A Little White Lie-Bor

Turns out the world’s megabanks have engaged in a rate-fixing fraud for years.  The London InterBank Offered Rate (LIBOR) is an interest rate index that literally hundreds of trillions of dollars in financial instruments are pegged to.  And how is it set?  Well, someone phones up 18 duuudes around London every day and says “Yo, if you were gonna borrow money from some other bank right now, what rate would they charge you?”  And they can answer with whatever wild-ass-guess they want.  So they lied, in order to make themselves more money.  Shocking, I know.  Seems like the one thing you can trust banks to do is cheat when given the opportunity.

Why Isn’t Wall Street in Jail?

Nobody from Wall St. but Bernie Madoff is going to jail.  No wonder the banksters continue their trillion dollar white collar crime spree.  They and their regulators are one in the same.  Favorite quote from a congressional staffer: “You put Lloyd Blankfein in pound-me-in-the-ass prison for one six-month term, and all this bullshit would stop, all over Wall Street. That’s all it would take. Just once.”  Meanwhile we jail a mom in Ohio for trying to send her kid to a better school across town.

Links for the week of June 26th, 2010

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Links for the week of September 11th, 2009

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Links for the week of September 4th, 2009

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Shared Links for May 5th

  • How David Beats Goliath – When the rules are stacked against you, the intelligent thing to do is break them. (tagged: strategy law war insurgency guerilla gametheory basketball lawrenceofarabia )
  • Continuous bankruptcy – Bankruptcy as it stands now is a discontinuous process. Your legal solvency is binary: either you are bankrupt, or you are not. It doesn't have to be that way, and I think you can make a good argument that it's better if it isn't. Continuous processes work themselves out in small steps, with lots of information flow along the way. Discontinuous ones are like explosions. It's easier to muster resistance to an explosion once you see it coming, and delay it. But how much better to start getting signals early on, and avert it altogether? (tagged: finance policy economics bailout banks bankruptcy discrete continuous )
  • Digital Recovery of Moon Images – Ahh, NASA. Your data management has improved over the years, but that's not saying much. 20 tons of magnetic tape in an abandoned McDonalds houses the only extant copy of the pre-Apollo analog imaging of the Moon (still the highest resolution available in most places). It can only be read by one machine on Earth, which was recently rescued from a chicken coop, and refurbished by a man who is about to die. You can't make this stuff up. (tagged: information technology space nasa archive data moon )
  • Will the Future Be Geo-Engineered? – The future is already geo-engineered, and has been ever since we started burning coal on a large scale more than 200 years ago. The question now is whether we back off, and try to let the system return to the quasi-equilibrium that allowed our civilization to arise, or introduce new and exciting perturbations, with completely unpredictable non-linear effects. I know which one I'm hoping for. (tagged: geoengineering technology non-linear climate policy environment )
  • Hacking Scalia – Law professor gives class an assignment to dig up as much "private" info as possible on Justice Scalia, a notable anti-privacy force on the SCOTUS. This irritates Scalia. Exactly! (tagged: law privacy scalia scotus )
  • No new coal: what real direct action looks like – The $10 million spent on violently policing the "climate camp" protest outside Kingsnorth is absurd, given that a single motivated saboteur, capable of advance planning and actually willing to risk arrest and injury, can walk into the power plant and shut down 500MW of coal fired power generation. If governments fail to deal with greenhouse gas emissions effectively, and remain in thrall to the carbon lobbies, it seems likely that soon this kind of action will become more common, and truly disruptive. All it takes is a few thousand people who actually care, and our infrastructure can be brought to its knees. (tagged: energy environment green coal climate protest kingsnorth directaction )

Shared Links for Apr 8th

  • The secret, social lives of bacteria – Cooperative behavior between bacteria, both inter and intra species, coordinated via chemical messages. Behavior like "should we make light?" and "should we kill the host now?". Scary, awesome, and a beautiful system to investigate with algorithmic game theory! (tagged: cooperation biology technology bacteria science )
  • Computational Legal Studies – More people using machines to understand politics. A whole new class of dual use technology. Propaganda or transparency? Manipulation or clarity? Unauthorized social networking. (tagged: transparency technology government law )
  • Public Private Investment Partnerships a la Enron – Giving banks the ability to both buy and sell into the toxic asset markets being set up under PPIP is a recipe for market gaming in the tradition of Enron, as outlined in this example. Great, a trillion dollar Enron! (tagged: finance bailout economics policy enron ppip banks )
  • The New Nostradamus – Bruce Bueno de Mesquita uses large game theory simulations to try and predict the outcomes of complex negotiations involving many parties, both economic and political. Sounds interesting. Also sounds a little bit like bullshit. But apparently the CIA did a prospective trial (no backtesting bias) and found that the models made accurate predictions something like 90% of the time, when the analysts providing the inputs to the model made wrong predictions. Not so surprising that computers are better at synthesizing massive logical datasets into an outcome. The hard part seems like it would be getting the right inputs, and also trusting that people behave rationally, and (perhaps) know what's good for them. (tagged: economics politics science math prediction gametheory technology )
  • Ice Shelf Instability Backgrounder – A good backgrounder from last summer on the Wilkins Ice Shelf (which has just collapsed), and shelf dynamics in general, with links to the relevant literature. None of this is quite as sudden and shocking as the media reports have made it out to be. (tagged: climate antarctica ice shelf )

Shared Links for Mar 14th

Shared Links for Feb 26th

  • Zombie Bank Monster Mash – An animated monster mash, starring our bailed out financial "industry" (or is it just a lobby now?). Sadly Mark Fiore seems unwilling to implicate the current administration in the continuing mess. (tagged: cartoon zombie finance bailout banks economics politics geithner )
  • No, Wait! You Got It Backwards! – Well, so much for any hint of "change" in the administration's policies toward the banking industry. The Treasury's plans to buy convertible preferred shares in the banks is completely backwards – giving a put option to the banks, instead of getting a call option in exchange for the risky investment. Taxpayers are guaranteed to be screwed. (tagged: treasury banks bailout geithner obama economics finance )
  • The Case Against Home Ownership – An infrequently made point in the US: owning is often more expensive, and less convenient, than renting… and that's even before you account for the massive government incentives that have been put in place since WWII to encourage people to buy their own place. People frequently look at me like I'm crazy when I suggest we should just live close to where we work as a way to avoid the expenses of driving, or the inconveniences of (bad) public transit. (tagged: subsidy transportation housing economics suburbia planning taxes )
  • Copenhagen to continue Copenhagenizing – Denmark's take on "economic stimulus": massive investments in public transit and bike infrastructure. In a nation of 5 million, they're committing $16 billion over the next 10 years, which is about $1/day per person (which is less than 1/5 what the average US family spends on their automobiles) Regional rail, intra-city light rail. Bike lanes and paths. Road pricing for drivers. Etc, etc. I'm glad someone is setting a good example. It will be interesting to see how the world responds to Copenhagen later this year, when the next round of climate talks takes place. I can't think of a better city to represent my hopes for the future. (tagged: transportation politics copenhagen bicycle rail denmark stimulus )
  • NYPD fires rookie cop caught on YouTube video bashing bicyclist – Last fall a cyclist was body checked off their bike by a cop in the midst of a Times Square Critical Mass ride. Said event was recorded via cameraphone. Cop perjured himself in official report, claiming cyclist ran into him intentionally. Video viewed on YouTube 2 million times. Cop now unemployed and facing 4 years in prison for assault, falsifying documents. Sometimes we win. Makes me want to record just about everything. (tagged: bicycle police transparency youtube )

Shared Links for Feb 23rd

  • Goodbye to the Age of Newspapers – I just don't buy the lament of the newspapermen. If the papers were subsidizing the collection of "real" news with ads, how sure are we that people ever wanted news? Why exactly should we believe that there ever was some public interest at heart in journalism? I'd say it's just as likely that the fragmentation of digital media, and the trend toward tabloid fluff, is an indication that nobody (or at least, not enough people) really cared about the "serious" news in the first place. Disaggregated, opinionated, (truly) non-profit journalism will certainly be different than the muckrakers, or Big Media, but it's unclear to me that it will be worse in any way for government transparency, or democratic interchange. (tagged: technology media government transparency democracy )
  • The Crisis of Credit Visualized – Another great popularly accessible explanation of how we got into this mess, this time in cartoon form. Too bad there weren't any regulators in the story! (tagged: economy crisis financial animation mortgage subprime )
  • Bank insolvency: tips & tricks – Never, ever, feed a zombie bank. The great thing (or, one great thing) about blogs is that you can talk about serious and technical issues, using analogies to zombies. Try that in the Economist, or the WSJ. (tagged: economics finance stimulus bailout fed banks zombie )
  • Ann Druyan Talks About Science, Religion, Wonder, Awe, and Carl Sagan – Musings from Ann Druyan (Carl Sagan's partner) on how we might apply the wonder of the cosmos, as revealed by science, toward the creation of naturalist spiritual communities. (tagged: science religion sagan atheism naturalism cosmos spirituality )
  • There's no reason for non-recourse – Options are valuable. That's why we have markets for them. The trillion dollars worth of non-recourse loans (cf pawnbroker) which the Fed is apparently about to offer up to the finance industry, will, because they are non-recourse, lead to a misvaluation of the assets being bought, even if they're being bought by private entities, because the penalty for non-repayment is simply forfeiting the asset (which might very well end up being worthless). The Fed is acting like a pawn shop, but a dumb one: what pawn shop in its right mind would let you exchange your cubic zirconia for half the value of a diamond? (tagged: finance economics crisis bailout fed geithner bernanke )