Reason Morning Links: GM, AIG, IOUs, and JC

- GM finishes selling its most valuable assets to a new, government-owned company.

- AIG asks permission to pay more bonuses.

- Pending: a secondary market for California IOUs.

- A nationally coordinated burst of protests erupts in Iran.

- A new wave of violence hits Iraq.

- Disgruntled Canadian Catholics charge the prime minister with stealing Jesus' body.

Comments

[FrBunny]

From the Body-snatching piece:

...In my own parish the priest stood up one day and said he found a host in the parking lot. He was really angry.

Do you know how hard it is to scrape host off your shoe?

[Xeones]

Based on my own (limited) experiences with popery, Jesus doesn't have a lot of flavor. His blood can get you buzzed, though.

[Spartacus]

A regulated market for the IOUs "makes it even more advantageous" for individuals holding them, who could sell them at a fair price, said Paul Maco, an attorney at Vinson & Elkins in Washington who was a director of the SEC's Office of Municipal Securities. The price they receive may be discounted in accordance with the market's perception of the risk of the state repaying the notes, but it would be an orderly market price, he said.

I guess those unionized state employees who didn't want to take a pay cut, just got a pay cut.

[Rich]

Wrt the new GM logo, I wonder whether any consideration was given to changing the color to red.

[Rich]

Good thing CA's "toxic assets" will be regulated.

[Tricky Prickears]

"
? AIG asks permission to pay more bonuses."

Here's an idea:

The argument that these people (FP div.) still have jobs is that they are the only ones that know how to unravel the mess they created. OK. Let's say I buy that argument. How about taking their bonuses and putting them in an escrow account and telling them they'll get their fucking money when they're done cleaning up the mess? That's called incentive.

[domoarrigato]

We never throw Jesus out

bwahahaha!

earlier generations of Catholics were told not to chew the host because it would hurt the body of Christ

Ouch!

[BlueBook]

I would think a quick bite would be the most merciful option, as it would render Our Lord And Savior unconscious before he reached the acid bath of the stomach.

[Rich]

Oh, Tricky, next you'll be suggesting debtor's prison.

[Tricky Prickears]

Oh, Tricky, next you'll be suggesting debtor's prison.

Not likely. But when dealing with these 20 or so FPers, the word "fraud" does come to mind. And you can include Greenberg.

[Nephilium]

Steve:

Someone already came up with the red version of the GM logo...

Nephilium

[Tricky Prickears]

? Pending: a secondary market for California IOUs.

Interesting. BOA, Wells Wacho, and Shiti won't be accepting IOUs for deposit? Somebody explain to me again why these banks are still in business. On second thought, never mind.

[Thinker]

Tricky,

Escrow is essentially what AIG has done with these bonuses. During Liddy's March testimony he pointed out that:

A. None of the recipients of these bonuses are responsible for the mess.
B. These recipients are getting paid only when they have effectively unwound their books
C. These recipients are not paid salary during this period.

In exchange for going to a competitor where they could easily sell against AIG's book, they stay. If they complete their jobs, they can get paid.

Seems very reasonable to me.

[Rich]

Seriously, Tricky, I agree with you. And we need some analogous incentives for congresscreatures.

[P Brooks]

And we need some analogous incentives for congresscreatures.

How about a guillotine on the Mall?

[Ben Kenobi]

Tricky--do you really blame those banks for not taking California's shitty IOUs?

[Xeones]

How about a guillotine on the Mall?

Better would be something based on the popular and ever-expanding Saw movie franchise. I'd settle for the guillotine, though, as long as we can set the cons on fire first.

[Tricky Prickears]

As part of this agreement, the senior executives were to receive half their 2008 bonuses -- which totaled $9.6 million -- in the spring, with another quarter disbursed on July 15 and the rest on Sept. 15. The last two payments would depend on whether the company made progress in revamping its business and paying back bailout money to taxpayers.

They were aimed at retaining 400 employees at AIG Financial Products, the troubled unit whose complex derivative contracts nearly wrecked the global insurance giant.

Quoted article here

[Fluffy]

There was ALREADY a secondary market for California IOU's. It was called Ebay [alternately, Craigslist].

The state of California just wants to make sure that after they issue you an IOU, you can't convert it into cash without paying a fee to a brokerage firm.

[P Brooks]

as long as we can set the cons on fire first.

Done. We can marinade them in gasoline overnight, if you wish.

[PR]

Interesting. BOA, Wells Wacho, and Shiti won't be accepting IOUs for deposit? Somebody explain to me again why these banks are still in business.

because they won't be accepting IOUs for deposits.

[Fluffy]

By the way, to fuck with the state of California on this IOU regulation thing, someone should now sue to block the issuing of the IOU's on the grounds that if they're securities, California is creating new bond issues without legislative or popular initiative authority.

[domoarrigato]

There is no legal method for a state to declare bankruptcy.

[Abdul]

For all the jokes about Jesus' body, what the PM did was more offensive than wearing shoes in a mosque or slapping your hands on a Talmud. In terms of offense, he might as well have said "Go fuck yourself, Canadians who respect religion or religious differences!"

[Tim Cavanaugh]

Great comment on the Harper story:

by Sassylassie
Jul 08 2009

...I have an entire silver thing full of the those waffers, in twenty years I can't find one person to take them off my hands.

[jsh]

California is creating new bond issues without legislative or popular initiative authority

The govt needs to do it to survive. The constitution isn't a suicide pact. Therefore, the govt has the authority to do so. Its a living document, remember?

[R C Dean]

I guess those unionized state employees who didn't want to take a pay cut, just got a pay cut.

Nope. Employees get cash. Its businesses (vendors) and taxpayers who get the trash.

Tricky--do you really blame those banks for not taking California's shitty IOUs?

No kidding. They got killed the last time they took junk paper. Why do you want them to do it again?

[R C Dean]

There is no legal method for a state to declare bankruptcy.

Very true. Of course, if sovereign immunity allows a state to simply walk away from its obligations, then what would it need bankruptcy for?

[brotherben]

I've never been to a Catholic mass where the host was placed in one's hand. I was under the impression that the priest was the only person allowed to physically touch the wafer during the communion part of the mass. The host was always placed, by the priest, onto the recipient's tongue.

[Tricky Prickears]

Tricky--do you really blame those banks for not taking California's shitty IOUs?

No. I just thought it was interesting. My interest, in particular, is to see if the treasury tries to tell them that they have to accept the IOUs.

Nope. Employees get cash. Its businesses (vendors) and taxpayers who get the trash.

For now. And this does suck for the vendors. I don't know about Cali., but when contracting off the federal government, it can take up to 90 days to get paid to begin with.

[Kolohe]

Dang brotherben you
1) haven't been to mass in a longer time than I have, which is pretty long
2) are old 🙂

[Tim Cavanaugh]

Abdul, what should he have done (once the host was handed off that is)? He can't consume it in good conscience. (Depending on his sect, he also would have been violating RCC laws; I believe Orthodox Christians are the only non-Catholics allowed to receive.) By putting it in his pocket he at least saves it, which is not fundamentally different (though it may be doctrinally different) from taking the leftovers and putting them in the Monstrance. Unless somebody can prove Harper threw it away, I don't think you can say it was a deliberate blasphemy.

He should of course have crossed his arms across the chest in the traditional no-communion gesture. But have you ever done that? It feels terribly insulting, even if it's not taken that way.

[Xeones]

We can marinade them in gasoline overnight, if you wish.

Can we mix kitty litter, styrofoam, or frozen orange juice concentrate into that marinade?

[J sub D]

A new wave of violence hits Iraq.

Wait a minute!
I thought we won that war.

[domoarrigato]

then what would it need bankruptcy for?

Some were suggesting that the IOU's be blocked on grounds that CA doesn't have the authority to issue securities. But, the alternative is default. Surely the IOU's is the less harmful option. My point is that those wishing for CA to simply walk away from it's obligations should know there will be no assurance of and orderly, law abiding process of determining who gets screwed - it would essentially be a political decision.

I personally don't think that is a better option than IOU's - legal or not.

[Tricky Prickears]

Oh, and 3.5%? Is that tax exempt?

[brotherben]

kolohe,

1) true
2) ditto

When did they start handing off the host?

[brotherben]

domoarrigato, I ain't tryin to be difficult. Some would argue the same for the stimuli from the feds.

[Kolohe]

I first received communion in 1981; at least since then.

[BlueBook]

They gave us the choice, hand or tongue, (insert bad priest joke here) when I first had it in the mid 80's. Most held out their hands, but I think some of the kids got a little thrill from sticking their tongue out at The Man.

[domoarrigato]

broben - not sure I see the parallel to pro-stimulus arguments. maybe a little, but...

[R C Dean]

I personally don't think that is a better option than IOU's - legal or not.

In the short term, not. However, the IOUs allow CA to put off the day of reckoning, and postponing settlement with leverage pretty much guarantees that the day of reckoning will be even worse when it gets here (and get here it will).

I am increasingly convinced that there is a fiscal catastrophe in our future. IF there is, the longer we put it off, the worse it will be.

In the long run, I fear the IOUs, like the stimulus and current spending orgy, are going to make us all worse off than if we had just taken our medicine now.

[brotherben]

domoarrigato, you said, "But, the alternative is default. Surely the IOU's is the less harmful option..."

The stimulus was sold to the public, via fear and hysteria, using the same basic argument. The alternative was said to be the sequal to the great depression and the stimuli, while painful, were a better option.

[J sub D]

I am so out of it.

I haven't taken communion since 1971.
I'm an atheist today, but that wasn't the reason I left the RC church as a sixteen year old.

[God Fearing Atheist]

Anyone notice that the Russians are a lot smarter than US on the AGW front?

"For us the 80 percent figure is unacceptable and likely unattainable," Arkady Dvorkovich told reporters.

"We won't sacrifice economic growth for the sake of emission reduction," he added.

From here.

[Fluffy]

Arrigato, I'm not necessarily saying I want California to default.

I'm just angered by the state and federal government's determination to put as many obstacles in the way of people turning the IOU's into cash as they can.

California fucked these people once by giving them IOU's instead of actual payment. Now they're telling people, "Even if someone offers you cash for your IOU, you better not take it until we decide it's OK for you to do so."

I am, spitefully but appropriately in my view [spite is often appropriate], saying, "Hey, if you want to make it hard for me to liquidate the IOU you gave me by defining it to be a security, I'll fuck you right back by arguing that defining it that way makes it illegal for you to issue it in the first place. Have fun in default."

[domoarrigato]

The stimulus was sold to the public, via fear and hysteria, using the same basic argument. The alternative was said to be the sequal to the great depression and the stimuli, while painful, were a better option.

The IOU's weren't sold, they were imposed. I'm struggling...

[brotherben]

I haven't taken communion since about 82' or 83'. I have been to three wedding masses in the late eighties and one in about 94'. I didn't notice the hand to hand passage of the host but then again, I didn't go forward to recieve it. I haven't been inside a Catholic church since then.

[domoarrigato]

Fluffy - Oh I agree completely. Security or otherwise, there should be no impediment to trading them. My point wasn't about the trading, it was solely about the question of IOU's vs. default.

[brotherben]

domoarrigato, as is generally the case, the stuggle is mine. I argue about as well as Stevie Wonder drives.

[Nick]

From the Brickbats:

Royal Newfoundland Constabulary Chief Joe Browne says the department will apologize for detaining Dane Spurrell. Police saw Spurrell walking along the road and assumed he was drunk because of the way he walked. He was not drunk. He is autistic.

I understand the taboo of driving drunk, but since when are people not allowed to walk drunk? Seriously, Canada? If her were on skates would that have been OK?

[Nick]

I am increasingly convinced that there is a fiscal catastrophe in our future. IF there is, the longer we put it off, the worse it will be.

Do you think revolution will come if modern Americans have to deal with a fate like those that lived during the Great Depression? I just think people are too spoiled, too connected, and too easily incited to put up with that.

[Spartacus]

RC--

I was under the impression that employees were getting "paid" with IOUs. My bad. Probably just a matter of time, though.

[Zeb]

No sane person really believes that the host is actually Jesus' body. Sorry, that's just too absurd for me to accept.

[R C Dean]

Do you think revolution will come if modern Americans have to deal with a fate like those that lived during the Great Depression?

I think that

(a) a fiscal catastrophe (and ensuing social disruption) is almost inevitable.

(b) the fiscal catastrophe is a necessary, but not sufficient, condition for a comprehensive purge of our current political class and a resetting of the relationship between Society and the State in America.

(c) There is no guarantee that, if the purge/resetting occurs, we will be more free than before.

Believe it or not, I used to be a pretty optimistic guy.

[brotherben]

R C Dean, I am optimistic, in an ignorant delusional kinda way, that Obama's tinkering will have a net positive effect on the country. If it all goes down in flames, well, I am fine with that as well. The reality to me is that our society is broken in a way that is unfixable without a calamity that results in a massive die-off and complete revival of our government as originally intended. I hope Obama reaches the right by sailing left, but I have my doubts.

[Abdul]

He should of course have crossed his arms across the chest in the traditional no-communion gesture. But have you ever done that? It feels terribly insulting, even if it's not taken that way.

Know what feels more insulting? Sticking the body of Christ in your pocket like a breath mint you're saving for later. Lots of people, even (especially) faithful catholics just stay in the pews if they are not in a state of grace. I've done it. If anyone looks at you funny, you say "Sorry, rubbed one out just before mass."

It's not like he didn't know better. Catholicism is hardly some obscure sect. He could've asked anyone on the staff who shows up to work with a dirty forehead on Ash Wednesday.

BTS, i think the Orthodox need permission to take communion from a Bishop or someone above. However, Eastern rite catholics can participate, and some of them have "Orthodox" in their names.

[Ebeneezer Scrooge]

(c) There is no guarantee that, if the purge/resetting occurs, we will be more free than before.

It is a virtual certainty that we'd be less free.

We do not have the kind of intelligentsia in this country today, that we had in 1775.

Think about the kinds of ideas that float around today. Then think about where they're going to take us.

[Ebeneezer Scrooge]

brotherben,

that Obama's tinkering will have a net positive effect on the country

Clue me in. How does this delusion work?

[Ebeneezer Scrooge]

Anyone notice that the Russians are a lot smarter than US on the AGW front?

They've been smarter than us on this front for a long long time.

So has China. So has India, and most especially those parts that AGW will purportedly flood -- those people said "screw you" to economy killing carbon taxes.

[Ebeneezer Scrooge]

J sub D,

Wait a minute!
I thought we won that war.

We did. We were just weren't smart enough to notice when it was over, and get the hell out of Dodge.

[Ebeneezer Scrooge]

Nope. Employees get cash. Its businesses (vendors) and taxpayers who get the trash.

The only jobs that will have any chance of existing, are government employee jobs. Everything else is going down the drain.

Unless the government itself actually manages to collapse. But that would mean a complete purge. I strongly suspect a partial purge a) is way more likely, and b) will give far worse end results.

[Ebeneezer Scrooge]

Politics, like any version of MS Windows, is a self polluting proposition.

You can unplug a PC and reinstall Windows. The end result will still suck, but at least you know (* more or less) what it's going to do.

Politic systems are not so highly evolved.

The Romans got by for a long time with periodic plebeian revolts. The Chinese and Egyptians used the simple expedient of successive dynastic collapses.

Beyond that, I don't see that anybody has found a practical way to build a reset button into a political system.

* Fact: install Windows on any PC multiple times and you will find slight variations in how it chooses to install itself, even though you've got exactly the same hardware every time.

[Art-P.O.G.]

Yes, the violence has been coming in waves for what seems like an eternity. Especially in Mosul.