Merrill Lynch Reports Biggest Quarterly Loss in Its 93-Year History
October 25th, 2007Via: Bloomberg:
Merrill Lynch & Co. reported the biggest quarterly loss in its 93-year history after taking $8.4 billion of writedowns, almost double the firm’s forecast three weeks ago.
The writedowns on subprime mortgages, asset-backed bonds and leveraged loans led to a third-quarter loss of $2.24 billion, or $2.82 a share, six times more than Merrill estimated on Oct. 5. Chief Executive Officer Stanley O’Neal said today that the New York-based firm may sell assets to shore up its balance sheet.
Merrill’s stock fell the most in five years, its credit rating was cut and the perceived risk of default on the company’s bonds rose after O’Neal said the firm misjudged the severity of the decline in debt markets since July. Investors who lauded the 56-year-old CEO for chasing higher returns as the biggest underwriter of securities backed by subprime loans now question his management. O’Neal said the firm increased the writedown after a more “conservative” analysis of its holdings.
Terror Watch List Swells to More than 755,000
October 25th, 2007Via: USA Today:
The government’s terrorist watch list has swelled to more than 755,000 names, according to a new government report that has raised worries about the list’s effectiveness.
The size of the list, typically used to check people entering the country through land border crossings, airports and sea ports, has been growing by 200,000 names a year since 2004. Some lawmakers, security experts and civil rights advocates warn that it will become useless if it includes too many people.
“It undermines the authority of the list,” says Lisa Graves of the Center for National Security Studies. “There’s just no rational, reasonable estimate that there’s anywhere close to that many suspected terrorists.”
The exact number of people on the list, compiled after 9/11 to help government agents keep terrorists out of the country, is unclear, according to the report by the Government Accountability Office (GAO).
Kids Submit Biometric Data to Receive Their Government Cheese
October 25th, 2007Via: Statesman Journal:
With the federal government lagging behind on its plans to implement the use of electronic passports, identification cards and driver’s licenses, biometric vendors are targeting a new market: schools.
But the use of biometric technology in schools, such as a system being used by Stayton Middle School’s cafeteria, has some parents and privacy advocates condemning the move as outright Orwellian.
“This is biometric data collecting,” said Jann Carson, the associate director of the American Civil Liberties Union in Portland. “It’s the ‘Big Brother’ theory. The last thing we should do is teach parents and their young children to be casual about turning over personal data, like a fingerprint, just for the sake of speeding up a lunch line.”
California Fires: Arson
October 25th, 2007I’m waiting to hear that bin Laden himself did it. Swooping low over the bone dry death trap of Southern California, with his magic carpet, and his Zippo of mass destruction.
Film at 11.
Via: CBS:
CBS News has learned a task force of agencies, including the FBI, ATF, the Orange County Fire Authority and the California Department of Forestry will announce shortly that the massive Santiago Canyon Fire – which has caused an estimated $10 million in damage – is being officially declared an arson, and a $50,000 reward is being offered to find the arsonist.
Investigators have identified two separate “points of origin” where they believe the fire was set, CBS News has learned. FBI agents secured the scene to “maintain its integrity.”
Mitre Corporation Search
October 24th, 2007The Mitre Corporation user (host: mw-128-29-43-3.mitre.org, ip: 128.29.43.3) conducted the following Google search: synthetic environments for analysis and simulation
Related Cryptogon Page: Synthetic Environments for Analysis and Simulation
Mitre Corporation is one of the BIG intelligence and military community cutouts, like SAIC and Battelle Memorial Institute. Tens of billions of dollars worth of tax payer money flows into these black holes each year, yet, how many Americans have ever even heard the names of these organizations?
One in one hundred?
One in one thousand?
(No jokes, please, about Americans who can’t find the U.S. on a map.)
Trillion-Dollar War: Afghanistan and Iraq Set to Cost More than Vietnam and Korea
October 24th, 2007Via: Independent:
President George Bush will have spent more than $1 trillion on military adventures by the time he leaves office at the end of next year, more than the entire amount spent on the Korean and Vietnam wars combined.
There are also disturbing signs that Mr Bush is preparing an attack on Iran during his remaining months in office. He has demanded $46bn (£22.5bn) emergency funds from Congress by Christmas and included with it a single sentence requesting money to upgrade the B-2 “stealth” bomber.
By wrapping his request in the flag of patriotism, the President has made it very difficult even for an anti-war Congress to refuse the money. He was accompanied by the family of a dead US marine when he made the request for funds on Monday.
More: $2.4 Trillion by 2017
Cash-Strapped Americans Raiding Their 401(k)s
October 24th, 2007Via: Chicago Tribune:
Despite potential tax and investment problems, more investors have been borrowing from their 401(k) plans or taking hardship withdrawals in recent months, some retirement plan providers say.
Many in the field expect more borrowing in 2008, as consumers struggle with tighter credit and potentially higher mortgage payments.
IMF Chief Warns Dollar May Suffer ‘Abrupt Fall’
October 24th, 2007Via: AFP:
The head of the International Monetary Fund, Rodrigo Rato, warned Monday of a potential “abrupt fall” in the US dollar that could roil the global economy.
“There are risks that an abrupt fall in the dollar could either be triggered by, or itself trigger, a loss of confidence in dollar assets,” Rato said at the close of annual meetings here of the IMF and the World Bank.
The outgoing IMF managing director spoke here as the European single currency hit a new high of 1.4347 dollars and global equity markets plunged amid renewed fears a US credit crunch could pitch the world’s biggest economy into recession.
“The uncertainty … comes from downside risks that are much higher than they were six months ago. The turbulence in the credit markets is a warning that we cannot take the benign (global) economic environment of recent years for granted,” Rato said on the final day of the annual meetings of the IMF and the World Bank.
“We still do not know the full effects of the decline in the housing market and the subprime problems of the US economy. Further disruption in financial markets and further falls in housing prices could lead to a global economic downturn,” he said.
A crisis in the risky US subprime mortgage sector, where loans are given to homebuyers with poor credit histories, erupted this year as borrowers defaulted on mortgages amid rising interest rates and a sharp slump in US housing prices.
The credit woes spilled into global financial markets and roiled stock markets worldwide in August. Although markets have recovered somewhat, the uncertainties of the extent of the problems are plaguing investors.
Cryptogon Readers Contribute $100 and $20
October 23rd, 2007ES sent $100 and MW sent $20. Wow! ES is a new contributor and MW has been hitting that little, blue “Donate” button for years. Thanks guys.
Charles Riechers: Suicide Is Not Painless
October 23rd, 2007The New York Times has published an astonishing op-ed piece about Charles Reichers and the corruption industrial complex.
The crimes are… breathtaking.
I appended the full text to the Cryptogon post on Reichers (if you would like to comment on this, please do it there).
Via: New York Times:
Set against the epic corruption that has defined the war in Iraq, Mr. Riechers’s tragic tale is but a passing anecdote, his infraction at most a misdemeanor. The $26,788 he received for two months in a non-job doesn’t rise even to a rounding error in the Iraq-Afghanistan money pit. So far some $6 billion worth of contracts are being investigated for waste and fraud, however slowly, by the Pentagon and the Justice Department. That doesn’t include the unaccounted-for piles of cash, some $9 billion in Iraqi funds, that vanished during L. Paul Bremer’s short but disastrous reign in the Green Zone. Yet Mr. Riechers, not the first suicide connected to the war’s corruption scandals, is a window into the culture of the whole debacle.
…
As it happens, he was only about three degrees of separation from Blackwater. His Pentagon job, managing a $30 billion Air Force procurement budget, had been previously held by an officer named Darleen Druyun, who in 2004 was sentenced to nine months in prison for securing jobs for herself, her daughter and her son-in-law at Boeing while favoring the company with billions of dollars of contracts. Ms. Druyun’s Pentagon post remained vacant until Mr. Riechers was appointed. He was brought in to clean up the corruption.
Yet the full story of the corruption during Ms. Druyun’s tenure is even now still unknown. The Bush-appointed Pentagon inspector general delivered a report to Congress full of holes in 2005. Specifically, black holes: dozens of the report’s passages were redacted, as were the names of many White House officials in the report’s e-mail evidence on the Boeing machinations.
The inspector general also assured Congress that neither Donald Rumsfeld nor Paul Wolfowitz knew anything about the crimes. Senators on the Armed Services Committee were incredulous. John Warner, the Virginia Republican, could not believe that the Pentagon’s top two officials had no information about “the most significant defense procurement mismanagement in contemporary history.â€
