Credit Default Swaps

Matt Taibbi has written an excellent article for Rolling Stone on the financial crisis, including a scathing indictment of AIG as well as a good explanation of credit default swaps and other instruments of failure.

The mistake most people make in looking at the financial crisis is thinking of it in terms of money, a habit that might lead you to look at the unfolding mess as a huge bonus-killing downer for the Wall Street class. But if you look at it in purely Machiavellian terms, what you see is a colossal power grab that threatens to turn the federal government into a kind of giant Enron — a huge, impenetrable black box filled with self-dealing insiders whose scheme is the securing of individual profits at the expense of an ocean of unwitting involuntary shareholders, previously known as taxpayers.

Find the full article here.

Statistically Significant Other

I love math jokes and wordplay.

Menachem and Donash in Rashi's Torah Commentary

Places I've found (via search with Davka's Judaic Classics Library) that Rashi mentions Menahem ben Saruq in his commentary on the Torah:

BRE 11:28 - ur אור
BRE 15:2 - 'ariri
BRE 30:8 - naftulei
BRE 30:41 - hamiksharos
BRE 30:42 - ubeha'atif
BRE 32:25 - v'yei-aveik
BRE 35:16 - kivras
BRE 49:19 - gad g'dud yegudenu
BRE 49:26 - ta'avas

SHM 2:10 - m'shisihu
SHM 3:22 - v'nitzaltem
SHM 9:33 - natach
SHM 13:16 - ul'totafos
SHM 21:13 - tzeidah
SHM 28:22 - sharsheres

VAY 19:19 - sha'atnez
VAY 26:21 - keri

BAM 10:36 - shuvah
BAM 24:8 - yigrom

DEV 7:13 - ashteros
DEV 32:26 - afeihem

Places that Rashi mentions Donash ben Labrat:

SHM 28:28 - yizah
BAM 11:8 - leshed

Negative Interest Rate

I'm a sucker for entertaining any wild idea, as long as you can support it with a logical argument. I love the suggestion that Greg Mankiw recently raised of using monetary policy below the theoretical zero-limit interest rate by implementing a negative interest rate, i.e. if you borrow $100 today, you only have to pay back $98 next year (at a -2% rate). Wild!

Would You Trust a Chinese Condom?

The US Agency for International Development is switching suppliers from Alabama-based Alatech, the only US condom maker, to a Chinese company. USAID has distributed 10 billion condoms in poor countries around the world. According to their web site, Alatech manufactures 1 billion condoms each year. Chinese condoms cost 2 cents each versus 5 cents each from Alatech.

The small town of Eufaula, Alabama (map, pop. approx 14,000) will be severely effected by this change. 300 jobs are expected to be lost.

I'm not sure why more major American news outlets didn't pick up this story. When I searched for it on Google, most of the news hits were from foreign (non-US) media.

Even Fox News got it from the Kansas City Star.

Wallet Pop headline writes had fun with this story: American condom-makers layoff workers as production heads overseas (original headline: American condom-makers get the shaft as production heads overseas)

Reagan Got It, Once

Some memorable quotes from Ronald Reagan's speech introducing Herbert Humphrey:

High prices have not been caused by higher wages, but by bigger and bigger profits.

The Republican promises sounded pretty good... But what has happened since then?

Prices have climbed to the highest level in history, although the death of the OPA was supposed to bring prices down through "the natural process of free competition".

Labor has been handcuffed by the vicious Taft-Hartley law.

Social Security benefits have been snatched away from almost a million workers by the Gearhart bill.

Fair employment practices, which had worked so well during war time, have been abandoned.

Veterans' pleas for low-cost homes have been ignored and many people are still living in made-over chicken coops and garages.

Tax reduction bills have been passed to benefit the higher income brackets alone. The average worker saved only $1.73 a week.

In the false name of economy, millions of children have been deprived of milk, once provided through the federal school lunch program.

This was the pay-off of the Republicans promises...

At the end, he summarizes major initiatives

adequate low-cost housing

civil rights

prices people can afford to pay

a labor movement freed of the Taft-Hartley law

Human Rights for All

In a reversal of a Bush administration policy, President Obama and his administration support human rights for all and have decided to sign a U.N. declaration that condemns human rights violations based on sexual orientation and gender identity.

Wikipedia entry with the text of the declaration
Reuters coverage

Check out this NY Times article from back in December when the declaration was first brought up. At the end of the article, the former US position is explained:

The official American position was based on highly technical legal grounds. The text, by using terminology like “without distinction of any kind,” was too broad because it might be interpreted as an attempt by the federal government to override states’ rights on issues like gay marriage, American diplomats and legal experts said.

“We are opposed to any discrimination, legally or politically, but the nature of our federal system prevents us from undertaking commitments and engagements where federal authorities don’t have jurisdiction,” said Alejandro D. Wolff, the deputy permanent representative.

So suddenly the (thankfully former) administration woke up to the federal system and couldn't find the authority to support a declaration that the entire EU and every major western country has supported. They can figure out how to twist the Commerce Clause in such a way that allowed them to raid the homes of terminally ill patients who are trying to get some relief with medical marijuana, but they couldn't figure out how to support human rights for all citizens of the world without peeking into their bedroom. Sheesh!