But it was a beautiful day at the beach right around the corner of my house. Many people were on the bluffs, watching the ocean. Even the county sheriffs came (in 5 cars), just to watch the waves. Bright sunshine and warm weather.
We did see some unusually choppy actions, not the orderly wave sets we normally see. Nice way to spend a Saturday afternoon, watching the waves and gossipping with the neighbors while getting tanned...
Saturday, February 27, 2010
Friday, February 26, 2010
If you violate, you drop a coin or two in a no-cuss jar. They actually passed the resolution.
California Assembly passes resolution for Cuss Free Week
(2/25/2010 San Jose Mercury News)
"SACRAMENTO — Feeling a little salty, Californians? Better get it out of your system while you can.
"Amid the ongoing — and occasionally tense — debate over how to clean up California's budget mess, lawmakers are trying to tidy something else, almost as unmanageable: our language. Thursday morning, the Assembly approved a ceremonial resolution turning the first week of March into "Cuss Free Week."
"With the Senate expected to follow suit next week, all Californians will be asked to bite back on four-letter words and a few choice compound phrases. WT (bleep)?, you ask. Don't sweat: Police officers won't be waiting with soap. That's not the point.
"According to sponsors of the measure — inspired by a Southern California teen whose creation of a "no cussing" school club sparked an international movement — it's more about minding the delicate sensibilities of those around you. Like your grandmother. "When we're at our grandmother's house," said Anthony Portantino, D-Pasadena, "we have respect and decorum."
"Aren't there more important things on government's agenda right now? Sure, Portantino concedes. But maybe a little civility is just the prescription to help "break through that logjam." To keep things honest, Portantino is handing out no-cuss jars to all 120 legislative offices in the Capitol — and to Gov. Arnold Schwarzenegger. Every time a naughty word slips out, a few coins get dropped in. He'd like us all to try it at home, too. How's that for a deficit-reduction strategy?"
56% thinks so, while 44% disagree.
From CNN Political Ticker today [emphasis is mine]:
"Washington (CNN) – A majority of Americans think the federal government poses a threat to rights of Americans, according to a new national poll.
"Fifty-six percent of people questioned in a CNN/Opinion Research Corporation survey released Friday say they think the federal government's become so large and powerful that it poses an immediate threat to the rights and freedoms of ordinary citizens. Forty-four percent of those polled disagree.
"The survey indicates a partisan divide on the question: only 37 percent of Democrats, 63 percent of Independents and nearly 7 in 10 Republicans say the federal government poses a threat to the rights of Americans.
"According to CNN poll numbers released Sunday, Americans overwhelmingly think that the U.S. government is broken - though the public overwhelmingly holds out hope that what's broken can be fixed.
"The CNN/Opinion Research Corporation poll was conducted February 12-15, with 1,023 adult Americans questioned by telephone. The survey's sampling error is plus or minus 3 percentage points for the overall survey."
No link to the full result yet.
My guess is that the current Obama administration has turned the heat on the proverbial pot a bit too high too quick, and the proverbial frogs (that's the rest of us, except for Democratic supporters) are noticing the heat after all these years.
Wednesday, February 24, 2010
While the sham hearing continued on Capitol Hill, FBI raided three Toyota suppliers in an anti-trust investigation. The three suppliers are Denso Corp, Yazaki North America and Tokai Rika. Their Japanese parent companies supply Toyota in Japan.
FBI raids US headquarters of Toyota supplier Denso in antitrust probe (2/24/2010 AP via Los Angeles Times)
"NEW YORK (AP) — The FBI raided the U.S. offices of three auto suppliers to Toyota and other manufacturers as part of an antitrust investigation, the agency said Wednesday.
"The FBI's Detroit office said agents raided the offices of Denso Corp, Yazaki North America and Tokai Rika. All the raids took place Tuesday evening. There was no immediate indication the investigation involved the safety of the auto parts." [The article continues.]
Apparently, Japanese companies supplying a Japanese company is a punishable offense in the U.S.
Denso supplies Toyota with accelerator pedals that are superior to the ones supplied by CTS and trouble-free. Can't allow that, can we? (Read these excellent articles from The Truth About Cars "Complete Guide to Toyota's Gas Pedals")
Abject apology by the CEO of Toyota was stupid and unnecessary. Clearly he wasn't informed of "taking the fifth". Chicagoland thugs won't stop until they drive Toyota out of the country. The U.S. consumers will have less, inferior choices when it comes to choosing their cars and trucks.
""Where is the remorse?" scolded Rep. Marcy Kaptur, D-Ohio." (from AP article today)
Hahahahaha that's rich. What a circus.
The inept DPJ (Democratic Party of Japan) administration is bogged down with land transaction scandal of the party leader and probably has little time or inclination to spare to protest to the Obama administration.
So... I don't quite understand. Toyota is bad and evil because it built cars that occasionally failed for unknown reasons. Goldman Sachs is brilliant because it designed CDOs that would fail so that they could bet against them. And oh by the way in that process Goldman may have helped crash the world economy into the deepest recession since the World War II.
Here we have Goldman Sachs, who, from all indications, created CDOs (collateralized debt obligations) specifically designed to FAIL. Goldman sold them to either gullible investors or co-conspirators (think Societe Generale), often with AIG's insurance (CDS, credit default swap). Goldman itself shorted those CDOs through AIG's CDS. Sure enough, CDOs crashed when 1) underlying MBS (mortgage backed securities) crashed because of sub-prime loan debacle; 2) index that supposedly tracked CDS started to show unusually high spreads, making the securities insured with those CDS drop in price; 3) AIG got downgraded, triggering the collateral requirement and downgrade of CDOs; 4) all of the above and probably more. (Read AIG-related article by David Fiderer at Huffington Post, if you think you can keep your blood pressure from shooting up.)
Goldman Sachs has gotten away with it.
Now we also have Toyota, subject of media and congressional circus right now, whose Japanese CEO naively admits guilt, saying he is sorry, that his company shouldn't have expanded this rapidly, that they were remiss in quality, etc - the usual, honorable thing to do in Japan and totally stupid thing to do in the U.S., where anything he says will be used against him and his company in a criminal prosecution which the Obama government is so intent on pursuing.
For Toyota to replicate Goldman's success, Toyota has to build a car specifically designed to fail, sell it and take out huge insurance policies on the car and the driver. An accident happens, and the insurer cannot pay because the payout is simply too huge. The government steps in to pay on behalf of the insurer. When someone raises the question of a faulty car built by Toyota, Toyota will say "People are simply jealous of our performance, because we're so good." And people will say "Oh OK, I guess you guys are really good."
FBI raided the offices of Toyota suppliers Tuesday night. For what criminal offense?
Some people may say "Well, in Toyota's case, people actually have died from the defect." People have died from the stock market and housing market plunge at least in part caused by the products and trading strategies by the likes of Goldman Sachs. I remember a few who committed suicide.
Still, Goldman Sachs has gotten away with it.
The U.S. Securities and Exchange Commission (SEC) chairman Mary Shapiro announced a new rule to "restrict" short selling today, and it has been approved by 3-2 vote.
According to the announcement, this new rule will do the following:
"... a circuit breaker would be triggered any time a stock has dropped 10 percent in one day. At that point, short selling would only be permitted in a security if the price is above the current national best bid."
The circuit breaker, therefore, won't stop short selling even when the stock has dropped 10 percent. Short sellers will still be able to short as long as the price is above the current national best bid (sort of uptick rule, and SEC actually calls it "alternative uptick rule").
Creating the national best bid should be very easy for the outfits that can do "flash-trading" and "high-frequency trading", both of which SEC is supposed to have been investigating oh for such a long time. Instead, the agency is busy harassing Toyota.
With flash-trading and HF trading, it should be very, very easy to keep the drop within the 10% threshold while these quant traders short away the stock.
And this non-rule will be effective for the day the stock plunges 10 percent, and the day after.
Why does SEC even bother? Is it just to show that they are doing "something" to justify their salaries and benefits?
I have a feeling that this will join the list of "unintended consequence" very shortly. What unintended consequence I haven't yet figured out. One possibility is a no-bid market. Who wants to invest and trade in a market which is openly manipulated by meaningless regulations and by the likes of Goldman Sachs?
Another possibility is that investors/traders who are long the security may get trapped, unable to unload their shares. I am sure the brokerages and banks will have mechanisms to distinguish long sellers from short sellers, but somehow I can't seem to trust such mechanisms.
In a crash like we had in September-October 2008, you may want to dump your holdings as fast as you can, whatever the price, even if you may get a sizeable haircut. It was better to lose 10% by selling out than to lose 50, 60, even 70% several days, weeks, months later. Some stocks lost more than 90% before the market bottomed in March 2009.
This potential entrapment of long sellers is perfectly in line with another recent SEC ruling that will allow money market funds to refuse redemption in a crisis.
Capital and information want to flow in and out freely. Any effort to stop the free flow will eventually backfire.
After the damage is done, the government will say "Who could have known? But we meant well..." A lot of people (other than people with their heads in the sand, including government bureaucrats) will have known. Intention will be irrelevant.
Tuesday, February 23, 2010
The Congressional hearing on Toyota's recall problems (aka "kangaroo court", aka "witch hunt" in the name of public safety, my foot) will have Toyota's CEO Akio Toyoda tomorrow.
Japan's Nikkei Shinbun reports that Toyota's US factory workers are in Washington D.C. to show their support for their CEO and for their company.
"The Congressional hearing on February 23 on Toyota's recall problems was an unusually popular event. The line of people wanting to attend the hearing was 50 meters long. 300 people showed up for 150 slots.
"Among them, there were people wearing shirts with Toyota logo. They were men and women who work in Toyota factories around the country. One of them, from a Toyota factory in Indiana, said to the reporter, "We are only a small portion of the Toyota employees. We want everyone to know that there are tens of thousands of Toyota employees supporting the company throughout the United States."
"Referring to Toyota's CEO Akio Toyoda, who is going to testify on February 24, she said, "I trust him to make the right decision. I want him to correct the wrong impression that Americans have gotten about Toyota over the recall problems."
"There are already people forming a line to attend the February 24 hearing."
CNN also reports that Toyota's US dealers staged a rally on Capitol Hill in support of the company and their brands which have exemplified quality worldwide.
Toyota dealers rally in defense of brand (2/23/2010 CNN International)
"Washington (CNN) -- More than 100 Toyota dealership owners and staff rallied on Capitol Hill Tuesday to defend their businesses and Toyota as Congress opened high-profile hearings into recent large-scale vehicle recalls.
""We take great pride in the fact that as of last night, together we've done over 690,000 recalls already and are pacing at 50,000 a day throughout the United States," Paul Atkinson, chairman of the Toyota National Dealer Council, said to the crowd. "My question for you is: How did we suddenly overnight become the villain?"
"... Tamara Darvish of Darcars Automotive was quick to point out more bad news for Toyota could mean more bad news for their network of 172,000 employees in the United States.
"Atkinson noted that, in the wake of last year's bailout of General Motors and Chrysler, they're now in competition with government-backed automakers for market share."
"... But a message of optimism also was a recurring theme at Tuesday's rally. AutoNation President and CEO Mike Jackson said he believes the drop in sales was largely due to the fact that many vehicles were taken off the market until they were repaired. He does not expect the brand to suffer in the long term.
""What's fascinating about the American people is that if they see a company that's done it right for decades, but has a bad moment and makes a mistake and owns up to it and commits to change and does everything possible to make it right, the American people will understand and forgive," he said."
That's the spirit.
Now, can you imagine GM (or Chrysler or Ford) factory workers and dealers coming to Washington D.C. to show support for the CEO and the company, defending their brand and quality? I can't.
Good for them, these Toyota US workers and dealers. I just don't buy the allegation that Toyota short-changed safety for the profit. That's not how they have made cars anywhere in the world, from what I once observed in a Toyota plant in Japan. Local Craigslist has a listing for night shift auto technicians at a Toyota dealership to fix the pedals.
Transportation Secretary LaHood today "testified that ... NHTSA's investigations of complaints about unintended acceleration have produced no evidence that electronic throttle systems are affected by electromagnetic interference, as some have speculated." (Wall Street Journal, 2/23/2010)
In other words, no one knows what causes unintended acceleration, but let's gang up on Toyota because it sells more vehicles than Government Motors and people actually like them, and we the government won't allow that.
My next car will be a Toyota.
Monday, February 22, 2010
Don't they have better things to do?
Grand jury subpoena has been issued, and now SEC has joined the fray.
Toyota faces federal, congressional probe (2/22/2010 AP via Yahoo Finance)
"WASHINGTON (AP) -- Federal prosecutors have launched a criminal investigation into Toyota Motor Corp.'s safety problems and the Securities and Exchange Commission was probing what the automaker told investors, the company disclosed Monday. Newly released internal documents showed that Toyota officials visited with U.S. regulators years ago who "laughed and rolled their eyes in disbelief" over safety claims.
"The twin developments created new public relations challenges for Toyota plus the prospects -- however likely or unlikely -- of hefty federal fines or even indictments against executives in the U.S. and Japan. They also complicate Toyota's ability to discuss details driving its recall of 8.5 million vehicles because anything executives say could be used against the company inside a courtroom.
"Top Toyota executives were expected to testify at hearings Tuesday and Wednesday on Capitol Hill. One lawmaker said he believed Toyota misled owners about the repairs and relied upon a hastily-arranged study to reassure the public.
"In a new filing with the SEC, Toyota said it received the grand jury request from the Southern District of New York on Feb. 8 and got the SEC requests Friday.
"It wasn't immediately clear what U.S. laws Toyota might have broken. A subpoena would specify why prosecutors sought company documents, but Toyota would not comment beyond its disclosure with the SEC. A spokeswoman with the U.S. Attorney's Office for the Southern District of New York declined to comment, saying it does not confirm or deny its investigations as a matter of policy."
"...Legal experts said the fresh subpoenas could affect how Toyota executives respond to the questions from lawmakers.
"Eric Dezenhall, a crisis management consultant in Washington, said the subpoena might cause Toyota to limit its testimony because apologies are admissible in court. He predicted the company would walk a line between carefully phrased testimony and enough disclosure to describe the cars' mechanical problems and steps Toyota had taken to make the vehicles safer." [The article continues.]
Ms. Shapiro's agency is yet to do anything about naked short selling that probably precipitated the market crash in September-October 2008 which in turn crashed the global economy, or about so-called "flash-trading" (aka front-running) by big investment houses like Goldman Sachs. But she finds time to investigate Toyota.
This is getting beyond absurd.
No word about other companies with the same sticking pedal problems. No word about the company (CTS) who makes the accelerator assembly for Toyota and other major auto manufacturers including GM, Ford, Chrysler, and Honda that is known to cause the problem.
And how about this allegation by Wayne Madsen that CTS's accelerator may be negatively affected by military frequencies? (CTS supplies to the US military.)
But no. Obama-land is intent on doing all it can to squash Toyota by staging a show trial. With the subpoena, Toyota executives have little choice but take the fifth in the congressional hearing, and they will be painted by the obliging media as "guilty". Its union pals must be ecstatic.
When will Japan start dumping US Treasuries, I wonder?
a lot more tax.
The White House has released its version of the health care reform bill, which is basically the Senate version with some so-called "compromise" to bait the Republicans. The president has declared that it will be voted in, using the Senate "reconciliation" process that requires only 51 votes instead of 60, unless GOP "cooperate" (meaning they capitulate to the president's bill).
It will cost $1 trillion over 10 years, and Obama claims it won't add to the federal deficit.
He is right. Because it will be funded by TAXPAYERS, whether they like it or not (61% of voters dislike it, and think it should be scrapped). The U.S. taxpayers will be forced to fund this monstrosity that will put IRS as the enforcer, penalties for individual and companies for not having a health insurance that is deemed "appropriate" by the government, tax investment income, tax branded prescription drugs and medical devices (they disingenuously call it "annual fee"), include "Cadillac tax", the government panel to decide on insurance premiums, and much more.
Probably the definition of "reform" has changed. It may not be "making it better", but "make a change, whether it is good or bad, but change nonetheless".
I am afraid the President is either several steps behind the general public, or he is tone-deaf. When Americans were more worried about deepening recession and job loss in early 2009, he declared health care "reform" and global warming legislation to be the top priorities. When Americans grew angrier at federal budget deficit and wasteful spending by his government, he decided to throw more money on job creation. When Americans feel they are totally tapped out and no more extra money to shell out to the government, he proposes, among other things, to tax even the unearned income so the taxpayers can pay for his health care reform which is really just an insurance "reform" which is not even a reform.
And his pitch? It won't add to the federal deficit.
SO WHAT? Americans don't have money for him.