The Ticker Quick Views on Politics, Economics and Finance
It is time to come clean on Benghazi. If Hillary Clinton runs for president, it will be time to come clean on Benghazi right through to 2016. If Clinton emerges triumphant, takes the oath of office and becomes the nation's first female president, the time to come clean on Benghazi will last another four years. (In case of re-election, better make that eight.)
This will require work. Unlike Whitewater, a convoluted, shady-sounding and quite possibly greasy real-estate investment deal, Benghazi consists of a discrete event, a brief aftermath and not much of a paper trail. After all, how much paper is produced in the course of a frantic night of violence in a faraway place?READ MORE
Immigration reform is dividing conservative groups in Washington. The Heritage Foundation has produced a report saying reform with a path to citizenship will cost taxpayers more than $6 trillion. The report has been widely criticized for bad methodology -- and some of the loudest critics have been other right-of-center groups, like Grover Norquist’s Americans for Tax Reform.
Partly, this reflects old divisions in the Republican Party: Business interests want more immigrants for a deeper labor pool and more economic growth, while conservative base voters tend to be skeptical of immigration. But it also reflects growing distance between establishment conservatives and Heritage, a think tank which acts increasingly like a Tea Party pressure group with a policy research arm.READ MORE
Jeffrey Skilling is back in the news. He should jog memories about what used to happen to people charged with engaging in huge corporate accounting frauds.
The former Enron Corp. chief executive officer has worked out a deal with the Justice Department to reduce his time in prison. The deal followed a court decision that his sentence needed to be recalculated because of an error by a trial judge.READ MORE
Yesterday, big-name investors, their fans and journalists (the latter two categories are not mutually exclusive) gathered at the Ira Sohn Conference in New York to hear some of the best ideas of the hedge-fund illuminati. Some speakers were old stalwarts with decades-long records of high returns, including former George Soros partner Stanley Druckenmiller, short-seller Jim Chanos and distressed debt maestro Paul Singer. But other managers were people who got seriously famous and seriously rich for only one reason: well-timed bets on the housing bust.
Bill Ackman, founder of Pershing Square Capital Management, took a huge short position against bond insurer MBIA; David Einhorn famously shorted Lehman Brothers and publicly called it out for disguising its massive real estate losses; and Kyle Bass only founded his firm, Hayman Capital, in 2006. He became one of the heroes of Michael Lewis’s crisis chronicle "The Big Short" and made billions for his well-timed and prescient bet on derivatives linked to mortgage-backed securities. All three spoke at Sohn yesterday.READ MORE
The Internet is good for many things -- conspiracy theories, shopping, sharing funny pictures with friends. But it may prove to be very, very bad for the extreme gun-rights movement.
Here are a few recent stories that the Web, in its collective wisdom, has plucked from relatively obscure locales in the past week and elevated to national prominence.READ MORE
Matthew C. Klein
Yesterday, my colleague Caroline Baum sarcastically suggested that the government give "every household a pre-loaded gift card." She thought the proposal was so ludicrous on its face that it would force people like me to apologize for ever having suggested that lower taxes and higher levels of government spending make sense when households and businesses want to repay their debts and increase their savings. Trouble is, it's a good idea.
Since 2007, U.S. households and businesses have been trying to repay their debts and rebuild their savings -- a major change in behavior from the previous 25 years. The stock of nonfinancial private debt soared from about 95 percent of gross domestic product in 1982 to about 170 percent of GDP by the eve of the crisis. At the same time, U.S. households started taking a lot more risks with their savings: The share of household wealth held in safe, liquid assets fell to less than 8 percent between 1982 and 2007, from a postwar average of about 16 percent.READ MORE
On Monday, I went on Bloomberg Television and discussed whether Congress was responding aggressively enough to the U.S.'s economic problems. (Answer: It's not.) A chyron that Bloomberg put below me -- “Where is the Crisis?” -- reflects why Congress is asleep: For a lot of elites in New York and Washington, things don’t look too bad.
Here’s how host Erik Schatzker put it to me:READ MORE
This week, I spent a day on jury duty at the Civil Court in Jamaica, Queens. I didn’t get picked for a jury, but I did see what an American civic institution looks like in the most diverse county in the U.S.
Queens is full of immigrants: 1.1 million immigrants live there, just under half the borough’s population, and they came from all over: 48 percent from Latin America, 37 percent from Asia, 13 percent from Europe and 2 percent from Africa. More than 100 languages are spoken there. So the crowd in the Central Jury Room in Jamaica on Tuesday was much more diverse than you would see in most courthouses, if equally grumpy.READ MORE
Brad DeLong has commented on my beef with Paul Krugman. I’m reluctant to engage, to be honest, because his post exemplifies the intemperance I’m addressing. Once an admirer, I gave up on his commentary a long time ago. You get a sense of the problem from his post about me. He illustrates it with a picture of a clown. He also wants me fired. “Bloomberg has some house-cleaning to do,” he says -- charming, and from a tenured academic, to boot.
DeLong’s fine under the supervision of a competent adult, as here (an excellent paper, which I praised at the time). But as an unattended blogger he regresses to intellectual adolescence, light on thinking and exhaustingly heavy on peevish belligerence. Not just uncivil, he actually disapproves of civility -- today, as you see, I’m trying to meet him halfway.READ MORE
It's as though it took the death of Margaret Thatcher to release the old warhorses of the Conservative Party to go public and say the U.K. should leave the European Union.
Today it was Michael Portillo's turn. Portillo is a former Cabinet minister. He was, at one point, the Thatcherite great young hope to lead the Tory party, until he lost his seat in parliament. He is still listened to.READ MORE
Bloomberg View columnists Margaret Carlson and Ramesh Ponnuru met online today to discuss Mark Sanford's victory in yesterday's congressional race in South Carolina. What follows is a lightly edited transcript.
Margaret: Mark Sanford was supposed to be the only Republican capable of losing an election in South Carolina's overwhelmingly Republican 1st District. Just a few short months ago, distraught Republicans were saying that even you or I, Ramesh, could have defeated Sanford. So they left the hapless candidate, the philanderer famous for his non-journey along the Appalachian Trail, to run a lonely race. He traveled the district speaking of redemption and deficits with no support from the national party and little staff or money.READ MORE
Gallup has a new survey showing American adults largely in agreement on the nation's top priorities: more jobs and a growing economy. At the same time, the poll exposes how partisanship colors the way Americans interpret even basic questions of public policy.
For example, asked to rate how high a priority "reducing gun violence" is, 73 percent of Democrats rated it a top/high priority while only 40 percent of Republicans said the same. Likewise, 83 percent of Democrats cited "improving access to health care" as a top/high priority while only 47 percent of Republicans did.READ MORE
As you've surely heard, the greatest coach in the history of professional sports has just retired. I refer, of course, to Sir Alex Ferguson. And I’m not being hyperbolic.
It’s true that coaches have achieved great things with lesser talent. It’s also true that Sir Alex didn’t necessarily “revolutionize” soccer the way that, say, Rinus Michels and Johann Cruyf did with Ajax in Amsterdam. And it’s true that in England's Premier League, Sir Alex has never had to deal with certain constraints -- such as salary caps -- that come with managing teams in the far more tightly regulated sports leagues in the U.S.READ MORE
Syria's peek-a-boo game with the Internet resumed yesterday, as Internet connections to the outside world were disrupted.
Just before 3 p.m. Eastern Time yesterday, Google Inc.'s Web services in Syria were inaccessible, according to the company's transparency report, which tracks disruptions in the search provider's products. Other Web companies also reported outages.READ MORE
In the past few days, I have read numerous disquisitions on what John Maynard Keynes meant when he said, "In the long run we are all dead." Economists, journalists and bloggers have rushed to defend Keynes against accusations that his childless state somehow made him disregard the long run in favor of short-term stimulus policies.
I'll leave "long run" to the etymologists. What struck me about the outpouring is just how many advocates there are for more government spending. When the economy is depressed, the government needs to borrow and spend so we have the means to spend, Keynes argued. It's that simple.READ MORE
Yesterday, in an interview with Bloomberg Television, House Speaker John Boehner warned that the U.S. government must balance its budget. After all, he said:
We have spent more than what we have brought into this government for 55 of the last 60 years. There’s no business in America that could survive like this. No household in America that could do this. And this government can’t do this.
It’s hard to think of better evidence for the sustainability of budget deficits than the fact that we have run them for 55 of the last 60 years. If our fiscal practices haven’t caught up to us after 60 years, when will they? Or does Boehner take a David Stockman-like position that the last several decades of American advancement have in fact been a ghastly failure?READ MORE
Yesterday, the New York Post broke the story that Chris Christie covertly had a weight-loss procedure known as gastric banding in February.
The New Jersey governor, and possible 2016 presidential contender, said, “I know it sounds crazy to say that running for president is minor, but in the grand scheme of things, it was looking at Mary Pat and the kids and going, ‘I have to do this for them, even if I don’t give a crap about myself.’”READ MORE
The Senate Judiciary Committee will begin writing the immigration-overhaul legislation today. The measure is likely to clear the panel, without modifications, in the next two weeks.
There is potential subplot, a narrative worthy of Hollywood. That is the contest, with implications for national Republican politics, between two freshman Cuban-American senators: Marco Rubio of Florida, a member of the bipartisan gang that assembled the draft bill, and Texas' Ted Cruz, a member of the committee. Both are solid conservatives and both have their eye on the 2016 Republican presidential nomination.READ MORE
How much bigger would a large U.S. bank's balance sheet look if it had to follow the same accounting rules that European banks do? We're starting to get a peek.
Of the six largest U.S. banks, so far only Citigroup Inc. and Morgan Stanley have filed their first-quarter reports with regulators. Citigroup showed $1.88 trillion of assets as of March 31 using U.S. accounting standards, which let companies show "net" figures on their balance sheets for derivatives and certain other types of financial instruments.READ MORE
You could say Jamie Dimon is the Houdini of Wall Street, wiggling out of one embarrassing situation after another. But can he maneuver out of his most recent tight spot?
Two companies that advise shareholders on corporate governance are supporting proposals to oust some of JPMorgan Chase & Co.'s board. They also favor splitting Dimon's roles as chairman and chief executive officer into two.READ MORE