Now that I have finished the book myself and have given folks a chance to avoid spoilers, a brief post about the end of the book.
It turns out that it wasn’t clear that WaMu had actually failed. Even when it was seized by the FDIC, wiping out shareholders and bondholders, and then sold for almost nothing to politically connected and savvy JPMorgan Chase, the bank may well have had sufficient liquidity under Federal rules. A quiet bank run, in which billions of dollars left WaMu daily, was precipitated by the following factors: (1) leaks from Washington, D.C., (2) the FDIC insurance limit of $100,000 per depositor (almost enough to buy a car today!), (3) consumer ignorance regarding the practicalities of FDIC insurance, (4) consumer reluctance to become embroiled in a process of getting money from the FDIC. If not for the leaks about the regulators’ concerns, the bank run probably wouldn’t have happened and the regulators wouldn’t have been able to seize WaMu’s assets.
We may never know the answer to whether the bank actually met the relevant criteria for being shut down. Kirsten Grind, the Wall Street Journal reporter who wrote the book, gives various estimates for the bank’s liquidity on the day of shutdown but is unable to say which one is correct.
Partly this is due to the reasons discussed in the previous post regarding this book. But it is also due to the fact that the government treated some of the biggest New York banks differently than WaMu, only slightly smaller. The NY banks, donors to Senator Charles Schumer, had similar liquidity issues to what WaMu suffered. But they were deemed “systemic risks” a.k.a. “too big to fail” and, therefore, were showered with government money (taxed, borrowed, or printed) that was denied to WaMu. A handful of political appointees and government workers at the Fed, the US Treasury, the FDIC, and the OTS had a tremendous amount of discretion regarding which banks would get bigger and which would be seized.
So in addition to the topics mentioned in my previous post, the book serves as a good example of the importance of lobbying and political donations!
Related:
“A Champion of Wall Street Reaps Benefits” (NYT, 12/13/2008): Senator Schumer plays an unrivaled role in Washington as beneficiary, advocate and overseer of an industry that is his hometown’s most important business. Mr. Schumer led the Democratic Senatorial Campaign Committee for the last four years, raising a record $240 million while increasing donations from Wall Street by 50 percent. That money helped the Democrats gain power in Congress, elevated Mr. Schumer’s standing in his party and increased the industry’s clout in the capital. Calling himself “an almost obsessive defender of New York jobs,” Mr. Schumer has often talked of the need to avoid excessive regulation of an industry that is increasingly threatened by global competition.
A text message exchange with a friend who owns a car wash in a Democrat-run sanctuary city. I asked whether Governors Abbott and DeSantis were sending him a good supply of migrants.
Him: Not yet!
Me: Would be good for your labor costs. What are you paying now?
Him: Average wage is about $22 per hour.
Me: We are informed that $15 is fair.
Him: I can’t get high school kids for $15. I don’t understand how people afford life.
Me: What do they make after tips? I always tip 20% at car wash.
Him: $22 is the average wage with tips. It’s all reported income because 90 percent of tips are credit card. I pay employment taxes on the tip wages. So if you tipped him, I owe taxes on that amount.
Me: Is there a variation in wage depending on skill?
Him: Most people that are full time make $25-29 per hour. High school kids make $19, which is insane. They are useless. College kids even worse. Entitled and can’t solve problems on any level. Wish we had more legal migrants. I would hire them all. White [local] kids = not good workers. We need more migrants. Just legal ones who are willing to work.
Me: I am seeing a good blog post here.
Him: I think another 50 million legal migrants would solve all our issues. The government could continue to pay the elite natives to stay home and print money to pay migrants to do all the work. Of course it would cause housing inflation, but that’s the Ponzi scheme we all benefit from. [“we all” being those rich enough to own homes!]
Related… a tastefully understated vehicle at the local car wash (entire crew from Latinx America):
Also, in the Department of Diversity is Our Strength, “Diversity is important in all industries, but perhaps especially so in supercomputing,” from my former employer Hewlett-Packard:
Diversity is important in all industries, but perhaps especially so in supercomputing. Alison Kennedy joins an #ExascaleDay discussion with HPE's Shin-Wen Kuo, sharing practical ways organizations can encourage, hire, and promote diversity. Watch now: https://t.co/dH2mKtfgcqpic.twitter.com/j5wTnXOMDy
What did I do for HP, you might ask? Helped in 1982-83 with the first implementation of the Precision Architecture, a RISC processor that eventually morphed into the Intel Itanium server chips (final shipments in July 2021, nearly 40 years after my efforts on a wire wrap prototype).
Here’s part of an invitation that I received to an election night party:
The party is here in South Florida, but the host is a lockdown refugee from San Francisco. Some political signs have gone up in our town. There is a lot of enthusiasm for Governor DeSantis and a bit for Congressman Brian Mast (a Republican who is somewhat hostile to civilian gun ownership). Marco Rubio is predicted to win, but I haven’t seen any signs for him (compare to 50+ for DeSantis and a handful for Mast).
Charlie Crist has run a 99% negative campaign. Here’s a recent example:
Ron DeSantis has: ❌ Banned abortion with no exceptions for rape or incest ❌ Banned books ❌ Banned saying “gay”
What’s next, banning all those who disagree with him?
If you’re 15 weeks, 6 days pregnant or less, it is legal for you to get an abortion in Florida.
This rule allows for more abortion care than almost anywhere in the European Union (Germany has a 12-week limit, for example.) Doesn’t Crist’s statement at least merit some kind of warning sign to users that the facts are “missing context”?
Despite Crist’s crusade for freedom of the press (undoing DeSantis’s purported “banned books” action) and freedom of speech (undoing DeSantis’s purported “banned saying ‘gay'” action), he apparently has failed to generate excitement among people who live in Jupiter. I have seen no signs for him.
Who else has been invited to an election night party? I can’t remember this much excitement for the typical mid-term election. I wonder if it is because government has become larger and more pervasive and therefore there is now much more at stake than in previous decades. For example, if you have a student loan outstanding the outcome of this election can determine whether you’re going to be $10,000 richer or not. That’s a tax-free bonanza, right? If the election doesn’t go well, the gender studies graduate might have to work a second job to earn $20,000 pre-tax to be equally well off compared to if Democrats prevail and the college debt can be shifted onto the backs of the working class?
The newspaper that assures us that replacement theory is false, like other “fringe right-wing conspiracy theories”, gleefully points out the Dämmerung der Weißen (the twilight of the whites; see also Götterdämmerung):
The county in recent years has become one of the nation’s most diverse, where the former white majority has fallen to just 30 percent of the population.
A shrinking white share of the population is a hallmark of the congressional districts held by the House Republicans who voted to challenge Mr. Trump’s defeat…
Because they are more vulnerable, disadvantaged or less educated white voters can feel especially endangered by the trend toward a minority majority,…
… the white population of the United States expected within about two decades to lose its majority.
Maybe there could be an opera about this. I would love to see Donald Trump portrayed as a character by the Metropolitan Opera.
in the recent image below, we can see that native-born whites are in the minority on the Juno Beach (FL) Fishing Pier. Discussions of election integrity are uncommon on the pier, however.
The NBAA BACE convention, a.k.a., “NBAA”, was a fun experience even though I’m not in the market for the $20-75 million airplanes that are the core of the show.
NBAA includes some safety talks. At a talk about a Challenger 605 accident at Truckee, I learned that only 1% of unstable approaches result in a go-around (it should be closer to 100%). The talk was also notable for the blame-the-pilot culture, with the panel of experts predictably calling for more training. Nobody asked why Air Traffic Control refused to give the pilots a straight-in approach, thus setting the crew up for failure in a vastly more challenging circling approach. Nobody asked why the $20 million machine couldn’t be smarter, e.g., by giving pilots guidance during the circle, noting the unorthodox configuration of full flaps before lining up on final, shouting out ”stall” instead of playing a confusing tone, and shouting out ”go around” like in an Embraer Phenom 300. The Challenger prohibits the use of spoilers below 300′ AGL and it was the continued use of spoilers in the fast/high approach that resulted in the stall, according to the NTSB. Given that the machine has a terrain database and a radar altimeter, why didn’t it say “you have left the boards out“? Everyone killed by the B737 Max’s runaway-trim-by-design would likely still be alive if the machine had simply spoken “I am trimming forward” when its MCAS system was operating.
Turboprops are about as low as NBAA goes. The Cessna Denali, a competitor to the Pilatus PC-12, has been afflicted with an additional year of delay because the General Electric turboprop, developed by Walter in the Czech Republic, isn’t going to be ready. The GE folks say that certification is delayed because the FAA is freaked out by all of the 3D-printed parts in the engine. The Cessna folks say that certification is delayed because the GE and Walter folks responded to SARS-CoV-2 by stopping work for 1-2 years. “They haven’t done anywhere near as many of the certification hours as they were supposed to,” said a Cessna employee. The engine looks good at least!
In other low-end news, I learned that after-market gear overhaul is now available for the Embraer Phenom 100 ($85k) and Phenom 300 ($125k). This is a 10-year item, even if the plane isn’t flown at all, and these prices are less than half of what Embraer charges, thus reducing the total cost of ownership. There were a lot of changes from HondaJet, which I’ll cover in a separate post.
What about at the high end? Billionaires can’t buy Bernie, but they can get a 787-based Boeing Business Jet delivered in 2025 if ordered today for $250 million. Lufthansa needs 2 years of prep time and then 18 months of installation time for a $120 million executive interior. The proud new owner will ride in the back beginning in 2027.
Is it wasteful of the Earth’s limited resources when a rich family travels via personal Boeing 787? Absolutely not! If the plane is filled with sustainable aviation fuel (SAF), the impact is less than when you take your 2007 Camry to Publix. Example:
Speaking of sustainability, I attended a talk on climate risk presented by a Massachusetts Democrat who is an executive at a big aviation lender. In a regulated industry, one of the big risks is regulatory/tax. What if righteous rage/envy results in Gulfstreams and larger being banned?
We don’t have to think about how many trees humanity could have planted for the $370 million acquisition cost of the BBJ 787. We can fix this by changing the fuel:
We still might not be able to fly conveniently because it is a proven scientific fact that hurricanes are becoming more frequent and severe (contrary to “Changes in Atlantic major hurricane frequency since the late-19th century” (Nature.com 2021); denying Science is sometimes okay). Separately, due to anthropogenic climate change it was a frosty-for-Orlando 60 degrees and cloudy on Day 2 of NBAA and everyone at the static display was seeking shelter.
I missed the first half of the climate change talk because I was at the Diversity, Equity & Inclusion talk scheduled at the same time:
My live notes from the talk:
“It’s absolutely not about quota.” And then … “Look at the complexion of your employee base to evaluate where your are.”
There are “dear friends” involved (can we agree to send everyone who uses this term to Venezuela in exchange for all of the folks that they’re sending to enrich our economy). “Lean In” is referenced tangentially. Creating emotionally safe spaces in the office is critical to safety.
Black pilots cannot be safe because they are constantly exposed to microaggressions [e.g., from customers and line guys and therefore out of the operator’s control] and that takes up a lot of energy [that they might otherwise be using to run checklists and focus on their job].
They’re sharing their diversity journeys. Executives are “very committed” and people are “walking this path together.”
Slide for Andrew Cuomo: “framing intimate interactions—permission & grace”.
For the those who celebrate gender ID diversity, any pronoun choice made during registration made it through to the printed badge. I’m sorry that I didn’t pick Xe/Xem:
If you’re a nerd, you’ll like all of the cutaway jet engines on display from manufacturers and overhaul vendors.
The biggest booths by far were from companies involved in selling fuel. They had the best parties with food and booze flowing freely starting at 4 pm. And live bands:
When I pointed out to an FBO owner that Million Air had taken over Marathon Key and raised the 100LL price to $9/gallon, he said “The consolidation is ongoing and probably irreversible. On top of that a lot of smaller airports are closing which traditionally served GA avgas users.” Did the government’s various coronapanic programs have something to do with this? “Indirectly yes, they lead to the largest money creation in history. That in turn caused all that money having to be spend and it was spent buying up assets like FBOs at highly inflated prices. Now the new consolidated FBO’s could and have to raise prices substantially to at least pretend to justify the huge investment. Not only fuel margins, also hangar margins, etc. are way up.”
In addition to the trade show at the rebuilt-from-the-flooding-in-record-time convention center, there was also a static display of aircraft at KORL, a 25-minute drive away. Gulfstream is the friendliest by far of the luxury jet vendors. I managed to bust into a G600:
Given that it is a clean sheet of paper design, I’m not sure why the cockpit needs so many controls.
Dassault and Bombardier give a big middle finger to any peasant who wants to see the interiors of the rich. Everything is “by appointment only”. Bombardier does remind the peasantry that it is actually the height of ecoawareness to ride solo in the back of a 100,000 lb. jet aircraft. They’re all about ESG. Greta Thunberg would be proud… if they would let her into the booth.
Let’s call this photo “Race to the Maintenance Shop” (Maserati in front of a 22-year-old Bombardier):
Vaerus Jet Sales brought the most beautiful plane to the static display (DC-3):
I managed to dominate a Facebook pilot group by posting “Certified airplanes cost too much so I have decided that it is time to buy an experimental aircraft.” over the following photo of a Gulfstream G800 and one showing a huge “EXPERIMENTAL” placard next to the front door.
The keynote by Neil DeGrasse Tyson covered the entire universe, but he did not explain how he survived cancelation after being accused by four different females. He did point out that most people are stupid because, unlike him, they don’t think scientifically (ergo, Dr. Fauci is the world’s smartest person because he personifies Science). He told the audience to “be ashamed to die until you’ve scored some victory for humanity” (he has already declared personal victory as a result of educating a lot of people). Dale Earnhardt Jr. was quite humble by comparison. Is it fun to win the Daytona 500? Yes, but it is also agony to lose. He said that he missed racing, but not the emotional rollercoaster of feeling great for a week after a win and then feeling terrible for a week after a loss. He didn’t talk about surviving a Cessna Latitude crash and fire at 0A9 (5000′ runway with a 902′ displaced threshold; good illustration of my general rule to avoid airports that don’t start with a K, i.e., those that meet ICAO standards, and also a good illustration of the statistic cited above: “Neither the pilot nor copilot called for a go-around before landing despite awareness that the approach was unstabilized.”).
Loyal readers know how much I would love to post pictures of the righteous in the crowded convention center wearing masks, but sadly the Followers of Science were thin on the ground. This is an industry where safety is always the #1 priority and the convention was packed with desk job and work-from-home heroes (actual pilots, who might be presumed to be less risk-averse, are a minority). If they’re so passionate about safety, why wouldn’t they adopt the cost-free strategy of wearing at least a cloth mask in accordance with CDC guidance?
I did find a software company whose operations are split between Sweden and California. Employees from both divisions were there. The Swedes thought that the Californians were crazy for locking down, not going into work, ordering everyone to wear masks, and closing their schools. The Californians said that the Swedes were the crazy ones, running around mask-free and sending kids to school. (Sweden, of course, ended up with a substantially lower COVID-tagged death rate and the age-adjusted death rates would be even more in Sweden’s favor (Sweden has a median age of 41 while California’s is about 37)).
What about the recession? “We’re a little less busy than we were in March 2022, which was our best month ever,” said one charter operator. “But part of that is that we don’t have capacity. Our owners are flying their planes like crazy. And there is a two-year wait to get pilots into some of the type-rating programs.”
CVS says “The bivalent vaccine provides added protection against COVID-19 and the Omicron variant”:
.@CDCDirector Rochelle Walensky visited a CVS Pharmacy today to get her bivalent COVID-19 booster. The bivalent vaccine provides added protection against COVID-19 and the Omicron variant and is available at CVS Pharmacy locations nationwide. https://t.co/wXDZYrmMydpic.twitter.com/BQojEnRpl4
Let’s ignore the fact that the customer depicted got COVID a month later. My question is how CVS is allowed to make the claim regarding “added protection” for this emergency use authorized injection. Ordinarily, a company cannot make claims for a medicine without a fair amount of data. But it is way too soon to know if these new shots will reduce hospitalization and/or deaths compared the rate among those who got their 4th or 5th shot with the 2020 version. The tests that have been done look at antibodies in the blood and the effect on someone who is exposed to SARS-CoV-2 is unknown. Shouldn’t CVS be limited to saying “We hope that it will work better…”?
Bivalent booster shots from Moderna Inc. and Pfizer Inc. failed to raise levels of protective proteins called neutralizing antibodies against the dominant omicron strains any more than four doses of the original Covid vaccine, according to an early independent study on a small group of people.
Researchers at Columbia University and the University of Michigan compared levels of neutralizing antibodies in blood samples from 21 people who got a fourth shot of the Moderna or Pfizer-BioNTech SE bivalent boosters against antibody levels in 19 people who got four shots of the original vaccines.
The results don’t mean that getting a bivalent shot has no benefit, and it will need to be confirmed in much larger studies.
The results also contrast sharply with an Oct. 13 press release from Pfizer and BioNTech touting “positive early data” from a clinical trial suggesting that its bivalent vaccine “is anticipated to provide better protection.” The statement was based on data collected from subjects in the first seven days after immunization, and the company has not yet released details.
I like the highlight text! Our assumption should always be that whatever is new and shiny in pharma will benefit us! (See also Bad Pharma.)
Screen shot in case the above tweet is memory-holed:
Who here wants to brag about getting his/her/zir/their bivalent booster?
Any time that a friend in Massachusetts drives by a #StopAsianHate sign, he says “I wish those Asians would stop hating so much.” Let’s check in with #StopJewishHate starting with a tweet from the Tyrant of Tallahassee:
As the sun sets and Yom Kippur begins, @CaseyDeSantis and I wish all of our Jewish friends an easy and meaningful fast.
TAKE OUR NAMES OUT OF YOUR VILE FASCIST MOUTH. We do NOT accept wishes for our fasts from an antisemite like you. How dare you, after all the harms you’ve done to the Jewish people. You deserve only scorn from us. I forgive everyone this Yom Kippur but not truly evil men like you
We hate you….you have no Jewish friends
Sorry Ron you wishes mean nothing to us Jews,gays,veterans or 86 million Americans when you say nothing about nazis marching in Orlando and seeing how you speak about immigrants many of us were birthed by Holocost survivors you are disgusting
You have zero jewish friends🖕🏼 AbortionRightsAreHumanRights #AbortionIsHealthcare #GOPWarOnWomen
“We need to root out antisemitism everywhere it rears its ugly head,” said White House press secretary Karine Jean-Pierre.
The White House criticized former President Donald Trump on Monday for telling American Jews over the weekend to “get their act together” and “appreciate” Israel “before it is too late.”
White House press secretary Karine Jean-Pierre said at a news briefing that Trump’s comments on his Truth Social website were “antisemitic” and “insulting” both to “Jews and to our Israeli allies.”
“For years now, Donald Trump has aligned with extremist and antisemitic figures,” she said.
I’m still trying to figure out when it works to tell someone who is filled with hate to “stop hating”!
Finally, we have Kanye West. He said that Jews control the media. To prove him wrong, Jews got him expunged from all media. Here’s an interesting angle on the Kanye story:
if you replace the word whiteness with Jewishness pretty much every major news publication sounds like Kanye pic.twitter.com/QMqcDBdVTG
The UK has a new prime minister. Because they could not find anyone 78-86, which Science proves is the age range in which a human exhibits optimum decision-making skills, they’ve chosen 42-year-old Rishi Sunak.
Rishi Sunak is about to become the UK’s first prime minister of colour and the first Hindu prime minister, both milestones in Britain’s evolution as a multicultural and multi-faith society. … the UK has never had a black or brown prime minister before.
Neema Begum, assistant professor in British politics at the University of Nottingham, said Sunak’s appointment “shows how far ethnic minority representation has come in politics”. “Sunak as prime minister is not necessarily a cause for celebration for all ethnic minorities. It shouldn’t be used to refute the ongoing existence of racism or obscure the fact that there are well-documented systemic racial and ethnic inequalities in housing, health and education.”
Rishi Sunak and his wife, Akshata Murty, have a combined net worth of around £730 million ($826 million), … That’s around twice the estimated wealth of King Charles III.
So… this guy overcame racism and, as a “brown” person navigated a society in which white privilege is a huge advantage. This leads to the question How much more successful would Rishi Sunak have been if he had been born white? Instead of having to wait to age 42, at what age would he have become prime minister? Instead of being worth $826 million, how much would he be worth if he’d enjoyed white privilege?
Here’s a recent sunny Saturday near the Palace of Westminster. Almost impossible to walk on the bridge because nobody can decide whether to walk on the left or on the right.
And a young Heroine of Faucism who is wearing a non-N95 mask as defense against an aerosol virus while on a 30-minute nearby London Eye ride in close proximity to the unmasked:
Just for fun, a photo at the top:
On the subject of systemic racism, a newspaper that I picked up on my way into a multi-million-dollar electric vehicle:
A never-lived-in oceanfront mansion that quietly sold for $110 million last year is to be torn down and replaced with a new property.
The mansion, built in 2016 at 1071 N. Ocean Blvd, Palm Beach, is owned by a company linked to cosmetics billionaire William P. Lauder.
He owns an empty lot next door and is believed to want to combine both parcels of land before building his dream home, just six miles from former President Trump’s Mar-a-Lago.
The home was originally purchased for $40.42 million by Philadelphia businessman Vahan Gureghian and his wife, Danielle, an attorney, but they never moved in.
There is even room for a two-lane bowling alley in the basement – although it’s soon to be destroyed by the wrecker’s ball.
He purchased that lot, at 1063 N Ocean Blvd, for $25.4 million in April 2020 at which point he demolished the existing home which had stood there since the early 1960s.
(What kind of engineering was involved to make a watertight basement? Almost nobody in Florida has one.)
To make our envy even more intense, the article includes a photo of the dilapidated eyesore:
What does the guy who is throwing out a 6-year-old 36,000-square-foot house have to say about our beloved planet? A 2021 talk from the committed environmentalist:
During the pandemic, concerns about the environment have intensified and Lauder noted that, at this point, sustainability is no longer a choice for companies.
“We have to think about what we make and sell from cradle to grave,” he noted. “How can we get more recycled material in our packaging? How can we reduce the use of plastic and other components that end up in landfills?”
The entire house will go into a landfill, but that’s okay because very little of it is plastic?
It’s all about the Science:
Sustainability and science go hand-in-hand. Lauder said…
The Estée Lauder Companies (ELC) announced on November 2nd that it has achieved Net Zero emissions and sourced 100% renewable electricity globally for its direct operations, reaching the target it set on joining RE1001.
Building upon this achievement, the company has also met its goal to set science-based emissions reduction targets for its direct operations and value chain, positioning the company to take even more decisive action against climate change in the coming decade.
The Estée Lauder Companies commits to reduce absolute scope 1 and 2 GHG emissions 50% by 2030 from a 2018 base year. This target is consistent with reductions required to keep warming to 1.5°C, the most ambitious goal of the Paris Agreement. The Estée Lauder Companies also commits to reduce scope 3 GHG emissions from purchased goods and services, upstream transportation and distribution, and business travel 60% per unit revenue over the same timeframe.
It was Science who said “toss that 6-year-old house into the landfill”!
So we started off sick with envy, but ended up learning something profound about the role that each of us can play in saving Spaceship Earth.
Here are frames that Facebook offers me. #1, of course, perhaps based on my search history, is a “Pride 2022” frame. If we expand the selection to include frames created by Facebook affiliates, such as the U.S. Government, there is a rich selection of COVID-19 vaccination frames:
Monkeypox is a global health emergency, according to WHO. Why doesn’t Facebook offer us the chance to express pride in our monkeypox vaccination status?
In the Department of Vaccine Pride, here’s one from a month ago:
Laboratory data suggest these updated vaccines provide increased protection against currently circulating variants. If you received your last COVID-19 vaccine >2 mo. ago, I encourage you to join me & get your updated vaccine now. pic.twitter.com/SZS7VeJict
