while the train passed over them), including:
- The Bronze Medal (New York City's highest civic honor)
- Appearances on David Letterman, Ellen DeGeneres, and CBS's "Early Show" (video here)
- $10,000 in cash from Donald Trump
- $2,500 from the New York Film Academy for his daughters' education
- Tickets and a backstage tour for "The Lion King"
- A trip to Disney World
- A year of free subway rides
Barney Frank Calls For Omnipotent Financial Regulator
He's got both knees jerking in unison now.
House Financial Services Committee Chairman Barney Frank (D., Mass.) today called for major changes to the way financial services are regulated.
“Among his proposals:
- Create a Financial Services Risk Regulator, which would monitor systemic risk. Rep. Frank said the Federal Reserve could also be given this power. The regulator would have the “capacity and power to assess risk across financial markets regardless of corporate form and to intervene when appropriate,” Rep. Frank’s office said. The regulator would also have access to information from investment banks that might use the discount window. The regulator would also “report to Congress on the health of the entire financial sector and act when necessary to limit risky practices or protect the integrity of the financial system.”
- Consolidate supervision. Rep. Frank calls the current format “duplicative.”
- Make changes to regulatory capital, margin, and leverage requirements.
Why... that's so fabulously far-reaching, it simply has to work.
Don't even concern yourself with bullets 2 and 3. Right up top, Frank is describing a single federal financial regulator with essentially boundless jurisdiction and authority. This regulatory is to be charged with "assess[ing] risk across financial markets" and "intervening when appropriate." So when the sum total of the trillions of distributed, rational, self-interested decisions being made throughout the marketplace strike the divine regulator as potentially squirrelly, he saves the day by overriding such decisions and determining a more optimal allocation of risk and resources among billions of market participants? Or does he just pull the plug temporarily, and let everyone cool off while the free market engines of value creation grind to a halt? Or does he assemble a blue ribbon committee to ponder the apparent suboptimality in the marketplace and commission a series of opinion papers on the topic? Whatever the specifics, I'm sure they'll be ironed out. The important thing is that we slap this bold new layer of regulation on the financial system as soon as possible, and worry about the incidentals later.
While we're at it (given the looming and inevitably tiresome healthcare battle that seems to be in store for 2009), legislators might want to head off that issue by establishing a similarly powerful Health Risk Regulator, who would have the capacity and power to prevent heart attacks, shrink tumors, lower cholesterol, relieve the symptoms of both indoor and outdoor allergies, etc. Yes, yes, I know what you're thinking. There's no guarantee that a government appointee is going to be able to thwart ALL health risks. But he'd certainly do better than millions of individually trained specialists around the world, greedy private sector dwellers that they are.
Weekend At Osama's
In his producers' defense, they've done a fine job making him appear lifelike with the sunglasses, calypso music, and 2005-vintage grievances.
Update: There's the translated transcript.
Hillary's "Experience" In Black And White
[The production] includes Presidential records from the Office of the First Lady. These files detail the First Lady’s daily schedule including meetings, trips, speaking engagements and social activities for the eight years of the Clinton Administration.
Specifically, the records that are opened are from the White House Staff and Office Files of Patti Solis Doyle, Special Assistant to the President and Director of Scheduling for the First Lady. Doyle was charged with the First Lady’s schedule from 1993 – 1998 and then assumed additional responsibilities as Director of Advance for the First Lady throughout the rest of the administration. These records, originally housed in binders, by month, detail the activities of the First Lady throughout the Clinton Administration. However, there are 32 dates throughout the eight years for which Patti Solis Doyle did not have schedules. Some dates will have a final schedule as well as a “revised final” schedule.
It's more than 11,000 pages of carefully vetted documents, so you'll want to get cracking. With this release, the Democratic Presidential contender decrees herself “probably the most transparent person in public life.”
Still waiting on those tax returns, the income sources that funded her $5 million loan to her campaign, the Clinton Library donor list, explanations for the Norman Hsu-tainted campaign cash she refuses to refund, and any explanation for or acknowledgment of her selling campaign contributors' personal data to dirty list brokers who resell such data to criminals.
Okay, maybe not the single "most" transparent person...
Wall Street Will Gladly Pay You Tuesday
Well investors certainly got over any initial disappointment in the Fed's 3/4 point interest rate cut in a hurry.
For the second Tuesday in a row, the Dow Industrials rocketed more 400 points, finishing 3.5% higher. The Nasdaq and S&P 500 did better still, each adding 4.2%.
Against an unlikely and foreboding financial backdrop, the Dow is having its best week-to-date performance in 7 years (the Monday-Tuesday run on March 26-27, 2001 was a single point stronger).
In history, the Dow has seen six 400+ days, two of which occurred in the last week.
Of course, for all this explosiveness, markets have managed only to move violently sideways. The index is just 0.07% changed from where it opened 7 Tuesdays ago. Still, the slight change is positive, despite the chart giving off a decidedly downward-trending vibe. Kind of the way the theme song to M*A*S*H sounds like it's written in a minor key, but it's really major (though still thoroughly depressing).
Indeed, a linear regression suggests the Dow is trending downward at 7 points/day over these 7 sideways weeks.
Fed Policy Pick'em [Update: 75 All Around]
You've got about 3 hours left to place your bets on this afternoon's Fed action. I tipped my hand yesterday that I'm expecting a 75 basis point cut to the Fed Funds rate. Ordinarily, such monetary largess would be enough to make markets giddy with gratitude (there hasn't been a larger one-day cut in more than 20 years), but today, investors might just turn their noses up at 75.
Recent Fed Funds futures trading suggests that most traders are expecting at least a full point, if not more. Even the implied probability of a cut as mighty as 150 basis points has risen to nearly 25%.
For my money, 75 is plenty for now. The Fed Funds rate has been cut 2.25 percentage points in six months, from 5.25% to 3.0%. Slashing it another full percentage point (or more) today would constitute a larger aggregate rate cut than the Fed instituted during the 9 months of easing following 9/11, when the Fed Funds rate went from 3.5% to 1.0% by June 2002.
If the Fed needs to cut rates again, it can always do so. It has shown in recent months that it has no trouble instituting inter-meeting rate cuts when appropriate. Bernanke has also found innovative, non-rate-centric ways to combat illiquidity and tight credit, but it likely makes sense to conserve some dry powder for that primary weapon, should the economy or the financial system encounter some significant exogenous shock (see previous paragraph). And while today's wholesale inflation report weighs in at mild-to-moderate, the inflationary impact of the barrage of interest rate cuts tumbling down from the Fed in recent months likely has yet to fully mature.
Still, whatever the virtues of easing off the easing, investors appear to be expecting big things from the Fed this afternoon Major stock indices are all rallying hard in anticipation, but market psyche is likely easily bruised, immediately following a period of reduced confidence in, and even mildly panic over, the investment banking sector, if not the stability of the financial system in general.
It's been largely due to strong and swift Fed action that Bear Stearns' collapse didn't trigger a domino effect among other significant banks. It'll be a shame if a failure by the Fed to fully sate such a cut-hungry market winds up befouling the newly (if cautiously) optimistic tone returning to Wall Street.
With that in mind, go ahead and get your Fed Funds rate cut prediction on record, if you've got one. Extra style points for correctly predicting any change in the Discount Rate (beyond the 1/4 point cut announced on Sunday).
Recent information indicates that the outlook for economic activity has weakened further. Growth in consumer spending has slowed and labor markets have softened. Financial markets remain under considerable stress, and the tightening of credit conditions and the deepening of the housing contraction are likely to weigh on economic growth over the next few quarters.
Inflation has been elevated, and some indicators of inflation expectations have risen. The Committee expects inflation to moderate in coming quarters, reflecting a projected leveling-out of energy and other commodity prices and an easing of pressures on resource utilization. Still, uncertainty about the inflation outlook has increased. It will be necessary to continue to monitor inflation developments carefully.
Today’s policy action, combined with those taken earlier, including measures to foster market liquidity, should help to promote moderate growth over time and to mitigate the risks to economic activity. However, downside risks to growth remain. The Committee will act in a timely manner as needed to promote sustainable economic growth and price stability.
Again, this suits me fine. If I may belabor the point, observe how aggressively rates have been cut over the last six months (in red) compared with the same period following the 9/11 attacks (in blue), the last time the Fed undertook significant monetary easing.
Despite offering "only" a 3/4 point ease, the Fed has now cut both faster and deeper than it did post-September 11.
If the Fed had slashed by the 150 basis points many were predicting, that red line would be touching the x-axis.
Good News: You'd Probably Survive a Major *Non-Airport Landing*
Interesting (and morbidly reassuring) stuff over at Freakonomics today.
George Bibel has written a fascinating book entitled Beyond the Black Box: The Forensics of Airplane Crashes.
I suspect this is one book that you are never going to find in the airport bookstores.
His chapters have uplifting titles like “In-flight Breakup,” “Pressure, Explosive Decompression,” “Burst Balloons,” and “Metal Fatigue: Bending 777s and Paper Clips.”
In spite of all this, it turns out that for most people in most crashes there is a surprisingly happy ending. Take, for instance, crashes that result in “total hull loss,” which means that the crash damages the airplane beyond economic repair. Of the 446 DC-10s ever delivered, 27 of them were involved in crashes that led to “total hull loss.” Overall in these crashes, 69 percent of all passengers and crew members survived. If you throw out the three worst crashes, the survival rate is nearly 90 percent!
"Candle In the Wind" Braces For Another Rewrite
Okay, folks. We always knew this was a possibility. There's no need to panic. Just calmly make your way to the nearest river crossing and take refuge in an outer borough or northern Jersey for a while.
Actually, I rather enjoy Elton John, somewhat in spite of myself. It's not like I "celebrate the guy's entire catalog" or anything. But in the realm of the multi-decade singer-songwriter, he's put out more tolerable stuff than most.
Even so, this is bound to be a downright cringeworthy festival of musical bootlicking.
Anyone want to venture some set list predictions?
How's your favorite financial stock holding up today?
Below is a two-day chart from Google Finance showing the relative performance of several of the large banks (JP Morgan, Bear Stearns, Morgan Stanley, Lehman Brothers, Citigroup, and Merrill Lynch). XLF is a Financial Sector tracker.
On the bright side, the Dow Industrials have pulled almost even, after plunging nearly 200 points at the opening bell.
Don't expect this roller coaster to pull into the gatehouse until at least tomorrow afternoon, when we'll get word from the Fed on whether it's going to cut the Fed Funds rate another 50, 75, or 100 basis points.
I'm placing my chips on 75. I'm looking at last night's quarter-point inter-meeting cut to the discount rate as a potential tea leaf. Until recently, the discount rate typically sat one percentage point above the Fed Funds rate. In August 2007, the Fed squeezed that spread down to a half point (and temporarily down to a quarter point, following last night's cut). If the Fed Funds rate gets knocked down a whole percentage point, the spread would jump back to 125 basis points. So far as I can tell, the spread's never been that large.
Update: Yipes. A few more hours has not improved matters, particularly for Lehman.
Only 5 trading hours left until Fed catharsis...
Flip On Your TV
Any early birds out there can catch me on Fox Business Network tomorrow morning at 5:00, discussing - among other things - the announced acquisition of Bear Stearns by JPMorgan Chase for the princely sum of $2 per share (compared with Friday's close at $30, down from $57 on Thursday) and the newest Federal Reserve initiatives to stabilize a wobbly financial sector.
Sleepers-in can catch me in another segment at 5:30, and again some time between 6 and 7.
Update: My DVR failed to capture the appearances, but Fox Business has uploaded one of the clips to their site. There are 3 others that I'll update with if/when they turn up.
The Great American Pork Out
In an increasingly rare, fully attended vote last night, the Senate struck down a legislative amendment that would've enacted a one-year moratorium on earmarks. The measure, championed by Sens. Jim DeMint (R-SC) and John McCain (R-AZ) won just 29 votes - 23 Republicans and 6 Democrats (including both Presidential contenders).
Undeterred, FreedomWorks has launched the No Earmark Pledge, inviting sitting House and Senate members and Congressional candidates to affirm that...
EARMARKING, The practice by which members of Congress divert taxpayer funding to special projects outside of the normal oversight and authorization process, has grown out of control and is open to waste and abuse.
THEREFORE, I, in my capacity as congressman/senator/president, do hereby pledge that I will personally support spending reform in Congress by refusing to seek, support, or enact earmarks during the appropriations process for fiscal year 2009.
So far, 8 Representatives and 2 Senators (all Republicans) have signed, as have 5 Congressional candidates (also all Republicans).
Casting a vote for an amendment headed for landslide defeat is one thing. Will the Democratic Presidential candidates now reaffirm their disavowal of pork spending by pledging to give it up? It's worth noting that John McCain hasn't signed the pledge yet either (which appears to have gone live just hours ago), but seeing as he was a co-sponsor of the amendment and hasn't requested an earmark in his 21 years in the Senate, it's probably a safe bet he'll be on board.
Bear Market Friday
When the market opened this morning, we appeared poised to finish the week in splendid fashion, building nicely on the big gains seen since Monday's lows. The Labor Department had just released new inflation data, showing such mild price increases that some market watchers literally didn't believe it. Add to that the news that JPMorgan Chase and the New York Federal Reserve Bank had put together a liquidity injection for Bear Stearns (sending Bear shares up 10% in pre-market trading) and you had all the makings of a broad-based rally.
It lasted 12 minutes.
The Bear Stearns story quickly became the sentiment-defining story and investors quickly had second thoughts about the implications of the bailout.
Stocks plunged early Friday as investors worried that a plan to ease a liquidity crisis at Bear Stearns Cos. indicates how severe credit troubles have become.
"The Bear Stearns news reversed the early positive sentiment from the inflation data," said Peter Cardillo, chief market economist at Avalon Partners. "There had been nervousness about Bear Stearns for some time and now the market's concerns about the company have been proven true."
From the bank's press release:
Alan Schwartz, president and chief executive officer of The Bear Stearns Companies Inc., said, “Bear Stearns has been the subject of a multitude of market rumors regarding our liquidity. We have tried to confront and dispel these rumors and parse fact from fiction. Nevertheless, amidst this market chatter, our liquidity position in the last 24 hours had significantly deteriorated. We took this important step to restore confidence in us in the marketplace, strengthen our liquidity and allow us to continue normal operations.”
The Fed's Tuesday morning announcement of a new $200 billion Treasury auction (specifically targeting investment banks) inspired the biggest one-day jump in stock prices in five years, largely because it offered some comfort to investors that major financial institutions would be protected from potentially game-ending liquidity squeezes. That injection, however, doesn't happen until the end of the month, leaving Bear Stearns in a short-term lurch. The assistance from JPMorgan and the New York Fed may well shore Bear up in the mean time, but the potential susceptibility of other major banks to similar fates is what's got the market pacing around the room, tearing its hair out.
This coming Tuesday, the Fed, which has gotten very creative at finding ways to inject liquidity that don't involve interest rate cuts (and thus may be less prone to stoke inflation) will have another opportunity to fire its primary weapon. Fed funds futures suggest the market expects either a half-point or three-quarter-point cut, with a small chance of a whole point cut. A whole percentage point reduction in the fed funds target rate would be the largest cut in 26 years.
Love Client #9
Having taken his troubles down to Madame Dupre, the shortest-serving elected Governor in New York history now faces a potential slew of serious criminal charges.
Experts say "Client 9" could face the following charges:
* Money laundering for trying to conceal the source and recipient of financial transactions.
* Tax evasion, if he was a knowing party to an all-cash business that wasn't filing taxes.
* Violation of the Mann Act for paying for the trip from New York to D.C. by the call girl known as "Kristen."
* Misuse of state resources, if he used his state-issued credit card for hotels or meals with prostitutes as well as if he was being protected by State Troopers during his dalliances.
* And finally, soliciting prostitution.
There's also the question of whether Spitzer used campaign funds for these trysts, which opens up a whole other litany of charges from fraud to federal election violations.
The prostitution charge carries the least severe possible sentence. Ironically, one of the first bills Spitzer signed into law raised the penalties for Johns, the men who patronize prostitutes, from a maximum of three months, to now up to a year in jail. Money laundering has a maximum of 20 years.
Spitzer must now be praying that U.S. Attorneys will exercise some small measure of the prosecutorial restraint he never displayed. The U.S. Attorney's office says no plea bargain has been reached with Spitzer.
A weary-looking Silda, mother of their three teenage daughters, ignored a question from The Post's Andrea Peyser on whether she'll leave her horndog husband.
The Color Of New Money
Well, the greenback took another slap in the face today.
The Federal Reserve issued the first new five dollar bill, with a ceremonial purchase of a book of speeches by fin mascot Abraham Lincoln.
First, they came for Grant. Then, they came for Jackson and Hamilton. And now Abe.
"They" of course being pastels. And Ben Franklin's next on the degreenification chopping block. Adding security features is all well and good, but are the peach and pink strictly necessary?
How about the purple five in thousand-point font on the back?
Shtupergate: The Resignation
It was just a matter of time:
Spitzer Aide: More Correct To Say That He Is Not Resgining
It's hard to imagine a sentient, non-delusional being conceiving of a way that Eliot Spitzer can remain in office, but maybe this is a hail Mary trial balloon (to mix a metaphor) to gauge just how appalled the public might be to the thought of the Governor clinging to the office he so thoroughly and ironically disgraced.
Or maybe he just feels he needs to polish up this one and only bargaining chip to convince federal prosecutors he has to be coaxed into resignation.
A top aide to Governor Spitzer said today Mr. Spitzer has not made up his mind about whether to step down from office despite mounting calls for his resignation amid allegations that he arranged to meet with a $4,300-a-night prostitute in the nation's capital on the eve of Valentine's Day.
"He has not made up his mind," a senior adviser to Mr. Spitzer, Lloyd Constantine, said. "It is more correct to say that he is not resigning."
This, as new information comes to light suggesting Spitzer has been soliciting prostitution for at least the last six years and possibly more than ten (i.e. throughout the duration not only of his short tenure as Governor, but of both four-year terms as New York's Attorney General).
(HT: Ben Smith)
Stocks' Best Day In 5-7 Years
Following the Federal Reserve's announcement Tuesday morning that, in coordination with foreign central banks, it would take additional measures (big, relatively novel, big big measures) to increase capital market liquidity, the equity markets spent the day careening significantly higher.
The seriously big measures, which included a new $200 billion auction of Treasury securities to investment banks, was seen as a well-targeted injection of liquidity right where it's needed. The move inspired gains of more than 3% among the major stock indices. Of course, this came on the heels of three big consecutive down sessions, leaving the broad market still down fractionally since this time last week.
Even so, the strength of today's rally is remarkable. The Dow Industrials rocketed 416 points (3.5%), the best performance since March 2003, on both a point gain and percentage basis. The broader S&P 500 was up 3.7%, also its best showing in 5 years (and nearly 7 years on an absolute point basis). The Nasdaq Composite put up even bigger gains, climbing 4.0% during the session.
The WSJ MarketBeat blog recaps other recent Fed initiatives aimed at restoring liquidity, and the limited sustained impact they seem to have had on market sentiment.
- December 12: Prior to the market’s open, the Fed announces the creation of the Term Auction Facility. The market had declined by 300 points the day before, when the Fed cut rates by a mere 0.25 percentage point. The one-day rally on this news amounts to just 40 points, and the industrials never manage to gain any ground through the rest of the year.
- January 23: As global economic worries engulf foreign markets, prior to the market open. The Fed surprises the market with a cut of 0.75 percentage point. That day, the Dow gains 300 points, beginning a fresh rally that lasts for another two weeks before fizzling out.
- March 7: The Fed announces an increase in the TAF auction, along with a new 28-day repo, just before the jobs figure is released. In a bit of reverse psychology, the Dow falls by more than 100 points as investors wonder, “What does the Fed know?”
As to whether this move will have better luck...
Will this work? “If you define the problem as a purely irrational move in the credit markets, then you might think this is a panacea,” note analysts at Bianco Research. However, they say, if housing prices — the underlying factor in this mess — continue to fall, this move may be yet another one that is steamrolled by the markets.
To Quote Samantha Power: Ergh.
Laying to waste the idea that Barack Obama is better able to connect with American youngsters, Hillary Clinton made a campaign stop in Scranton, Pennsylvania, where she creaked back and forth self-consciously while a high school choir treated her to
a serenade rhythmic yelling, with occasional rhyming.
Radha Iyengar and Jonathan Monten, prepare to be anointed worst persons in the world (and congratulations in advance).
The two Harvard researchers have arrived at the blasphemous conclusion that negative public statements about and negative media coverage of the Iraq War results in greater U.S. troop fatalities.
Are insurgents affected by information on US casualty sensitivity? Using data on attacks and variation in access to international news across Iraqi provinces, we identify an "emboldenment" effect by comparing the rate of insurgent attacks in areas with higher and lower access to information about U.S news after public statements critical of the war. We find in periods after a spike in war-critical statements, insurgent attacks increases by 5-10 percent.
And the purest heresy:
The results suggest that insurgent groups respond rationally to expected probability of US withdrawal. As such counterinsurgency should consider deterrence and incapacitation rather than simply search and destroy missions.
A rational terrorist model suggests that insurgent actors should increase attacks on an
occupying country when that country is closer to the margin of withdrawal. ... In the context of insurgency, this “resolve” refers to the perceived commitment of the counterinsurgent to bearing the costs of defeating insurgency.
I hope Drs. Iyengar and Monten have enjoyed their time at Harvard.
(HT: Marginal Revolution)
Shtupergate: Shtup By Numbers
As we enter the 436th and likely final day of the rollicking Spitzer administration, Zubin Jelveh at the Odd Numbers blog takes a look at the economics of high-end prostitution, as evidenced by the Emperors Club's pay scale and service quality distribution.
To Jelveh, something doesn't add up.
According to the complaint filed against the prostitution ring which serviced Eliot Spitzer, the owners of the Emperors Club brought in at least $1 million in revenue over roughly a 3-year period.
Let's assume that the Emperors Club and the prostitutes split the proceeds 50-50, so there is another million dollars out there that went to the roughly 80 women. That means that over the three-year period, the call girls earned about $12,5000 each on average, or a little over $4,000 per-year.
So why are these women choosing careers that don't pay them as much as a legal job? It could that getting paid for sex is a part-time gig which brings in supplementary income. Or it could be that not all of the money earned by the Emperors Club is deposited into the bank account tracked by the F.B.I. This could mean that the $1 million gross revenue figure is an understatement.
I'd guess it could also mean that the $1 million figure cited several times in the federal complaint with regard to prostitution receipts, money laundering, etc. is deliberately conservative, perhaps siginificantly so 1) to ensure the complaint remains accurate and unimpugned as various numbers shift around upon further investigation, 2) because $1 million is a big enough number to make the point, 3) because it's a big round number, and 4) possibly because some greater crime or aggravating condition might be triggered at that threshold, so exceeding it - by however much - becomes the key point.
Either way, I tend to agree with Jelveh's latter hypothesis - that the Emperors Club was generating considerably more than $1 million in annual revenues.
Previously: From Troopergate To Shtupergate
Update: On a related note, Slate.com offers business tips for aspiring high-class fleshmongers gleaned from the Emperors Club website, including:
Exploit all possible revenue streams. Most brothels stick to selling sex. Emperors' Club has a more diverse business model. Alongside the hooker portfolios, there's a page inviting companies to advertise on emperorsclubvip.com. (To inquire about rates, please e-mail firstname.lastname@example.org). The site promises access to a well-heeled clientele, noting that members' gross annual income averages $3.63 million per year. Perhaps Spitzer received some kind of financial aid—his annual salary is a scant $179,000.
From Troopergate To Shtupergate
New York Governor Eliot Spitzer's fall from grace was already a swift one, going from a landslide 69% victory in November 2006 to a negative opinion rating of 80% in February 2008.
Today's bombshell admission by the Governor of his involvement in a prostitution ring might tend to hasten this downfall.
The governor’s travel records show that he was in Washington in mid-February. One of the clients described in court papers arranged to meet with a prostitute who was part of the ring, the Emperors Club VIP on the night of Feb. 13.
Mr. Spitzer appeared on a CNBC television show at 7 a.m. the next morning. Later in the morning, he testified before a Congressional committee.
An affidavit filed in federal court in Manhattan in connection with that case lists six conversations between the man, identified as Client 9, and a booking agent for the Emperors Club.
The Emperors Club reportedly arranged for female accompaniment at rates as dear as $5,500 an hour and also offered investment advice. Full service, indeed.
I'll say it again: Don't blame me, I voted for Faso.
The Governor is about to hold a press conference to address this latest scandal.
Previously: 4 Out Of 5 New Yorkers Agree: Spitzer Is Lousy
Update: Hot Air is poised to put up video of the presser.
Update: It sounds like this may be the result of a deal cut by one of the four people charged last week in connection with the bust of the Emperors Club. [Update: Or not - the trail may have started with a federal probe into Spitzer's suspicious money transfers ]
All four were charged with conspiracy to violate federal prostitution laws: Mark Brener, 62, and Cecil Suwal, 23, who live together in Cliffside Park, N.J.; Temeka Rachelle Lewis, 32, of Brooklyn; and Tanya Hollander, 36, of Rhinebeck, N.Y.
Brener, accused of being the leader and recruiter of the prostitutes, and Suwal, accused of controlling the operation's bank accounts, also were charged with conspiracy to launder more than $1 million in illicit proceeds.
Lewis and Hollander were accused of arranging meetings between prostitutes and clients. They were released late Thursday on $250,000 bail each.
In a criminal complaint, FBI agent Kenneth Hosey said clients were told a wire transfer to the Emperors Club would be identified as QAT Consulting to appear to be a business transaction.
No guarantees this is the same organization, but here's a web site for QAT Consulting Group, with plenty of double entendre fodder.
As our client, you will be protected with “attorney- client privilege of information”, as defined and secured by the Law of the United States—your privacy is strictly yours and your business/tax affairs will always remain yours private matters.
Our services are comprehensive and hands on. We combine our business management and financial expertise with the expertise of our highly qualified associates- investment consultants, lawyers, bankers,independent trustees, marketing and promotion specialists, artists and feng shui masters.
Flashback: Little did we know this was dirty talk.
Update: Fox News reports that sources say the Governor will resign.
Update: Incidentally, I've had a FOIL request pending in Governor Spitzer's office (in connection with the State Sunshine project) for more than a month for all governmental e-mails sent or received by the office for the 4-day period immediately preceeding Spitzer's Washington trip in question.
I received some static from Spitzer's assistant counsel, stating that the office couldn't comply with the request until I clarified the term "governmental e-mail." Excerpted from my reponse:
I'm not sure which word ("governmental" or "e-mail") is problematic, so I'll try to offer clarification on both:
By "governmental" (in the context of "governmental e-mail sent or received by the Office of the Governor"), I'm referring to all e-mail messages sent or received by personnel employed by or in the Office of the Governor during the date range identified, whether or not those messages were related to government business and whether or not those messages were transmitted via government-issued accounts or hardware, so long as they were sent or received by the respective personnel either during normal working hours, or during any hour while at their physical place of employment, or during any hour in any location if those messages were transmitted in furtherance of official or unofficial duties or tasks assigned to the sender or recipient by a superior, by the Office of the Governor, or by another state agency or official.
By "e-mail", I'm referring to all inbound and outbound electronic mail messages transmitted via Simple Mail Transfer Protocol (SMTP), Post Office Protocol (POP), Internet Message Access Protocol (IMAP), X.400, or web-based protocols, as well as electronic messages transmitted via SMS or other text messaging protocols.
Please let me know if any further clarification is required.
That was 10 days ago. It'll be interesting to see what this turns up.
Prosecutors apparently have text messages in their possession related to the case, which were included in my FOIL request.
Update: The Governor just released a brief statement, acknowledging a failure to live up to his own standards and apologizing to his family. He did not announce his resignation, but said he would have more to say "in short order."
Update: Sources says Spitzer has been indicted, but that seems to be in doubt. The federal complaint itself appears to mention him only as "Client #9."
Update: Here's video and a transcript of the non-resignation.
Over the past nine years, eight as attorney general and one as governor, I’ve tried to uphold a vision of progressive politics that would rebuild New York and create opportunity for all. We vowed to bring real change to New York and that will continue. Today, I want to briefly address a private matter. I have acted in a way that violated the obligations to my family and that violates my — or any — sense of right and wrong. I apologize first, and most importantly, to my family. I apologize to the public, to whom I promised better. I do not believe that politics in the long run is about individuals. It is about ideas, the public good and doing what is best for the State of New York. But I have disappointed and failed to live up to the standard that I expected of myself. I must now dedicate some time to regain the trust of my family. I will not be taking questions. Thank you very much. I will report back to you in short order. Thank you very much.
Update: Hillary quickly purged Spitzer (a superdelegate who has pledged to support Clinton) from her endorsement list. But will she *reject* his vote at the convention? Hillary taught us the importance of the distinction between *denouncing* and *rejecting* in her tiff with Obama over Louis Farrakhan.
Update: Here's the federal complaint.
Update: So far, Hillary neither denounces nor rejects, only wishes well.
"I don't have any comment on that, but I obviously am sending, you know, my best wishes and thoughts to the governor and to his family," she said.
Objects On Your Desk Suddenly Rolling Eastward?
Complain to these people.
British scientists have simulated a black hole inside a fiber optic cable, making it possible to study what happens to light on the far side of an event horizon.
"If you've created an artificial event horizon inside an optical fiber," I wondered, "why isn't there an enormous gravitational pull that sucks in you and your lab and everything else in the world?"
"We actually made pairs of black-hole white-hole horizons (80 million per second). They exist only as long as our light pulses propagate through the fibre (about 10 nanoseconds) and they act only on light. In other words, they are completely harmless."
Obama Lowballs Rezko Cash By 2/3
Like Mike Huckabee, it appears Barack Obama didn't major in math.
The Chicago Sun-Times reports that Rezko and his associates provided three times as much money for Obama than the presidential candidate has admitted:
During his 12 years in politics, Sen. Barack Obama has received nearly three times more campaign cash from indicted businessman Tony Rezko and his associates than he has publicly acknowledged, the Chicago Sun-Times has found.
Obama has collected at least $168,308 from Rezko and his circle. Obama also has taken in an unknown amount of money from people who attended fund-raising events hosted by Rezko since the mid-1990s.
But seven months ago, Obama told the Sun-Times his “best estimate” was that Rezko raised “between $50,000 and $60,000″ during Obama’s political career.
The results of the Sun's investigation are several months old, so it's all the more quizzical that Obama hasn't been grilled harder on this business. But outlets outside of Chicago have displayed a strong distaste for covering Obama scandals and his chief rival can't with any credibility whack him agressively on it (beyond a glancing jab about a Chicago "slumlord"), give her and heur husband's boundless web of dirty money connections.
A Clash Of Liberal Guilt
Found Adorning Samantha Power's (Former) Office Wall
Oh, now that's just uncalled for...
(Click for full size.)
No Wonder Howard Dean Won't Pick Up Florida's Do-Over Primary Tab
His cup runneth dry.
For all the success that Democratic presidential candidates have had in raising money — taking in a combined total of over $500 million in the current race — the Republicans are beating them in one crucial area of fund-raising: the money being raised by the parties themselves.
The Democratic National Committee ended 2007 nearly flat broke, with cash of $2.9 million and debts of $2.2 million. Since then it has raised some money, paid down debt and managed to put $3.7 million in its piggy bank. This compares, however, with $25 million that the Republican National Committee has in cash on hand, after having raised $97 million since the beginning of 2007.
Even a no-frills, bargain basement, snail mail do-over contest in Florida would cost an estimated $4 million.
''We can't afford to do that,'' Dean said. "That's not our problem. We need our money to win the presidential race.''
(HT: HA Headlines)
One Hundred Beelyun Dollars
This morning, the Federal Reserve announced it would increase the size of its upcoming loan auctions from $60 billion to a nice, round $100 billion, in an attempt to pour additional liquidity into the credit market. The announcement made pre-market traders momentarily cheerful, until they figured out why the Fed was making the move.
The news had come out just a few minutes before the February employment report was to be released and any cynics who suspected the announcement was a preemptive adrenaline shot by the Fed (who had seen the employment figures last night) were vindicated when the report was published.
The headline bummer is a loss of 63,000 jobs in February. That's the biggest drop since 2003 and doubly troubling since it follows January's negative job growth (which today was revised down from -17,000 to -23,000). The unemployment rate, for what it's worth actually ticked down from 4.9% to 4.8%, while analysts were expecting it to creep back up to 5%, which it scraped in December. But a shrinking job base and steady (or dropping) unemployment can be explained by people dropping out of the active labor force, whether because they're making babies, retiring, dying, emigrating, taking this job and shoving it, or simply suspending a job search until conditions improve. In other words, the contrary move in the unemployment rate (while on its face a positive) is somewhat tricker to read into.
While many GDP forecasts are still looking for positive, but very near-zero growth in the first quarter, today's report has to kick a few over the center line and into slight negative territory. String two quarterly negatives in a row, and you've got a recession. Then again, five weeks ago (before today's news of course), Congressional and Federal Reserve economic models saw the odds of recession in 2008 at between 10% and 35% (lower than the 40% odds you have of observing a recession if you pick a year at random from the last 30).
When the official Suitably Flip oddsmakers last weighed in, we had ratcheted up 2008's likelihood of formal recession (two sequential negative quarters) from 25% to 33%. In light of today's data, let's dial that up to 40% - still less likely than not, but something of a gathering specter. The possibility of seeing at least one quarter of negative growth is clearly much greater. Unemployment data are lagging indicators and the Fed has pulled out a lot of stops over the last few months (which do take months to take hold), so March may well be faring better than January and February. Even so, it seems likely that first quarter GDP growth will start with the words "negative zero point". Your new odds of at least one quarter of contraction in 2008: 65%.
Shall we end on some less mopey news? Not all sectors showed job losses in February. In fact the service sector (which makes up nearly 85% of the non-farm labor market) added jobs on the whole, thanks to big gains in education, healthcare, leisure, and gummint employment. The 4.8% unemployment rate remains way below the 40-year average of 6.0%. And February's monthly rise in average hourly earnings kept pace at 3.4% (annualized), the second consecutive month it has come in markedly higher than the fourth quarter rate of 2.8%.
Not All Crossings Are Created Equal
Today, Democratic National Committee Chairman Howard Dean on the subject of the disputed Florida and Michigan primary votes remarked:
You cannot violate the rules of the process and then expect to be forgiven for it
Given the weak stance of Democrats on illegal immigration, it's evidently copasetic to cross the U.S. border surreptitiously, but don't dare try to cross the Democratic party.
Times Square Recruitment Center Bombing
Early this morning, a bomb detonated in an military recruiting station in the heart of Manhattan. No one was injured and mass transit was uninterrupted, but the explosion was powerful enough to be felt 44 stories up, four blocks away, in the Marriott Marquis.
Police are searching for a bicylcist who may have been involved.
"We're concerned and we're doing a very thorough investigation, working closely with the federal authorities," said Police Commissioner Ray Kelly.
He added that one witness at the scene saw a man riding a bicycle "in a suspicious manner" just before the explosion. The man was wearing a hood and dark colored clothing and had a backpack. The witness did not see the man's face, nor did the witness see the man throw anything.
What a worthless lead.
Police said it was too early to say whether the Times Square blast was related to two other minor explosions in the city in recent history.
In October, two small explosive devices were tossed over a fence at the Mexican consulate, shattering three windows but causing no injuries. No threats had been made against the consulate, and no one took responsibility for the explosion, police said.
Michelle Malkin's got a round-up of additional coverage and reaction.
Update: John McCain weighs in.
“We can’t allow this kind of thing to happen in America — a place where we’re trying to attract young men and women to serve in the military,” McCain told reporters during a news conference here. The individuals involved, he said, should be brought “to justice as quickly as possible.”
Update: Via Allah, here's Fox-commentated video surveillance of the incident.
Update: "We did it!" The apparent perpetrators claim the blame via letters to their Congressmen (enclosure: raving anti-military manifesto).
Super Tuesday II - Wishing With Fire
What a strange confluence of circumstances that leaves me rooting for Hillary to dream the impossible dream and pull out a pair of wins tonight in Ohio and Texas. I don't doubt she'll find a way to justify staying in the race if she loses one or the other (more likely Texas, where she'll almost certainly lose the delegate match, if not the popular vote), but I've gradually and somewhat disturbingly begun to indulge those illicit hopes that Clinton pulls off enough of an upset to get back in the race.
I've been insisting for a while that Obama is now officially unbeatable for the nomination, and I think that holds even if Hillary does manage a campaign reignition via a blowout performance tonight. I suspect we're simply too far down the road for her to sway enough of those few remaining Democrats in future primary states who genuinely have yet to make up their minds. At least I hope that's the case... Because if Clinton were to parlay an upset tonight into an honest-to-goodness comeback that ultimately landed her in the winner's circle, I'd have a hard time ever forgiving myself for the forbidden, hopeful vibes I'm sending her way tonight.
The polling wisdom at this point is that Clinton is more beatable in the general election than Obama. I'm not convinced that's actually true (Obama's unprecedented lack of qualifications seems finally to be taking feeble root in the public consciousness). But even if Clinton is the more easily defeated nominee, having her at the top of the Democratic ticket in November is just too close to the nightmare scenario. So long as she truly is incurably the dead candidate stumping that I think she is, then a feckless, but boisterous resurgence after tonight is a safe and wonderful development for McCain supporters.
Still, rooting for Hillary feels a little like the way I imagine Jonas Salk felt about injecting kids with inactivated Polio germs.
One interesting tidbit is how distantly Iraq and health care (19% each) trail the economy (58%) as the key issue for Ohio voters. The economy is clearly more of a more pressing issue in Ohio than nationally, but it's still pretty remarkable.
Update: At Hot Air, Allah and Ed are covering the action with a terribly slick new liveblogging tool.
Update: Time of first legal challenge... 7:45 pm. Congratulations to all you office pool winners. Fox News is reporting that Obama has gone to court to ask a judge to keep the polls open extra-late in Cuyahoga County, which includes Cleveland. I'm not sure the Obama campaign is looking closely at the exit polls. Northeast Ohio is the only region of the state where Hillary is winning (by a huge margin too, 61-39).
Update: Obama is also requesting that polls stay open late in Franklin County, which includes Columbus.
Update: Obama succeeds in throwing Clinton into a possible briar patch. A Cuyhagoga County judge has ordered 15 precincts to stay open until 9:00.
Update: Bob Beckel says Obama is doing much better in Cuyahoga County than elsewhere in northeastern Ohio (though I don't see any county-specific exit polling to confirm that), so maybe his courthouse vote grubbing will serve him well after all.
Update: With 1% of precincts reporting, Obama's enjoying a 58-41 leads over Clinton in Texas. Including early voters, though, nearly 800,000 votes have been counted and the partial returns include counties scattered throughout the state, so this looks like a fairly reliable win for Obama in Texas. Add to that his outperformance in large cities that will be disproportionately represented in the delegate count, due to Texas-specific rules, and the Lone Star state might extend Obama's delegate lead by 60 or more. Clinton would have to win Ohio with more than 70% of the vote to offset that damage.
Update: Via Allah, Huckabee will concede. How noble of him to step aside. It appears, then, that notwithstanding Huck's endless lingering, he'll come up just shy of surpassing Romney as runner-up
in the delegate count, unless he manages to win Rhode Island tonight (which he won't).
Update: With Texas called for McCain, the presumptive nominee has become the semi-official nominee. His delegate estimate now totals 1,195, 4 above the 1,191 required.
Update: Huck has just finished his concession speech.
Update: Hillary wins Rhode Island, nabbing just a few net delegates, but snapping Obama's 11-contest winning streak. She's gradually closing Obama's early vote lead in Texas too, and seems to be on a trajectory to pull even by the time the rest of the primary votes are counted. Again though, a popular vote tie strongly favors Obama in the delegate count, as does the separate primary caucus, yet to be reported. I'm pulling for her, I just don't think she's going be able to pull it off.
Update: Still no results from Cuyahoga County, but Hillary's lead in Ohio has expanded to 20 (with 21% reporting), making a win there look increasingly likely.
Update: Cuyahoga County (Cleveland) results finally coming in. Hillary leads 51-48. Statewide, she still leads by 16 points, with 35% reporting. Time to call that one.
Update: Hillary's now within a couple thousand votes (out of more than 1.4 million) in Texas. She just might pull off the popular vote victory (though still unlikely she could win the lion's share of the delegates, given the allocation scheme and the impact of the cauci), which would be delightful.
Update: Ohio finally called for Hillary. Whatever else happens, it's a good night.
Update: Hillary has also pulled into the lead in Texas (repeat above caveats...).
Update: Let's play delegate math. Obama went into tonight with a 109 delegate lead. He should get a net 5 or 6 delegates out of Vermont, while Hillary should pick up a net 3 or 4 out of Rhode Island. If the Ohio vote share holds at 57-41 in Clinton's favor, she'll pick up roughly 23 more than Obama. Among those three states, then, she should narrow the 109 gap by around 21, leaving Obama with a lead of roughly 88, not including Texas.
Hillary currently leads 50-49 in the Texas primary - almost certainly not enough to equal Obama in the primary-connected delegates, but let's assume she expands that lead enough to reach delegate party in the primary (giving each candidate 63). There are 67 delegates tied to the caucuses, meaning Obama would need to win just under 2/3 of the caucus votes to offset Hillary's net pickups in the other states.
If the funky Texas primary allocation scheme has the effect of granting a bonus of, say, 10% of the primary-connected delegates to Obama, he'd need to win just 57% of the caucus votes. Based on his previous caucus performance, that seems like a low bar.
And that's not the required threshold for Obama win Texas - it's the threshold for him to win by more than 21, thus more than offsetting Hillary's wins elswhere, expanding his delegate lead, and increasing the percentage of remaining national votes Hillary has to win to capture the nomination.
Yes, yes, momentum and all that. But based on the percent of remaining votes required, Hillary's mathematical hurdle will almost certainly be higher tomorrow morning that it was today (read: even more unreachable).
And yet her campaign is clearly "reignited" and right this minute, she's giving an exuberant speech that suggests she's quickly abandoning any tentative thoughts she may have had about throwing in the towel.
Less of a chance that Hillary wins AND less of a chance of her withdrawing?
I think we call this the best of both worlds.
Update: The networks are now calling Texas for Hillary (repeat above caveats). Her lead in the primary popular vote is about 4 points, good for about 5 net delegates, before the bonus shifting toward Obama. With 5% of caucuses reporting, Obama leads by 12 points, which (if that margin holds and the delegate split goes proportionally) would be good for about 8 net delegates, for a net-net Texas delegate gain of 3 for Obama.
Meanwhile, Hillary's lead in Ohio has pulled back to 12 points - her estimate net delegate gain there is now roughly 17. Between Rhode Island and Vermont, Hillary picked up another single net delegate.
That's a net-net-net delegate gain of 15 for Clinton, before the Texas warping, bringing her within 94 of Obama. The gap of 94 is smaller than the 109 delegate lead Obama had a day ago, of course, but as noted above, Clinton's hurdle has actually risen. In this scenario, she needs 596 of the remaining 1,097 delegates up for grabs (54.3%). Before Super Tuesday II, she needed 755 of the remaining 1,400 (53.9%).
And since (with rare exceptions like today in Texas) Democratic delegates are allocated proportionally, she would need to outscore Obama by that margin (better than 54-46) in the aggregate popular vote in the remaining 11 contests.
Remember, that's assuming zero bonus delegates going Obama's way in Texas. Whatever the size of that bonus, it will serve to further elevate Clinton's 54.3% burden.
To date, Hillary trails Obama in the aggregate popular vote 52-48 (51-49 including Florida), so capturing 54.3%+ from here on out would likely take a fair bit more than the momentum she'll take away from Texas and Ohio.
De Minimus PostingAlert readers will have noticed that posting's been light the last couple days. Busy, busy. My apologies. Normalcy to return by the end of the day.
Live From New York, It's an FEC Violation!
I wonder how the Clinton campaign plans to book her SNL soapbox (pleading in person for votes explicitly from Ohio and Texas voters) in this quarter's campaign filings.
Update: Video at Hot Air.