Occupationsxetentcy: September 2010

Wednesday, September 29, 2010

foreclosure investing

Michael Burry, who needs no introduction, was on Bloomberg TV earlier discussing his latest investment allocation, which no longer focuses on shorting real estate via the cheapest possible instrument, and instead is going long cash assets in the form of farmable land (oddly enough, not multi apartment commercial real estate), small tech, and, yes, gold. “I believe that agriculture land -- productive
agricultural land with water on site -- will be very valuable in
the future. I’ve put a good amount of money into that.” Burry, just like Zero Hedge, laments the surge in cross-asset correlations, which makes all hedging strategies virtually impossible, and is a primary reason for why so many rational investors have decided to depart from the market: "I’m interested in finding investments that aren’t just
simply going to float up and down with the market. The incredible correlation that we’re experiencing -- we’ve
been experiencing for a number of years -- is problematic." Lastly, Burry agrees with the Paulson-Greenspan view on gold, but not any of the other Paulson "Recovery" themes we presented in extreme detail over the weekend: "Paulson's big in gold, and that's something that is interesting to me given how I see the world playing out, but other than gold I haven't really bought into any of the other theses." (And no, you still can't eat it, dammit).

Full interview:

And a second interview in which he discusses why no one is accepting blame for the financial crisis;

Key quotes:

On who is to blame for the financial crisis:

“My number one concern is that there has been a complete utter total abdication of personal responsibility though out our entire society. I don’t think anyone anywhere is taking blame themselves for what they did to contribute to the crisis. And again I think it gets back to that blame game. It is the most damaging thing we can do as a country is to blame a narrow set and not look within ourselves for what each of us did or didn’t do to the basic wrong that led to this mess.”
“From the borrower to the average broker all the way to the federal reserve through Congress, the President, several Presidents, I think that this has been coming for awhile and there has been a lessening of the credit standards over a period of time that ultimately led to the kind of blow off top that we have.”

On the current housing market:

“It’s an artificial market. There are a tremendous number of homes where the home homeowner, I think it’s between 2.5 to 3 million homes, where the home homeowner are more than 9 months past due and are not giving notices that they are past due and they’re just living there for free. I actually know one that has been there for a few years without having to pay anything. I think that Fannie and Freddie are basically being used as special purpose vehicles by our government to support the housing market. The private mortgage market is practically nonexistent; 96-97% of mortgages are flowing through Fannie and Freddie now. I think Fannie and Freddie are exercising a tremendous amount of power over the market by withholding properties from sale and not forcing foreclosure, the foreclosure process. I think that it would be best for the government just completely got out of the mortgage market and let the housing, because home prices are a function of income the leverage applied.

On what he is investing in agriculture, real estate and gold:

“I believe that agricultural land, productive agricultural land with water on site, will be very valuable in the future. And I’ve put a good amount of money into that. So I’m investing in alternative investments as well as stocks.”

“I think there is some value in real estate. You have to buy it right. It’s not in general, that’s the problem. I think that there are an awful lot of people out there looking to buy these distressed properties out there and so you need to find special situations. That is how I’ve invested from the beginning. I’m looking for these special situations, these unique ideas and that’s true in real estate too.”

“In my situation I’d rather go long on housing itself, real estate itself. Depending on how you structure it, in the real market, in the physical market, you can get some pretty good deals and I’ve done some of that too.”

“Paulson is big in gold and that is something is interesting to me and given how I see the world playing out. Other than that, I’m just saying, other than gold I haven’t really bought into the other

On the danger of having more power for the Federal Reserve:

“Well, I don't feel that the economic theories and policies that got us into this mess are the same policies and theories that will get us out of this mess. And more to the point, I don't -- I'm 100 percent sure that the policies and theories that got us into this mess won't prevent the next mess from happening.

And that's probably my biggest frustration with the whole process. I don't think that -- I think with all the blame on Wall Street and all the focus on Wall Street -- the increase -- the perp walks for Wall Street -- these things, in a lot of ways, are non -- are not very productive. I think it's not very productive to blame a narrow set of individuals or a narrow set of institutions.

Nobody is taking time to blame anything that anybody in Congress did or the Fed did or the other businesses, you know, how the banks acted, how the mortgage brokers acted, how people acted, how borrowers acted. There's -- there's a lot of blame to go around. And I think this blame game being oriented entirely toward Wall Street is -- is not overall helpful.

On Goldman Sachs shutting down its proprietary trading business:

“I think that brokers should not trade for their own account in securities -- and securities that are also available to their clients. I just don't think that should be done. I think broking should be pretty boring -- safe, boring, low return business. And I think the same is true for banks. They should be very safe, solid, indestructible businesses. And so there are -- some of these seemingly Draconian measures, I think, do need to be taken.”

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Full interview:

And a second interview in which he discusses why no one is accepting blame for the financial crisis;

Key quotes:

On who is to blame for the financial crisis:

On the current housing market:

On what he is investing in agriculture, real estate and gold:

On the danger of having more power for the Federal Reserve:

On Goldman Sachs shutting down its proprietary trading business:

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Fox News's Obama 'Loves Gangsta Rap' Headline Is Pulled Down

Kinect will talk to MSN Messenger Xbox 360 News - Page 1 ...

Read our Xbox 360 news of Kinect will talk to MSN Messenger.

Nintendo: 4m 3DS sales in first month 3DS News - Page 1 ...

Read our 3DS news of Nintendo: 4m 3DS sales in first month.

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Fox News's Obama 'Loves Gangsta Rap' Headline Is Pulled Down

Kinect will talk to MSN Messenger Xbox 360 News - Page 1 ...

Read our Xbox 360 news of Kinect will talk to MSN Messenger.

Nintendo: 4m 3DS sales in first month 3DS News - Page 1 ...

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Fox News's Obama 'Loves Gangsta Rap' Headline Is Pulled Down

Kinect will talk to MSN Messenger Xbox 360 News - Page 1 ...

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Friday, September 24, 2010

personal finance

As Elizabeth Warren starts building the Consumer Financial Protection Bureau, there’s never been more uncertainty and upheaval surrounding the costs and fees associated with consumer finance.

There’s definitely a fair amount of good news. Old-fashioned overdraft fees now banned unless you opt in to them, and the Wells Fargo case, in which the California bank was ordered to pay $203 million to customers who had their largest transactions processed first, could set an important and expensive precedent for banks. Kate Davidson reports that smaller community banks are likely to fall into line on this front, but it’s still amazing how opaque the national banking system is when it comes to such policies. Get this:

Community banking companies that process transactions highest-to-lowest include the $3.6 billion-asset Renasant Corp. in Tupelo, Miss.; the $10.5 billion-asset Citizens Republic Corp. in Flint, Mich.; the $13.7 billion-asset Susquehanna Bancshares Inc. in Lititz, Pa.; the $6 billion-asset First Commonwealth Financial Corp. in Indiana, Pa.; and the $8.5 billion-asset Hancock Holding Co. in Gulfport, Miss.

Many banks that KBW surveyed would not disclose information about their processing practices. Several declined to comment when reached by a reporter, or did not return calls seeking comment.

It’s a simple and powerful strategy: simply don’t tell anybody, whether they’re a bank analyst or a reporter, what your policy is when it comes to overdrafts. That way, people shopping for a new bank will have to simply go on your public marketing materials, rather than being able to make any kind of easy apples-to-apples comparisons.

One of the things I hope that Warren does is to make every bank’s fees and policies public, in an open database which can be easily parsed by personal-finance websites. It’s not like these things are a secret, per se: they’re just very difficult to find right now. Let’s make these things as transparent as possible, instead.

Meanwhile, the ABA is, predictably and depressingly, pushing back against the idea that consumers would rather have fewer overdraft fees:

Nessa Feddis, a vice president and senior counsel at the American Bankers Association, said she expects regulators will eventually consider changes to rules affecting the order of processing. But she noted that the issue has been the subject of debate and litigation for decades, and said a Federal Reserve study found that customers want important payments — such as rent, mortgage or other bills — processed first, and they’re willing to pay for it.

I’ve looked for this Federal Reserve study, and can’t find it, does anybody know what she’s talking about? If it exists, it only serves to underline how important it is that the CFPB have full independence from the rest of the Fed. And if it doesn’t exist, then the ABA is even more mendacious than I’d imagined.

In any case, banks are definitely looking for new fee-revenue streams, and that’s where the uncertainty comes in. Blake Ellis has a look at some of them: Wachovia, for instance, will now charge you $10 to transfer money from your savings account to your checking account if you don’t have enough money in checking. It’s essentially an overdraft fee without an overdraft, and it’s existed for some time at Wells Fargo, which is now imposing it on Wachovia customers too.

I see four main forces here, all pulling in different directions.

The first is banks’ desire for income streams: they are going to want to introduce as many new fees as possible, especially banks like TCF which were highly reliant on those overdraft fees. (TCF’s business was particularly cunning: it banks a large number of students, who then learn the hard way about how much overdraft fees cost. Once they’ve learned their lesson, they move on to other banks, but TCF just stays there, signing up a new cohort of naive freshmen each year. It, like Wells Fargo, is being sued over its overdraft practices.)

The second is lawsuits. The Wells Fargo decision is the biggest, but other decisions are important too, like the $18.75 million settlement in North Carolina against a payday lender there. The more such decisions there are, the warier banks will be of trying to push the envelope.

The third is Warren’s new bureau, which could become an invaluable public resource for holding bank practices up to scrutiny.

Finally, of course, there’s the constant scramble, on the part of banks, for market share and customers: the more confusing the landscape becomes, the more appealing it is to try to attract new customers by promising them a simple product with no hidden fees. bank

It’s impossible to predict where we’re going to end up once all these factors have been working for a while, but it’s easy to predict that the route from here to there is going to be a rocky one and is not going to go in a straight line. So be careful out there. Your bank is having to deal with a scary and unfamiliar regulatory landscape, and might well react in unexpected ways.

WILMINGTON, Delaware (CNN) – Christine O'Donnell's Senate campaign is pushing back hard on allegations that she misused election funds by putting them to private use. Leading the counter-offensive is Cleta Mitchell, an attorney and an expert in campaign finance law, who was just retained by the O'Donnell campaign to deal with the allegations.

In an interview with CNN, Mitchell responded to a complaint against O'Donnell filed this week by the watchdog group Citizens for Responsibility and Ethics in Washington. The group, known as CREW, accuses O'Donnell of spending roughly $20,000 from her failed 2008 campaign for the Senate for personal expenses.

"That is not true," Mitchell told CNN. She accused CREW and its executive director, Melanie Sloan, of libeling O'Donnell and said the campaign is considering a lawsuit against the group.

"She has committed libel per se, slander per se by calling my client names... I've looked at lots of campaign FEC (Federal Election Commission) reports. And the things she (Sloan) is saying are simply not true," Mitchell said in the interview.

Sloan has called O'Donnell "a criminal" and "a crook," in accusing the candidate of tax evasion and a host of other financial improprieties.

Central to the allegations are claims that O'Donnell used 2008 campaign money to pay rent, to buy food and gasoline and even for a bowling outing. CREW says those expenditures occurred in 2009 and early 2010 when, the group says, O'Donnell had no active campaign.

"She did have a campaign because she had gone from running in 2008 to running in 2010," Mitchell told CNN Tuesday. "She was already running... she moved from one campaign to another and frankly the campaign headquarters was in her home - that's not unusual."

For her part, Sloan denies allegations her group is politically biased and says it is acting on information provided to it by a former O'Donnell campaign official.

"We've added up what we think is over $20,000 in expenses that were improper, that were money she used - campaign funds put to personal use. But it's really hard to say, because there's been no audit of her campaign. The fact is, once you start seeing this trend … the odds are there are many more expenses that we don't know about," Sloan told CNN in an interview.

Campaign officials are upset that the CREW complaint is getting so much press.

"You see, what the problem with Melanie Sloan and FEC complaints is you get to make big headlines, with lots of allegations and two or three years later, when they're dismissed as being baseless, there's no press. And so Melanie Sloan waited until Christine O'Donnell won the Republican nomination and less than a week later files a complaint that she's obviously had for a long time, just ready to go," Mitchell said.

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personal finance blog

Come November, it is the intention to throw the bums out. All of them. Many Senate seat challengers, while running as Republicans, have risen to the top with backing from the "tea party." Wisconsin's Ron Johnson is just such a candidate. A fiscally conservative businessman, Johnson has never run for public office and is an inexperienced campaigner. But the way his rhetoric matches with fact, he already seems the pro. Ron Johnson can now distinguish the bum's face. That bum is incumbent Senator Russ Feingold.

Now campaign finance filings found by The Awl show that despite his vigorous denouncement of the bank bailouts, Johnson's campaign has received funding from many of the same banks who received bailouts. This means you and I have helped fund Ron Johnson's anti-bailout campaign. So we should get to know him.

Johnson has gladly taken the tea party badge. Back in May, Washington Post columnist and conservative icon George Will said Johnson "is what the Tea Party looks like." FreedomWorks, the Dick Armey-run conservative organization that organized the 9/12 rally in 2009 but is not at all behind many "grassroots" tea party events, called Johnson a “Champion of Freedom."

His website's rundown of his personal history ("Meet Ron") begins, "Ron grew up in a family and in a place where one of the greatest compliments you could give a person was to say that he or she was a hard worker." And it only gets more vague. Apparently, this is intentional. Johnson declined to meet Feingold in all six debates, agreeing to just three. That a long-time incumbent is challenging his newcomer to debates should immediately raise raise a red flag. Without detailed positions, what is there to specifically criticize? Johnson's campaign has taken to dismissing all criticisms of the candidate as typical political attack ads, even as Johnson's crew runs similar spots. This kind of electioneering doublethink infects Johnson's campaign, a rhetoric capable of forgetting whatever it's necessary to forget, only to draw it back into memory at the moment it is needed.

Johnson claims to be for freedom, his rallying cry being "First of all, freedom." But then he believes marriage can only be between a man and a woman.

He is passionate believer in the values of Rand's Atlas Shrugged. But not the book's fundamental view of the "monstrous absurdity" of original sin, as he is a fervent and active Lutheran who says "freedom of religion doesn’t mean freedom from religion."

Johnson has adopted an all-green design and logo, giving the impression that he is a friend of the environment. But he is fervent supporter of fossil fuels, defending BP against recent criticisms and calling climate change theories "lunacy" and "not proven by any stretch of the imagination.” (Johnson has suggested sunspots have caused recent weather changes, despite sunspots being at historic lows.)

Johnson demands a smaller, less-involved government, saying our current one is "robbing the bank accounts of future generations of Americans." But even while Johnson calls government spending and subsidies a "threat to our freedom" and insists "government doesn't create jobs," he refuses to acknowledge that his company received millions of dollars in industrial revenue bonds. Johnson's campaign maintains the money he received was not a government handout. Yet this exact form of government subsidized loan is what fiscal conservative temple The Cato Institute calls "corporate welfare."

As everyone debates whether or not this constitutes a government subsidy, the blog Uppity Wisconsin reveals Johnson's membership on the board of an industrial development corporation partly funded by the city and county that "has successfully helped area business apply for and secure over a million dollars in Customized Labor Training (CLT) grants… designed to assist companies that are investing in new technologies or manufacturing processes by providing a grant of up to 50% of the cost of training employees on the new technologies." Yet, Johnson insists that subsidization "doesn't work through the free market system very well."

Johnson could not be more different than Feingold when it comes to creativity and a voice for Wisconsin. Johnson is a voice for money. He admits as much, saying of Wisconsin's loss of manufacturing jobs to NAFTA "there are always winners and losers." For a candidate who complains about a private sector tax base, those "losers" include the 177,000-odd manufacturing jobs Wisconsin has lost in the last decade; that's 177,000 incomes that paid taxes.

From a GOP perspective, he is a midterm wet dream. Giving all the appearance of the throw-the-bums-out attitude of the zeitgeist, Johnson has nonetheless endorsed all the old bums' ideas about how to fix things. For health care Johnson says "Mitch Daniels has the solution," referring to the incumbent Indiana GOP Governor. On taxes, Johnson points to old-school GOP insider Ronald Reagan. Johnson has said that during Reagan's era, the top income rate of 28 percent meant "we were 72 percent free," which suggests Johnson may endorse a complete elimination of the income tax.

For solutions to entitlement reform, Johnson points to fellow Wisconsinite and incumbent GOP Congressman Paul Ryan. (It's noteworthy that while Johnson castigates opponent Feingold for being a career politician, he reveres Congressman Ryan, whose never held a job outside government since graduating college in 1992. Spectacular doublethink).

The greatest doublethink of all is the impression that Johnson is a self-made millionaire, that thanks to the opportunities provided by the American Dream, he pulled himself up by his bootstraps, an example of how America can reward hard-working citizens. On his website, the story goes that after moving to Wisconsin "Ron started a business called Pacur with his brother-in-law" and he has said he built his business from "from scratch," from "the ground up." But what Johnson's campaign doesn't often mention is that the candidate was set up with the business by his billionaire father-in-law. Uppity Wisconsin has unearthed evidence that Johnson's firm Pacur is the beneficiary of less-than-market-driven business from its main client, Daddy Inc.

Reading a candidate's website for his position papers is for suckers. To really understand how a candidate will vote, one needs to be in on the fund-raising calls he or she spends the majority of the day performing. Since that's impossible, the next best thing is to look at which of those calls were successful. Where each candidate stands is directly defined by the money trail.

Russ Feingold's Federal Election Commission report reads like a who's who of labor. American Maritime Officers Voluntary PAC. American Dental Association PAC. Alliant Energy Corporation Employees PAC. Air Conditioning Contractors of America PAC. Committee on Letter Carriers PAC (yes, this exists). Association of Postmasters. Amalgamated Transit Union. Writers Guild. Sheet Metal Workers. Air Traffic Controllers. United Brotherhood of Carpenters. American Nurses. Optometric Association. Assisted Living Federation. Associated Milk Producers. Boilermakers. Longshoremen. Walt Disney Productions Employees PAC. Bricklayers. Even the PAC from Awl friends the Human Rights Committee supports Feingold (since 1997).

Meanwhile, Ron Johnson has largely self-funded his campaign, running three TV ads for each one of Feingold's. When asked how much of his fortune he will spend to defeat Feingold, Johnson has said, "All of it." He's off to a good start, spending $4.4 million in the run-up to the primary, or about $9 per vote. That's a lot more than the many thousands of dollars both he and his wife gave in 2004 to Feingold's GOP challenger, Tim Michels.

Johnson doesn't really need the $5,000-odd donations brought in by his committee, Ron Johnson for Senate Inc. That's why looking at his list of donors is even more telling. A newcomer, Johnson's list of financial supporters is short; but it includes the American Bankers PAC, American Express Company PAC, American Insurance Association PAC, Deloitte & Touche PAC, Financial Services Roundtable PAC, National Venture Capital Association PAC, and the Exxon Mobil PAC. The last of those donors recently got Mr. Johnson in some trouble when it was revealed that all his defense of oil exploration in the Gulf, and his criticism of the Obama Administration's treatment of BP, might be because he personally holds hundreds of thousands of dollars in BP and Exxon stock.

Much like many of this year's tea party-associated GOP candidates, one of Johnson's core campaign points is criticism of the financial bailout. Funny then that Johnson's campaign has been the beneficiary of the largess of the very corporations he believes should not have received bailout money.

For example, the cash Johnson received from the Financial Services Roundtable PAC on August 27 and the American Bankers Association PAC on July 8 and July 30 came from, amongst others, hardcore Treasury bailout beneficiaries such as JP Morgan Chase, SunTrust, Bank of America, Regions Financial, Zions and First Horizon. The money Ron Johnson received from the Bluegrass and Senate Majority Fund PACs came, in part, from one of the greatest bailout beneficiaries of them all, Goldman Sachs. Despite statements about staying out of politics this cycle, Goldman donated to both PACs on March 31 of this year. On June 24, Ron Johnson's campaign received two $5,000 donations from the Bluegrass PAC, a day later the campaign received two donations from the Senate Majority PAC in the same amounts.

To be clear, while it may not be the backbone of his funding, some of the very bailout money that Ron Johnson has criticized is now funding his campaign.

Tea Party members might also be interested to know that some of the $2,700 PAC donation he received on August 27 came from Sallie Mae.

Johnson's campaign ignored repeated requests from The Awl for comment.

Johnson has, and will continue to, paint Feingold as a Washington D.C. insider. But would a Democratic insider have voted against dismissing President Clinton's impeachment proceedings? Feingold did.

When it comes to true politician insiders, potential Johnson supporters should ask about his connections to Americans for Prosperity's old Republican establishment strategist Mark Block. State political blog One Wisconsin Now even makes a good case for how Johnson worked with supporters to actually diminish true grassroots tea party involvement after former Governor Tommy Thompson dropped out of the race. Johnson's dismissal of Wisconsin tea party groups and alignment with Americans for Prosperity's tea party is a microcosm of how the entire movement has been clandestinely hijacked by the GOP. And those who genuinely are grassroots tea party patriots should be worried about Johnson's connection to the retail version of their movement. As One Wisconsin Now also just uncovered, Americans for Prosperity, along with Republican party leaders, are dragging the tea party reputation into good old GOP voter suppression tactics.

The great irony of course is that the newly angry who long for fiscal reason and weep for the Constitution, those who have become the "party of no," could not have a greater ally than Russ Feingold.

Feingold voted against the 2008 TARP bailout. In fact, he voted against the repeal of the Glass-Steagall Act, which in large part caused the need for the bailout. He voted against NAFTA. And just days after 9/11 and at the height of that event's fervor, Feingold hauled his giant balls up to the voting machine and registered a nay vote against the "USA Patriot Act" on the grounds that "The Founders who wrote our Constitution and Bill of Rights exercised that vigilance even though they had recently fought and won the Revolutionary War. They did not live in comfortable and easy times of hypothetical enemies. They wrote a Constitution of limited powers and an explicit Bill of Rights to protect liberty in times of war, as well as in times of peace." He was the only senator to vote no. By all means, read his full remarks in the wake of the vote and ask yourself why Russ Feingold isn't getting speaking invites for tea party rallies.

The once-progressive Republican Wisconsin Idea may have suffered greatly of late, broken and ill, slouching toward yore. But the election of Ron Johnson over Russ Feingold would be the ultimate blade run across its throat.

George Will's backseat make-out session with Johnson in May heavily leaned on Atlas Shrugged symbolism, noting it was Johnson's favorite book. Will noted Johnson's belief that we are already living in the "novel's dystopian world."

When newspeak replaces debate and the nation's vocabulary gets smaller every election cycle, where doublethink goes unquestioned by voters, we are indeed sliding into a novel's dystopian world, but it wasn't written by Ayn Rand.

Abe Sauer is enjoying autumn in Wisconsin.

Photo by WiscPolitics.com via Flickr

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Thursday, September 23, 2010

Making Money Now

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One thing you're missing here: Craigslist started charging for the Adult Services section at the request of previous Attorneys General with the idea that adding a charge that required a credit card would curtail the use of the section for illegal activities.

http://www.scattorneygeneral.com/newsroom/pdf/2009/craigslist.pdf

Posted by: Collin |
September 8, 2010 6:04 PM

Ah! Makes sense. Updating the post. Thanks for bringing that to my attention.

Posted by: Adrianne Jeffries |
September 8, 2010 6:14 PM

I'm baffled as to why craigslist didn't see the profit issue ahead of time. I'm 100% behind them, but raking in millions just doesn't look good, and makes them an easy target. From day one of charging for Adult Services, they should have been giving 100% of that money to organizations that work to prevent sex trafficking and child prostitution, to make it 100% clear that the money was for filtering, not for profit.

Posted by: Brad Weikel |
September 8, 2010 6:17 PM

I think this is a good thing to do for Craiglist. But I bet that some thousands or maybe millions of dollars will be taken out from earnings in the industry with Craiglist ready to censor. LOL. Thanks for the info.

Posted by: WebHosting Guru |
September 8, 2010 7:09 PM

I'm baffled how an article on ReadWriteWeb could miss the obvious question of free speech on the internet.

What you have here is public officials (facing re-election) using their office as a pulpit, making legal threats they know to be unenforceable, and lying to the media in order to prohibit speech which they know to be legal. State AGs are literally using a public relations campaign to circumvent an Act of Congress intended to curtail their power against just *this* kind of electioneering. That the AGs happen to be exploiting victimized children in their media campaign is almost incidental to the larger attack on the law and Constitution.

The Communications Decency Act protects electronic publishers from liability for content produced by users of the system. Absent that immunity there could be no Google, no Blogspot, no Facebook, no WordPress.com, no Digg or Reddit, no Twitter and no comments (like this one) on ReadWriteWeb.

The moralistic campaigns against 4chan and craigslist all lead to one inevitable conclusion: the publishers of ReadWriteWeb will be criminally and civilly liable for the comments of this community.

Here's a concept that's new: Has anyone ever substantiated the claims that Craigslist has ever been used for child or human trafficking? Is there even one demonstrable case of this occurring? If not, then the site may have just established millions of dollars in damages for a defamation suit against it's detractors. Yes, Craigslist is a public person, that doesn't mean they can't be defamed: they just have to prove damages.

Posted by: Baffled |
September 8, 2010 10:04 PM

Mobile phone carriers should be banned to provide a phone number to prostitutes as they are also making tons of money from an illegale activity.

Same thing for people selling cloth, sex toys, etc.

Posted by: idont |
September 9, 2010 9:21 AM

Does respecting the opinions of others include despising others, of implying that others will be at fault if the awful Rethugs, whom Obama has been, you will recall, courting with “bipartisanship”?

Does respect entail telling us that what we saw, in print, of Obama’s clear promises, what we heard with our own ears, of Obama’s promises, an Obama many worked for thinking that, as a black man, Obama would be good for the country, and the vote alone, by itself, Was and IS a sign of the good of the country … does respect mean telling us we never saw or heard such things … that we are lying and making things up?

Does respect mean telling people who have watched, closely, the political scene for longer than Obama has been alive, people who were willing and happy to donate time and effort and ideas, people who had and have good, indeed wonderful, ideas, ideas that still must be implemented to avert serious economic and social disaster, that they are “effing r*****s”, in need of a drug test, and of “getting” a “real” life?

Does respect mean peddling fear?

Or does “respect” mean something else perhaps, like appreciation, or at least, tolerance AND the understanding that people who do not agree with you are, possibly, neither stupid nor uninformed?

Apparently, what phred suggested, regarding a party having actual accomplishments and a moral compass is less important than “winning”, when such “winning” simply means more of the same.

Frankly, AC2, it matters little who is in power because the “system” is so corrupt, economically and legally, specifically as regards the rule of law, as Obama has continued and extended the worst of the Bush-Cheney Executive power grab, and the military has far to much power, politically and, in terms of the amount of the nation’s “wealth and treasure”, a stranglehold on the nation’s “looking forward” future, that regardless of who is in “power”, as they are both essentially the same, in spite of YOUR assertions that, somehow, they are not … our society faces very hard times … and to be brutally honest … the pain ought to be shared equally, and the blame, let’s not put it on “progressives”, or even the T-baggers, but on those who have had and do have power, especially Obama who had, despite those who dispute it, a genuine and heartfelt mandate to actually make some changes, which as President, with majorities in both the House and Senate, as well as each and every one of those “Democratic” Senators and Representatives, he and the Democrats COULD have done?

At the very least, respect means not calling others stupid or blaming them for the failures of others.

When the spill in the Gulf occurred, certain pundits intoned, “We are all responsible for this catastrophe.”

But look who is still in business, the largest supplier to the US military, aka Bee Pee.

When the economic meltdown occurred, certain pundits intoned, “It was those who could not afford these homes, but really we are all to blame.”

But look who is getting huge, actually obscene, “bonuses”?

Now you can say, “It’s systemic, and the D’s can’t fix it over-night”

Righto, AC2, righto.

Wonder when they plan to start?

Righto, right after they defeat the awful, evil R’s … well soon thereafter, anyhow.

But it’s hard, doncha know?

Righto.

Now, you will note, AC2, that at no point did I take you, personally, to task or suggest that it will be your fault if disaster befalls us? Nor did phred, for that matter.

Those who differ from you have never said you are to blame, yet you, and other partisans who agree with your viewpoint, charge us with such “responsibility” constantly and consistently,

Nobody “lost” 2000, but the Dems, Gore and Lieberman.

Frankly, AC2, I voted AGAINST Lieberman AND Gore’s apparently happy choice of Lieberman as his running-mate.

And, you know, just between us, AC2, Gore’s behavior, during Bush v. Gore, was not inspiring, to say the least.

Kind of cowardly, like the D’s in general, and certain ones, in particular.

These times, clearly, call for courage and bold innovation, not capitulation to selfish greed, mindless fear, and state secrecy, “secret” law and killing at a distance on the whims of one man or woman. Democrat or Republican. The President of the United States of America.

In my opinion.

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Comments

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One thing you're missing here: Craigslist started charging for the Adult Services section at the request of previous Attorneys General with the idea that adding a charge that required a credit card would curtail the use of the section for illegal activities.

http://www.scattorneygeneral.com/newsroom/pdf/2009/craigslist.pdf

Posted by: Collin |
September 8, 2010 6:04 PM

Ah! Makes sense. Updating the post. Thanks for bringing that to my attention.

Posted by: Adrianne Jeffries |
September 8, 2010 6:14 PM

I'm baffled as to why craigslist didn't see the profit issue ahead of time. I'm 100% behind them, but raking in millions just doesn't look good, and makes them an easy target. From day one of charging for Adult Services, they should have been giving 100% of that money to organizations that work to prevent sex trafficking and child prostitution, to make it 100% clear that the money was for filtering, not for profit.

Posted by: Brad Weikel |
September 8, 2010 6:17 PM

I think this is a good thing to do for Craiglist. But I bet that some thousands or maybe millions of dollars will be taken out from earnings in the industry with Craiglist ready to censor. LOL. Thanks for the info.

Posted by: WebHosting Guru |
September 8, 2010 7:09 PM

I'm baffled how an article on ReadWriteWeb could miss the obvious question of free speech on the internet.

What you have here is public officials (facing re-election) using their office as a pulpit, making legal threats they know to be unenforceable, and lying to the media in order to prohibit speech which they know to be legal. State AGs are literally using a public relations campaign to circumvent an Act of Congress intended to curtail their power against just *this* kind of electioneering. That the AGs happen to be exploiting victimized children in their media campaign is almost incidental to the larger attack on the law and Constitution.

The Communications Decency Act protects electronic publishers from liability for content produced by users of the system. Absent that immunity there could be no Google, no Blogspot, no Facebook, no WordPress.com, no Digg or Reddit, no Twitter and no comments (like this one) on ReadWriteWeb.

The moralistic campaigns against 4chan and craigslist all lead to one inevitable conclusion: the publishers of ReadWriteWeb will be criminally and civilly liable for the comments of this community.

Here's a concept that's new: Has anyone ever substantiated the claims that Craigslist has ever been used for child or human trafficking? Is there even one demonstrable case of this occurring? If not, then the site may have just established millions of dollars in damages for a defamation suit against it's detractors. Yes, Craigslist is a public person, that doesn't mean they can't be defamed: they just have to prove damages.

Posted by: Baffled |
September 8, 2010 10:04 PM

Mobile phone carriers should be banned to provide a phone number to prostitutes as they are also making tons of money from an illegale activity.

Same thing for people selling cloth, sex toys, etc.

Posted by: idont |
September 9, 2010 9:21 AM

Does respect mean peddling fear?

Or does “respect” mean something else perhaps, like appreciation, or at least, tolerance AND the understanding that people who do not agree with you are, possibly, neither stupid nor uninformed?

Apparently, what phred suggested, regarding a party having actual accomplishments and a moral compass is less important than “winning”, when such “winning” simply means more of the same.

At the very least, respect means not calling others stupid or blaming them for the failures of others.

When the spill in the Gulf occurred, certain pundits intoned, “We are all responsible for this catastrophe.”

But look who is still in business, the largest supplier to the US military, aka Bee Pee.

When the economic meltdown occurred, certain pundits intoned, “It was those who could not afford these homes, but really we are all to blame.”

But look who is getting huge, actually obscene, “bonuses”?

Now you can say, “It’s systemic, and the D’s can’t fix it over-night”

Righto, AC2, righto.

Wonder when they plan to start?

Righto, right after they defeat the awful, evil R’s … well soon thereafter, anyhow.

But it’s hard, doncha know?

Righto.

Now, you will note, AC2, that at no point did I take you, personally, to task or suggest that it will be your fault if disaster befalls us? Nor did phred, for that matter.

Those who differ from you have never said you are to blame, yet you, and other partisans who agree with your viewpoint, charge us with such “responsibility” constantly and consistently,

Nobody “lost” 2000, but the Dems, Gore and Lieberman.

Frankly, AC2, I voted AGAINST Lieberman AND Gore’s apparently happy choice of Lieberman as his running-mate.

And, you know, just between us, AC2, Gore’s behavior, during Bush v. Gore, was not inspiring, to say the least.

Kind of cowardly, like the D’s in general, and certain ones, in particular.

In my opinion.

robert shumake

Phil Pruitt Joins Yahoo! News As Politics Editor

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Real Estate News: Existing Home Sales Rise - Developments - WSJ

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robert shumake

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Here is a look at real-estate news in today's WSJ.

Aaron Brown: Cable News Is Too Political

Wednesday, September 22, 2010

Making Money Easy

Both Matthew Yglesias and Alex Tabbarok seem to think we disagree about the role of technology and inequality. We don't.

As Tom Noah's series on inequality suggests, there are lots of questions when it comes to inequality. But what's confusing people here is one particular question: skills-biased technological change. That's where technology changes (we now have computers) and those who know how to use the new technology pull away from those who don't. In this case, the scenario would be that the computer-literate start making a lot of money, while those who aren't comfortable with laptops and Firefox lose out.

That explanation is intuitively appealing, but it doesn't fit the facts. For one thing, Europe had the same technological revolution, but without the attendant increase in inequality. For another, the startling changes in inequality was between those at the 99th percentile and those in the 90th percentile. It was the tippy-top pulling away from the top, or what I like to call "the conehead economy." If you imagine the economy as the person, it's grown eight inches, and most of that growth has been in its forehead.

Matt and Alex both double back on this and note that technology does play a major role here, and they're right: The Internet, television and other forms of mass media and communication make it much easier for one person or firm to serve a national or international audience. To use an easy example, Kobe Bryant can make more money because the Chinese watch his basketball games and pay him to endorse their products (that's not a random example, incidentally).

But saying that the rise in inequality is partly the result of technological change is not the same as saying it's the result of skills-biased technological change. It's not that satellite television has created a need for more basketball players and that need isn't being filled. If that were the case, the answer would be easy: Train more basketball players. It's that satellite television has made it much, much more lucrative to be one of the world's top basketball players. It's not about skills, but about the opportunity to make money. Training more basketball players won't really help reduce inequality or spread opportunity in that world. Higher tax brackets for the super-rich, however, might.

Graph credit: Slate.

Social games are the rage these days, but making money from them isn’t easy. Gamers play these titles for free, but Adknowledge is figuring out how game publishers can wind up making money from 100 percent of the players.

Adknowledge’s Burlingame, Calif.-based Super Rewards subsidiary is launching a three-part system for making money from virtual currency in games. That could help boost the engagement of players in social games and help raise the revenue generated from each user, said Adknowledge chief executive Scott Lynn. Adknowledge can offer this money-making system as a one-stop shop for publishers and game advertisers.

The three elements include an in-game overlay, offer banners, and a new offer wall for online game publishers. Adknowledge claims the new platform improves the experience for users and increases the number of paying users in a game. Adknowledge is one of a number of companies that give users the option of accepting special offers in lieu of payment for an online game. You can accept an offer such as signing up for a Netflix subscription in return for virtual currency in a game.

But results show that roughly 75 percent of players do not use offers. Super Rewards can target those missing the offers with an in-game overlay, which brings a single, high-value offer to users within a game. The overlay shows up at strategic moments in a game, such as after the initial load. The offers can include promotional language such as “Get More Coins.”

The offer banner uses the space around the main game landscape, presenting a mini version of an offer wall during game play. Users can pay for virtual items at the moment with direct payment methods.

Publishers using the three-part system include The Broth, whose Facebook game Barn Buddy saw its revenue increase 25 percent after using the new system for just five days, said Broth chief executive Markus Weichselbaum. Other publishers have seen a 45 percent increase in the number of new paying users. Adknowledge said developers have seen a 40-percent increase in the number of first-time payers. Super Rewards’ rivals include TrialPay and Offerpal.

Adknowledge has more than 300 employees and $300 million in revenue, making it the largest privately owned internet advertising network. It was founded in 2004 and has grown through acquisitions. The company has raised $48 million in funding from Technology Crossover Ventures.

Next Story: Game media firm IGN Entertainment to give free office space to indie game startups Previous Story: DEMO: VentureBeat’s Matt Marshall touts tech and farming trends (video)

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Both Matthew Yglesias and Alex Tabbarok seem to think we disagree about the role of technology and inequality. We don't.

Graph credit: Slate.

The offer banner uses the space around the main game landscape, presenting a mini version of an offer wall during game play. Users can pay for virtual items at the moment with direct payment methods.

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Tuesday, September 21, 2010

managing your personal finances

Are you a fan of the GTD personal productivity system? Well if you like "Getting Things Done," here's GFD, Getting Finances Done, which shows you how to map David Allen's same principals to managing your personal finance and achieving your financial goals.

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Saturday, September 18, 2010

personal finance programs

The State University of New York, which has 64 campuses, has agreed to a code of conduct developed by New York Attorney General Andrew Cuomo designed to safeguard students from unscrupulous marketing.

The code outlines steps schools should take to monitor and limit credit card marketing to students, according to Bloomberg News. Under the code, colleges would be required to offer financial literacy programs and not share personal information with credit card companies without permission.

Perhaps most importantly, the code bans agreements in which the school earns a percentage of finance charges imposed on students. Schools are being asked to select cards based on students' best interests if an exclusive marketing agreement is made with a credit card company, and must also monitor all credit card offers being marketed on campus.

Cuomo is investigating credit-card marketing practices that target college students through their institutions.

A 2009 survey by Sallie Mae found the average college student graduates with nearly $4,100 in credit card debt.

At a time when bailouts for America’s rich proceed unimpeded and Americans are left to fend for themselves, support for further subsidies for the rich is limited among the public. Gallup polling finds that a majority of Americans (56 percent) oppose extending the Bush-era tax cuts, which went overwhelmingly to the wealthiest of Americans. Just one in three support extending the cuts, despite the current rhetoric of the Republican Party.

Opposition to the Bush-era tax cuts is entirely rational among the public in light of the cuts’ failure to promote economic growth. The Bush tax cuts concentrated the greatest benefits toward the rich, and benefits for the affluent became even greater in their later years (during the 2008 to 2010 period specifically). They are set to expire this year, unless Democrats and Republicans in Congress renew them. Although massive amounts of cash from the cuts fell into the hands of America’s wealthiest one percent, these elites have looked at the increased volatility of today’s market and decided to hoard the cash instead of investing it. To make matters worse, extending the cuts will result in an additional transfer of $31 billion into the hands of America’s billionaires.

Labor economist Robert Reich argues that tax cuts directed at the rich do little to restore a vibrant economy. Providing an inconvenient historical analysis to the narrative forwarded by Republicans, Reich explains that from the 1951 to 1980 period, when marginal taxes were between 72 and 90 percent, average economic growth per year was at 3.7 percent. From 1983 through the recent recession – when tax cuts under Reagan and Bush were a mainstay of macro-economic policy, national yearly economic growth averaged 3 percent. Reich is not alone in his conclusion. My previous piece on the Bush tax cuts, drawing on data from the Economic Policy Institute points out that, during the period when Bush’s tax cuts were passed and when the economy began a recovery (following the dot.com crash of 2000), economic growth was generally significantly weaker than during previous economic cycles that weren’t characterized by mass tax cuts for the rich (http://www.media-ocracy.com/?p=1436). In short, there appears to be little evidence that massive subsidies to the rich are the magic formula for restoring an ailing economy. They do a lot to redistribute wealth, but little to promote short-term rapid growth, since they keep money out of the hands of those most likely to spend it right away – the working and middle class.

Tax cuts for the rich (and the cuts for business Obama is proposing) – as with cuts to the wealthy in the past – will do little-to-nothing to restore growth. The reason why is obvious enough: at a time when the masses are tapped out due to continued high levels of unemployment, massive layoffs, and high levels of personal debt, Americans have little incentive to spend without caution. Putting more money into the hands of the public (through a mass public employment program, for example, or other social welfare programs), would help in terms of stimulating spending and economic growth. What will not help are tax cuts aimed at businesses that have no incentive to increase production of goods and services because of the decreased ability of the mass public to afford such goods at a time when everyone is tightening their belts. All that tax cuts for the rich will do is further increase the already appalling depression-level inequality that exists in this country. Besides, business elites have been sitting on a mountain of cash for some time now. If they haven’t invested that money by hiring new workers, there’s little reason to expect that they will do so following another infusion of tax cuts. Corporations like the pharmaceutical giant Pfizer are sitting on more than $26 billion in cash, refusing to reinvest it in job growth. Pfizer isn’t alone either. Fortune reports that non-finance companies in the S&P 500 are holding $837 billion in cash, a growth of 26% since 2009, at a time when the economy limps along and the state mass layoffs for public workers are becoming more common. This level of cash reserves is far outside normal levels from years past, and is unconscionable at a time when these companies should be hiring new workers and focusing on expansion.

As political scientists Jacob Hacker and Paul Pierson show in their book Off Center: the Republican Revolution and the Erosion of American Democracy, the public has opposed tax cuts for the rich for at least the last ten years. Most would rather see government expand its responsibilities to assist the masses and less fortunate through the expansion of broad based social welfare programs. This lesson may stand at odds with Republican-conservative propaganda framing the public as moving to the right in the midst of a Tea Party revolution, but there is little reason to take these pronouncements seriously in light of decades of public opinion data showing longstanding public support for many individual social welfare programs (for more on this data, see the recent books by Martin Gilens, Benjamin Page, and Robert Shapiro, titled Why Americans Hate Welfare and Class War? What Americans Really Think about Economic Inequality).

Corporate America’s gravy train of bailouts and business tax cuts have enabled a culture of entitlement among America’s rich and a callousness that justifies massive layoffs, pursued alongside record executive and CEO bonuses. The pillaging of public funds for private gain is unlikely to stop in the near future in light of what appear to be imminent mass gains in Republican Congressional seats this fall.

Anthony DiMaggio is the editor of media-ocracy (www.media-ocracy.com), a daily online magazine devoted to the study of media, public opinion, and current events. He has taught U.S. and Global Politics at Illinois State University and North Central College, and is the author of When Media Goes to War (2010) and Mass Media, Mass Propaganda (2008). He can be reached at: mediaocracy@gmail.com

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