Blogs

The Meltdown

| Wed Sep. 17, 2008 2:33 AM EDT

THE MELTDOWN....OK, this is probably sort of a dumb question, but: Has anyone figured out yet how America's financial giants all managed to misprice the risk of the subprime mortgage market so spectacularly? Yes, I know bankers have been doing this forever. Centuries of experience tell us that they have the impulse control of five-year-olds. And yes, the rating agencies screwed up in a big (and possibly fraudulent) way. That certainly helped things along.

Still: it's not as if the bubbly nature of the U.S. housing market was a secret or something. It's been a hot topic of conversation for years. Everyone knew that there was at least a decent chance that the bubble would burst at some point. Even if you were an optimist, you'd concede the possibility.

So what happened? I don't buy the "black swan" theory. What happened wasn't that unusual or that unlikely. Anyone with access to a Case-Shiller chart and even a vague notion of what was going on in the mortgage market knew that a bursting of the bubble was a distinct possibility. So why did bankers get into a frenzy bidding each other down on the size of that possibility? Were their risk managers all out to lunch? Or did they all get overruled by the suits in mahogany row? What's the deal?

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Tough Day at the Office

| Wed Sep. 17, 2008 12:30 AM EDT

TOUGH DAY AT THE OFFICE....First she gets fired from HP, now Carly Fiorina has been fired from the McCain campaign. Maybe the Fed should hire her to run AIG next?

Beam It Down, Scotty

| Tue Sep. 16, 2008 10:07 PM EDT

CoronaSolar.gif Want solar without all the hassle of clouds and night? Beam it down from space. John Mankins of Space Power Association ran the first technical test on this old idea and announced the new results last week, reports Nature.

For less than $1 million and only 4 months of prep, Mankins transmitted microwaves from Maui to the neighboring island of Hawaii—proving that energy can be transmitted all the way through the atmosphere.

Here's the deal: Even on a sunny day, the atmosphere absorbs and scatters half the Sun's rays. Panels in orbit could collect it all, daytime, nighttime, and every time in between. Beam the energy via microwaves to the surface. The microwaves will pass unhindered through our 60-mile-thick atmosphere. Presto. 100-proof solar fuel.

So many solutions. But so many Galvestonians standing dumbfast as the storm approaches. Can we get moving? Please?

Julia Whitty is Mother Jones' environmental correspondent, lecturer, and 2008 winner of the Kiriyama Prize and the John Burroughs Medal Award.

Can't Afford Solar? Paint It White

| Tue Sep. 16, 2008 9:26 PM EDT

B9a_agra700.jpg Your roof, that is. A new study calculates that installing white roofs in the world's cities could offset 1.5 years of manmade carbon emissions, reports AAAS.

Light-colored roofs cool the planet in two ways. They reflect radiation back into space. And they keep your house cooler so you use less air conditioning.

Researchers from Lawrence Berkeley National Laboratory and the state of California estimated the global number of roofs and asphalt surfaces in cities and conservatively estimated they comprise 1 percent of Earth's surface. They then found that using light-colored concrete, or applying white glazes to buildings, could increase the reflectivity of urban surfaces by 10 percent, effectively negating 44 gigatons of CO2. In comparison, halting deforestation of tropical forests would eliminate about 7 gigatons of emissions.

Total global annual emissions from fossil fuels are currently running at about 28 gigatons.

The new snow: paint.

Julia Whitty is Mother Jones' environmental correspondent, lecturer, and 2008 winner of the Kiriyama Prize and the John Burroughs Medal Award.

Will Bitch Go Broke?

| Tue Sep. 16, 2008 7:50 PM EDT

bitch%20cover%20200.jpgBitch, the 12-year old feminist pop culture magazine, recently announced that it needs to raise $40,000 by the middle of October in order to cover printing costs of its next issue.

The situation Bitch is facing is all too common in the magazine industry, especially among independent publications. But what's particularly difficult about Bitch's situation may have something to do with the magazine's advertising policy.

At any magazine, there's always a question lingering in the background: What happens when you publish ideas that are controversial to the institutions that actually pay for the magazine? Like many independent magazines, Bitch doesn't make that much money from advertising. The magazine is perfectly up front about this, explaining that:

Bitch, on the other hand, is loyal—and accountable—to its readers. We're in this together, which is why we call ourselves a reader-supported magazine. Think of us as the print version of listener-supported radio.

In other words, Bitch won't accept all ads, only the ads from companies it, well, likes. Companies "with products and services are aligned with our mission." (Mother Jones, incidentally, does not have such a policy on advertisements—this magazine accepts most ads and promises not to let advertisers' interests affect editorial content. Not everyone is thrilled about that.)

This is not to say Bitch has chosen the "wrong" ad policy. There are plenty of good reasons to turn down ads if they don't fit with a magazine's mission, and Bitch's spirit of independence is inspiring. In practical terms, however, this puts Bitch in an emergency situation where it has to raise $40,000 in the next four weeks.

The fact of the matter is that most periodicals—except for the notable exception of the ad-dominated cash cows that are women's magazines (the other kind)—aren't exactly lucrative, whether the advertisers make things that are hazardous to your health, are ideologically questionable or responsible for numerous disreputable products.

The demise of Bitch would be a major loss, as the magazine provides a valuable service as a fresh voice for contemporary feminism. But the problem is not just what happens by October 15th but also what happens the month after that and after that…

—Daniel Luzer

Deer in Headlights

| Tue Sep. 16, 2008 6:15 PM EDT

DEER IN HEADLIGHTS....This is pretty laughable:

At a rally [in Tampa], Mr. McCain vowed to take aim at what he called the "unbridled corruption and greed that caused the crisis on Wall Street."

Mr. McCain — who has said for months that he believes that the fundamentals of the economy are strong — has used the word "crisis" a lot on the last day to describe the financial situation. He did so in a series of television interviews Tuesday morning, where he called for the creation of a commission to study the problem, along the lines of the commission that investigated the Sept. 11 attacks.

McCain has been running ads for weeks saying that he'll "reform Wall Street and battle Big Oil" — claims that usually prompt me to burst out laughing when they pop up on my TV. If there's a person in the entire country less likely than John McCain to reform Wall Street or battle Big Oil, I'm not sure who it is.

Of course, it would be a lot easier for Democrats to scoff at McCain if they hadn't mostly supported all the same financial deregulation that he did. I have my doubts that repealing Glass-Steagall contributed much to our current problems, but in any case the repeal was supported by Robert Rubin and Larry Summer and signed into law by Bill Clinton. Ditto for the Commodity Futures Modernization Act a year later. What's more, Democrats were mostly pretty happy about the rapid growth of subprime loans to low-income house buyers during the boom years, and a bunch of them supported the 2005 bankruptcy bill too. Hell, last year Senate Democrats couldn't even bring to a vote the biggest no-brainer of all time: a bill to close the carried interest loophole that allows billionaire hedge fund owners to avoid paying income tax at normal rates.

It's true that Barack Obama has some good ideas about re-regulation of Wall Street, and it's noteworthy that he's had these ideas for a while. McCain, conversely, is like a deer in headlights: he has no clue what's going on, so all he can do is keep repeating the word "crisis" like a windup doll and then call for a commission to dig up some answers for him. Not exactly inspiring leadership.

Still, Obama's job would be a lot easier if Democrats had spent the past eight years acting like Democrats. Think they'll learn a lesson from this?

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BlackBerryGate Continues: "Morse Be Damned!"

| Tue Sep. 16, 2008 5:06 PM EDT

I love the internet. Here's what some jokester created after the McCain campaign claimed John "Is Aware of the Internet" McCain invented the BlackBerry.

McCain_Blackberry_Poster.jpg

Previous example of the internet having fun at John McCain's expense can be found here.

One Person Who Could Tell John McCain Who Invented the BlackBerry

| Tue Sep. 16, 2008 3:34 PM EDT

Elise Pickering, a member of the Women for John McCain Steering Committee who lobbied for BlackBerry's creator, Research in Motion, earlier this year. (Via the Senate Lobbying Database.)

Palin Contradicts Palin on Troopergate Explanation

| Tue Sep. 16, 2008 3:33 PM EDT

palin-motorcycle-250x200.jpg

As part of an effort to beat back the investigation into whether Governor Sarah Palin fired Alaska's public safety directory Walt Monegan because he refused to dismiss a state trooper involved in an ugly divorce with her sister, Palin's attorney filed papers on Monday claiming that Palin fired Monegan because of his "outright insubordination" regarding policy and budgetary matters. The problem with this explanation: it directly contradicts Palin's own story.

In mid-August, Palin spoke with New Yorker writer Philip Gourevitch, who was in Alaska--prior to Palin being named John McCain's running-mate--to do a piece on "the peculiar political landscape" of the state. During his time there, the controversy regarding Monegan's dismissal was in the news in Alaska. And Gourevitch asked Palin about it:

[Palin] said that one of her goals had been to combat alcohol abuse in rural Alaska, and she blamed Commissioner Monegan for failing to address the problem. That, she said, was a big reason that she'd let him go--only, by her account, she didn't fire him, exactly. Rather, she asked him to drop everything else and single-mindedly take on the state's drinking problem, as the director of the Alcoholic Beverage Control Board. "It was a job that was open, commensurate in salary pretty much--ten thousand dollars less"--but, she added, Monegan hadn't wanted the job, so he left state service; he quit.

Top McCain Surrogate Says McCain's Not Qualified To Run a Corporation

| Tue Sep. 16, 2008 3:26 PM EDT

First, a McCain aide suggested John McCain invented the BlackBerry. But now, another top McCain aide--Carly Fiorina, the former CEO of Hewlett-Packard--says that McCain (and Sarah Palin) would not be qualified to run a major corporation. Really, she did:

Update: The fallout of this comment has not been good for Fiorina.