TheMommyBlog

Friday, March 05, 2010 Family

I’ve been toying with resurrecting PearSoup.com ever since it was turned into a phishing site and I had to kill it. Lemme know what you think—if it’s worth doing again, I’ll keep it up. New features include a “Vote It Up” function!

Friday, March 05, 2010 Business, Bad Mood Dude, Family, Internet, News, Politics, Technology

This is just a portion of an article by Paul Craig Roberts, former university professor, Wall Street Journal editor, and assistant secretary of the U.S. Treasury. His latest book, How the Economy Was Lost: The War of the Worlds, has just been published by CounterPunch/AK Press.

My heart sank with every paragraph, as each point was identified, explained, and sank in. It’s like having a game of charades replaced by a set of progressively more informative bullet points with snapshots from your families’ lives appended.

I would love to poke holes in it and identify it as political propaganda, but I have seen, first-hand, too much of what’s described unfold. This is so much worse than accepting the previous, prevalent belief that we would never be able attain our parents’ generation’s standard of living.

Doomed by the Myths of Free Trade
How the Economy was Lost

By PAUL CRAIG ROBERTS

The American economy has gone away. It is not coming back until free trade myths are buried six feet under.

...The demise of America’s productive economy left the US economy dependent on finance, in which the US remained dominant because the dollar is the reserve currency. With the departure of factories, finance went in new directions. Mortgages, which were once held in the portfolios of the issuer, were securitized. Individual mortgage debts were combined into a “security.” The next step was to strip out the interest payments to the mortgages and sell them as derivatives, thus creating a third debt instrument based on the original mortgages.

In pursuit of ever more profits, financial institutions began betting on the success and failure of various debt instruments and by implication on firms. They bought and sold collateral debt swaps. A buyer pays a premium to a seller for a swap to guarantee an asset’s value. If an asset “insured” by a swap falls in value, the seller of the swap is supposed to make the owner of the swap whole. The purchaser of a swap is not required to own the asset in order to contract for a guarantee of its value. Therefore, as many people could purchase as many swaps as they wished on the same asset. Thus, the total value of the swaps greatly exceeds the value of the assets.*

The next step is for holders of the swaps to short the asset in order to drive down its value and collect the guarantee. As the issuers of swaps were not required to reserve against them, and as there is no limit to the number of swaps, the payouts could easily exceed the net worth of the issuer.

This was the most shameful and most mindless form of speculation. Gamblers were betting hands that they could not cover. The US regulators fled their posts. The American financial institutions abandoned all integrity. As a consequence, American financial institutions and rating agencies are trusted nowhere on earth.

The US government should never have used billions of taxpayers’ dollars to pay off swap bets as it did when it bailed out the insurance company AIG. This was a stunning waste of a vast sum of money. The federal government should declare all swap agreements to be fraudulent contracts, except for a single swap held by the owner of the asset. Simply wiping out these fraudulent contracts would remove the bulk of the vast overhang of “troubled” assets that threaten financial markets.

The billions of taxpayers’ dollars spent buying up subprime derivatives were also wasted. The government did not need to spend one dime. All government needed to do was to suspend the mark-to-market rule. This simple act would have removed the solvency threat to financial institutions by allowing them to keep the derivatives at book value until financial institutions could ascertain their true values and write them down over time.

Taxpayers, equity owners, and the credit standing of the US government are being ruined by financial shysters who are manipulating to their own advantage the government’s commitment to mark-to-market and to the “sanctity of contracts.” Multi-trillion dollar “bailouts” and bank nationalization are the result of the government’s inability to respond intelligently.

Two more simple acts would have completed the rescue without costing the taxpayers one dollar: an announcement from the Federal Reserve that it will be lender of last resort to all depository institutions including money market funds, and an announcement reinstating the uptick rule.

The uptick rule was suspended or repealed a couple of years ago in order to permit hedge funds and shyster speculators to rip-off American equity owners. The rule prevented short-selling any stock that did not move up in price during the previous day. In other words, speculators could not make money at others’ expense by ganging up on a stock and short-selling it day after day.

As a former Treasury official, I am amazed that the US government, in the midst of the worst financial crises ever, is content for short-selling to drive down the asset prices that the government is trying to support. No bailout or stimulus plan has any hope until the uptick rule is reinstated…

Tuesday, March 02, 2010 Family

The kids are insulting each other’s mother and then apologizing to me.

Monday, March 01, 2010 QOTD

Me: I won’t blame our misfortune on outside forces because whatever happens, happens, and the outcome is merely a measure of the limit of my ability to cope.

Logan: I didn’t understand a word you just said but I’m sure it was very meaningful.

Saturday, February 27, 2010 Bad Mood Dude, Family

I wasn’t going to write about this because it’s just gross, but it’s starting to sound a little funny, and we’re kicked out of the house for three hours while the open house is going on. We’re at my ex’s house. Hannah Montana is on in one room, and Mario in the other. I’m hunkered in a corner waiting it all out.

So, police tape. I SO WANTED to block off half my house today to keep anyone from wandering back there because I thought there was no way I could make it livable again.

You see, at around two a.m. I heard a child get up and use my bathroom. Yes the other one is still not functional. Shut up. About ten minutes later, I heard sounds in the other bathroom and got worried. There shouldn’t be anything going on in there except baths, and that was NOT water running.

I know I exaggerate for humor but I swear to all that is good and crunchy I am not stretching one syllable. There was no way to get down the hall or into the bathroom without stepping in it. It was UNBELIEVABLE. Just like those cartoons where someone leans in to coo at a baby and the baby fire-hoses him with spit-up. There was a lot of effort going into controlling the fire hose, but it looked like a child actually holding a fire hose and being whipped around by the force.

By the time I skated in there, there was no place to focus other than the little two-gallon metal trash container, and it wasn’t going to hold much more. I just didn’t know what to do or how I was going to get out of there and across the valuable Gabbeh runner between the kitchen and me. No matter. First order of business: wait it out and then deposit child into hot, sudsy bath. When I was sure it was in remission, I stuck my feet one by one into the tub and tiptoed along the tops of the baseboards until I was out of the swamp.

Ok. paper towels, new roll. Tilex. Swiffer mop. Bucket. Oil soap. HazMat suit.

Good gravy, I’ve cleaned up some messes but this was—I know I’ve said this—UNBELIEVABLE. And I couldn’t mutter or swear or I’d further offend my already mortified child.

One hour later—ONE HOUR—I’d cleaned that bathroom like I’ve never cleaned anything before. Walls, baseboards, tiles, grout, you name it. I finally fished my baby out of the tub and into bed. Then I went back for one more sweep.

This morning, It looked and smelled great! Yipee! I win! But wait… something… crap there was still something somewhere. I just couldn’t figure out where.

And then I decided to re-enact it. I went into the bedroom and closed the door. Bingo. The first obstacle. It was ALL OVER the inside of the door. I’m guessing that was the first barrier. Then there was the turn into the bathroom, slipping in the mess, then the closed toilet, then the spin around to hit the 2-gallon decorative waste can. That’s when I walked (slid) in. Mystery solved.

And just enough time to set it right before we left and let the realtors do their thing.