And Now… Pope Proposes New Financial World Order Guided by Ethics
July 7th, 2009Via: AP:
Pope Benedict XVI called Tuesday for a new world financial order guided by ethics, dignity and the search for the common good in the third encyclical of his pontificate.
In “Charity in Truth,” Benedict denounced the profit-at-all-cost mentality of the globalized economy and lamented that greed had brought about the worst economic downturn since the Great Depression.
“Profit is useful if it serves as a means toward an end,” he wrote. “Once profit becomes the exclusive goal, if it is produced by improper means and without the common good as its ultimate end, it risks destroying wealth and creating poverty.”
The document, in the works for two years and repeatedly delayed to incorporate the fallout from the crisis, was released one day before leaders of the Group of Eight industrialized nations meet to coordinate efforts to deal with the global meltdown.
The release was clearly designed to give world leaders a strong moral imperative to correct errors of the past, “which wreaked such havoc on the real economy,” and make a more socially just and responsible world financial order.
“The economy needs ethics in order to function correctly — not any ethics, but an ethics which is people centered,” he wrote.
Goldman Sachs Code Torrent
July 7th, 2009.rar 32MB. A distributed real-time co-located high-frequency trading platform… A very low latency (microseconds) event-driven market data processing, strategy and order submission engine.
Update: Some Readers Don’t Know What the Hell Any of This Means
In short: I gamed Google and tricked people who were looking for the stolen Goldman Sachs software to come to my site… So I could see which organizations they were involved with. It’s a mystery to me why more organizations don’t hide what their people are doing online (ask any 12 year old computer enthusiast how this is done if you don’t know), but for whatever reason, many of them don’t.
The bit of text above that starts out, “.rar 32MB…” Was just fodder for Google. Knowing how Google works, I knew it would show up in the index like this:
Doesn’t that look yummy? That’s the point.
Why is this bit of text an image?
Initially, I wanted to let regular readers know what I was up to, but I didn’t want Google to display my tip off in search results. Also, some people think that they’re pulling a 007 move by viewing search results in Google’s cache. But from where do the images load? Hint: Not from Google.
—End Update—
UPDATE: Goldman Sachs Sniffing Around
This story is making the rounds through Goldman Sachs now. It’s 14 visits from five different hosts at the moment:
figment22.gs.com 12.47.208.50
figment24.gs.com 206.230.48.34
figment25.gs.com 206.230.48.50
figment27.gs.com 12.47.208.58
cflodc1.gs.com 204.4.131.140
They’re a combination of direct hits and referrals from zerohedge or takeareport.
—End Update—
I have not seen as much activity from Goldman Sachs as I thought I would on my little honey pot. This is all so far. Then again, this hasn’t even been up 24 hours yet:
204.4.131.140 2009-07-07 12:01:17
/?paged=2
Referrer: http://www.google.com/search?hl=en&rls=com.microsoft%3A*&q=Mr.+Aleynikov+strat&aq=f&oq=&aqi=
Hostname: cflodc1.gs.com
* SEARCH ENGINE: Google (page: 1)
* KEYWORDS: Mr. Aleynikov strat
Other interesting visits:
Citadel Investment Group
64.22.160.1 2009-07-07 11:53:59
/?p=9712
Referrer: Direct hit
Hostname: cit1.citadelgroup.com
—
InfoNgen is the first Discovery Engine for business, finance and information professionals that knows what’s critical to you. Extracts relevant and timely information buried on the web, within emails, in desktop documents or on network drives. Identifies trends and connections between topics, companies or products that might not otherwise be apparent. And delivers results in real time.
63.87.234.186 2009-07-07 05:12:58
/?p=9712
Referrer: Direct hit
Hostname: host186.infongen.com
—
Batterymarch is a global equity specialist, investing in approximately 50 countries for clients around the world. Our unique quantitative strategies combine the power of technology with the wisdom of experienced fundamental investors.
199.58.12.24 2009-07-07 21:12:51
/?p=9712
Referrer: http://www.google.com/reader/view/
Hostname: smtp.batterymarch.com
—
U.S. Army
128.190.125.2 2009-07-07 17:59:55
/?p=9712
Referrer: Direct hit
Hostname: wks125-2.belvoir.army.mil
—
Clough Capital
74.201.46.1 2009-07-07 17:38:18
/?p=9712
Referrer: Direct hit
Hostname: host1.cloughcapital.com
—
Microsoft
131.107.0.101 2009-07-07 17:09:44
/?p=9712
Referrer: From your blog
Hostname: tide531.microsoft.com
—
The Benefit Company
66.184.209.18 2009-07-07 16:20:15
/?p=9712
Referrer: Direct hit
Hostname: 66.184.209.18
—
At ECBridge™, we know that information is the lifeblood of today’s business. Our experienced, international team helps clients plan, implement and manage innovative e-business solutions. We can help your firm gain competitive advantage, by extending the reach of your company’s information.
207.111.251.165 2009-07-07 16:12:14
/?p=9712
Referrer: Direct hit
Hostname: mail.ecbridge.com
—
New York City Police Department
206.212.185.216 2009-07-07 12:49:12
/?p=9712
Referrer: From your blog
Hostname: 206.212.185.216
—
City of Houston
204.235.227.149 2009-07-07 12:05:43
/?p=9712
Referrer: From your blog
Hostname: 204.235.227.149
—
Note: U.S. Department of Homeland Security is obsessed with this post, and with Cryptogon, today. There are at least a couple of DHS employees who read Cryptogon as a matter of routine, but the activity over the last 24 hours shows 10 visits, 43 page views from five different hosts/IPs:
sbcp5.dhs.gov 204.248.24.164
bcp1.cbp.dhs.gov 63.167.255.151
bcp3.cbp.dhs.gov 63.167.255.153
sbcp6.dhs.gov 204.248.24.165
sbcp3.dhs.gov 204.248.24.162
It would be interesting to move to a subscription model. Would DHS subscribe to Cryptogon? *chortling*
Big Banks Don’t Want California’s IOUs
July 7th, 2009Via: Wall Street Journal:
A group of the biggest U.S. banks said they would stop accepting California’s IOUs on Friday, adding pressure on the state to close its $26.3 billion annual budget gap.
The development is the latest twist in California’s struggle to deal with the effects of the recession. After state leaders failed to agree on budget solutions last week, California began issuing IOUs — or “individual registered warrants” — to hundreds of thousands of creditors. State Controller John Chiang said that without IOUs, California would run out of cash by July’s end.
But now, if California continues to issue the IOUs, creditors will be forced to hold on to them until they mature on Oct. 2, or find other banks to honor them. When the IOUs mature, holders will be paid back directly by the state at an annual 3.75% interest rate. Some banks might also work with creditors to come up with an interim solution, such as extending them a line of credit, said Beth Mills, a California Bankers Association spokeswoman.
Meanwhile, on Monday morning, a budget meeting between Gov. Arnold Schwarzenegger and legislative leaders failed to produce a result. Amid the budget deadlock, Fitch Ratings on Monday dropped California’s bond rating to BBB, down from A minus, the latest in a series of ratings downgrades for the state.
The group of banks included Bank of America Corp., Citigroup Inc., Wells Fargo & Co. and J.P. Morgan Chase & Co., among others. The banks had previously committed to accepting state IOUs as payment. California plans to issue more than $3 billion of IOUs in July.
Fitch Cuts California Debt Rating to Two Notches Above Junk
July 7th, 2009Snowballing cluster.
Via: Reuters:
California suffered a new setback in its financial crisis on Monday when Fitch Ratings cut its rating on the state’s general obligation debt to just two notches above junk status.
Fitch cut its rating on California’s long-term bonds to “BBB,” two notches above speculative grade, citing the state’s budget and revenue crisis.
The state last week started issuing “IOU” promissory notes for some bills to conserve cash for priority payments, including payments to investors holding the state’s debt.
The rating agency also kept the debt of the most populous U.S. state on watch for additional downgrades.
Xinjiang Riot Death Toll Hits 156 as Unrest Spreads; Indiscriminate Arrests
July 7th, 2009These are Chinese government numbers.
Via: Reuters:
Chinese police have arrested more than 1,400 people following rioting in the capital of Muslim Xinjiang region which left 156 people dead and more than 800 injured, state media said on Tuesday.
While there were some reports that the violence had spread elsewhere in the region, Xinjiang’s Communist Party boss said the unrest had been quelled, although he warned “this struggle is far from over.”
Calm had settled over Urumqi, the region’s capital, after 20,000 police, troops and firefighters reclaimed the streets from rioters who burned and smashed vehicles and shops on Sunday night.
Xinjiang’s state-run media quoted the regional Communist Party boss Wang Lequan as calling for officials to launch “a struggle against separatism.”
Some Xinjiang newspapers also carried graphic pictures of the violence, including corpses, at least one of which showed a woman whose throat had been slashed.
A total of 1,434 people had been detained, state news agency Xinhua reported, although local residents told Reuters that police were making indiscriminate sweeps of Uighur areas.
Reminder for New BlueHost Clients
July 7th, 2009I see that seven people have recently signed up for hosting with BlueHost, but only two of you have confirmed your orders. (Or, put another way, only two of you are showing up as having confirmed on my screen, in which case I need to contact BlueHost.)
BlueHost requires that each customer confirm that they actually want the hosting package. They will attempt to call you at the phone number that you provided. If, for some reason, they can’t reach you, or you don’t want them to reach you over the phone, you may send an email to verification at bluehost dot com and just write that you want to verify that you wanted the service along with the main domain name associated with the account.
Here are partial domain names of the accounts that are NOT yet verified:
folks
crypt
inter
crder
boom
Thanks for all of your support.
UPDATE: BlueHost wasn’t kidding about that $3.95 per month special being for a limited time. It’s over now.
Biden: We ‘Misread the Economy’
July 6th, 2009Maybe Goldman Sachs needs a few billion dollars more in handouts.
Via: ABC News:
“The truth is, we and everyone else misread the economy,” Biden told me during our exclusive “This Week” interview in Iraq.
Biden acknowledged administration officials were too optimistic earlier this year when they predicted the unemployment rate would peak at 8 percent as part of their effort to sell the stimulus package. The national unemployment rate has ballooned to 9.5 percent in June — the worst in 26 years.
“The truth is, there was a misreading of just how bad an economy we inherited,” said Biden, who is leading the administration’s effort to implement it’s $787 billion economic stimulus plan.
“Now, that doesn’t — I’m not — it’s now our responsibility. So the second question becomes, did the economic package we put in place, including the Recovery Act, is it the right package given the circumstances we’re in? And we believe it is the right package given the circumstances we’re in,” he told me.
The vice president argued more time is needed for the stimulus to work.
“We misread how bad the economy was, but we are now only about 120 days into the recovery package,” he said. “The truth of the matter was, no one anticipated, no one expected that that recovery package would in fact be in a position at this point of having to distribute the bulk of money.”
Biden didn’t rule out a second government stimulus package, but downplayed calls from Nobel Prize-winning economist Paul Krugman this week that a second stimulus will be needed.
I pressed the vice president, who is also leading the administration’s middle-class task force, on whether he’d rule out a second stimulus package.
“So, no second stimulus?” I asked.
“No, I didn’t say that,” Biden said, “I think it’s premature to make that judgment. This was set up to spend out over 18 months. There are going to be major programs that are going to take effect in September, $7.5 billion for broadband, new money for high-speed rail, the implementation of the grid — the new electric grid. And so this is just starting, the pace of the ball is now going to increase.”
Toyota: America’s Car Company
July 6th, 2009Via: Business Insider:
A new study from Cars.com sheds light on the absurdity of thinking cars have a “nationality.”
When you consider that even a post-bailout GM will expand its use of foreign labor, it shouldn’t be that hard to understand how an “American” car isn’t really so, just because its maker was founded in Detroit.
And more generally, there seems to be little reason to think that American cars are really more American in any metrics that matter: Namely, labor and parts inputs.
According to the new survey, the most American car in America is the Toyota Camry, containing the highest percentage of American inputs, even surpassing the Ford F-150. Actually, Toyota utterly dominates the top 10 list, with a Honda thrown in for good measure.
Now some might object to this, saying that even though these cars are “made-in-America”, the value still flows overseas, but really, even that’s not right. Toyota still pays taxes in America. Its stock is traded in the US, and is no doubt owned by individual retail accounts and mutual funds.
U.S. Lurching Towards ‘Debt Explosion’ with Long-Term Interest Rates on Course to Double
July 6th, 2009Via: Telegraph:
In a 2003 paper, Thomas Laubach, the US Federal Reserve’s senior economist, calculated the impact on long-term interest rates of rising fiscal deficits and soaring national debt. Applying his assumptions to the recent spike in the US fiscal deficit and national debt, long-term interests rates will double from their current 3.5pc.
The impact would be devastating by making it punitively expensive to finance national borrowings and leading to what Tim Congdon, founder of Lombard Street Research, called a “debt explosion”. Mr Laubach’s study has implications for the UK, too, as public debt is soaring. A US crisis would have implications for the rest of the world, in any case.
Using historical examples for his paper, New Evidence on the Interest Rate Effects of Budget Deficits and Debt, Mr Laubach came to the conclusion that “a percentage point increase in the projected deficit-to-GDP ratio raises the 10-year bond rate expected to prevail five years into the future by 20 to 40 basis points, a typical estimate is about 25 basis points”.
The US deficit has blown out from 3pc to 13.5pc in the past year but long-term rates are largely unchanged. Assuming Mr Laubach’s “typical estimate”, long-term rates have to climb 2.5 percentage points.
He added: “Similarly, a percentage point increase in the projected debt-to-GDP ratio raises future interest rates by about 4 to 5 basis points.” Economists are predicting a wide range of ratios but Mr Congdon said it was “not unreasonable” to assume debt doubling to 140pc. At that level, Mr Laubach’s calculations would see long-term rates rise by 3.5 percentage points.
The study is damning because Mr Laubach was the Fed’s economist at the time, going on to become its senior economist between 2005 and 2008, when he stepped down. As a result, the doubling in rates is the US central bank’s own prediction.
At Least 140 Dead in Chinese Riots
July 6th, 2009UPDATE: Internet Access Down in Region
—End Update—
Same video in case YouTube pulls it.
Via: Reuters:
At least 140 people have been killed in rioting in China’s northwestern region of Xinjiang, with the government blaming exiled separatists for the Muslim area’s worst case of unrest in years.
Hundreds of rioters have been arrested, the official Xinhua news agency reported, after rock-throwing Uighur people took to the streets of the regional capital on Sunday, some burning and smashing vehicles and confronting ranks of anti-riot police.
The unrest underscores the volatile ethnic tensions that have accompanied China’s growing economic and political stake in its western frontiers.
Along with Tibet, Xinjiang is one of the most politically sensitive regions in China, and in both cases the government has sought to maintain its grip by controlling religious and cultural life while also vowing economic growth and prosperity.
But analysts said the fresh trouble in the remote resource-rich region was unlikely to have a major impact on China’s economy.
“In terms of China’s domestic economy, it is in a remote place and it does not have a big impact on things generally unless there is some evidence, of which there is none, that the government is in some meaningful way losing control,” said Arthur Kroeber, Managing Director of Dragonomics, a research and advisory firm in Beijing.
Beijing’s image as a global power, though, may take a hit as it cracks down on the rioters, say analysts.
“Unfortunately … this will bring a negative impact on China’s image as a responsible power. Coercion alone will not solve the problem. If you use coercion alone it will worsen the problem,” said Zheng Yongnian, director of the East Asian Institute at the National University of Singapore.
Signaling a security crackdown in the strategic region near Pakistan and central Asia, a senior Chinese government official said the unrest was the work of extremist forces abroad.
“This was a crime of violence that was pre-meditated and organized,” Xinhua quoted the unnamed official as saying.
He blamed the violence on the World Uyghur Congress led by Rebiya Kadeer, a Uighur businesswoman now in exile in the United States after years in jail, and accused of separatist activities. She did not answer calls for comment.
But exiled Uighur groups adamantly rejected the Chinese government claim of a plot. They said the riot was an outpouring of pent-up anger over government policies and Han Chinese dominance of economic opportunities.
China’s markets largely brushed off the riots, with the benchmark Shanghai Composite index ending up 1.2 percent at a 13-month closing high, bucking a generally weaker trend in the rest of Asia.
“This is regional unrest only,” said Zheshang Securities analyst Zhang Yanbing.
