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RIP, Dennis

I lost a friend today. He was riding his bike to work this morning, when he was hit by a truck. He was a very safe cyclist. He was in the bike lane. It was a very bike-heavy street. It should have been obvious for the driver to look out for cyclists.

I didn't hang out with Dennis outside of work much, and I really wish I had. He was a great guy to be around. Dennis had severe hip arthritis, despite the fact that he was only about 30, so he walked like an old man. He played up the old man bit, too. Sometimes he'd go off on giant rants about things that bugged him. It was hilarious, and he played it up to be so. He also was a completely credulous believer in some very ridiculous conspiracy theories. That was also hilarious. He was a very funny guy, and a great photographer. He will be missed.

It's frustrating that streets aren't designed to be safe. They are designed to be fast, by car. There's been some ideas thrown around on a lot of urban design sites (like this livable street photoshop contest on GOOD) that would make the streets a lot safer for pedestrians and cyclists. One of the ones that would have saved Dennis' life is a raised divider between the road and the bike lane. The truck would never have swerved into him, even if the driver didn't see him. These ideas are all so abstract, but they actually can save lives and prevent injuries. It never really sinks in until you're personally touched by an incident. Then it seems so clear, so obvious that something needed to be done. Still needs to be done.

It's been a rough year for me so far. Hopefully things will turn around, but I've definitely had several personal tragedies and big changes. I'm trying to deal with it all constructively, though. The body is like the cart, the mind is like the horse, and the attitude is like the carrot. If you think negatively, and hold that carrot in the negative direction, your mind will start to head that way, pulling your body with it. You'll be unhealthy. However, if you hold that carrot on the peaceful and happy side, you'll start to let go of sadness and frustration, and you'll end up being happier and healthier. That's what I'm trying to do.

run #2

Went way better. I just got back. I'm still kinda shaky and all sweaty and flush, so you'll have to excuse any irregularities in my typical style of prose.

So yeah, I ran twice as far this time, a scant two days after my first. (I wanted to go yesterday, but I had to wait all day for the furnace repair guy to show up. Which he never did. Grrr, that's infuriating.) I think what really causes that most awful burn, and the accompanying "can't walk normal at all" feeling is the little 3/4 block sprint that I use to finish it all up with. I was actually doing fairly decently until then, at which point my calves cried out for mercy. But I was not merciful.

Anyway, It's really encouraging that it's all going better already. I also have a nasty cold right now, so hopefully when that goes away I'll be able to do even better!

XOXO
-Joel

May is Healthy Month.

That means no meat, no fast food, and running. So far so... well pretty decent. I did have a bratwurst the other day, but it was only because it was specially prepared for the event, and my friends didn't know I was planning my veggie-month. (It was pretty tasty. Not gonna lie.)

I got some new shoes for running, too. I haven't had a decent pair of running shoes, or even really general athletic shoes, in about 4 years. Kinda shows my level of dedication to exercise. (Climbing excepted, 'cuz climbing is awesome.) I did a bunch of research, and read a wide variety of articles that said that the best shoes for running are, actually, no shoes at all. Barefoot is best. (Furthermore, there's a direct correlation between how much you pay for a shoe and how likely you are to get injured because of running. Odd.) Now, it'd be all awesome and stuff for me to just take off running barefoot around everywhere, but unfortunately I don't have idyllic fields of flowers to run through. I've got streets that may occasionally have glass or nails on them. So barefoot itself is not an option, sad to say. The solution? Vibram Five Fingers.

I got these crazy shoes a couple of days ago, but I didn't really have an opportunity to get out and run until this afternoon. The shoes themselves are... a bit peculiar at first. It's like you're barefoot, but your feet are a little stickier, and you don't have to worry about pebbles and whatnot. There's no padding under the heel or anything, just rubber. This means that you run in a more natural way. (Check out their website if you want to learn more about the shoes themselves.) That natural way means one slightly unexpected thing, however: since you are running differently, you use completely different muscles than you are used to. The long and short of it is that I managed to run a total of about 7 blocks. After that my legs were shocked and angry in a way that my muscles have not been in a very, very long time. The skin from just beneath my calves to the tops of my ankles was completely red for about twenty minutes or so. This is because the muscles were so shocked that my body sent as much blood as it could to the area to get things workin' down there. (I wasn't hot or anything, as it was raining and cool out, so it wasn't that.) It's now almost 12 hours after my little inaugural run, and my legs are still rather miffed. That are below the calves is still particularly unhappy, but at least I'm not walking like an old man anymore.

Can't wait to do it again tomorrow. (The plan was to run every day in May, and I intend to stick to it gorram it!)


SAD update

So I mentioned several months ago that I've been diagnosed (well, I self-diagnosed at first, but it's since been corroborated by experts) with a social anxiety disorder, and I said that I'd update if it seemed like the thing to do. So I'm doing that.

I eventually was able to get my health insurance taken care of, thanks to Mom & Dad. This meant not only that I wouldn't have to worry so much about pneumonia, but also that I was able to start therapy a few weeks ago. So far it's been good, and I imagine that things will really start cookin' when I get an appointment with a psychiatrist (which, apparently, is terribly difficult in the cities) to get me on some anti-anxiety medication. It'll be pretty nice to be able to do a lot of the things that I can't.

I thought I'd give a little backstory so everyone can kinda understand what's going on, and what has happened.

Growing up in Rochester was very insular. Everyone was pretty well off, everyone was nice to each other, and everyone (especially!) tried to do that whole maintaining of the illusion of a Leave it to Beaver existence. (which, when added to the extremely type-a people who tend to work for Mayo means that there are a hell of a lot of screwed-up kids that come from Rochester.) I am lucky in that, as is constantly pointed out to people who meet my family, I actually DID grow up in that type of environment, and it wasn't all just a nice public face covering up deep ugliness. The one downside to this kind of upbringing is that I never really had to deal with difficult people. I wasn't made fun of in elementary school, I wasn't teased, etc. I actually never realized this until I told my therapist the other day, but it's absolutely true. And, just as true is the fact that this is probably not such a good thing for one's ultimate emotional stability. It's like growing up in a completely germ-free environment. Sure, you don't get sick when you're there, but when you step outside, you're gonna be in trouble. In addition to this idyllic childhood, I had the aforementioned social anxiety, meaning that I was never very good at associating with people genuinely, besides a handful of friends. My personal favorite and best defensive mechanism was, and still is, my sense of humor. Not only do you get to make other people feel good, you also get to divert the attention away from whatever it is you're worried they'll notice! It's a win-win. So yeah. Social anxiety + general lack of exposure to emotional trauma.

Anyway, then I thought it'd be a good idea to join the Marines. (Turns out that this was perhaps not the best choice.) I was able to deal with the verbal abuse and complete lack of power in boot camp, because it's boot camp, fer chrissakes. I was not prepared for, nor did I expect, the treatment that I got at DLI. For the first time in my life I was subjected to daily verbal abuse, primarily about the fact that I was overweight (for a Marine) and physically pretty weak (for a Marine) and the fact that I happened to exist. Basically, what I'm getting at is that a lot of this was probably not meant as personal, and was just good ol' ribbing from wherever everyone else came from, but since I was raised in magical happy-land, I was completely unable to emotionally deal with it. Also, I didn't have any really close friends that I would have been able to confide in. So the increasing frustration over my inability to be remotely competitive on the physical side of things and my inability to appropriately handle the emotional trauma that I was receiving led to a lot of problems. I don't really remember much of my time at DLI. Most of it was because it was so damned monotonous, but there could certainly be parts that I just was unable to process correctly, so I simply can't remember. The long and short of it is that it manifested itself into the breathing problem that ultimately got me discharged. I was really miserable in the Marines, and I still have nightmares about going back. It's the only thing I have nightmares about, though they are pretty rare. Needless to say, the problems that I had didn't simply just go away when I got out.

I was able to ignore the nagging feeling at the back of my head that I'd had issues that I needed to work out because my life was pretty busy and on the right track when I was at school. I would have finished years ago, were it not for the fact that the two classes I needed to graduate (one of which was my thesis course) happened to be held at the exact same time during the summer semester. This meant that I had to get a job. Once I started working at Ritz full time, the emotional security of a regular gig was too intoxicating to stop. It was also incredibly unfulfilling, and while I made a lot of friends, it was a terrible environment and an even worse excuse not to do anything else. That security continued when I went to White House (which I did because two of the guys I worked with at Ritz went there, and all the people I liked working with were gone) and it seemed like it was going to be perfectly fine. Since I didn't get hired on, however, I was able to realize, in all my downtime, that the job itself wasn't what I needed so much as the emotional security of having a job. Which I'm addressing in a different way, now. The upshot of that means that once I'm better able to handle the irregularity of NOT staying at a dead end job for years, I'll be able to move on and approach my career in a much healthier fashion.

So yeah. I'm in therapy now, and soon I'll get some meds, and soon enough after that I'll be able to move on with life. Which is kinda what I was looking forward to doing, honestly.

Tags:


random invention idea

I think someone should go right ahead and invent a little closet that would periodically emit a puff of steam (when it's closed, naturally!) and maybe some febreeze or similar into the clothing. I'm thinking dress shirts, specifically, but it would probably work for slacks and whatnot, too. The gravity and the steam would do a fairly decent job of keeping your shirts relatively wrinkle-free, while the febreeze would keep them smellin' all pretty, too. You wouldn't have to launder them as much, saving money and water, and you'd save time ironing, too. I mean sure, if you want super-crisp clothes, you'll probably go ahead and iron and starch everything anyway, but for folks such as myself who aren't terribly fond of having to do laundry and iron, and who can get away with generally smooth shirts, it'd be a real time-saver. It'd be relatively small, I'd imagine, so that you could rotate clothing in and out on a need basis. I suppose you could make a big one, but it seems kinda pointless to me.

So yeah, someone go invent that, please. If you make a fortune, give me one of them. (Some cash would be nice, too.)

XOXO
-Joel

economic stuff #2

Okay, so I went a little off the deep end with the last one. What I really wanted to talk about, I'm gonna talk about now.

Basically, there are a couple of ways that we can deal with the whole shebang. One way is to pour boatloads of cash into the failing banks, and hopefully they'll be all nice and solvent-y, and we can get back to business and overspending and all that jazz.

A couple of problems with that, though: First of all, we don't really know how much the banks are in the hole because they've been less than forthright about the value of the CDOs that they've got. Makes sense, though. Right now, the damn things are basically all worthless, but that's not to say that they won't be worth something someday, when the market stabilizes. Sure, some of them will just turn out to be a colossal waste of money, and people holding those particular hot potatoes are gonna get burned. (Kinda the nature of the beast, I'd normally say, but the effective repeal of the Glass-Steagal act essentially means that some companies are so big that if they failed they'd take the economy down with them. And by that I don't just mean our economy. The whole world would be royally fucked for a generation or so. Think great depression times a thousand or so.) Another key problem with this particular tack is that, funny thing, it turns out that the lot that were in charge of the banks were spectacularly good at lying about the health of their companies. It's what they do to survive. We could end up financing the hell out of some bank that doesn't really REALLY need the money, but hey, if we're writing checks, they are happy to cash them. The other main problem that I can think of off the top of my head (what, did you think I was actually researching this as I write it, with tabs open and all that crap? I ain't doing this for a living!)(yet) is that the government isn't exactly flush with cash right now. A 14 trillion dollar debt and a budget deficit of half a trillion dollars'll do that to ya. Every penny that gets spent means 1) a penny that needs to get paid back, and 2) a penny that could have been spent elsewhere, like, I dunno, infrastructure or national healthcare or education or... well let's save that list for another time. (Oh, I thought of another problem: a history of bailouts leads institutions to take more dangerous risks, because the precedent of the government bein' all enabley and socializing mistakes while not worrying about profits isn't what I'd call good parenting. Or governing. Basically it sets up the system for a worse failure in the future.)

The other extreme method is to just nationalize the hell out of everything. Kick out the owners, say "sorry, you guys screwed the pooch", and put the government in charge. This is a pretty terrible plan if you want to have the government running the banks for a long time. Fortunately, they really REALLY don't want to do that. They've got enough on their plate (what, there are PIRATES now? Our list of problems has officially become silly.) A more realistic view is that they'd have a nice big buyer all set up, and they'd swoop in, take over the bank, and sell it off overnight. The biggest problem with this is that it really really pisses people off, and it carries the distinct odor of socialism, which is to say it has the current political environment equivalent of having herpes at an orgy. Ain't no one gonna hit that. (What's so bad about socialism, you might wonder? It's socialism! It... huh. I don't really have the most fantastic retort to that, but it sure as hell sounds foreign.)(again, a topic that might have to get covered in the future.) Also, the precedent of the government swooping in and taking over an institution like a bank isn't exactly the best one to be setting. What if some future jackass Treasury Secretary decides that it'd be really funny to do to his former competitor? That just isn't cricket. All things considered, however, it's less frustrating than worrying about paying too much or too little and omigod nobody's gonna have any money for forever after this, like the previous option.

A third option is to just let the fuckers fail. This is stupid. This is cutting off your nose to spite your face. Or kicking one of the only able-bodied guys out of the liferaft for rowing the wrong direction. Or some other theoretically satisfying, in a schadenfreude sort of way, stupid, stupid thing. It's stupid. Don't think it's a good idea. 'Cuz it's a stupid idea, and everyone would laugh at you for seriously considering it. (PROTIP: instead, just say "I wish we could just let the fuckers fail." That way you gain populist points, and you don't sound like a reactionary idiot! Well done you. I'm pretty sure you can use that attitude to get laid.)

So what we did at first (back in September) was to prop up Goldman Sachs (funny, this was Hank Paulson's plan, and the company that he was just head of before being in charge of the treasury! What an odd coincidence!) and let Lehman Brothers and Bear Stearns collapse. This is like a weird combination of idea one and idea three. Needless to say, it was really, really dumb. If we'd propped up Lehman and Bear, we might have had less to bail out now, but who's really to say? Hindsight in this case is nowhere near 20/20 yet. Anyway, it didn't work terribly well. Goldman Sachs needed an additional $350 bn. Not only that, but a bunch of other companies went "wait, what? These things are worth what now?" and seriously considered jumping out of the nearest window, but thought that might be a little too retro chic, and opted to begging for money.

Fortunately, by that time, we didn't have such an insanely huge prick in charge of the Treasury. Now we only have a moderate prick in charge. And basically the strategy has been to kinda keep bailin' folks out, but put out the feelers that say "hey, you know, it might be cheaper to just nationalize the hell out of some of these banks." Now, Geithner ain't gonna come out and say that. And that's a good thing (and why he's not the hugest prick) because saying "I'm going to nationalize some banks" makes investors pull out, and stock prices drop, and cash reserves dwindle, and people's deposits and/or investments (mostly the investments we're worried about here, 'cuz of the good old FDIC) shrivel up and blow away. Then you've got further bank runs, rioting, cats and dogs living together, all kinds of madness. So they are like "sure, we'll help out with some money. But we're gonna do some stress tests to see how healthy you guys are, 'cuz just askin' just ain't workin'." And the American people are like "lolz whatever, we don't know what's going on, but we'll either 1) watch the daily show to find out or 2) take part in some overhyped demonstrations that very, very stupidly managed to get everyone to snicker about teabagging." ('cuz this shit be confusing.) And the banks are like "well, we thought we had them over a barrel, but apparently the tables have turned? Very clever, government. Very clever."

And here's the part that nobody is talking about, but what I think is really going on.

So, the FDIC is one of the coolest things we've got in this country. It's basically like a government thing, but it's actually private. It's an insurance dealie that all the banks take part in so that, worse comes to worse, the individual investor's covered up to 250 g's. It makes everything nice and smooth and pretty, and it's really good at taking over banks that fail. It does it all the time nowadays, and they are very professional about it. All kinds of Bourne Identity shit, coming out to the place in staggered flights, checking into hotels under assumed names, walking into a bank at 4:55 pm on a friday and telling the boss "hey. You're in the red. This is ours now." And then selling the bank to someone else at about 4:57pm that day. Sometimes the folks who've got their money in the bank don't even realize that one of these has happened, 'cuz nothing changes for them. All the tellers are the same, they keep the same rates, all that jazz. Anyway, it's smooth like butter. Smooth like clockwork. Smooth like Marvin Gaye.

Just a couple weeks ago, the FDIC is like: "you know what might be a good idea? Extending our line of credit with the government from $200m to about $500m. And maybe allow it to be bumped up to a cool trillion in case of emergency." The FDIC has all kinds of cash on hand, but they be crazy professional (remember, Bourne Identity here) and so they don't do jack without having the funds available. Now, I haven't heard if this was actually a done deal or not, but they had a very slick sales pitch, and they are so totally awesome that I seriously doubt that anyone would turn them down. Remember, they aren't asking for money, they are just saying that, should the need arise, it wouldn't be the worst thing in the world to have this kinda cash available. So Treasury and congress and whever else needs to sign off on it is more than likely to give them the green light.

Now, one other funny little thing going on is this crazy little Senate race here in the great state of 10,000 lakes. And it looks like the Dem, Al Franken (yeah, that Al Franken. Stop laughing. He's not as crazy as that wrestler we had as governor. Also not 1/10000 as crazy as Michelle Bachmann. God, that woman's giving this state a black eye.) Once Al gets seated, that means the Dems have 59 seats in the Senate. One more vote means a bomb-proof majority. No filibustering or nothing. And they could probably convince Lieberman to vote with them. Or maybe a Republican incumbent who doesn't want to lose in 2010. There are ways, is what I'm saying. Anyway, once the Dems have 60, then they can start doing the crazy stuff that needs to get done. The really, really good stuff.

So here's what I see happening: Franken finally gets seated in late May or in June. In the next week, some Friday night, you'll have a swarm of FDIC agents tap into that emergency Trillion fund, and use it to sweeten the deal for someone to buy up some banks that ain't got no right being there. Treasury might temporarily nationalize some other ones. Basically it'll be a big ol' nationalizing spree, with some long-time bankers who were raking in the cash and being douchebags suddenly out on their asses. With 59 seats and some strong incentive, the political will not to do it is effectively neutered.

All in all, I think it's a pretty good strategy, and I think everyone will be shocked and amazed and be all "holy crap, I didn't see this coming" but in the end it'll work out pretty well.

the end.

Time to not try to write about Econ stuff for a while. TL:DR.

XOXO
-Joel
 



economic stuff

So, as I've been unemployed and relatively net-savvy, I've been listening to and reading a lot of stuff about the economy and politics, as is my wont. You can't stop me. (So there.) There's basically an extremely high amount of confusion about the whole mess we're in, and what we're actually trying to do to get out of it. You know it's confusing because you don't have party line voting. You don't really have partisan politics. This is not one side versus the other politics. This is not the typical minority party automatically gamesaying whatever it is that the party in power says, just to drive a wedge and stir up some support from the base. This is epic, royal confusion on the part of some of the smartest people (well, maybe I should say the savviest people) in the nation. The strongest oppositional arguments we've heard about bailouts and whatnot are "gosh, that's an awful lot of money." Which, I should point out, is extremely true. Well done there, republicans. Billions and trillions of dollars is a lot of money.

Anyway, here are some of my thoughts about the whole mess, seeing as I've got nothing but time and a pretty reasonable head on my shoulders. Naturally, I'm not what people would call an "expert" in any legal capacity. Consult your own financial expert before engaging in a bailout of several banks or creating a national budget.

So here's the deal. The big part of the mess is finance. Very similar to financing that you'd get for a car, or a house or whatever. The companies that would do stuff like that (banks, essentially, but there can be some more complicated differences that I won't get into) got a huge amount of leeway to branch out into all kinds of crazy, high-wire financial wheelings and dealings throughout the 90's, culminating in about 2000. Originally, you'd have banks that got its money from mortgages and stuff, and they'd sit on them, making a very safe, reliable, steady profit. Big banks basically had a whole bunch of mortgages. Since they were on the hook for the money, they wouldn't lend to people unless they were reasonably sure that they'd get their money, and that the borrower wouldn't default. Safe, boring, perfectly healthy, but not terribly liquid.

PART ONE: THE BEGINNING
So throughout the late 90's and early 00's, banks started creating some really interesting new financial tools that would allow them basically to gather up a bunch of mortgages and bundle them together, and sell them off as Collateralized Debt Obligations (CDOs) which means exactly what you think it means. Debt obligation means that people owe you, and collateralized means, shockingly, that there's collateral. In this case, it's the actual house that was put up for mortgage. Now the crazier part starts happening.

Different financial institutions would buy up these CDOs and slice them up into different categories. They'd sell shunks of the safest stuff for the lowest rates of return and the riskiest stuff for the highest rates of return and all that jazz. Basically, it was sliced up into all kinds of crazy categories. Now, the people who would rate how safe or risky these different things are are called, rather unsurprisingly, ratings agencies. The surprising thing is that these agencies aren't paid by a general investment fund (like, say, the FDIC) or by the government, but by the companies whose stuff they are rating. Kinda leads one to see that it'd be pretty easy to have some chicanery going on there. And there was plenty of chicanery. Not only that, but the non chicaned (to coin a phrase) stuff was all rated by what boiled down to the exact same piece of code, and that code had some very small errors in it. Errors which caused really really risky stuff to be rated as really safe stuff. Which is kinda no good.

So while that's going on, with these inappropriate ratings of these assets that people don't really seem to notice all that much, you've got a really, REALLY big increase in overall financial play. A lot of people were making a lot of money selling these things. They worked really, really well, and were basically considered as safe as cash. This meant that a lot more people and institutions wanted to get involved, and so you have a bunch more investment going on. In order to free up more of these CDOs, banks tried to get more customers. Fortunately, the interest rate was really low, because Alan Greenspan set it that way, dammit. (Apparently he wasn't listening when he warned about irrational exuberance.) The reason he did that was because... well I don't really know. It was kind of a really bad idea. The prime rate really should have been higher, to slow the stupidly fast growth of the financial sector. I guess, on the whole the economy was growing at a pretty steady rate, so potentially the argument could have been made that there was room for growth, especially coming from someone so enamoured of Ayn Rand as he was. (Whose name will unfortunately live on in perpetuity in crossword puzzles because it's of its peculiar and useful spelling, like baseballer Mel Ott or the isle of Elba, where Napoleon spent his last days. Other than that, she can rot for all I care. More on her later, if I feel like getting all mad at someone.) At any rate, (haha) interest rates were extremely low. So housing prices soared like the mighty, mighty eagle. This was perfect for the banks, because they had all kinds of pressure from these folks who wanted to sell CDOs, and it was perfect for investors, because they all wanted to put their money in CDOs, and this was perfect for the average Johnny America on the street, who wanted to buy a house, because that's what people do. Also, it made a great lil' market for house-flipping, which got people stinking rich. Hell, there were plenty of shows on TV about buy houses to turn around and sell them right away.

Since there was such a crazy amount of money coming around so crazy fast, big financial institutions (some of which called themselves banks, but made only the tiniest amount of their money by actually banking) were super-crazy leveraged. This meant that they would borrow huge sums of cash for a relatively quick turnaround (sometimes really quick, like overnight) and get huge profit margins. Think about it, if you have a great deal on something that you know will sell like hotcakes in a really short period of time, it's not so crazy to borrow money so that you could purchase more of these widgets, making yourself even more money. Also, the companies lending the money really didn't mind, because they'd have a tidy little profit for relatively low risk, since the market was going up and up and up, and the money usually was only gone for a short period of time. Plus, there was another really, really useful tool insuring these financial institutions. Insurance on the trades, basically.

You've got these big institutions that'll insure other big institutions for a relatively small amount of money (that becomes huge over time). It worked out really well for everyone involved, because it made people more willing to take on greater risk, and to be really super leveraged (30 to 1 leveraging was not unheard of, meaning that you were borrowing 30 times the amount that your company actually had. That's kind of insane.), and the insuring institutions would make skads of money, meaning that they could comfortably insure even larger sums of cash.

PART TWO: THE TIPPING POINT

So you've got all this money going around, and you've got everyone clamoring for more CDOs, and you've got low interest rates. (Also, I forgot to mention, you've got the most incredibly lax oversight in the history of financial oversight. The Bush appointees basically came in and said "we are not going to pay attention to anything you do. We believe that the market just magically works." (this was stupid.) So then you get a huge push for flipping houses, and everyone thought that they could make stupid amounts of money, and you start giving mortgages to people who really, REALLY shouldn't have gotten them. Let's not blame the individuals for this though; there was a culture of house-craziness that implied that it was super safe, and that everyone should have a house, and that you couldn't lose money. Sure there were some schmucks who shouldn't have tried to get loans, but there was a lot more schmucks who hawked sub-prime, adjustable-rate mortgages (ARMs), sometimes even interest-only (!), to people who didn't really know any better. There have been cases where people wanted to get prime-rate mortgages, and who had cosigners, but were misled into taking a sub-prime loan instead. Boils yer blood, that one does. Those poor folks who didn't know any better. (Oh, and there were several cases of out and out fraud, where things were changed after signing, and bait-and-switch deals.) So yeah. Lots of really bad loans were coming in.

These really bad loans still did the same things as the really good loans, however. They got bundled together, chopped up, and sold as CDOs. And they got rated AAA, to boot.

Then you started having a problem. Oops! People couldn't pay their mortgages (mostly because of ARMs, which meant that the rate could go from 5% up to 39% in  a month. Ouch.) That meant that the CDOs that were so beautiful were suddenly not so hot. Long story short, a lot of people lost money, which is not totally bizarre, and it happens. It's all part of the system.

No, the REALLY big problem was that all of these places were so over-leveraged, and so tied up in all this mess, that there really wasn't anything that anyone could do. The big insurers suddenly were out billions, if not trillions of dollars. Everything went up in smoke. Nobody would loan anybody ANYTHING. Nobody knew how much of these bad loans people had on their books, and so nobody knew how badly off everyone else was. The reason that people didn't say anything about these so-called toxic assets (and remember, to a bank, an asset basically means an outstanding loan, while a liability means money that you actually have. It's a bit confusing, but makes sense if you think about it. Assets are money coming in, liabilities are money going out.) is because no one really knew what the hell they were actually worth, and they didn't want people to know that suddenly they've got stuff worth what was probably a few cents on the dollar for what they paid for 'em.

So yeah, no one's loaning any cash out. And that's a very, very serious problem. That's the real problem, actually. While the housing collapse was bad, it was more like the small explosion that propels the cobalt (or whatever it is that they use)  into the reactor in a nuclear bomb. (was it cesium? I always forget.) Anyway, a finance meltdown is really really bad, because for a wide variety of reasons. Sure, no one is willing to loan someone money to make hugely-leveraged purchases, and banks might be a little more wary about loaning money to buy a house, but that's still not the worst part. The worst part is that part of the design of our entire economy is the idea that these loans are made. Do you think employers pay their employees' salaries by what they have on hand? Lord no! They borrow it on Thursday night, pay their employees on Friday, and then pay back the bank when their invoices come in on Tuesday or so. It's just how it works. No lending means no money. No money means no economy. There ya go.

So basically, back in September, this is what almost happened. As in, closer than the Cuban Missile Crisis almost happened. As in, an emergency meeting was called on a Thursday to make sure that the economy still existed the next Monday. Yeah. Close one.

Scary times.

PART THREE: THE SOLUTION

will have to wait a bit. I meant to get to this (actually, I meant to use this part as the introduction to my post, but I thought I should explain a few things for those who didn't really know what was going on) sooner, but it's late and I'm tired and I'll have to post the rest later.



awkward and sad news.

A friend of mine died this morning.  My uncle mike (technically not my uncle, but close enough) coded after he'd been hospitalized for extremely high blood pressure. He's had zero brainwave activity since last night, and the plug is being pulled tomorrow morning. It's DEFINITELY what he would have wanted.

I didn't know Mike terribly well. He was my cousin's uncle by marriage, and I only me him a few times. I chatted with him online a LOT, though. He was a man that lived life to the fullest, though. He, like me, was agnostic/atheist. He, like me, was super-liberal. The one thing that he was that I wasn't, was that he was able to do whatever the hell he wanted. All the time.

I'm not exactly sure what it was that happened to him, but he was independently wealthy. He spent his days checking out political blogs, good music, good food and drink, pot, good photography, travel, and, yes, even porn online. He was a man who was not given to concern about what others thought about him. He was tall, gangly, some what awkward, and a stutterer. He married a fantastic woman who loved him dearly (my thoughts go out to you tonight, auntie Anne), and had good friends that were always there to enjoy life with him.

He was, without doubt, a lover of life, and someone who reveled in what modernity had to offer. He was a geek par excellence. I'm positive that, if I had actually moved down to Houston, a plan of mine some time ago, I could have roped him into enjoying the finer points of DnD and super-geeky board games. He was a man that was not afraid of what "people might think of him." He was a man who thought that the primary points of life were a) enjoy the hell out of it, and b) make sure others enjoyed the hell out of it, too. He was what I like to call a "responsible hedonist". He was not one of these people who would be uptight over personal choice. He'd drop Truth and Beauty Bombs all over your ass, if you weren't careful.

In many ways, he was a hero of mine. Sure, he never landed a plane in the Hudson river, or saved babies from a burning building, but he was Mike, goddammit. He was fucking Mike Badger. And he was exactly what he was, and he didn't give two shits what you thought. Not because he was trying to look cool, but because he had to live how he had to live. Part of that code meant that he had to support what would help the greatest number of people, but he wasn't going to let false and bizarre notions ruin his enjoyment. He knew that there was only one pass around this big, wet, dirtball that we call a planet, and he wasn't going to let social constructs wreck who he wanted to be. If someone had a problem, he'd double-check it. If it was reasonable, he'd go along with it. If it was their own hang-ups trying to impinge on his shit, well, Fuck Them. Mike Badger was Mike Badger. Just like Joel Robert Johnson tries to be Joel Robert Johnson.

So I'm trying to let stupid bullshit slide right the hell off my back. If you don't like it, well maybe that's YOUR problem. I can't be bothered. At the same time, I'm gonna do the best that I can to make sure that the assholes that have been operating like they were the kings of the cave without any morality but historical precedence back them up get ignored. If thhey don't like it, then fuck them.

It's what Mike would have wanted.

Another thing he would have wanted was to point out that at least he made it out of the fucking Bush administration. 'Cuz fuck them, too.

This one's for you, Mike.

I fell off the wagon.

First time it's happened so far in this experiment. I knew it would happen eventually, and I'm not gonna beat myself up for it. Turns out that going climbing and then watching Man Vs. Food was a little bit too much to resist today. I guess I'll have to start climbing on eat days. It just made me too ridiculously hungry, and I had that leftover meatloaf that was crazy delicious. C'est la vie!

Also, I've decided to change up the schedule a little bit. Instead of doing every other day, which led to some rather unfortunate situations where I was fasting and all my friends were eating, I'm going to a MWFSun eat days and TuThSat fast days. I think it'll be a lot better in the long run.

Excelsior?

I am awesome at solitaire

99 seconds, bitches.




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thedoursalmon
The Dour Salmon

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