The 3% solution plan

This morning I had my short swim and as is usually the case as I was getting out of the pool in walks a cute guy in board shorts is walking in.

David Wright has some serious competition in the hot New York baseball players category. Brett Gardener and Xavier Nady of the Yankees are (as Mr. Barrett would say) very woofy. I also have to say that at time I find A-Rod kind of hot in a dirty way, actually more like the Moped fashion.

I have previously consigned Thomas Frank to the dustbin of self-loathing, leftist Americans. I may have to re-evaluate that belief after reading his editorial in the WSJ today. IT is worth a read if you have the time. Also you should read the Mean Street blog on the WSJ by Evan Newmark. Over in the NYT I saw the story about the guy who rescued a fellow strap hanger after he fell on the tracks and have to say the guy is cute but it is too bad he is an actor.

So early this morning I got a text message from my oldest. I was a bit taken aback as he should have been in school and they are not allowed to have their cell phones on during the school day. I asked him why he was not in school. He, his brother, mother and maternal grandmother were in Pennsylvania attending his maternal great-grandfather's funeral. I knew the gentleman was not doing well but I did not realize he was in that bad of shape. I told him to give his grandmother a hug for me. The boys were not close to their maternal great-grandfather but I think it could give them some pause for thought considering the ex' mother has ovarian cancer. I asked how he was doing and he said he was bored and asked if he could call me. I told him sure. He did not get a chance to though as the service began. I sent the ex a text telling her I was sorry. I will send her mom a note expressing my sympathy.

Speaking of notes, the husband and I have gotten old school since November. After our house warming party we actually received hand written thank you notes form some of our guests for hosting the party. We thought it was a great idea and since then we have sent hand written thank yous to friends who host us for dinner, etc. I sent DR and PF one and PF told me it was very thoughtful. He asked if the husband had written it and I said not because his hand writing is like chicken scratch, I wrote it. His next comment was he would have thought the husband had the better hand writing.

I think last night is proof the husband has fully become black Irish. We took a cab home and the driver was blabbing away in Spanish thinking neither of us spoke the language. The husband thought the guy was providing advice for the love lorn on some phone service.

So the FASB is dead it would seem to me. They have changed the rules regarding mark to market. No the marks can be determined by the holder. Basically we are no in the land of theoretical and/or imaginary values. It can change from quarter to quarter too it seems. So basically the S in FASB (which stands for Standards) is useless. As one co-worker said it gives the companies wide latitude when determining the value of certain holdings- which means it is no longer standard.

I feel bad for the current CEO of AIG. He got torn a new asshole today by a bunch of grandstanding politicians. The guy got stuck with a bunch of legally binding contracts. He followed the law and did what was contractually obligated. These politicians knew. Now they are arguing that contract law can be nullified by political fiat when ever it can suit their purposes. The whole basis of our Constitution is the rule of law and property rights. The kicker is also that FNM and FRE have similar retention packages and yet they politicians aren't that upset about it. Maybe it's because if you follow the money with those two it will lead back to the same politicians who instructed FNM and FRE to make sub-prime loans. OR it could have to do that a major advisor of President Obama's was the former CEO of FNM.

There was an FOMC meeting today in case you missed it. They couldn't lower rates so no one was expecting anything on that front. The big news is the Fed bit the bullet and is now in full, explicit quantitative easing mode- they are just printing as much money as the need. They announced they would buy up to $300 billion of U.S. Treasuries. It coincided nicely with the BOE governors voting out right to print $75 billion new pounds. They Brits were just more honest about it.

The Fed will now again be keeping the price of money artificially low- just like Greenspan did. That is what got us into trouble to begin with and they seem to think it can save us as well. Real simple; you print 300 billion new dollars that increases the supply of money. When supply goes up the price people are willing to pay, i.e. demand, goes down. That means the store of value the USD represents will go down. Get ready for inflation in a big way.

USTs dropped the most in over 35 years on the announcement. They had been perilously close to getting above 3%. the reason that is a big level is because many believe the Fed is purposefully keeping the 10yr at 3% or lower in order to keep mortgage rates down. Their reasoning is if mortgage rates stay low people will buy house which is the root of the problem. The catch is banks are tightening their lending standards. So it may not matter how low rates are if banks can't find qualified borrowers. Oh wait, FNM and FRE are nationalized and so are Shitigroup and BAC so the government will force them to lower standards to make mortgage loans- much like they did in the mid '90s. This is good how? More debt to solve the problem of too much debt?

North Korea is about to launch a missile- I mean rocket to deliver satellites. This is going to be a big test for President Obama.

Mom is on IM. I and the husband chat a lot with her during the day. This afternoon she informed me the house next door was apparently a huge drug dealing den that got busted this afternoon. There were two local police cars, six county sheriff cars and six unmarked law enforcement cars. It had to be like something out of Weeds or Breaking Bad. I told her I think it is time to sell the house and move.

We had dinner with TK tonight. The food was great, the company was great but the restaurant did not impress me. The music was so loud I could not hear a word TK and the husband said. I maybe getting old...

TK finally got a laptop and has discovered the joys of on-line hooking up. We toasted to munting. He has some good stories.