Conservation: "Do you want to see something really scary?"
“If running out of oil doesn't scare you, maybe an iceberg the size of Connecticut floating away from Antarctica and hitting the United States will get your attention…The real question is: are we going run out of the things we need before we find substitutes for them?” – Andy Rooney
Shooting Up America
When President Obama recently stated that pushing for a reinstatement of the ban on "assault weapons" (think: AK-47s) was not in the cards, it was a political acknowledgment of how completely the NRA (national rifle association) has achieved a stranglehold on congress.
To get a sense of this stranglehold in action, and the culture war that underlies it, you have to watch the 60 Minutes expose, ‘Gun Rush,’ as it does a really good job of showing how fears of Obama (in some circles), combined with a devastating economy have fueled a run on guns that is (unfortunately) uniquely American.
We see giddy retailers at a Richmond (Virginia) Gun Show, where lax to non-existent "Background Check" laws allow anyone to buy handguns, assault weapons and bullets as easily, and with as little pre-qualification, as buyers of bulk food products at Costco.
Check that: you need a membership at Costco.
For those of us who see events like Columbine, the Virginia Tech massacre, runaway gang violence and the recent killing of four Oakland (California) police officers by a parolee armed with assault weapons as emblematic of all that is wrong with our gun culture, this program is a wake-up call as to just how outside the power centers you/we are.
Crisis Altering Wall Street as Big Banks Lose Top Talent
One of the “holy shit” moments of the banking crisis (as foretold by the collapse of Long Term Capital Management a decade earlier) was the reality that derivative and hedging strategies did not mitigate risk, but rather amplified it, not because anything endemic to the instruments themselves, but rather because such strategies lead to imitation, which in turn, fosters simultaneous mass movement of securities on a global level; by definition, systemic risk.
The good news is that if (and only if) appropriate and comprehensive regulatory and enforcement mechanisms (with some formal concept of regulatory power across national boundaries) can be put in place, this is a manageable dynamic.
Simply put, we need better governance of market underwriting control mechanisms.
And oh by the way, as to all of the indigestion by banking executives around comp package caps as the “stick” side of being bailed out and subsidized by the American people? True, such tethering of pay schemes compromises their ability to retain top talent, but the counter is that maybe that is a good thing.
The argument here is that a winnowing of talent from the “too big to fail” entities opens the door for smaller entities to promulgate, which actually moderates volatility in the financial marketplace.
“If the risk-taking spreads out to these smaller institutions, it is no longer a systemic threat,” said Matthew Richardson, professor of finance at the Stern School of Business at New York University. “And innovation is spreading out too. This is a good thing.”
Real the full article in the New York Times HERE.
