Category Archives: Uncategorized

(Community Matters) He gets credit for finally speaking up. And, he’s responsible for letting the genie out of the bottle.

(Community Matters) Violence from the Right. In my mind it’s even scarier than it appears.

From Three Blue Dudes:

Paul Krugman writes something that’s been on my mind lately: That as ugly as GOP rhetoric is right now, it will be even uglier if Obama wins the general election and becomes President of the United States.

What it came down to was that a significant fraction of the American population, backed by a lot of money and political influence, simply does not consider government by liberals (even very moderate liberals) legitimate. Ronald Reagan was supposed to have settled that once and for all.

What happens when Obama is elected? It will be even worse than it was in the Clinton years. For sure there will be crazy accusations, and I wouldn’t be surprised to see some violence.

The next few years are going to be very, very tough.

I think that’s exactly correct. It is easy to forget how crazed and unhinged the Right was about the Clintons and the things they said and did to destroy him, including impeaching a popular and successful president. It will be worse with Obama and there is no reason to believe that the media, which outrageously lent credence to even the most preposterous anti-Clinton conspiracy theories, has learned anything at all. Most likely, they will entertain the new anti-Obama conspiracy theories [mostly just recycled anti-Clinton theories] just as eagerly.

When Easter 2009 rolls around, we’ll hear that Obama wants to cancel the Easter Egg Roll at the White House because he hates Baby Jesus. A year from now, we’ll be told that Christmas has been cancelled at the White House, but Ramadan is mandatory for all federal employees. And that’ll be the mild stuff. Wait until we hear about all of Obama’s white bastard children — race-mixing being a particular bugbear for the American Right.

It will get ugly. Don’t fool yourself.

In January I wrote about James Dobson, radio broadcaster and founder of Focus on the Family, and his tendency to refer to Bill Clinton’s administration as a regime because he felt moral issues prevented him from supporting a Clinton administration. He went so far as to question how long “Christain” Americans could support an immoral regime. This is real stuff. (never mind that Dobson is a hypocrit and argued against investigation of Republican congressional influence in any coverups related to Mark Foley).

In fact, powerful political interests misinform and stoke fear in many people off-balance and scared because of change, economic & political balance-of-power threats. You’ve seen Palin and McCain incite xenophobic and nationalistic anger bordering on violence among some supporters. Already, Former Republican Senator Lincoln Chaffe has withdrawn his support for the McCain/Palin ticket out of concern. Former Michigan Republican Governor Millken has similar withdrawn his support of McCain and for the same reasons. Let’s hope more honorable Republicans stand up against this wave of resurrection.

(Community Matters) This from Daily Kos. I haven’t vetted it. Warning, includes the F word

(Community Matters) I didn’t even know their supreme court was hearing a case. Ruling 4-3 that gay marriage is legal. here

What a great ending to a lousy financial week. Regret that there are some who might not consider it progress. Gay men & women marrying will strengthen your sacred institution of marriage, not in any way threaten it. And, we’ll help strengthen inclusive family values.

(Community Matters) The invitation to fly to New York for the final debate. Cruel only because I’m hosting a fundraiser and can’t!

(Community Matters) You gotta remember, the call with bankers I’m catching up on was held yesterday. I just finished hearing the remainder.

Of course, since then the equities markets were down yesterday by 0.8% to 2% depending which benchmark measured and after today’s 5% to 7.6% tumble, it’s interesting to note that yesterday morning’s call warned we could easily see another 15% to 20% decline (to the average 50% declines experienced in 1973-74 and 2000-02). For many reasons, they do not expect we’re headed into a depression like the 30s when stock prices declined 86%.

Good gosh, there is a long list of recent US financial expenditures/authorizations associated with this recession/bailout:

• $100B in tax rebates earlier this year
• $50B in business tax incentives as well
• $300B for home mortgage refinancing passed a couple of months ago
• $200B conservatorship monies for Fannie & Freddie
• $85B for AIG
• $50B in assets from the Exchange Stabilization Fund to guarantee money market accounts (# shares held at 9/17 – I’ve subsequently read if you sold but bought back, you’re still insured up to # shares on 9/17. In case anyone bailed into treasury only mmfs and now want back into something with an above inflation rate of return)
• $700B bailout, aka TARP, the Troubled Asset Relief Program

On the bailout (TARP), they explained that Treasury can 1) purchase assets, 2) insure the value of assets for a fee and 3) purchase any other financial instruments (aka preferred stock thus giving them an equity play)

Of course, TARP also provided for an increase in FDIC insurance to $250,000, so CD spread programs have just gotten easier. As an fyi and from my old banking days, it was a fallacy in the 80’s & 90’s that you had $100k per account or unique account style. Then, you attributed proportional interests among account owners and each person or company had a total of $100k insurance within each financial institution. Not sure if this is still the way they’d calculate.

There was a question about why the markets didn’t seem to be responding so favorably to the finally passed bailout (NO THANKS TO LLOYD DOGGETT). Our presenter stated that the requirement for warrants and caps on executive compensation were giving pause to participation (good), as were the facts that some financial institutions had already written down the securities so were considering whether to simply hold and recapture their own gains and, conversely, if they hadn’t already been required to write down the values, concern about the balance sheet implications of doing so.

Fiscal stimulus measures: Prior to the meltdown, expectations of another $50B stimulus measure. Now imagine we’ll see even higher numbers, though probably not during the lameduck Congress, but from our new administration and Congress.

Discussion about the new IRS rules re: tax write off of losses from acquired financial institutions. This probably not of much interest. (but for my own notes: from limit of 5% of acquired
“value” to unlimited. Retroactive. And, questions about IRS authority to even reinterpret these limits).

Wow, still predicting 8%+ growth in China. Euro markets stronger than UK and USA. Expect Euro back up to 1.5x USD (currently 1.36).

Equities. What are the opportunities? Extreme pessimism in the market. Bullish sentiment lowest since 1994. All time high indices of anxiety over volatility. (yeah, your mind jumping to opportunity too?) Panic – liquidation of MMFs to treasuries akin to stuffing the mattress. Combination of credit crisis, home price declines and ongoing deleveraging will continue to take its toll.

Normally predict 2 to 2.5 years for the economy to fully recover after a banking crisis. But, since equity prices anticipate economic changes, where’s the trough? If we’re predicting GDP to bottom 4Q, 1Q and 2Q, might we be there?

Lots of good info on earnings, price:earnings and historical comparisons. US large cap 10 year rolling percent returns and S&P percent changes. Appears there could be cautious opportunities to slightly bump up allocations to equities, averaging over next 6 to 9 mos. Though, absolutely, ought to maintain plenty of liquidity for a good night’s sleep.

(Community Matters) Several years ago a group of community leaders were in Colorado as guests of Applied Materials’ Charitech initiative. We were challenged to think up a new initiative for our city. Our group created the East Austin Economic Forum. Lots of meaningful observations there, the most memorable for me was that the psychological barriers to economic success for East Austin were at least as ingrained within East Austinites, if not more so.

The next year, Cloteal and I were both receiving the usual flurry of emails reminding us about the upcoming Anglo Angelous Economic Forecast presentation. We were at breakfast with Margo Weisz and wondered aloud, why isn’t there as substantive an economic presentation about East Austin and how the broader region’s and nation’s economic forecast will present challenges and opportunities for East Austin entrepreneurs. Voila . . . The East Austin Economic Summit.

This event has become one of THE economic summit presentations in Austin. Regret that I’m away and unable to be there this Saturday.

(Community Matters) Small world, when Steven and I arrived at his favorite guest house (really a small hotel at the edge of Noe Valley and the Mision District, overlooking Delores Park) last night, as we were fumbling for the keys to the property, a gentleman called down from the courtyard that he’d let us in.   Austinite Anton Nel.  And, he too is an early riser so we’ve enjoyed a a morning chat and cups of coffee.  He’s playing here on Sunday afternoon and in Austin with the Symphony next weekend.  I may take our nieces (Hilary, 16yo & Hanah, 15yo) who fly in on Friday for a weekend visit. We’re solo until Steven returns (where from, I have no idea.  NY?) on Saturday.  

(Community Matters) I’ve said for weeks now the election is Barack’s to lose or have stolen. And, I’m saying bullshit that this doesn’t represent deliberate attempts to suppress votes.

But for every voter added to the rolls in the past two months in some states, election officials have removed two, a review of the records shows.

On Monday, the Ohio Republican Party filed a motion in federal court against the secretary of state to get the list of all names that have been flagged by the Social Security database since Jan. 1 [which by law should be the database of last resort “because using the federal database is less reliable than the state lists, and is more likely to incorrectly flag applications as invalid”] . The motion seeks to require that any voter who does not clear up a discrepancy be required to vote using a provisional ballot.

Republicans said in the motion that it is central to American democracy that nonqualified voters be forbidden from voting.

The Ohio secretary of state, Jennifer Brunner, a Democrat, said in court papers that she believes the Republicans are seeking grounds to challenge voters and get them removed from the rolls.

Considering that in the past year the state received nearly 290,000 nonmatches, such a plan could have significant impact at the polls.

(Community Matters)
I did dial into the call with my favorite bankers. Not great news. Expect the deepest post war recession with unemployment growing to. 8% through 2009. But they don’t believe we are looking at a depression. Housing prices should stabalize after another 15% decline. Inflation no longer a concern, nor are they seriously worried about deflation. Fed’s liquidity measures: short term lending markets very disfunctional. Banks won’t lend to each other so the Fed is taking on that role, even lending unsecured for very first time to public companies, commercial paper market. Sharp increases in Fed balance sheet – was $900B in early Sept, $1.5T last week, and growing. More may still be needed to stabalize the markets. Posted from my blackberry

(Community Matters)
Steven and I are really on the airplane on our way to San Francisco for a long romantic weekend. Until this morning I wasn’t sure it would happen. So much going on, not the least the EF Fall Service Day on Friday – over 400 volunteers from Austin’s entrepreneurial communities to transform Govalle Elementary school’s campus. Amanda Chiampi a total rock star and insisted I go forward with our delayed and shortened summer vacation.

Now, if you’ll just sign up for Tuesday’s Obama briefing at Headliners from senior advisors Valerie Jarrett and PaulTewes or for the Obama debate watch party at our house on Wed, I won’t have to make so many calls from SF! 🙂
Posted from my blackberry

Oct 14 briefing here

Oct 15 debate watch here