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When’s Congress Going to Pay a Fine?

July 14, 2014

I see that Citigroup just settled with the DOJ on its role in the sub-prime mortgage debacle from the middle of the last decade.

In the deal announced Monday, Citigroup will make a $4 billion civil monetary payment to the Justice Department, and another $500 million in compensatory payments to state attorney’s general and the Federal Deposit Insurance Corporation.

The bank will provide $2.5 billion in consumer relief, which will include financing for construction and preservation of affordable housing, as well as principal reduction and forbearance for residential loans.

‘The comprehensive settlement announced today with the U.S. Department of Justice, state attorneys general, and the FDIC resolves all pending civil investigations related to our legacy RMBS and CDO underwriting, structuring and issuance activities,’ said CEO Michael Corbat. ‘We also have now resolved substantially all of our legacy RMBS and CDO litigation.’

JP Morgan has previously settled for $13B, and Bank of America is still under pressure.  All of this stems from the companies being pushed to provide more loans for homeowners.  So they began to offer the sub-prime mortgages to those who couldn’t qualify for a regular mortgage.  The resulting dip in home prices caused a collapse in the market that is still ringing through the markets.

Wait, they were pushed?  Yep.  Most people forget that pressure was put on the banks by Congress, who passed legislation to make home buying easier.  The administration then pushed the banks again via Fannie and Freddie (which essentially totally collapsed in the down-swing).  So, when is Congress going to pay a fine?  When does the administration admit culpability for sucking down billions of our tax dollars in this mess?

Oh, right, they won’t.  I hope we feel better as taxpayers knowing that.

Super-size My Mall

July 8, 2014

One for the geeks here: Occasionally, I’ll be flipping through the channels in the backwaters of the TV scene, hoping I can find a commercial where they’re firing a cannon at a poor boat (you’ll know it when you see it, folks), and I’ll hit on one of those construction shows that describes how to make a truck the size of  house, or a massive jumbo jet.  I work on some of the world’s smallest technologies, so it’s really cool to see big stuff.  If I’m really lucky, I can find a show where Dubai is building a whole new set of islands for rich people.  Well, how about an entire city that’s air conditioned?  Thanks to The Register for finding this one for me.

Project to develop the world’s largest mall, largest indoor park, cultural theatres and wellness resorts with a capacity to host over 180 million visitors annually

Project highlights:

Mall of the World, a project developed by Dubai Holding, will have the following connected features:

  • World’s largest mall occupying 8 million sq. ft. connected to 100 hotels and serviced apartments buildings with 20,000 hotel rooms
  • Temperature-controlled covered retail street network spreading over 7 km
  • Largest indoor family theme park in the world
  • Wellness district catering to medical tourists in a 3 million sq. ft. area
  • Cultural district comprising theatres built around New York’s Broadway, The Celebration Walk, similar to the Ramblas Street in Barcelona and shopping streets based on London’s Oxford Street
  • Dubai’s largest celebration centre accommodating 15,000 revellers

This, like I said above, is no big deal to Dubai.  A decade ago, they put a ski slope in a shopping mall.  The scale of their civil engineering projects is amazing, and getting moreso as they plan the next ones.  International business in the country — or at least the open city part of the country — is legendary, and it funds the rest of the country along with the oil reserves that flow in the desert.

This country, though, seems to be the best in terms of being totally extravagant about its wealth.  I’ve never figured out how it doesn’t have the massive unrest that the rest of the region has… and don’t talk to me about Saudi Arabia, which mostly exports terrorists to destabilize the rest of the area.  But somehow, things stay relatively calm, and that makes for a very decadent experience for visitors.

So as long is it remains a great place to be a civil engineer, Dubai will continue to amaze with some interesting stuff.  I’m sure it’d be nice to visit, though I’ll probably let others do that.  I’ll stick with my outside activities, even if I have to handle the heat.

Overconfident in Your Overconfidence

July 7, 2014

This one hits close to home, and at the same time makes me laugh out loud at the culture of technology companies.  In a blog post that’s being picked up by some news agencies, Avery Pennarun, a Google employee, laments the fact that some companies can hire too many good people.

Many people might not believe the premise: that Google only hires the best and brightest.  That’s something that doesn’t surprise me.  I work for a large tech company, and I’ve been involved in hiring for over two decades.  And good companies do an excellent job of screening out people that don’t fit the culture.  So when a company like Google screens potential employees, it likely is very good at finding only the types of people that already make the company successful.  Mr. Pennarun calls this particular set, “smart people,” which is probably true in a simplistic way.  I’m sure they’re all pretty darn smart… they have to be to make it to the level where Google would want to hire them.

But I’d probably rather focus on the limitations he notes.

We all make decisions for emotional or intuitive reasons instead of rational ones. Some of us admit that. Some of us think using our emotions is better than being rational all the time. Some of us don’t.

Smart people, computer types anyway, tend to come down on the side of people who don’t like emotions. Programmers, who do logic for a living.

Here’s the problem. Logic is a pretty powerful tool, but it only works if you give it good input. As the famous computer science maxim says, “garbage in, garbage out.” If you know all the constraints and weights – with perfect precision – then you can use logic to find the perfect answer. But when you don’t, which is always, there’s a pretty good chance your logic will lead you very, very far astray.

His take continues that people need to make mistakes to learn how to fail, and that Google culture doesn’t necessarily let people make mistakes.  I doubt that’s true.  What the culture doesn’t let happen is for those mistakes to have consequences.  The project might be total dud in the market, but the company will continue to keep the group working on it, and keep promoting the activity.  Mr. Pennarun believes this is detrimental to the company, and it probably is.

If you look at Nokia in the early days, they had a motto: “Fail early.”  That is, recognize that you’re making a mistake and fix it before the project it doomed.  I’ve seen this culture in many other large companies as well.  The take on Google encompassed here is that it doesn’t encourage failure.  It encourages constant forward movement.  That’s a fine plan as long as the money keeps coming in, but what happens when times are tight?  At this point, Google doesn’t have to worry about that, but in the future…?

As his blog notes, knowing how to fail is an important component in success.  Being confident that a company can’t fail is surely a problem, but a little dose of humility makes smart people smarter. Let’s see how this works out as Google hits a few rocks.  I’m fairly confident — but not overconfident — that the culture can adapt.

Lawyered-up Enough for Government Work

July 3, 2014

There’s the start of what will probably be some increasing consternation over the fact that US Investigations Services was just awarded a contract for background checks.  If you’re not aware, they’re the contractor that did the background check on Edward Snowden, and I think the dude that shot up the Navy yard.

They were the lowest bidder on the contract, and therefore the US had to take them, at least that’s the story from the WSJ.  Probably a more relevant observation could be that there are very few firms that feel like doing all the legal hoop-jumping to work with the government.  I have some limited experience with government contracts, and you almost always have to find a firm that has all the right lawyers and credentials to actually do a bid.  So it’s not shocking to me that this retread of suck get a shot at the contract again.

So, wonderful.  If you have enough lawyers, and have some ideas on how to lobby, you can get my taxpayer money.  Why did we fight for independence again?

Compulsion in Any Form

July 1, 2014

Okay, I’m being the Energizer Bunny of posts today, especially since I’ve been pretty infrequent lately.  But this link from Reason was interesting to me, and brings together a couple comments I’ve been making over the past month or so.  It juxtaposes the Hobby Lobby decision with a recent law in Georgia requiring businesses to accept concealed carry.

Nevertheless for a certain kind of spouter of partisan talking points, the Supreme Court ruling—that the government could not, in fact, bully people into doing something if those people have religious objections—was more evidence of the “war on women” Democrats plan to keep running on.

Meanwhile in Georgia, a new gun bill that permits lawfully licensed residents to carry their firearms into a wide range of “public accommodations” (like bars) and actual government buildings goes into effect today. Opponents of the bill, generally liberals, tend to be the same people who opposed the Hobby Lobby ruling, while conservatives who applauded theHobby Lobby ruling for protecting religious liberty applaud Georgia’s law for protecting their Second Amendment rights.

I’m a big fan of voting with my feet.  I see a lot of people saying that they’re planning to boycott Hobby Lobby because of the recent decision.  Hey, that’s their choice.  I’d think it a more powerful decision if they’d ever set foot in a Hobby Lobby before, but that’s a different story.  Likewise, there are many stores or businesses that I don’t support because of various policies.  For instance, I think Nike’s advertising is pretty loathsome, and I haven’t bought a piece of Nike gear for over a decade as a result.  That’s my call, and I don’t throw paint at people who choose to wear it, nor do I usually even go out of my way to say that I don’t buy it.  It’s my call, and it’s your call.  Personally, I’d probably be more inclined to frequent Hobby Lobby, except there’s not one within three hours of me.  You make your calls and live with them, I’ll make mine.

Likewise, women are not “trapped” by working at Hobby Lobby.  Even if jobs are pretty scarce, I’d imagine that it’s not that difficult these days to find a job around minimum wage at a place that supports 20 types of contraception as opposed to 16 on its health plan.  I don’t ever advise quitting a job before one finds a new one, but you get the point.  If you don’t like the policies your company keeps, then find a new one.

No matter what, forcing the government — be it the administration, the congress, or the courts — to make your decisions for you ends up making everyone equally unhappy.  How ’bout you decide for yourself rather than waiting for your tax dollars to work?


July 1, 2014

When I pay the salary of an employee, I hold both myself and them strong accountable for their behavior.  Apparently, as a taxpayer, I get less of that these days. Thanks to Hot Air for the pointer.

It’s going to be a little more difficult to ferret out which members of Congress are lavished with all-expenses-paid trips around the world after the House has quietly stripped away the requirement that such privately sponsored travel be included on lawmakers’ annual financial-disclosure forms.

The move, made behind closed doors and without a public announcement by the House Ethics Committee, reverses more than three decades of precedent. Gifts of free travel to lawmakers have appeared on the yearly financial form dating back its creation in the late 1970s, after the Watergate scandal. National Journaluncovered the deleted disclosure requirement when analyzing the most recent batch of yearly filings.

“This is such an obvious effort to avoid accountability,” said Melanie Sloan, executive director of the watchdog group Citizens for Responsibility and Ethics in Washington. “There’s no legitimate reason. There’s no good reason for it.”

Honestly, I’m not going to get in high dudgeon about it.  But it does frost me that pretty much any side of politics is interested in being less transparent rather than more.  I doubt this will get a lot of play from either side given the volume of Hobby Lobby that’s going on this week.  But I’d hope that a few more people take note and voice at least a little displeasure.

Updated: I saw it tweeted at NRO, and Ed Morrissey is picking it up.  Maybe we’ll see some of the news sources start to sniff it more.

It’s Everybody’s Civil War

July 1, 2014

In my continuing series of notes about cyber-warfare, here’s another note that modern warfare includes psychological and some actual battle on the net as much as on the ground.  From the Register:

“Several new botnets using dynamic DNS have been detected, which might have been used for cyber espionage and targeted multi-staged cyber attacks, reportscyber intelligence outfit IntelCrawler.

IntelCrawler adds that harmful activity is concentrated in four Iraq cities: Baghdad Erbil, Basra and Mosul. A lot of malware is home-brewed and much of it has previously featured in the Syrian civil war, where ISIS has become a key player over recent months. A substantial segment of the command nodes used in the cyber-spying were hosted on no-IP domains that later became the target of a controversial Microsoft-led takedown operation this week, IntelCrawler adds.

If you hang around here enough, you know that cyber-intrusion has gone corporate.  You can get malware with 24/7 tech support and affordable monthly maintenance payments.  And taking the jihad to the net means that recruits don’t have to have a flair for travel to exotic locales with a penchant for sand, AK’s, and Reaper drones.  It appears that some of the recruits are merely providing computer time for the struggle.  It wouldn’t surprise me to see some bitcoin mining or trafficking going on to fund the effort to establish a caliphate.

I’m almost concerned that our ideological enemies are getting upper hand in on-the-ground cyber work.  While I’m sure that the US has a broad capability, I’m not positive that we’re actually testing the attack side of the systems as much as the terrorist cells, and certainly not as much as China or Russia.

This is more fodder for the future of wars that have very different borders, and the fact that US “soil” is already under sustained attack seems to be regarded pretty lightly by our citizens.


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