Clown Show

According to the Wall Street Journal, the Federal Reserve Board has chosen Denis Hughes, president of the AFL-CIO in New York, to become chairman of the Federal Reserve Bank of New York, to serve through the end of 2009. Hughes has been serving as acting Chairman since May.

The New York Fed chairmanship typically has gone to prominent Wall Street executives or academics. The ascension of a labor leader is a new twist for the New York Fed and a sign of the public pressure the Fed has been under to loosen its close ties to Wall Street.

The current brilliant financial tactician and Treasury Secretary Timmy Geithner honed his multiplication skills there.

Hughes is plainly and simply a hack. He is there to protect organized labor and shake down business. He has no history of acting outside of type. His appointment can do nothing but solidify the dysfunction and cynicism that has captured New York finance. He is the typical Obama appointee - a radical whose radicalism is somehow not indicative or emblematic of Obama's radicalism, who for some bizarre reason is still viewed as a go-go moderate. Oh, well Hughes represents organized labor, so he is not outside the mainstream. When organized labor represents but 11 percent of American workers, he most definitely is outside the American mainstream. He has no financial expertise to speak of. He's a shill and a jack boot.

Investor's Business Daily sums up the problems with this appointment:

Denis Hughes, president of the AFL-CIO in New York, has served as interim head of the New York Fed board since May. His ascent to one of the world's most important financial posts is another troubling sign of this administration's too-tight embrace of organized labor.

Understand, this is a time of great financial peril. That's the main reason why Bernanke was renominated. The idea of changing Fed leaders in the middle of a financial crisis was too much.

Bernanke has printed close to $2 trillion in new money to help refloat the economy. President Obama is no doubt happy — if for no other reason than it will let the White House claim its $787 billion "stimulus" is the real reason the economy's starting to grow again.

But the naming of Hughes as the top banker at the New York Fed is the real news. And it's quite astounding.

He has no significant finance experience. Nor does his educational background — "Brother Hughes," as the AFL-CIO's Web site calls him, has a B.S. degree from the Harry Van Arsdale School of Labor Studies at Empire State College — reassure us.

Of greater concern is his career as a bought-and-paid-for union official and political operative. The New York Fed chairmanship is hardly a place for a person whose entire career has been spent fighting and strong-arming the very people he'll now be regulating.

As American Thinker editor Ed Lasky put it, Hughes is someone "who may be more schooled in extracting concessions from corporate America than the intricacies of high finance."

Exactly. More to the point, can those on Wall Street who come before him in routine regulatory matters expect fair treatment? Will union issues become part of the New York Fed's agenda? Will banks find requests to expand or merge stymied because unions fear a loss of jobs somewhere?

These are more than just academic questions. The New York Fed is the primus inter pares, the first among equals, of all the Fed banks. It is the bank that executes the Fed board's will in the marketplace. It is the on-site regulator of Wall Street, playing, as its Web site says, "a leadership role in monetary policy, financial supervision and the payments system." Now it's headed by a union shill.

Putting this key Fed bank in the hands of a person whose experience suggests a bred-in-the-bone hostility to capitalism strikes us as bizarre at best and dangerous at worst. And it bears the unmistakable imprint of the White House. Just last week we wrote about plans to elevate former United Steelworkers adviser Ron Bloom from head of the auto task force to "industrial policy czar."

Putting so many union people in powerful positions of economic policymaking is a recipe for disaster. Since 1955, the share of the workers belonging to unions has plunged from 33% to about 11%. Still, though increasingly unpopular, unions have helped wreck two major industries: autos and steel. Not much of a track record.

But now, through politics, unions are getting rewarded with control of the economy — a very bad omen for American capitalism.

Perhaps there is hope in the limited nature of the appointment, as the Fed will choose 2010's replacement sometime in November or December. At the top of the list is the Fed's newly named Vice Chairman, Lee Bollinger. Bollinger is another leading financial expert and wunderkind, as evidenced by training as a lawyer, his tenure as Columbia University's 19th president, his abuse of affirmative action at University of Wisconsin, and his noted free speech advocacy, including ensuring that Iranian terrorist leader Mahmoud I'mmadinthehead was given a podium at Columbia University.

Isn't it bliss?
Don't you approve?
One who keeps tearing around
And one who can't move
But where are the clowns?
Send in the clowns

Last Day Dawning

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Posted via email from Sydney's posterous

Dinner: the Dogfish Head Raison D'Etre

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Dinner

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Your Host Dresses Up After A Day On the Sand

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Vacation Jail

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Untitled

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Chart O' the Day

Says Chart of the Day:

One positive outcome of the financial crisis was that gasoline prices did plunge from their record highs – down 60% peak to trough. Beginning at the end of 2008, however, gasoline prices have surged and are currently 61% above their December 2008 lows. Today’s chart provides some perspective on the recent spike with a long-term view of the average US price for a gallon of unleaded gasoline. It is interesting to note that most gasoline price spikes were a result of Middle East crises and often preceded or coincided with a US recession. So while gasoline prices are currently well below the record high levels of 2007, this recent rally has brought prices to a level well above what was witnessed from 1984-2004 – a two decade span of relative energy price stability.

What's In A Name

So far this week, Sydney Brillo Duodenum has been called a Klansman, an astroturfer, a racist, a Nazi, a mobster, a pistol packing assassin, a nut, a minority, a militiaman, a southerner, un-American, an evil monger, fishy, un-democratic but well-dressed, an extremist, partisan, in the way, a bus passenger, an intimidator, a silencer of regular people, a high-level Republican political operative, a demagogue, a shouter, disrespectful, and a heckler.

The worst of it though was when Sydney Brillo Duodenum Junior called SBD "the meanest dad in the world."

Kids say the darnedest things.

First Taste - Dogfish Head Theobroma

Dogfish Head Theobroma

Brewer: Dogfish Head Craft Brewery, Inc., Milton, DE

Location: Top of a Mayan pyramid in Bethesda, MD

Marketing BS: "Theobroma, or 'Food of the Gods,' is a re-creation of the premier chocolate beverage of the Americas, intended only for the gods, kings, and the elite. This liquid time capsule is based on the earliest chemical and archeological evidence of cacao in the New World, dating to before 1100 B.C., and enhanced by natural additivies of the later Mayan and Aztec drinks."

Other side of label: "Off-Centered Ales for Off-Centered People. As per the amazing molecular evidence, this ancient ale is brewed with honey, ancho chilies, ground annatto, Soconusco cocoa nibs and cocoa powder from our good friends at ASKINOSIE chocolate."

Marketing Translation: While on vacation at Copan during spring break, one of our summer brewing interns smuggled out some pottery shards, on which we found dried scum. We paid an intern in a molecular scientist's lab a lifetime supply of our winter seasonal brew to analyze the scum and make up a list of ingredients that, according to a Hollywood script, could constitute an ancient beer recipe brewed by chest slashing drunk ass Aztec priests.

Bottle/Label: This sucker's a pint of coiled danger. Makes your wife think you're drinking an entire bottle of wine. The label features a picture of a proto-Dora the Explorer popping out of a Mayan manhole cover.

Alcohol: 9%. Well, that certainly explains the non-stop bloody sacrifices, now doesn't it?

Method of Imbibation: A Guinness pint glass. Worked, as it held the head nicely and offered forth a full quafe of liquid complicity in pre-Columbian genocidal crimes against humanity.

The Pull: As silent as an obsidian blade making the final slash across the circumflex branch of some prole's left coronary artery.

First Swig: Completely surprising in its banality, but then mass murder at the hands of a cult to honor bloodlusting deities is pretty banal. What is so surprising is how modern this craft brew is. Nowhere to be found is chocolate or cocoa or cacao or ancho chilies or chocolate cocao or ancho chocolate cacao chilies or cocoa chilies or annatto chilie cocoa cacao or Countchocula. There aren't even any Soconusco cocoa nibs to tickle with one's tongue. There is, however, enough honey to cover the daily factory run of the HoneyCombs cereal plant in Jonesboro, Arkansas. It's reminiscent of Dogfish's Aprihop but without the apricots and full bore hoppiness. Nevertheless, while presiding over one's den on a Thursday evening, fresh from a full day of humiliations at the hands of eager Obamanauts, this beer will salve your tender soul and convince you that you too are an elitist, who, given enough time, will be pitching the heartless torsos of expendable seniors down a flight of stone steps, all in homage to a delusion of grandeur and progress and hope.

Competition: Dogfish Head Midas Touch Golden Elixir; Kirin Brewery Old Kingdom Beer

Recommendation: Drink it because you'll get a sweet buzz, which will make it easier to watch the first game of the Washington Redskins preseason as they fall miserably to the Baltimore Ravens. There ain't no sacrifice big enough to save this team.

Sitting Quietly in Their Homes, Listening to Him

Dorothy Rabinowitz in the Wall Street Journal:

The president has a problem. For, despite a great election victory, Mr. Obama, it becomes ever clearer, knows little about Americans. He knows the crowds—he is at home with those. He is a stranger to the country’s heart and character.

He seems unable to grasp what runs counter to its nature. That Americans don’t take well, for instance, to bullying, especially of the moralizing kind, implicit in those speeches on health care for everybody. Neither do they wish to be taken where they don’t know they want to go and being told it’s good for them.

Who would have believed that this politician celebrated, above all, for his eloquence and capacity to connect with voters would end up as president proving so profoundly tone deaf? A great many people is the answer—the same who listened to those speeches of his during the campaign, searching for their meaning.

It took this battle over health care to reveal the bloom coming off this rose, but that was coming. It began with the spectacle of the president, impelled to go abroad to apologize for his nation—repeatedly. It is not, in the end, the demonstrators in those town-hall meetings or the agitations of his political enemies that Mr. Obama should fear. It is the judgment of those Americans who have been sitting quietly in their homes, listening to him.

A Fishy Letter

Sydney Brillo Duodenum's Denver connection has forwarded to him an open letter from a private citizen - a Mr. J.T. Townsend - that was addressed to the Fishmonger-in-Chief. The letter concerns the Fishmonger-in-Chief's effort to sell his plan to socialize America's health care system, including requesting that the Fishmonger-in-Chief's supporters provide directly to the White House the names of Americans whom they believe are misrepresenting the President's plan to socialize America's health care system. This letter is very fishy. It smells like a freshly caught Red Snapper, filleted on deck, and dashed with lime and lemon juice, sea salt, cilantro, and minced garlic, onion and tomato. Delicious.

August 5, 2009, approximately 6 hours after learning of the existence of this link on the White House home page:

http://www.whitehouse.gov/blog/Facts-Are-Stubborn-Things/


Dear Mr. President;

This morning, I learned of the existence of this link on the White House homepage: http://www.whitehouse.gov/blog/Facts-Are-Stubborn-Things/

I was surprised, that in support of legislation that addresses what you consider one of the most important crises facing our nation – the current state of our healthcare industry - that instead of encouraging debate over solutions, you would allow your staff to create a website encouraging Americans to report to your White House “fishy” e-mails from their fellow citizens. To me, the existence of this site, and your encouraging of Americans to “get in the face” of those who disagree with your current view and proposed solution confirms that rather than engage in an active, intellectual debate regarding healthcare reform legislation, you’ve chosen to suppress and vilify the opposition. This is in direct contrast to your campaign rhetoric regarding cooperation and tolerance, and beneath the behavior of any principled leader.

During your campaign, you took on the mantle of high-minded principle, espousing your belief that a good leader needs to include everyone at the table, to tolerate ideas contrary to his own, and drive opposing sides to a workable compromise. Broadly, I agree with these premises. In execution, though, this website and your “in their face” comment abide by none of these principles. There are valid concerns regarding the healthcare reform legislation currently before our Congress. How does asking Americans to report their fellow citizens’ comments in opposition of this legislation to their White House, or telling them to get “in the face” of those who disagree, coincide with “tolerance”? Your actions demonstrate you do not value others’ opinions or debate.

American citizens have valid concerns about the legislation currently before Congress that coincides with your proposed solution for healthcare in the United States. The “Facts-Are-Stubborn-Things” website lists and dismisses three such concerns 1) the elimination of private coverage 2) control of personal finances 3) end of life care. The site coolly, but incorrectly, states that you have addressed all of these concerns. Indeed, the letter of the legislation does not eliminate a citizens’ current coverage, but it does affect their possibility of future coverage by a private insurer if they change employers or if they are an employer not currently providing health insurance. The ramifications of these measures on employment and wages have not been publicly articulated by you, and are the true heart of the concerns expressed in e-mails and editorials circulating the country.

As far as the control of personal finances, the taxes necessary to fund this program and its effects on the budget deficit have not been articulated by you to the satisfaction of this nation’s citizens. Numerous economic studies have been published in contradiction to the economic value you suppose will be created by a more efficient system, and you have yet to provide an accurate (GAO approved and independent private accounting firm) financial accounting of how much the program will cost and where the money will come from. This is a control of personal finance issue for every American citizen, as funds for government programs do not come from accounts generated by government revenues, but from the pockets of hard-working Americans.

Finally, I do not believe that you have addressed the end of life care issue, which is outlined in the legislation, and which you – in a nationally televised interview - dismissively said was not something you were aware of. It is not surprising you do not know that this provision is a part of the legislation. In fact, this and many other facts would be apparent to Americans if not for the existence of what is the most offensive part of the legislation that the website does not address – the current legislation before congress regarding healthcare reform is 1,100 pages long, and inclusive of hundreds of provisions and articles that you have never addressed publicly. Would you hold any other professional to such a low standard? You have not read the legislation in such a manner that makes you familiar with a provision that directly affects the pursuit of happiness of the citizens whose rights you are charged with protecting? Do you expect your military commanders to know the content of their written orders to subordinates? Do you expect the Federal Reserve to understand the contents of its written financial and economic reports? Do you expect businessmen to know the contents of the contracts they are signing? Do you expect doctors to know the contents of their patients’ files? And yet you present (as an adequate answer around legislation you say to be so important) that you’re not familiar with every bit of this legislation’s content? It is inexcusable that a President or any other government official would vote for or sign legislation without reading and understanding it in its entirety. If a law is so insignificant that it doesn’t need read to be passed, then it ought not to be passed at all.

I am ashamed that my nation’s highest-ranking, elected official discourages debate and has not articulated the ENTIRE content of legislation that will have such an intimate effect on my family and the families of my fellow citizens. The mantle of leadership in a true Republic is not demonstrated when the position is the vehicle by which you or any other leader promote your idea rough-shod over differing opinions. Instead, like any leader (and more so given the sanctity of your position), your responsibility is to convince by the eloquent presentation of facts.

I believe strongly one ought not to criticize without being prescriptive, so this is what I suggest you do to remedy the errors highlighted by the existence of this website.

Prescription for you, the President

• Act as a true leader – not a politician – and encourage active debate and deliberate consideration of the resulting legislation before it becomes law. The current “my solution is the only one” and rushing of congress to pass it as law is beneath any principled leader.

• Remove the facts are stubborn things website and quit actively encouraging Americans to “get in each other’s faces,” both of which are in direct contradiction to your campaign promises and rhetoric.

• Explain how this program will be funded – not with economically realized “value” – but accounting figures integrated into the current national budget.

and

• Do what the President ought to expect from every professional – fulfill your job responsibilities by knowing every fact of the documents (legislation) of your profession.

• Replace the “Facts-Are-Stubborn-Things” website with a site containing the proposed legislation and a personal note on every aspect of the bill and why you support it.

or

• Simplify the legislation to a digestible document that every citizen should read and consider.

• Present to the American people (article by article) the healthcare reform legislation in its entirety, and promise publicly that the plan includes nothing more and nothing less than what you have articulated.

Indeed, Mr. President, facts are stubborn things. Thus far, the facts are that you have acted contrary to your campaign promises and dismissively admitted you do not know the facts around what you’ve said is one of the most important pieces of legislation of our time.

I invite you to surprise me, because given your recent actions, I expect none of this to be done. Your website and “in your face comment,” are not indicative of a leader who would take these bold and difficult steps to gain support for your position.

Please, Mr. President, make me look the fool and live by your word.

Sincerely;


JT Townsend

Citizen

Eat This

Working Papers in Health Economics:

Food Prices and the Dynamics of Body Weight

A popular policy option for addressing the growth in weight has has been the imposition of a "fat tax" on selected foods that are deemed to promote obesity. Understanding the public economics of "fat taxes" requires an understanding of how or even whether individuals respond to changes in food prices over the long-term. We study the short- and long-run body weight consequences of changing food prices, in the Health and Retirement Study (HRS). We found very modest short-term effects of price per calorie on body weight, and the magnitudes align with the previous literature. The long-term effect is much bigger, but it takes a long time for the effect to reach the full scale. Within 30 years, a 10% permanent reduction in price per calorie would lead to a BMI increase of 1.5 units (or 3.6%). The long term effect is an increase of 1.9 units of BMI (or 4.2%). From a policy perspective, these results suggest that policies raising the price of calories will have little effect on weight in the short term, but might curb the rate of weight growth and achieve weight reduction over a very long period of time.

Yes, and "over a very long period of time" we are all dead.

The Body Politic

Mark Steyn:

Health care is a game-changer. The permanent game-changer. The pendulum will swing, and one day, despite their best efforts, the Republicans will return to power, and, in the right circumstances, the bailouts and cap-&-trade and Government Motors and much of the rest can be reversed. But the government annexation of health care will prove impossible to roll back. It alters the relationship between the citizen and the state and, once that transformation is effected, you can click your ruby slippers all you want but you’ll never get back to Kansas.

[...]

Government-directed health care is a profound assault on the concept of citizenship. It deforms national politics very quickly, and ensures that henceforth elections are always fought on the left’s terms. I find it hard to believe President Obama and his chums haven’t looked at Canada and Europe and concluded that health care is the fastest way to a permanent left-of-center political culture. He doesn’t say that, of course. He says his objective is to “control costs”. Which is the one thing that won’t happen. Even now, health care costs rise far faster under Medicare than in the private sector.

[...]

When health care is the government’s responsibility, it becomes its principal responsibility. Because the minute you make government the provider of health care, you ensure that, come election time, the electorate identifies “health” as its number one concern. Thus, in a democracy, the very fact of socialized medicine seduces the citizenry away from citizenship. Buying health care is no more onerous than buying a car or buying a house – which, pre-Barney Frank, most Americans seemed able to manage. Indeed, most of the complications are caused by existing government interventions. If you were attempting to devise a “system” from scratch, you might opt for insurance for catastrophic scenarios and, for PAP smears and colonoscopies and whatnot, something similar to the tax breaks for a Simplified Employee Pension: C’mon, how difficult can it be? Back in the day, your grampa managed to go to the doctor without routing the admin through Washington. Matter of fact, the doctor came to grampa. That’s how crazy it was.

[...]

the acceptance of the principle that individual health is so complex its management can only be outsourced to the state is a concession no conservative should make. More than any other factor, it dramatically advances the statist logic for remorseless encroachments on self-determination. It’s incompatible with a republic of self-governing citizens. The state cannot guarantee against every adversity and, if it attempts to, it can only do so at an enormous cost to liberty. A society in which you’re free to choose your cable package, your iTunes downloads and who ululates the best on “American Idol” but in which the government takes care of peripheral stuff like your body is a society no longer truly free.

Gratuitous, Juvenile Swipe of the Day

Reuters

" No, no, Mr. President, the First Lady' ass really is this big."

Chart O' the Day

Says the Chart:

Today's chart presents the Dow divided by the price of one ounce of gold. This results in what is referred to as the Dow / gold ratio or the cost of the Dow in ounces of gold. For example, it currently takes 9.8 ounces of gold to “buy the Dow.” This is considerably less that the 44.8 ounces it took back in 1999. When priced in gold, the US stock market has been in a bear market for the entire 21st century and is currently trading 78% off its 1999 highs. The recent five-month rally, however, has the Dow (priced in gold) putting in a significant test of resistance of an accelerated downtrend that began in mid-2007.

Dinner

Tonight's dinner is dedicated to Meme Roth, Food Fascist and All-Around Rude, Arrogant Bitch.

Hey There Obama

Beer Summit

The news out of Washington is that President Obama will be hosting a summit on race relations between whites, as represented by Cambridge Police Sergeant James Crowley, and blacks, as represented by Harvard professor Henry Louis Gates, Jr.

President Obama's highly anticipated sit-down with Cambridge Police Sgt. James Crowley and Harvard professor Henry Louis Gates Jr. over some brews is expected to take place early this week, administration officials said Sunday.

The President has selected the theme of “beer” to set the stage for a friendly discussion. Although the President’s inclination will be to offer Sgt. Crowley and Prof. Gates cold Heinekens wrapped in two ply cocktail napkins, Sydney Brillo Duodenum urges the President to direct the White House Bartender to seek out and procure some microbrews.

Because Sgt. Crowley and Prof. Gates are both Massachusetts-based, SBD offers the following two selections:

For Sgt. Crowley, who caught a really big fish, we recommend that the President offer him the following:

Harpoon IPA

For Professor Gates, the President could not go wrong by offering his close friend the following:

John Harvard's Nut Brown Ale


Anything with the name "Harvard" in it should appeal to the professor.

And, of course, the President should have something special for himself, which is why this presidential hometown brew is sure to please His Coolness:

The Blue Cat Brew Pub Off the Rails Pale Ale

Increasing Long-Period Hedonic Adaptation

Now that the global economic catastrophe is over, Capitalism has been squashed, Socialism proven, and the small details of government control of markets and economies remaining for clean up by squads of graduate TAs, the economics academy is turning its wizened eye to those few remaining economics issues that continue plaguing mankind.

To wit, Sydney Brillo Duodenum found a new landmark study in his morning e-mail of Social Science Research Network Microeconomics - Intertemporal Choice and Choice Abstracts. Sandwiched between no less important studies on "Life-Cycle Variations in the Association between Current and Lifetime Earnings - Evidence for German Natives and Guest Workers" and "Estimating Intertemporal and Intratemporal Substitutions When Both Income and Substitution Effects are Present: The Role of Durable Goods," we are relieved to find attention finally being brought to bear on:

Swinger Economics

Swinging is a sexual behavior of increasing relevance but substantially ignored in theoretical economic investigation. This paper has two major goals. The first is to describe what swinger is, discuss its economic relevance and single out the main characteristics of swingers’ behavior. To this end, the Italian situation has been considered as a type of case study. The second goal is to use standard and less-standard tools from economic theory to propose some preliminary assessments of the causes and consequences of swinger couples’ behavior. In this respect, some contributions on two-sided markets, hedonic adaptation approaches and equilibrium matching models have proved particularly useful.

This study by Fabio D'Orlando of the University of Cassino and Cream (!?!?!) Economic Center focuses on the Italian swingers market, as it were. With precision exposition, D'Orlando addresses this two-sided market (yuck, yuck) and even includes auto-economic erotic imagery:

Oh, baby.

SBD does not want to rob his readers of the pleasures of this study, but given the importance of this subject to the preservation of western civilization, he understands that the more known now about this, the better his readers will sleep tonight. D'Orlando concludes:

. . . the theoretical approaches which seem best suited to capture the empirical data are those based on the concept of hedonic adaptation. These approaches suggest that it is consistent with maximizing swinger strategy to begin from soft swinging and only later engage in “harder” swinging, and that also the search for ever new sexual experiences delays long-period hedonic adaptation and hence increases swingers’ long-period well being. Both these theoretical predictions seem to find confirmation in the empirical data on swinger behaviour.

Yes, it's all about long-period hedonic adaptation.

Next, SBD will look at this ground breaking study:

How Do Policy-Makers Actually Solve Problems? Evidence from the French Local Public Sector.

No doubt wine, some brie, and a baguette are involved. And a nap, too.