By Lambert Strether of Corrente.
2016
Money
“Americans of ordinary means have made 400,000 donations — about 80 percent of them were $200 or less — to Mr. Sanders. Contrast that with the appalling fact that fewer than 400 of the nation’s most affluent families, writing six- and seven-figure checks, account for almost half the money raised so far by both parties in the campaign” [New York Times]. There are not very many of the Shing.
“In 1980, this elite segment of the population contributed a total of 16% of all campaign contributions. Today, it’s over 40% and heading towards 50%. Yes, already, close to HALF the money in American politics is coming from 0.01% of the wealthiest donors – that’s around 25,000 compared to nearly 150 million registered voters” [Crowdpac]. As above….
“An FP investigation shows that Imaad Zuberi, who has bundled hundreds of thousands of dollars for leading Democrats, failed to disclose the extent of his ties to a foreign government” (Sri Lanka) [Foreign Policy]. “Imaad Zuberi, age 45, is a private equity fund manager, venture capitalist, and an elite political fundraiser.” Silly boy! He should have laundered his money through the Clinton Foundation. That’s what it’s for! Who the heck was advising this guy?
“Over and over during his presidential campaign, Walker has declared that, as president, he’d stand up to “special interests.” But by signing legislation a few weeks ago committing $250 million in public funds—which, once interest is included, balloons to more than $400 million—to the construction of a new stadium for the Milwaukee Bucks, Walker has made it clear, once again, that he’s willing to use taxpayer money in ways that help his political allies” [Politico].
“Bill Clinton Sought State Department OK For Paid Speeches Related to North Korea, Congo, New E-mails Show” [ABC]. ” The catch? The dictators of Congo and the Democratic Republic of the Congo would both be attending — and required photos with Bill Clinton. The speaking fee? A whopping $650,000. ”
The Voters
Quinnipiac poll word associations: Clinton: “liar”; Trump: “arrogant”; Bush: “Bush” [Fortune]
The Trail
“Candidate Loyalty Oaths Are Unenforceable And Unconstitutional [Outside the Beltway].
“Fiorina Super-PAC Takes Out Full-Page New York Times Ad Defending Business Record” [Bloomberg].
“in Nevada, the third state on Democratic primary calendar, Sanders faces a challenge that thus far has been the principal sticking point of his campaign: moving past a core supporter base that is largely white, and winning favor among minority voters” [Politico].
“Rising Kasich threatens Bush” [The Hill].
“Meet the woman who confirmed Trump’s hair is no toupee” [CNN]. Trump invited her up on stage!
Stats Watch
Personal Income and Outlays, July 2015: “On the consumer, the data are very solid led by a 0.4 percent rise in income that includes a 0.5 percent rise in wages & salaries which is the largest since November last year” [Bloomberg]. “There’s no hurry for a rate hike.” And: “The data this month showed relatively strong income growth – spending grew but grew slower” [Econbrowser]. But: “[N]ot to forget health care premiums count as consumption expenditures, with a one time adjustment in progress as previously uninsured people become insured and begin paying premiums” [Mosler Economics].
Consumer Sentiment, August 2015: “An early reading on the effect of global volatility is downbeat as the consumer sentiment index came in well below expectations” [Consumer%20Sentiment“>Bloomberg]. “[T]he effect isn’t enormous. This report is probably a wash for the September FOMC.”
“Week 33 of 2015 shows same week total rail traffic (from same week one year ago) marginally expanded according to the Association of American Railroads (AAR) traffic data. Intermodal traffic expanded year-over-year, which accounts for approximately half of movements. but weekly railcar counts continued in contraction” [Econbrowser]. Intermodal up, railcar down is the pattern, but why? Econbrowser backs out coal and grain, so it’s not that.
“An alternative measure of economic output, gross domestic income, advanced at a much slower 0.6% pace last quarter. By that gauge, economic growth barely inched ahead in the first half of the year. (GDI advanced at 0.4% pace in the first quarter versus a 0.6% increase for GDP)” [Wall Street Journal, “By Another Measure, U.S. Economic Growth Has Nearly Stalled This Year”].
“Markets Debate Drivers of US Treasuries” [Across the Curve]. A fine roundup.
The Fed: Jackson Hole program, with links to papers [Federal Reserve Bank of Kansas City (Jim Haygood)].
The Fed: “This September meeting is the gift that keeps on giving. Right now it is giving by the shear [sic] quantity of truly bad commentary arguing for a rate hike next month” [Tim Duy’s Fed Watch].
The Fed: “Cleveland Federal Reserve Bank President Loretta Mester said Friday she is “reasonably confident” inflation will move back towards the Fed’s 2% inflation target, but she has pushed back the timeline as to when it reaches it.” [Market News].
The Fed: “Federal Reserve Bank of Minneapolis President Narayana Kocherlakota said Friday he does not believe the Fed should raise interest this year, and the central bank may have to consider further quantitative easing” [CNBC].
The Fed: ” St. Louis Federal Reserve President James Bullard said that while world financial markets are volatile, U.S. fundamentals are good and the interest rate-setting Federal Open Market Committee shouldn’t alter its forecast for the economy” [Bloomberg].
Mr. Market
“Technology issues at Bank of New York Mellon Corp., the largest fund custodian in the world by assets, are preventing the bank from pricing hundreds of mutual and exchange-traded funds, The Wall Street Journal reported late Wednesday. That means investors can’t value their holdings, making trading during one of the most volatile market weeks in a decade even more complicated” [Francis McKenna, Market Watch]. But this says BNY are crooks who skim from their clients. Are we 100% sure these are IT problems?
“[A] collective $29.5 billion (£19.13 billion) flooded out of equity funds over the week [according to Bank of America Merrill Lynch’s “flow show” roundup], and that’s the worst since BAML’s data begins, going all the way back to 2002″ [Business Insider].
“Since July, American households — which account for almost all mutual fund investors — have pulled money both from mutual funds that invest in stocks and those that invest in bonds. It’s the first time since 2008 that both asset classes have recorded back-to-back monthly withdrawals” [Bloomberg].
“On average, hedge funds are down 2.9pc so far this month and 1.7pc in the red for the year, according to an index compiled by Hedge Fund Research. However, this drop compares favourably to a 5pc fall in the S&P index and a 5.7pc fall in the FTSE 100” [Telegraph].
“U.S. crude has gained about 16 percent over two sessions, headed for its first weekly rise since mid-June. If the day’s gains stick, it would be the second largest two-day rise in 25 years” [Reuters]. Headline uses the word “frenzy.” Is that like a “fracas,” except with money? Sigh…
Black Injustice Tipping Point
“Events mark Emmett Till slaying 60 years later” [AP].
“The Subtle Linguistics of Polite White Supremacy” [Medium].
“Black Lives Matter Activists Disrupt Bowser’s Police Agenda Presser” [DCist]. “But you’re the capital, CC.”
Corruption
“In what has to be a major embarrassment, Malaysian Prime Minister Najib Razak has quietly cancelled his appearance as a speaker at the prestigious 16th International Anti-Corruption Conference and Transparency International gathering, to be held Sep. 2-4 in the country’s political capital of Putrajaya” [Asia Sentinel]. Heck, with the $700 million in his personal bank account, Najib could just set up his own conference!
“Malaysia blocks protesters’ website on eve of mass rally” [Reuters]. They also outlawed wearing yellow T-shirts, the color worn by the rally sponsors.
Dear Old Blighty
“Does it matter if Corbyn can’t win for Labour?” [Byline]. The next election is what, five years away? From the hysteria of Blairite placeholders, you’d think it was tomorrow.
The MP who claimed expenses for his moat has now been made a lord [Telegraph]. Seems right.
“The UK government says it plans to significantly reduce subsidies paid to small-scale green power installations” [BBC]. Moar fracking!
Our Famously Free Press
“Planned Parenthood Videos Were Altered, Analysis Finds” [New York Times]. Wow, who could have predicted that?
Big Brother Is Watching You Watch
“In order to obtain a copy of the NSA’s main XKeyscore software, whose existence was first revealed by Edward Snowden in 2013, Germany’s domestic intelligence agency agreed to hand over metadata of German citizens it spies on, ” according to Die Zeit [Ars Technica].
“An appeals court in the District of Columbia has lifted an injunction against the National Security Agency’s call records program on grounds that the plaintiff has not proved his own phone records were collected and so lacks standing to sue” [WaPo]. That’s some catch.
“[E]ncryption has become so controversial that many people are unwilling to expound upon the debate [within the administration] on the record. Yet this article, which relies on interviews on and off record from more than two dozen officials from tech and security companies across the country, reveals the American business community worries such a policy, if enacted, would threaten the competitiveness of their businesses” [Christian Science Monitor].
“Let’s take away the emotion for a moment,” says Scott Montgomery, vice president and chief technology strategist for Intel Security. “Imagine you want to protect your house, and I’m going to sell you a deadbolt. That deadbolt is absolutely perfect. It’s the best deadbolt that’s ever been made. No one can break in … . Except, I’ve put in one method by which someone can break in.”
He asks: “Would you buy it?”
Obama has yet to make a decision…
Class Warfare
“Thousands have died after being found fit for work, [UK’s Department for Work and Pensions] figures show” [Guardian]. Slackers. If they really wanted to work, they wouldn’t die, now would they?
“The median total compensation of CEOs of U.S. public companies in the Russell 3000 index increased 11.9% in 2014 versus the prior year. Most workers aren’t seeing pay rises of anywhere near that” [Market Watch].
News of the Wired
“They hacked her pancreas and found love along the way” [Business Insider]. This is in fact really cool. And if the headline were really clickbait it would have been something like “Couple hack her pancreas with this one neat trick!”
“The Shepherd’s Crown by Terry Pratchett review – the much-loved author’s last Discworld novel” [Guardian]. I found the previous novel distressing, like the late De Koonings.
“Award-winning author Neil Gaiman, who co-wrote Good Omens with the late fantasy writer, said Sir Terry wanted any work being penned at the time of his death to be ‘taken out along with his computers to be put in the middle of the road and for a steamroller to steamroll over them all'” [Daily Mail].
“Yanis Varoufakis pushes for pan-European network to fight austerity” [ABC]. Nice timing…
“Days after he confessed to cheating on his wife and an addiction to pornography, Josh Duggar has entered rehab” [Business Insider]. May he find peace on yet another lucrative reality TV show.
“Gay Teen Worried He Might Be Christian” [The Onion].
Crackdown on little libraries [The Atlantic]. Stupid, albeit anecdotal.
“A team of Greek and Swiss archaeologists have discovered what appears to be a significant coastal settlement now covered by the Mediterranean Sea” [Spero News]. About three acres, with “stone defensive structures that are of a ‘massive nature, unknown in Greece until now.'”
Readers, feel free to contact me with (a) links, and even better (b) sources I should curate regularly, and (c) to find out how to send me images of plants. Vegetables are fine! Fungi are deemed to be honorary plants! See the previous Water Cooler (with plant) here. And here’s today’s plant:
Last of the poppies. Winter is coming….
If you enjoy Water Cooler, please consider tipping and click the hat. This is turning into a tough month, and I need to keep my server up!
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The Eastern Conference for Workplace Democracy in Worcester, MA this year was great. While attending, I took the opportunity to interview some of the worker-owners who were there. Two of my favorites were Kenny and Butterfly from Little Rock, AR. They’ve got a couple of catering co-ops that are combining food production and distribution with sustainable tech–an earthship building, in one instance, and a peddle-powered “food trike,” in the other:
Little Rock Catering Co-ops Have Big Plans for the Future
This is what the new economy looks like. Cool people with cool ideas, and the motivation and ability to put them into practice.
Re loyalty oath here is the language that has been added to the Republican application in SC (via AP)
This must be agreed to by September 30. Of course Trump could sign and then later do what he wants, but sounds like he won’t be on the ballot unless he either signs or engages in a messy legal challenge over a hypothetical.
Looks like SC needs a Major —– de Coverley to put an end to this non-sense.
I want eats!
Inconveniently, the Atlanta Fed’s 3rd quarter GDP nowcast downshifted from last week’s 1.4% to only 1.2% this week, as Fedsters carry on talking tough at the J-Hole confab.
https://www.frbatlanta.org/cqer/research/gdpnow.aspx
Stock prices aren’t used in the Atlanta Fed model. Its decline was ‘primarily due to some weakness in real services consumption for July.’
But stock prices are a factor in the Conference Board’s Leading Economic Indicators index, which dropped 0.2% in July, and likely will soften again in August (value to be announced Sep. 18, the day after the next FOMC meeting).
Will the Fedsters really hike rates on an iffy economy? Viewed from an ivory tower, everything looks normal.
Oh I am so happy their objective is to confiscate only 25% of my purchasing power over the next 10 years, yay! “Please, sir, may I have some more?”
Your PPP in a fiat currency is related to its correlation to productivity, the confiscation started in the mid 70s, were you even born then?
1956. Disgusted to see the spectacle of Politboro Economics, devastatingly explained by Stockman so even an idiot could get it:
http://davidstockmanscontracorner.com/the-central-bankers-malodorous-war-on-savers/
White House budget director David Stockman, who helped Reagan engineer the part of the scheme he wanted, tax cuts for the wealthy, that supply side Stockman?
Business career
After leaving government, Stockman joined the Wall St. investment bank Salomon Brothers and later became a partner of the New York–based private equity company, the Blackstone Group.[13] His record was mixed at Blackstone, with some very good investments, such as American Axle, but also several large failures, including Haynes International and Republic Technologies.[14] During 1999, after Blackstone CEO Stephen A. Schwarzman curtailed Stockman’s role in managing the investments he had developed,[15] Stockman resigned from Blackstone to start his own private equity fund company, Heartland Industrial Partners, L.P., based in Greenwich, Connecticut.[16]
On the strength of his investment record at Blackstone, Stockman and his partners raised $1.3 billion of equity from institutional and other investors. With Stockman’s guidance, Heartland used a contrarian investment strategy, buying controlling interests in companies operating in sectors of the U.S. economy that were attracting the least amount of new equity: auto parts and textiles. With the help of about $9 billion in Wall Street debt financing, Heartland completed more than 20 transactions in less than 2 years to create four portfolio companies: Springs Industries, Metaldyne, Collins & Aikman, and TriMas. Several major investments performed very poorly, however. Collins & Aikman filed for bankruptcy during 2005 and when Heartland sold Metaldyne to Asahi Tec Corp. during 2006, Heartland lost most of the $340 million of equity it had invested in the business.[17]
Collins & Aikman Corp.
During August 2003, Stockman became CEO of Collins & Aikman Corporation, a Detroit-based manufacturer of automotive interior components. He was ousted from that job days before Collins & Aikman filed for bankruptcy under Chapter 11 on May 17, 2005.
Criminal and civil charges
On March 26, 2007, federal prosecutors in Manhattan indicted Stockman in “a scheme … to defraud [Collins & Aikman]’s investors, banks and creditors by manipulating C&A’s reported revenues and earnings.” At the same time, the Securities and Exchange Commission brought civil charges against Stockman related to actions he performed while CEO of Collins & Aikman.[18] Stockman suffered a personal financial loss, estimated at $13 million, along with losses suffered by as many as 15,000 Collins & Aikman employees worldwide.
Stockman said in a statement posted on his law firm’s website that the company’s end was the consequence of an industry decline, not fraud.[19] On January 9, 2009, the U.S. Attorney’s Office announced that it did not intend to prosecute Stockman for this case.[20]
Publishing
In March 2014 Stockman launched a web based daily periodical, David Stockman’s Contra Corner featuring both his own articles and those from leading contrarian thinkers on geopolitics, economics, and finance.
Skippy…. Stockman is spouting Austrian economics… that should be your first clue… that he has no clue…
Stockman is spouting Austrian economics, that should be your first clue, that he has no clue imo.
Business career
After leaving government, Stockman joined the Wall St. investment bank Salomon Brothers and later became a partner of the New York–based private equity company, the Blackstone Group.[13] His record was mixed at Blackstone, with some very good investments, such as American Axle, but also several large failures, including Haynes International and Republic Technologies.[14] During 1999, after Blackstone CEO Stephen A. Schwarzman curtailed Stockman’s role in managing the investments he had developed,[15] Stockman resigned from Blackstone to start his own private equity fund company, Heartland Industrial Partners, L.P., based in Greenwich, Connecticut.[16]
On the strength of his investment record at Blackstone, Stockman and his partners raised $1.3 billion of equity from institutional and other investors. With Stockman’s guidance, Heartland used a contrarian investment strategy, buying controlling interests in companies operating in sectors of the U.S. economy that were attracting the least amount of new equity: auto parts and textiles. With the help of about $9 billion in Wall Street debt financing, Heartland completed more than 20 transactions in less than 2 years to create four portfolio companies: Springs Industries, Metaldyne, Collins & Aikman, and TriMas. Several major investments performed very poorly, however. Collins & Aikman filed for bankruptcy during 2005 and when Heartland sold Metaldyne to Asahi Tec Corp. during 2006, Heartland lost most of the $340 million of equity it had invested in the business.[17]
Collins & Aikman Corp.
During August 2003, Stockman became CEO of Collins & Aikman Corporation, a Detroit-based manufacturer of automotive interior components. He was ousted from that job days before Collins & Aikman filed for bankruptcy under Chapter 11 on May 17, 2005.
Criminal and civil charges
On March 26, 2007, federal prosecutors in Manhattan indicted Stockman in “a scheme … to defraud [Collins & Aikman]’s investors, banks and creditors by manipulating C&A’s reported revenues and earnings.” At the same time, the Securities and Exchange Commission brought civil charges against Stockman related to actions he performed while CEO of Collins & Aikman.[18] Stockman suffered a personal financial loss, estimated at $13 million, along with losses suffered by as many as 15,000 Collins & Aikman employees worldwide.
Stockman said in a statement posted on his law firm’s website that the company’s end was the consequence of an industry decline, not fraud.[19] On January 9, 2009, the U.S. Attorney’s Office announced that it did not intend to prosecute Stockman for this case.[20]
Publishing
In March 2014 Stockman launched a web based daily periodical, David Stockman’s Contra Corner featuring both his own articles and those from leading contrarian thinkers on geopolitics, economics, and finance.
Skippy… Know wonder your confused….
“Intermodal up, railcar down is the pattern, but why?”
Oil shipments are way down via rail the past quarter or so. I’ve also personally noticed the oil train volume in my neighborhood is way down since this spring too. Metal ores are also way down.
https://www.aar.org/data-center/rail-traffic-data
Thanks! I should have thought of the rail bombs.
Greek discoveries at Lambayanna and Lerna: This week’s New York has an article by Elif Batuman about the Maramaray tunnel in Istanbul. The Yenikapi neighborhood yielded a dig that produced artifacts going back to 6,000 BC, extending the history of the city back a couple of thousand years more.
She mentions a device that the archeologists called a “tablet computer.” It had erasable surfaces, which made it reusable. We know very little even still about ancient technology.
As always, though, the Northern Europeans prefer their Greeks and Romans dead: And lookee, even more dead Greeks and pre-Greek deadbeats.
The hit piece in Politico on Scott Walker misses a critical element of Walker’s economic development giveaway political calculus: it isn’t just cronies he gives the state’s money away to. To be honest, he seems willing to pony up for just about anyone with a story, it doesn’t even have to be a good one, but notably firms associated with some of the state’s “best” Democrats, including Kohl’s – which got huge money simply for not relocating out of state – and wanna-be Dem gov candidate Kevin Conroy’s Exact Sciences, now in the process of sucking up additional taxpayer money from the City of Madison.
Hillary: just call me TINA.
http://talkingpointsmemo.com/livewire/hillary-clinton-locking-up-delegates
WTF? Is she angling for a coronation?
She’ll have to go all Macbeth on Jeb! first.
Total Impunity, No Accountability?
Vincere est totum. (Winning is everything.)
It’s the smart thing to do, but if she stumbles, those votes will come “unlocked” in a nanosecond. “With great regret,” etc. etc.
Lambert, this may be an answer to your “why Biden” question.
The operative phrase in the headline is “Clinton campaign claims”. Why would they feel the need to enunciate the ‘inevitable’ coronation? They would only do so if there were doubts amongst the Dem kingmakers. Thus Biden playing footsie with the electoral swimming pool, saying ‘If she’s not a sure thing what about me?’ Meanwhile HRC sweats to ensure the DNC money that it’s all locked up already, no need for Joe. As this comes from TPM, it’s got the Dem imprimatur: ie, a message sent directly from HRC to the Team Blue faithful.
In essence, the lady doth protest too much.
“…if she stumbles, those votes will come “unlocked” in a nanosecond.’ Exactly, so noting to lose and something to gain: “I supported Hillary early on when she stumbled!”
Tim Duy can be replaced by a monkey with a double heads penny. Flip the penny – Heads we need ZIRP.
The Fed governors are too smart to fall for this obvious cost cutting move, which is why they invented QE to deliberate about.
With enough ZIRP and QE, Wall Street can have infinite financial leverage. And here we are.
NPR helpfully explains today that the solution for China’s ills is neoliberal economics.
I’m currently reading Ha-Joon Chang’s Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism and NPR’s prescription is straight out of the IMF/World Bank playbook. Oh those NPR liberals!
Ah, innovation…
(reaches for wallet)
I think the correct term for them is ‘Libruls’
NPR . . . . the voice of Public MSM.
xkcd: Engineer Syllogism. Should be at the top of every Greece IT thread. Happy Friday!
Walker has declared that, as president, he’d stand up to “special interests.”
Ah, what’s a little verbal whoopsie – ‘to’ in place of ‘for’ – between buddies?
When Walker says “special interests”, he very truly and sincerely means unionized workers and the unions which represent them.