Friday, November 28, 2008

Updating ATLAS SHRUGGED for the Financial Crisis

Friday flame bait:

Has ever a more pedantic, tedious tome been penned by any theorist before or since Atlas Shrugged? The odious combination of ideological rigidity and academic purity makes for a compelling manifesto for the naive and weak-minded.

The work has become the Das Kapital of the 20th century . . . Both were wrong, too long, and poorly written — and each has proven to be wildly destructive to the political economy.

Ironically, only one has been shown to be damaging to capitalism itself — and that wasn’t Marx’s s work, it was Rand’s.

Which makes this McSweeney parody all the more hysterical:

“How he hated his debased need for her, he who loathed self-sacrifice but would give up everything he valued to get in her pants … Did she know?

“I heard the thugs in Washington were trying to take your Rearden metal at the point of a gun,” she said. “Don’t let them, Hank. With your advanced alloy and my high-tech railroad, we’ll revitalize our country’s failing infrastructure and make big, virtuous profits.”

“Oh, no, I got out of that suckers’ game. I now run my own hedge-fund firm, Rearden Capital Management.”


He stood and adjusted his suit jacket so that his body didn’t betray his shameful weakness. He walked toward her and sat informally on the edge of her desk. “Why make a product when you can make dollars? Right this second, I’m earning millions in interest off money I don’t even have.”

He gestured to his floor-to-ceiling windows, a symbol of his productive ability and goodness.

“There’s a whole world out there of byzantine financial products just waiting to be invented, Dagny. Let the leeches run my factories into the ground! I hope they do! I’ve taken out more insurance on a single Rearden Steel bond than the entire company is even worth! When my old company finally tanks, I’ll make a cool $877 million.”

Their eyes locked with an intensity she was only beginning to understand. Yes, Hank … claim me … If we’re to win the battle against the leeches, we must get it on … right now … Don’t let them torture us for our happiness … or our billions.”

Attention college students and young Alan Greenspan/Phil Gramm-wannabees: The book is shite. Get over it.


McSweeney’s, November 20, 2008

Banker Bailout Gravy Train

Massacre in Mumbai: Up to SEVEN gunmen were British and 'came from same area as 7/7 bombers'


Last updated at 7:39 PM on 28th November 2008

  • British-born Pakistanis among arrested militants
  • Commandos storm strongholds to rescue hostages
  • Siege continues at Taj hotel as bystanders wounded
  • Death toll rises as another 24 bodies found in hotel
  • At least five dead hostages found in Jewish Centre 

British-born Pakistanis were among the Mumbai terrorists, Indian government sources claimed today, as the death toll rose to at least 155.

As many as seven of the terrorists may have British connections and some could be from Leeds and Bradford where London's July 7 bombers lived, one source said.

Two Britons were among eight gunmen being held, according to Mumbai's chief minister Vilasrao Deshmukh. At least nine others are reportedly dead.

The eight arrested were captured by commandos after they stormed two hotels and a Jewish centre to free hostages today. Despite the Indian authorities' assurances that the situation was under control, the siege continued at the Taj Mahal hotel and explosions could still be heard in central Mumbai.

One security official said: 'There is growing concern about British involvement in the attacks.'

But Gordon Brown has urged caution. He emerged from a conversation with India's Prime Minister Manmohan Singh to say there was no suggestion of a British link.

'At no point has the prime minister of India suggested to me that there is evidence at this stage of any terrorist of British origins, but obviously these are huge investigations that are being done and I think it will be premature to draw any conclusions at all,' Mr Brown said.


Calm: One of the young gunmen with his weapon, looking for more victims. Indian authorities say two of the arrested militants were British-born Pakistanis

Loss: Bollywood actor Ashish Chaudhary is consoled outside Mumbai's Trident-Oberoi Hotel after learning about his sister's death

Loss: Bollywood actor Ashish Chaudhary is consoled outside Mumbai's Trident-Oberoi Hotel after learning about his sister's death

Gone: US citizen Alan Scherr and daughter Naomi, pictured with his wife Kia, were killed in Mumbai's Oberoi hotel. They were in India with religious group Synchronicity Foundation, which was hosting a meditation program at the hotel

Gone: US citizen Alan Scherr and daughter Naomi, pictured with his wife Kia, were killed in Mumbai's Oberoi hotel. They were in India with religious group Synchronicity Foundation, which was hosting a meditation program at the hotel

Senior Whitehall sources said it was too early to say whether there had been any involvement by British nationals but that security services, working with overseas partners, would be looking at any potential links to the UK.

Home Secretary Jacqui Smith also said UK authorities had "no knowledge" of any British links with the massacre, while Foreign Secretary David Miliband said it was "too early to say" whether any of the terrorists were British.

As authorities tried to piece together the identities and motivations of the attackers, special forces were still battling with gunmen.

At the five-star Taj Mahal Hotel, officers were still locked in combat with up to six militants believed to be holed up in the ballroom. 

The Indian authorities thought they had ended the siege there last night after they shot dead three terrorists and released hundreds of hostages, but it raged again today.

In a major army operation, soldiers threw grenades at the walls in a bid to smoke out the militants. Four bystanders were reported wounded in the crossfire.

Mumbai officials say more than 155 people in total have now died in the attacks. Another 370 were wounded. 

Scroll down for more

Enlarge mumbai

Terror: Indian special forces prepare to take back the Taj Palace Hotel in Mumbai

Indian forces personnel fire towards the Taj Hotel in Mumbai, India,

The tragic figures include the bodies of another five hostages who were found dead inside the Nariman House Jewish Centre this afternoon after commandos finally secured the building.

Two militants were also killed. It is not known whether the Rabbi and his wife who were believed to be among the hostages are dead or alive.


Around 20 masked officers had raided the centre this morning, dropping from helicopters onto the roof, in an operation dubbed Operation Black Tornado.

Hours of heavy fighting ensued as they moved from floor after floor. As dusk fell, there was a massive explosion and it appeared to be over.

Enlarge Air rescue: A commando drops to the roof of Mumbai's Jewish centre this morning where at least 10 hostages are thought to still be being held

Air rescue: A commando drops to the roof of Mumbai's Jewish centre and below, officers span out ready to storm the building

Battle: Indian commandos take their positions near the Jewish centre

Across the city at the Oberoi Hotel, the siege ended when two militants were shot dead. 

Dozens of traumatised guests emerged unharmed but inside there were scenes of carnage and the bodies of another 24 victims.

Many of those freed had been locked in their rooms, terrified, for 41 hours while the gunmen rampaged.

Today, around 100 people were rescued and struggling to absorb their ordeal. One man was clutching a tiny baby in his arms as he walked out.

British lawyer Mark Abell emerged with a beaming smile, saying: 'I'm going home, I'm going to see my wife. ' 

The 51-year-old told how he had spent the night listening to gunshots and explosions and communicating with the outside world on his phone and Blackberry.

Describing the scene when he was eventually led to safety, he said it was 'carnage' with 'blood and guts everywhere'.

'I was supposed to be working in Delhi but I think I have had more than my fair share of my business trip so I am looking forward to going home to see my family,' he said.

Finally safe: A British man being led from the Oberoi Trident Hotel this morning after a siege lasting more than a day

Rescued: A British man is led to safety from the Oberoi Trident Hotel today and below, another guest emerges clutching a tiny baby

Safe at last: A guest emerges from the Oberoi hotel clutching a tiny baby

A number of the hostages were airline staff still wearing their Lufthansa and Air France uniforms when they emerged from the building.

As they came out some carried luggage with Canadian flags, and two women were dressed in black abayas, traditional Muslim women's garments.

Others were not so lucky. Reported dead tonight was an American and his 13-year-old daughter as well as the wife and two children of the Taj hotel's general manager.

Foreigners from Japan, Australia, Italy and Germany and one Briton - tycoon Andreas Liveras - have already been confirmed as among the victims.

At least eight Britons were injured and there are fears the British toll could yet rise further as more and more buildings are made stable and searched.

Earlier, one commando revealed he had seen around 50 bodies littering the Taj hotel floor after special officers stormed the building and rescued hundreds of guests.

Clad in black, with a mask covering his face, the unit chief said: 'There was blood all over the bodies. The bodies were strewn here and there and we had to be careful as we entered the building to avoid further bloodshed of innocent civilians.'

The terrorists had seemed like young, ordinary men but had clearly been very well trained, he said. 

'They were wearing T-shirts, just ordinary looking, but they have definitely been trained to use weapons. There is no way they could handle such weapons without being taught how to.'

Held hostage: Rabbi Gabriel Holtzberg and his wife Rivka were held at a Jewish center. Below, their two-year-old son is carried to safety

Feared dead: Rabbi Gabriel Holtzberg and his wife Rivka were believed to be inside the Jewish centre where the bodies of five hostages were found

At least nine terrorists are thought to have been shot dead in gun battles across the city as police and special forces tried to regain control.

Three arrested at the Taj Mahal have been officially identified as a Pakistani national and two Indians. Another is reported to be a Mauritian national.

They arrived in the city by sea before fanning out to at least 10 locations. Dinghies were found moored at a jetty by the famous Gateway to India monument.

Today, coast guard officials said they could have hijacked an Indian trawler to drop them off after finding an abandoned boat drifting near the shore.

The captain's dead body was found inside the vessel, along with communications equipment.

Dressed in jeans and T-shirts and heavily armed, they then headed for the city - which is India's financial centre - and started firing indiscriminately.

It is thought they gained entrance to the hotels by pretending to be staff and hotel guests, according to reports.

Blast: Police throw a grenade into the Taj Mahal hotel as they desperately try to control a militant believed to be holed up in a ballroom inside

Blast: Police throw a grenade into the Taj Mahal hotel as they desperately try to smoke out up to six militants hiding in the ballroom

Indian authorities have not released any details about the two Britons and the Foreign Office has refused to confirm Indian television reports.

Security services in Britain are now examining images of the gunmen in an effort to identify them. 

India's High Commissioner Shiv Shankar Mukherjee played down speculation some of the gunmen were British: 'I have seen nothing more than what is in the media and that is based on speculation. I will wait for the investigation to produce some hard facts.'

Speculation linking the attackers with Bradford was quashed by the Leeds-based Counter Terrorism Unit.

A statement from officers said: "At this stage we are not in receipt of any intelligence or information linking the events in India to our area."

A team of Scotland Yard anti-terrorist detectives and negotiators are now on their way to Mumbai to assist in the investigation.

Indian commandos have recovered credit cards and the militants' ID cards as well as seizing a vast arsenal of grenades, AK-47 magazines, shells and knives.

Enlarge Desperate: A hostage at the Oberoi peeks out of his window as the siege continues

Desperate: A hostage at the Oberoi peeks out of his window during the siege

A previously unknown Islamic group, Deccan Mujahideen, has claimed responsibility for the attacks but terror experts believe is is linked to Al Qaeda.

It is known that dozens of British-born Pakistanis have travelled to Pakistan to train in its camps in recent years.

One security source said recently: 'The camps are full and many of the people inside are Brits.'

There has been speculation that a British Al Qaeda suspect reportedly killed by a U.S. missile strike in Pakistan last weekend may have helped plot the attacks.

Rashid Rauf was among five killed in a missile attack in a tribal area in North Waziristan on Saturday. 

Security sources believe that at the time of his death Rauf had been planning a major attack on Western targets.

Met officers were also interviewing passengers returning from Mumbai as they stepped off planes at Heathrow.

There was also speculation that England cricketers could have been an intended target of the terrorists. 

It emerged that some of the team had been due to stay in Mumbai, most likely the Taj Mahal, on Wednesday evening before a late decision was made to switch training to Bangalore. 

Shocked player Michael Vaughan said: 'I don't know why it was switched but we could have been there in one of those hotels when they were attacked.

'All our white Test kit is in one of the rooms at the Taj Mahal hotel: All our pads and clothes for the Test series and our blazers and caps and ties. That's how close the danger is.' 

The England team will fly back to Britain today.

Rampage: The terrorist is joined by another machine gun-wielding fanatic as they hunt down victims

On the hunt: Two baby-faced gunman brandishing automatic weapons and below, the scene of carnage they left behind at the main train station

Massacre: Blood splatters the floor at the train station where travellers were slaughtered. Others abandoned their luggage and ran for their lives

The bloody drama which began on Wednesday night has now lasted more than two days. The targets across the city were: 

  • The Oberoi Hotel, in the commercial district. Its restaurant was bustling with diners, many of them tourists; 
  • Also attacked was the Leopold restaurant, a haunt of the city's art crowd. As the fanatics sprayed the packed cafe, diners fled in terror; 
  • Some of the worst scenes were at the major railway station. As they entered the Gothic Chatrapati Shivaji Terminus, once named after Queen Victoria, the gunmen were smiling. With an astonishing air of casualness, the terrorists started to shoot. Within seconds the concourse was a bloodbath. People lay screaming on the floor; 
  • A further prestigious target was the 105-year-old Taj Mahal Palace and Tower Hotel; 
  • More hostages were taken at the nearby Chabad House, headquarters for an ultra-orthodox Jewish group. A rabbi was among those held. 

About 15 police officers were killed, including the head of Mumbai's anti-terrorism unit.

India's prime minister Manmohan-Singh has blamed militant groups based outside the country - usually meaning Pakistan - raising fears of renewed tensions between the two nuclear-armed rivals. Pakistan condemned the attacks. 

The attack on the train station had echoes of previous terror outrages. 

In July 2006 more than 180 people were killed in seven bomb explosions at railway stations and on trains in Mumbai that were blamed on Islamist militants. 

  • Worried friends or relatives should call the Foreign Office's emergency line on 0207 008 0000.Enlarge A map shows the locations of the bombings across Mumbai

    A map shows the locations of the bombings across Mumbai

'Titanic' discovery was byproduct of military quest

Robert Ballard became famous as the explorer who found the wreckage of the Titanic. But what most people don't know about that expedition is that Ballard also secretly worked with the U.S. Navy to learn more about two lost nuclear submarines.

Ballard shared that nugget when he came to the Tampa Bay area last week for the Coastal Cities Summit, organized by the University of South Florida and other institutions. He spoke with the St. Petersburg Times about the Titanic and his underwater exploration career.

When you wanted to search for theTitanic, did you make an arrangement with the military?

I can only tell you now because they declassified this a few months ago. The Navy was not interested in the Titanic. … I mean, they funded the technology because it had so many military applications. And I was a naval intelligence officer for 30 years, and so I did a lot of missions for the Navy. Many remain classified, my best stuff. Rats …

Yes, the Titanic was a cover for a series of military operations. The Titanic was here, and over here was the Scorpion and over here was the Thresher (as he says this, he arranges three objects on a tabletop, roughly in a line, the center one depicting the Titanic).

And had that not occurred, I probably would not have found the Titanic because they wouldn't have funded me. I mean, if the Titanic was in the Indian Ocean, it'd probably still be in the Indian Ocean. But … it was straddled by two very interesting subs that we had lost — and the Scorpion was lost on war patrol … and it was carrying nuclear weapons. So it was a very hot sub to the Navy …

So the Navy said, look, we never actually tracked that all down, we never found the reactors, we never did environmental studies on them, nor did we ever find the weapons. We'll fund you to build all this stuff and we'll fund you to find the Titanic, although we don't expect you to find it because we're going to have you work most of the time on these subs and give you very little time to actually find the Titanic. I said, I'll take whatever I can get.

What was different about exploring the Titanic compared to other shipwrecks?

I've dove on wrecks and they get totally encrusted. The older they are, the more they don't look like wreckage. The Titanic was a museum piece. I mean, when you came down to it, you could look in the window and bounce your lights off the mirrors, and the chandeliers were hanging from the overhead. I mean, you went to a haunted house. And no one had ever seen a haunted house in the deep sea before. We'd seen some on military missions that we couldn't talk about, but they weren't that old. The Titanic was pretty old, three-quarters of a century at the time. I was surprised to see the manufacturer's name on everything … because of the deep sea. The deep sea is pitch black, you can't have photosynthesis, so you don't have all this marine life. It's freezing cold and deep pressure, no currents to abrade it to speak of, just enough to polish the brass.

Of all the explorations you have done, I wonder if there was a moment when you were … scared?

Oh, several times … I've had very close calls, enough that I don't want to play the statistical game. That's why I like robots. I had several (close calls). A fire at 9,000 feet in a 9-foot capsule when my emergency breathing system didn't work. That's scary. Right off of the Cayman Islands, I made a 20,000-foot dive and crashed on the way down into the side of a volcano, ruptured my flotation tanks, and barely made it back to the surface … so I really like telepresence. Trash the robot and go, "I'm so sorry."

Wednesday, November 26, 2008

They see gold making significant progress after price bounce

Peter Brimelow

Gold bugs, Grinches finally agree on something

Commentary: They see gold making significant progress after price bounce

By Peter Brimelow, MarketWatch
Last update: 11:41 p.m. EST Nov. 26, 2008
NEW YORK (MarketWatch) -- Gold bounces. Both gold bugs and gold Grinches think it's made significant progress.
Recently I quoted Dan Norcini of Jim Sinclair's MineSet , whose incisive daily commentaries are widely viewed as a great starting point for evaluating gold events. Norcini said then: "Once again the $750 level served to hold any gains in check. There is obviously a seller/s of great size at or near this level." See Website See Nov. 17 column
Norcini was still complaining about this last week. But then, boom! On Friday, Comex gold jumped $43.10 an ounce, and it went on to gain another $19.50 by Wednesday's close (although Wednesday itself saw a $9.20 loss). This ended gold's month-long oscillation below $750.'s veteran James Turk commented: "It is rare for gold to achieve such a huge one-day gain. In fact, I checked my records for the past twenty years and found only one other ... the other occurrence was on Sept. 17, 2008, barely two months ago. That rally also took gold back above $800." See Website
What happened? In the immediate sense, there's a consensus among gold bugs: the Comex option expiry, which happened at 4:30 p.m. Eastern on Thursday. Gold bugs have long argued that the writers of these options trade aggressively to prevent them closing with value. Since gold open interest (the total number of gold contracts outstanding) dropped 3.1% by Tuesday's close as gold rose some $75, it does seem that short selling by someone had indeed been repressing gold, with subsequent short covering causing open interest to fall.
In a larger sense, the move appears to be a triumph for LeMetropole Cafe's system of tracking gold premiums in India. See Website
This is done to assess if the world's largest gold buyer is in a mood to bid the global market for supplies. Last week, I reported that the premium over world gold in India had been very high, indicating strong Indian demand, and wrote: "This sort of reading is generally followed by a rise in the gold price." It was. See Nov. 17 column
More conventional gold bugs think gold equities are a leading indicator of any gold price rise. For a long time, these have been very sluggish. But now they have responded with enthusiasm. Phlx Gold Silver Index (XAUXhas risen 44% and Amex Gold Bugs Index. (HUI46% since Thursday evening. They were even up Wednesday when gold was down, causing Dow Theory Letters' Richard Russell's to ask: "Something different happening here?
What next? LeMetropole Cafe now reports gold premiums have disappeared in India. But it expresses the view they will return after a few days.
Not everyone is bullish. The well-connected, institutionally-oriented Gartman Letter shorted gold on Monday (at $813 with an $837 stop). This experienced observer is often scathing about gold bugs (Call it a "gold Grinch" -- they're just as fanatical). It said it was motivated by the suddenness of the move and the clear evidence of large-scale short covering.
But on Wednesday, Gartman produced another card. It announced it believed a large seller had appeared around $825.
Gartman is an outspoken opponent of the LeMetropole Cafe thesis that the gold price has been manipulated by public and private interests. It does not usually use this sort of argument when discussing the metal. But Gartman is exceptionally well-informed, and its observation deserves attention.
Still, even Gartman apparently thinks the "seller" (if there is one) has retreated.
Until India shows its hand, gold bulls take comfort that the sharp rise does not seem to have inhibited the astonishing appetite for small gold items in the West, as tracked by the Tulving Co.'s bid page, or 24hgold's eBay tracking page. See Tulving Website See 24hgold Website End of Story