WaMu got it right

“We hope to do to this industry what Wal-Mart did to theirs, Starbucks did to theirs, Costco did to theirs and Lowe’s-Home Depot did to their industry. And I think if we’ve done our job, five years from now you’re not going to call us a bank.”

— Kerry K. Killinger, chief executive of Washington Mutual, 2003

From today's Times

Kennedy sent us to the moon.

Where does Bush send us?

short and sweet

"I don't particularly want to see my tax dollars going to bail out the fools who overpaid for houses while simultaneously crowding me out of the market."

-- Irvine Renter on McCain's new "lets buy up bad mortgages" plan

Bailout Cost?

Paulson went around to the weekend morning talk shows in Washington.

When asked about the expense of buying bad mortgages from the reckless lenders, Paulson cautioned that the $1 Trillion expense that the treasury is putting up won't necessarily loose all that money. What they will get with that money are "illiquid assets" that will eentually be liquified.

Oh. So how much will the these mortgages eventually sell for -- how much is the american tax payer going to loose on these mortgages?

"The price you will get for those assets will be based upon how the economy does, the pace at which the housing markets recover," he said.

OK.

So the bubble drove prices above affordability. Prices are starting to drop, but are still well above affordability (thus the defaults and foreclosures!) and Paulson wants the US tax payer to buy up all of these mortgages and then hold their breath until housing costs return to their peak values?

How is this good?

Let's say family X makes $200K/year and they bought a $1.5M house with an option ARM two years ago with some obscenely low teaser interest rate (2.5%?). The option resets, the interest rate goes up to 10% and now the $12K/month mortgage is too expensive. Family X will default on their loan and "the bank" will have to foreclose. Nevermind that $1.5M is more than family X can afford -- their foreclosure will put a house on the market that "the bank" needs to sell in order to recover some of its losses.

"The bank" is either some stoopid wall street broker, or wamu, or wachovia. Or "the bank" is the US Treasury.

If it's the US Treasury, then there are a few scenarios that could play out. 1) Maybe they decide to let family X keep their house but pay a lessened interest rate. 2) They foreclose. 3) They let family X keep their house for a little while, paying less interest, and then foreclose a year or two down the road.

All three options represent money taken from my pocket.

Option 1). The treasury borrows money to buy family X's mortgage and has to pay interest on this debt. Family X isn't paying the full load of the interest. The difference they're paying is coming out of my pocket in current and future taxes.

Option 2) The treasury buys the mortgage at $1.5M and sells the house at $1M. Half a million of taxpayer money disappears, to be made up for by higher taxes now and in the future.

Option 3) The treasury borrows money to buy family X's mortgage, and pays the difference in their interest rate on this borrowing and the interest that family X pays. This difference is footed by me. Then the treasury forecloses. Since the treasury delayed selling in a falling market, the house is now worth $750K. $750K of taxpayer money has evaporated.

Shouldn't taxpayers also have the right to extract revenge on the rich bankers that will walk away from this bubble with fat pockets? The salaries they earned in the years leading up to the bubbles' burst left them with a sweet pot to ride out the impending depression. Can't we take that money from them? Shouldn't there be class action lawsuits against the firms that caused this disaster?

Let the games begin

I'm moderately miffed that in the wake of a speculative bubble in housing prices, one which I avoided taking part in by selling a house (before a move) and then renting in my new city, that the government has stepped in to bolster Fannie Mae and Freddie Mac with my (taxpayer) money. What kind of punishment is it to the people who were smart enough to avoid a bubble that they should pay higher taxes so the schmucks that bought at the height of the bubble can keep the houses they can't afford?

That's at least my simple-minded analysis.

Apparently Japan witnessed a similar run-up in real-estate in the '80s, that left the country in a decade-long recession though the 90's that they're still not quite out of. The Post has an article about it and how the lessons of Japan's mistakes are being well heeded by US regulators. Bernake was apparently one of the ardent critics of the Japanese government's response to the bubble's burst, and he seems to be true to his word in taking swift response to the crisis we're in.

Chilling quote:

"I don't think the Americans quite realize yet that behind this hill lies the Himalayas," said Takashi Watanabe, a top official at the Bank of Japan in the 1990s and now a professor at Tokyo's Bunkyo University. "The U.S. is going to go through a lot more before this is over."

Testing RSS

I'm years behind the times. Stromk just showed me how to use RSS and now I have to test it.

Gonzales: I forgot how to tie my shoes

When Gonzales testified before Congress a year ago concerning the firing of 8 prosecutors, he avoided all of their questions with Ronald Reagan like dodges: "I don't recall." Instead of owning up to the decisions he made, he refused to acknowledge that he'd made them... or at least, that's what continued acts of forgetfulness look like to me.

But there was always the possibility that Gonzales was so forgetful that he didn't remember any of the things he had done as Attorney General.

Today, the Post has a story on Gonzales' mishandling of classified information. In the article, it says that the reason Gonzales did not lock up the classified documents in his safe at night was because he

"could not remember the combination,"

That settles it. Gonzales is not an insubordinate hack who refuses congresses constitutionally mandated power of oversight. No. He's just an idiot.

Russia: the most fucked up country in the world

I can't imagine anything like this ever happening in the United States.

From the post:

"A leading opposition figure in Russia's volatile Ingushetia province was shot and killed Sunday after being detained by police... Magomed Yevloyev, a businessman and the owner of a Web site that angered Kremlin-backed local leaders with its coverage of official corruption and police abuse, suffered a gunshot wound to his head while in a police car taking him to a station for interrogation... The local government issued a statement saying that Yevloyev was shot after trying to seize a weapon from one of the police officers holding him. But a lawyer for Yevloyev ridiculed the explanation and said police dumped Yevloyev on a road after shooting him.... Yevloyev had just returned to Ingushetia after an absence of several months. He was seized by a large group of police officers after disembarking from a plane arriving from Moscow... the regional president, Murat Zyazikov, happened to be on the same flight and called police to the airport after recognizing Yevloyev in the business-class cabin... In a posting on his Web site last year [Yevloyev] claimed that Zyazikov had put a $50,000 bounty on his head."

Gold Stars

I have been playing a lot of Rock Band with Pants lately. Well, for the past 6 months. 10 months. Something like that.

We'd stopped playing for a few months and then picked it back up again recently when our downstairs barkeep had Guitar Hero running in the bar, and then later that week, invited us over to his place where a bunch of people got together to play Rock Band. I'd lost a fair amount of skill, so playing in front of people was a little embarrassing (though not nearly as embarrassing as singing was).

Well, after a steady month of practice, I had recovered to my former skills and at this point, I've actually gotten good.

Tonight, I was playing Bass on "Hysteria" by Muse (downloadable) on expert and I got through the whole song. 3 stars. 86%. Something I'll write home about.

Then later, I was playing Guitar on "Gimme Shelter" by the Stones, and the craziest thing happened: at the very end of the song, right around 166K points, my 5 star rating went to 5 gold stars.

I didn't even know there were gold stars. It certainly wasn't because I'd played flawlessly (there are bonuses in Guitar Hero for flawless performances, but not in Rock Band); I finished with only 98% accuracy.

This is a whole new challenge that's opened up for me in this game.

Another great Hitchens article

On Slate

new stamp

Virtual destructor

My fan base quickly pointed out that in the example code I sent through valgrind the other day, that class Derived didn't allocate any dynamic memory, and that not calling its destructor would not have been expected to leak memory. All of the comments I got suggested that if I had allocated some block of dynamic memory, either with a stl vector or a raw C-style array inside the constructor, and destroyed it in the destructor, the memory would be leaked in a call to the (non-polymorphic) base class dstor.

I went ahead and coded up the suggestion and found, yes, valgrind detects the leaked memory.

This makes me wonder, though: how the hell does delete know how large the thing is that its deleting?

I wish I could quit you

I got stuck in emacs while using cygwin. C-x C-c did nothing. So I tried M-x to type out a bunch of possible "exit" commands.

I tried:

quit
exit
leave

These are not meaningful ways to end emacs.

How do you quit?

M-x save-buffers-kill-emacs

Thank you google. If not for you, I might still be trapped in emacs hell.

valgrind non-virtual dstor leak bug

I ran valgrind on the following code which, you'll see, leaks the data stored in the derived class.

Valgrind does not seem to notice the leak. I'm not so happy about that.

/// test.cc
#include

class Base {
public:
virtual void blah() = 0;
~Base() { std::cout << "Base dstor" << std::endl; }
private:
int data_;
};

class Derived : public Base
{
public:
virtual void blah() {}
~Derived() { std::cout << "Derived dstor" << std::endl;}
private:
int data2_;
int data3_;
};


int main()
{
Base * bptr = new Derived;
delete bptr;
return 0;
}

..........
From the command line.

>g++ test.cc -o test.out
>valgrind --tool=memcheck test.out
==31535== Memcheck, a memory error detector.
==31535== Copyright (C) 2002-2005, and GNU GPL'd, by Julian Seward et al.
==31535== Using LibVEX rev 1575, a library for dynamic binary translation.
==31535== Copyright (C) 2004-2005, and GNU GPL'd, by OpenWorks LLP.
==31535== Using valgrind-3.1.1, a dynamic binary instrumentation framework.
==31535== Copyright (C) 2000-2005, and GNU GPL'd, by Julian Seward et al.
==31535== For more details, rerun with: -v
==31535==
Base dstor
==31535==
==31535== ERROR SUMMARY: 0 errors from 0 contexts (suppressed: 5 from 1)
==31535== malloc/free: in use at exit: 0 bytes in 0 blocks.
==31535== malloc/free: 1 allocs, 1 frees, 24 bytes allocated.
==31535== For counts of detected errors, rerun with: -v
==31535== All heap blocks were freed -- no leaks are possible.

Swedish Meatballs

"The steer grazes on grass during the day and enjoys the occasional swede as a treat."

Infant waterboarding

To ghastly to believe.

http://www.cnn.com/video/#/video/bestoftv/2008/04/18/ng.polygamy.crime.cnn

snowboarding

Pants and I finished our third day of snowboarding at this resort an hour outside of the city. They had this deal for newbs: $100, 3 lift tickets, 3 rentals, 3 lessons. I had a blast, and so did Pants, who before our first day had never been skiing, snowboarding or even sledding. It was her first time on a snowy hill. She liked it so much, we're talking about getting a season ticket next year -- $300 for the "limited" season pass (which means, on weekends, it's not good at the sister-resort up the street -- you can still go to the sister resort on weekdays, though) or $360 for the "unlimited" (good at the sister resort at all times). Pays for itself after 6 trips since usually lift tickets are $48. I'm totally psyched.

Welfare Dad

You know this guy is just going to go out and make the same mistakes the next time 'round. Those suckling at Uncle Sam's teat tend to think they never have to assume responsibility for their mistakes.

Bush: "I broke the law, I dare you to impeach me"

"Let me make it very clear and to state so officially in front of this committee that waterboarding has been used on only three detainees. It was used on Khalid Sheikh Mohammed. It was used on Abu Zubaydah. And it was used on [Abd al-Rahim al-]Nashiri."

-- CIA director Michael Hayden, yesterday.

Waterboarding is torture. Torture is banned under international treaty. Bush violated international treaty. He broke the law. He should be removed from office.

Twelve McCain Supporters

In all of West Virginia, only twelve people voted for John McCain. Twelve. I bet they know each other.

Of course, that's still 1% of the West Virginia vote, because only a little more than a thousand people in west virginia voted. The rest must think they live in Russia where there's no such thing as democracy.

Awesome

Hologram

Racist

"You don't like people from outside the state coming in and telling you what to do with your flag. In fact, if somebody came to Arkansas and told us what to do with our flag, we'd tell 'em what to do with the pole; that's what we'd do."

-- Mike Huckabee, while in South Carolina.

Unamerican

"I have opponents in this race who do not want to change the Constitution. But I believe it’s a lot easier to change the Constitution than it would be to change the word of the living God. And that’s what we need to do — is to amend the Constitution so it’s in God’s standards rather than try to change God’s standards so it lines up with some contemporary view of how we treat each other and how we treat the family."

-- Mike Huckabee