Thursday, April 22, 2010

If I Were a Rich Man

And now, since I've been really slamming the rich recently, here's the best song ever on our universal yearning to be rich.

Top Ten Foods for Inflammation

Daily Health News reports on the ten best and worst foods for bodily inflammation.

Wild salmon, mackerel and other omega-3-fatty-acid-rich fish.
Green, leafy vegetables (e.g., spinach and kale).
Cruciferous vegetables (broccoli, Brussels sprouts, cabbage, etc.).
Deeply pigmented produce, such as sweet potatoes, eggplant and pomegranate... along with carrots, plums, oranges, peppers, peas and red grapes.
Whole grains.
Tea -- specifically black, green and white teas.
Cold-pressed fresh oils, including avocado, flaxseed and olive oils in particular.
Spices (specifically, garlic, ginger, turmeric, saffron).


Desserts made with lots of sugar (cookies, candy, ice cream and so on).
Sweetened cereals.
"White" carbohydrates (white bread, white rice, white potatoes, English muffins, etc.).
Non-diet soft drinks.
Anything containing high-fructose corn syrup.
Processed meats (bologna, salami, hotdogs, sausage and others made with preservatives and additives).
French fries, potato chips and other fried snack foods.
Fast foods, most specifically the ones that are high-fat, high-calorie, high simple carbohydrate -- which describes most of the inexpensive offerings at quick-serve restaurants.
Margarine, because it contains processed sterols called stanols that have been implicated in both atherosclerosis and various fatty-deposit diseases.
Organ meats such as liver, because these often contain undesirable products including antibiotics, fertilizer and other unwanted residues.

Wednesday, April 21, 2010

Fat and the Brain

Olivia Judson writes in the NYT about the effects of obesity on the brain.  Hint: it ain't good.
Being fat is bad for your brain.

That, at least, is the gloomy conclusion of several recent studies. For example, one long-term study of more than 6,500 people in northern California found that those who were fat around the middle at age 40 were more likely to succumb to dementia in their 70s. A long-term study in Sweden found that, compared to thinner people, those who were overweight in their 40s experienced a more rapid, and more pronounced, decline in brain function over the next several decades.

Consistent with this, the brains of obese people often show signs of damage. One study of 60 healthy young adults (in their 20s and 30s) found that the fatter members of the group had significantly lower gray-matter densities in several brain regions, including those involved in the perception of taste and the regulation of eating behavior. A study of 114 middle-aged people (aged between 40 and 66) found that the obese tended to have smaller, more atrophied brains than thinner people; other studies have found similar results.

Brains usually atrophy with age, but being obese appears to accelerate the process. This is bad news: pronounced brain atrophy is a feature of dementia.

The Revolt of the Lower Uppers

Matt Miller writes about the revolt of lower upper class:
A few years ago, a Goldman Sachs banker, still shy of his 40th birthday and worth, I was reliably told, some $80 million, told me that he wasn't in his line of work for the money. "If I was doing this for the money," he said, with no trace of irony, "I'd be at a hedge fund."

What to say? Though such a statement is perhaps only fathomable on a small plot of real estate in Lower Manhattan at the dawn of the 21st century, it suggests how insular and debauched our ruling class has become.

For several years I've predicted that a new wild card in American life -- the presence of economic resentment at the bottom of the top 1 percent of our income distribution -- would become a powerful force for reform. The SEC's fraud case against Goldman Sachs may be the first shot in what I think of as the revolt of the "lower upper class."

Lower Uppers are doctors, accountants, engineers and lawyers. At companies they're mostly people above the rank of vice president and below the CEO. Their comrades include well-fed members of the media (and even part-time Post columnists who earn their livings as consultants). They include government officials -- and, yes, SEC lawyers -- who didn't make or inherit fortunes before entering public service. Lower Uppers are professionals who by dint of education, hard work and good luck are living better than 99 percent of anyone who has ever walked the planet. They're also people who can't help but notice how many people with credentials much like their own seem to be living in the kind of Gatsby-like splendor they'll never enjoy.

This stings. If people no smarter or better than you are making $10 million or $50 million or $100 million in a single year, while you're working yourself ragged to scrape by on a million or two -- or, God forbid, $300,000 -- then something must be wrong.

Especially when it's clear that many of the Ultrarich are not simply reaping the rewards of the "free market" but of rigged systems that are as likely to reward failure as success. CEOs who preside over years of tumbling stock prices routinely walk away with tens of millions for their trouble; hedge fund managers who barely beat the S&P commonly earn such princely sums in a year.

Derivatives Tamed

WaPo Columnist Harold Meyerson alerts us to a new bill coming of the Senate Agriculture Committee that could help to fix the 'derivative' mess that we have:
The clearest way for senators to demonstrate that they're not on Wall Street's side would be to support the bill that Arkansas Democrat Blanche Lincoln plans to bring before the Senate Agriculture Committee on Thursday. Going well beyond the bill that the House passed and the legislation that came out of Connecticut Democrat Chris Dodd's Senate Banking Committee, Lincoln's bill aims squarely at the big banks' most highly leveraged, profitable and risky-to-the-rest-of-us business: their trade in derivatives. (The Ag committee has jurisdiction because derivatives historically were used to trade commodities.)

Lincoln's legislation would require the firms that buy and sell derivatives -- 95 percent of such deals in the United States, according to the Comptroller of the Currency, are done by Goldman, Morgan Stanley, J.P. Morgan Chase, Bank of America and Citibank -- to do their trading openly on exchanges and to post some actual money behind their trades. Today, the market is unregulated. But if Lincoln's legislation passes, no longer would deals with the potential to threaten the nation's economic stability be invisible to regulatory agencies; no longer would businesses seeking to buy derivatives have to accept banks' terms with no ability to shop around or even ascertain the going price for such contracts. No longer would trades with foreign entities be exempt from regulation. And no longer would banks that our government backs up with deposit insurance and access to the Federal Reserve's discounted interest rates be able to put taxpayers on the hook for their speculative bets: They could either continue as derivative-trading casinos or as governmentally insured banks, but not both. In fact, Lincoln's bill goes a good deal of the way toward meeting Paul Volcker's proposal to remove banks' proprietary trading from the umbrella of federal protection.

Tuesday, April 20, 2010

Shorting the Middle Class

Arianna Huffington has, for about ten years now, been a tenacious advocate for the middle-class and against the financial shenangans of Wall Street.  (She converted from being a Newt Gingrich ally in the late 90s.)  This is why she has kept up a constant drumbeat about the need for fundamental financial reform on her website, The Huffington Post.  In a recent story, she writes passionately about this topic:
The press is all abuzz with news of the SEC suing Goldman Sachs for fraud. While this is certainly big news in itself, even more important is what it says about what the financial elite has been doing to America for the last 30 years: shorting the middle class.

The SEC's action is a perfect moment for us to look at the bigger picture of how the American people were sold on the promise of never-ending prosperity while Wall Street was overseeing a massive transfer of wealth from the middle class to the richest Americans.

The results have been devastating: a disappearing middle class, a precipitous drop in economic and social mobility, and ultimately, the undermining of the foundation of our democracy.

We Cannot Go On Living Like This

The Caretaker wrote a very thoughtful post, two posts back, on the wealthy, financial shenangans, and middle-class impoverishment.  For a slightly different take on that, read this essay by Tony Judt, a promoter of 'social democracy':
The materialistic and selfish quality of contemporary life is not inherent in the human condition. Much of what appears “natural” today dates from the 1980s: the obsession with wealth creation, the cult of privatization and the private sector, the growing disparities of rich and poor. And above all, the rhetoric that accompanies these: uncritical admiration for unfettered markets, disdain for the public sector, the delusion of endless growth.

We cannot go on living like this. The little crash of 2008 was a reminder that unregulated capitalism is its own worst enemy: sooner or later it must fall prey to its own excesses and turn again to the state for rescue. But if we do no more than pick up the pieces and carry on as before, we can look forward to greater upheavals in years to come.

And yet we seem unable to conceive of alternatives. This too is something new. Until quite recently, public life in liberal societies was conducted in the shadow of a debate between defenders of “capitalism” and its critics: usually identified with one or another form of “socialism.” By the 1970s this debate had lost much of its meaning for both sides; all the same, the “left–right” distinction served a useful purpose. It provided a peg on which to hang critical commentary about contemporary affairs.

Making Money the Old Fashion Way. Not.

William Cohan writes in the NYT about why the big Wall Street banks are making so much money right now:
Mostly, though, Wall Street is making money by taking advantage of its rock-bottom cost of capital, provided courtesy of the Federal Reserve — now that the big Wall Street firms are all bank holding companies — and then turning around and lending it at much higher rates.

The easiest and most profitable risk-adjusted trade available for the banks is to borrow billions from the Fed — at a cost of around half a percentage point — and then to lend the money back to the U.S. Treasury at yields of around 3 percent, or higher, a moment later. The imbedded profit — of some 2.5 percentage points — is an outright and ongoing gift from American taxpayers to Wall Street.

You’re welcome.
But then comes the obscene part.
By keeping interest rates so stubbornly low — and by remaining committed to doing so — the Fed is crushing the rest of us, especially senior citizens on fixed incomes and those who have rediscovered saving in order to have some peace of mind.

For instance, despite my bank calling it a “premier platinum savings” account, I am getting a measly 0.15 percent interest rate. On my “premier platinum checking” account, the interest rate is 0.01 percent. In an essay in The Wall Street Journal recently, Charles Schwab pointed out that there is more than $7.5 trillion in American household wealth stored in short-term, interest-bearing checking, savings and CD accounts. (The average interest rate for a one-year CD is 1.3 percent.)

Wednesday, April 14, 2010

Energy, Economics, and the Global Bust

This is a complicated topic that I am not sure I totally understand. But reading this blog post by Kevin Drum, and the comments section as well, helped chrystalize a few things that I at least want to get down before I forget them again.

1. An available supply of cheap energy has fueled the globalization that has made possible the last 100 years of greater wealth in human society. However as we enter a world of more expensive energy, the whole edifice of what we call modern free market thought tumbles down.

2. From the 1990s through today, due to cheap energy and globalization the rich have become ridiculously rich and have more money to invest than ever before. Rationally, they want to earn as high of a rate of return on their investments as possible. Investing in the kind of small, local businesses and infrastructure(or education, or building water plants, or growing local agriculture) that create jobs for everyday people has a very low rate of return compared to the financial shenanigans and internet bubbles and housing bubbles that can be created to earn a 20%, 30% rate of return. Following their rational economic interest, they will go with the higher rate of return.

Tuesday, April 6, 2010

"Who Are You Better Than?"

Via Balloon Juice, this is an excellent essay about the history of race in America and where the Tea Partiers fit in. And it was written on a motorcycle adventure message board of all places. I love the internet!

I want to first say that there are many responsible, racially-evolved Tea Partiers out there. But I do think that they should be aware of who they are joining forces with, and this essay accurately diagnoses those forces. It starts out with this quote from the book "Mississippi Burning":
"You know when I was a little boy, there was an old negro farmer that lived down the road from us, named Monroe. He was ... (subtle laugh), I guess he was just a little more luckier than my daddy was. He bought himself a mule.

It was a big deal in round that town. Now my daddy hated that mule. Cause, his friends were always kidding him about, "They saw Monroe out plowing with his new mule and Monroe is going to rent another field now he had a mule."

Friday, April 2, 2010

A Pen Pal in the White House

A touching story about a woman who wrote to Obama, as well as an interesting look at how the White House operates internally. Really one of the best articles I've read in a while. A taste:

Obama opened the purple folder on Jan. 8 and pulled out a three-page letter written on lined notebook paper. He prefers handwritten letters to e-mails, believing them to be more thoughtful, with better stories. The return address showed Monroe, Mich. The writing consisted of bubbly block letters, sometimes traced twice for emphasis. Obama started to read.

"Dear Mr. President," the letter began.