Nostalgia: 2006: " The Great Bank Robbery of 2005

 The Great Robbery of 2005; Or, a modest proposal for the historical revision of the tales of armed robbery; OR, Book Review: “The best way to rob a bank is to own one.” By William K. Black.

Recently right in the midst of our local bank moving to its new location, a bold, young man strode in and robbed it in broad daylight. Because of the bank relocating, the cameras had been disabled and in the aftermath, the local rumor was that probably the robber would never be caught. Hopes faded for a solution to the crime.  

As days passed, the rumor spread that this master of mischief had used such deceit as bandaids on his fingers to do the evil deed. He was rumored to change his clothes as fast as Superman and that he had a lot of tatoos on his back. The number of the tatoos seemed to grow as the days passed.

And then, just when the legend was starting to pick up speed, the robber was caught. By his own large mouth. 

It seems that the robber, had spoken to another person while the FBI videotaped his discussion of robbing six banks in four states in seven months. In the process of these crimes, he netted $40,000. If convicted, he faces 20 years in prison for each robbery. Like 120 years in prison for $40,000. 

I know what you are thinking----- that this guy just could not do the math. Robbers of earlier days in the 1930s were a lot smarter. Like Jesse James who the folks in Northfield, Minn still celebrate with Jesse James days. Those were the days! Those were the smartest of the smart! Wrong. Nothing has changed. The math was the same or worse in those days of yore. Who then ARE the “ GREATEST “of the bank robbers?…..Read on.

I am currently reading the book, “The Best Way to Rob a Bank is to Own One,” by William K. Black. Mr. Black was the lead regulator during the Savings and Loan Crisis of the 1980’s. In all, over 1000 individuals were convicted of felonies for what is called “control fraud.” This is essentially the white collar version of armed robbery. However, you might be interested to know that nobody counts it as robbery. Huh?

Mr. Black points out in his book that the lessons of the robbery of the S&L’s of the 1980’s has been lost on folks today, and today the same technique is being used to loot corporations. Mr. Black says ,” In 2003, the United States Department of Justice reported that property crimes had continued their trend and fallen to an all-time low. In fact, property crimes have surged to an all-time high since Enron collapsed in late 2001. The reason for the contradiction is that the Justice Department does not count serious crimes because it excludes white-collar crimes from its data keeping. A wave of frauds led by the men who control large corporations, what I term”control fraud,” caused the massive losses from property crimes.”(pp13)

So there you have it. All about the Great Robbery of 2005. Oh, by the way, it wasn’t the guy with the tatoos.

Nostalgia: 2008: On Bears, On Bear Stearns, On Bear Markets

 Yesterday, after listening to the Bloomberg News channel since 5am or so, I had turned the T.V. to "mute" so I could just see the breaking news on the bottom rather than listen to the spin by the pundits. It is a lot quieter that way.

Soon after the markets opened, I saw President Bush speaking, a little stressed it looked like, and after watching him for a while, I tried to guess what he was saying. It looked like he was mouthing that "There really are WMD in Iraq." Or maybe "We are really victorius in Iraq." or maybe that 'I am a compassionate conservative."

What a disappointment to turn on the sound and hear the actual words: "Trust me, the economy is sound. Our markets are resiliant. These are tough times....."

I did recall that these were almost the exact words that Herbert Hoover had mouthed in 1929.

The markets plunged right after President Bush had got done speaking. Nothing could be worse that a President trying to inspire confidence when his approval rating is historically low.

The markets are a matter of FAITH. A confidence Game. Always have been. Bankers rely on their counterparts to ensure that when there is a peak of outflow they can sustain it. No one bank alone has the cash on hand to do so; In fact, cash is probably less than 1% of assets. This is why when the faith of the investment community left Bear Stearns, they sold for $2 per share----the plunge in value is simply stunning for those involved.

The "Big boys" at Bear Stearns walked away with their bonuses from January. The regular employees walked away with nothing. At least bankruptcy would have been a little more equitable.  

Now that the Federal Reserve has indicated it can intervene creatively, we will see whether it will intervene directly into the mortgage maket and specifically provide a remedy to homeowners who are in their homes and facing foreclosure. They have the power to do this. So far there has been rhetoric. Treasury Secretary Paulson opposes such a move. President Bush opposes such a move. Such a move may be necessary. Stay tuned. 

Nostalgia: 2012 : The Rise of "Gangsta Government".

 (Ed note: This is reprinted due to popular demand from the Reflections blog) The Rise of "Gangsta" Government: Oh the Glories of Little Bohemia Recently I took a winter pilgrimage of sorts up to Manitowish Waters in Northern Wisconsin to spend a weekend near "Little Bohemia"---the resort where the FBI had that famous gun battle with John Dillinger as depicted in the recent movie. As I approached the lodge in the erie darkness, I was stunned that the very dark display of the film was in fact how it was in real life....we had a wonderful time at dinner there where there are momentos of the Dillenger event and I do recommend everyone to take a trip to see for yourself...but I digress... Those were the days when bold robbers met their fate at the hands of skillfull lawmen of the young FBI....what has happened to those days when bribery and extortion were met with the righteous wrath of the courageous FBI? Take for example the recent event in Madison, Wisconsin where a noted corporation, posing through a middleman, threatened the State of Wisconsin that they would leave for the warm weather of Florida unless they were paid several million dollars to relocate to the nearby Middleton...... How is this different from the famous extortion cons of the wild 1930"s. Very simple. Now we call it Economic Development

2005: Nostalgia: "The Tipping Point" or Where is Harry Truman when we need him?

 Recently there has been a lot of talk about the "Tipping Point" or the moment or event, whether large or small, that things change. On PBS News Hour on Friday last, David Brooks went into a long and interesting presentation on why Katrina was a tipping point, and not only that, but listed a long series of natural events that have as a result created a political earthquake. Click on the post to get the story as well as the real audio. 

Specifically, he mentioned the occasion in Louisiana of a very big storm when the governer had to decide to flood some homes to save the capital. He pledged to pay for the homes and rebuild. He lied. Out of the outrage of that incident came the rise of Huey Long. The Kingfish. The fictional rendition of Huey Long is dramatized in the novel "All the King's Men," by Robert Penn Warren. One of my favorites. 

If you can dust off your old copy of "All the King's Men," the opening two pages are pretty dramatic. It begins with the view from inside a limo driving in the night in Louisiana, with the headlights peering out, rolling through the night, with the powerful limo squashing all the critters that venture out on the roadway, rolling along cushioned from the reality of the ebb and flow of the real world below. It's been thirty years, and the picture is still vivid in my memory.

It is kind of sad and ironic that leaders like the Kingfish rise to power by working on the alienation of the people from their leaders and in the end, fall as a result of that same alienation.

The image of President Bush at 50,000 ft. reviewing the destruction of Katrina may also be a powerful image that may provoke a powerful political change. We shall see. Political patronage or Pork, may be a condemned routinely, in highway projects and in many areas of life, but when it permeates the survival of the country, or Homeland Security, we are in deep trouble. Thus, when asked recently whether the US can withstand another disaster or attack at this time, even President Bush hesitated and said "That's a good question." 

President Harry Truman rose to fame at the end of WWII investigating the corruption of war profiteers. It would be nice if we a had him now. He could come by on one of his train trips, come through Evansville, cause I would be the first to yell, "Give em hell, Harry."

"The Tipping Point" or "How LIttle Things Can Make a Big Difference" is written by Malcolm Gladwell and is available at the Eager Free Public Library.

2006: Nostalgia: Black Elk Speaks: " The Circle of Trust has been broken"

 The time was twenty years ago. My sister has just been through a perilous period as a public relations pro for a major Fortune 500 company. The pension assets of her world wide company had been threatened because some bonds---yes bonds peddled by Michael Milliken and such--- had comprised such a large portion of the company pension plan that in the panic that ensued with the bond scandal, the retirement of thousands was threatened. 

She was called in by the CEO. He told her the mission----to regain trust.

She told him directly that the only way to regain trust was to remove the barriers to communication and unite the employees worldwide, for better for worse---in an internal blog of sorts. To dispel rumor. Quickly. 

A year later. The panic was over. The employees had shared their worst fears. They had fashioned a financial solution together with management. It was not pretty. They were in it together.  

A year later, Susie was invited to speak in front of the Conference Board in Washington. They wanted a speech about broken trust, and how to regain it. The Conference Board is the board that each month releases the economic index of confidence. They wanted to hear some ideas on trust. On confidence. On how to regain it once broken. 

In her speech, Susie reviewed the conditions of employment of our fathers and mothers through the first 70 years of this century. Folks working their careers with one company. A spirit of compact between employer and employee. Then she described the total breakdown that was underway in America. 

She likened the breakdown to the experience of the American Indian. She referred to one of the Indian speeches, I believe it was by Black Elk, of the Sioux nation. He described the situation of the Indian. He said that they had made compacts with all the Presidents and all the compacts had been broken. Was there not one person left who could keep his word?

Black Elk went on to describe the vision of his people---a vision of interdependence world wide. A sacred circle. A sacred hoop. 

I relate the story in this season of politics since it is a time when promises are made with ease and easily broken. Too easily broken. 

This year especially, it seems that it is simply out of fashion to even talk about issues whatsoever. It is all about scandal, diversion and smear.  

Being a leader as Black Elk saw it is more than a shell game. A game of deceit. It is a sacred role. Something to think abou

Tales from Normal Mn: Nostalgia: 2010. : "no" means "no" in Normal Minnesota

 Well. It has been just a hubub of political activity locally. With all the budget talks. One of the things that just picqued my interest was the series of video where the discussion was about what would happen if a certain referendum would go down to defeat in November. What would happen if the public said "NO."

The answer was that the politicians would still "work it" and bring it back to the voters in a year. Maybe they would change their mind. Maybe if they were asked more nicely, maybe with a "pretty please" they would agree.

Just that morning I had been reviewing the early elementary school anti bullying campaign curriculum, and something struck me as unusual. The same kind of behavior that schools on a daily basis are teaching our kids to avoid, is the exact type of behavior that our government celebrates.

Whenever I wonder about things, I just pick up a cellphone and give my friend Herman, the countryboy lawyers from Normal, Mn. a call. He knows the law. He should know.

"Herman, how does it work up in Normal, Mn? Does "NO" mean "NO" in Normal?

Herman just laughed. "Wolfman,"(that's what he always called me), "NO" always means "Maybe" in politics. That is because there is no morals in politics, just opportunism. Hence, "NO" is just a relative term for a point in time. 

Then Herman went on: "In love and war, however, "NO" might mean different things. The President might say "NO" to Russia invading Georgia---and then keep saying "NO" hoping that it would be believed. Still. Ya have to have some force to back it up. So also in love. The girl can say "NO" but always keep her hand on the phone to call 911 to make sure. It is just "trust but verify," in love and war. 

Nostalgia: (2007) : Memories of John Jones

 Many of you may remember John Jones, the owner of Jones Barbells on Union Street. He was an avid flyer, a flight instructor and a weight lifter known nationally by his plane with the Jones Barbell logo on it. He was the son of a World War II ace pilot. 

There are many John Jones stories. He was a very simple and direct and honest person. Sometimes disturbingly so for high and mighty types. John was most at home in his welding overalls with the top glass shield that he retracted, like Dark Helmet, when he came from the back welding area to help a customer. He loved welding, and selling was just extra.

Back in 1990 I wandered into the shop to see his weight equipment and explained to the big guy that I had been a long distance runner in my youth, and a slow one at that, but needed to regain my leg strength. He said not a word. He just waved me to follow him back to the leg press section of the display room. He showed me his patented leg press machine, the one that had the special safety and he designed to prevent back injuries. I was an easy sale.

As I cleared out my storage chest recently of the many race t-shirts over the years, I had to smile. John never said that my dream of running again was crazy, like most of the relatives. He just showed me what was necessary.

Everything was on a handshake with John. His word was good. I would buy everything he had eventually. Finally, when I asked about some new piece, he quietly said, "Dick, you just need to use what you have. It's up to you, not the equipment."
That was just what I needed to hear then. 

To those of you that attended the recent peace vigil, I applaud your showing up to express your opinion by free assembly. To those who take the other side, I applaud your right to express it.

The question is not for those who show up. The question I have is ----Who is the real Observer. Is it me? I think not. I have to write a bit each day with my name on it. The observers are those who just log on to observe what the rest are talking about. I know because I get the traffic reports.

John Jones told me something that I did not want to hear. The equipment was not going to get the muscles. It was up to me.  

To those who are just observing, think about expressing yourself without fear. Think
about telling a friend about The Evansville Observer. The Observer is not about me. It is really about the comments. It's about the discussion. The Observer is just a place to talk. A place to chat about possiblities. It is only going to be what you, the observers, make it.

When Daytrading America

 When Daytrading America, Its always best to have a Hedge Fund analyst in the Situation Room---to give the best possible insider trading advice to all concerned and explain the mechanics of puts and calls.  

A "put" is not a "putt".  It could be easy to confuse the two.  

The China Bromance is Dead

 Back in 1972 the China Bromance began after Nixon visited China with Henry Kissinger.  As the love story developed, I always thought we would buy their bargain priced goods and we would sell them our higher level technology, and along the way show them how democracy worked and the magic of human rights.  

It's been 50 years.  No deal.  Seems we learned more about their authoritarian ways than they learned from us.  

Being positive:  We can go back to Rotary phones.  There was a time we were adults and could use a map when we traveled.  We could survive without our phone tracking our every step.  We could speak without our TV or phone recording us secretly.  

When we fish-- we can go back before electronic fish finders and go to our favorite spots on the lake.  We can just pop the small trolling motor onto the boat and fish in the early morning with the family.  No big pontoon with the luxury fish storage bin in the back.  Yes the good old days.

And other good news:  When couples go out to dinner, they won't be spending all their time staring at their phones and will actually talk to each other.  It could be wonderful.  A real reversal of attention deficit disorder.

And drivers will actually drive their cars rather than stare at their phones.  Biking will be a lot safer.  Yippie.  

 Classic Posts from the past:

Monday, October 22, 2007
Reflection: Thoughts on the Great Crash

OpEd: "The Great Crash" by Galbraith

If you have read the recent book by Alan Greenspan, "Turbulence," and I have not yet completed it, although I have skimmed parts, and if you have listened to the coverage of the G7 in Europe, as well as pundits in the press, there is the spin that we just cannot do anything about "busts" of markets. The Fed is just helpless it seems when it comes to taking any action to deflate "Irrational Exuberance."

Bold action CAN be taken to rescue banks that have been packaging "mortgage securities" and of course bold action CAN be taken to rescue banking entities that are "too large to fail." That being said, other than rescuing the big guys, they are helpless.

The cause of the Great Crash as explained in the book by John Kenneth Galbraith, was the severe disparity of wealth in America which had widened in the 1920's. The only time in our history that has equaled this is TODAY.

Frequently, the Big boys, as they are called, can be heard saying that this is NOT THEIR PROBLEM. It is true that one does not get to be a "big boy" through meditative exercise...however that being said, without buyers, sellers cannot prosper. In some marketing equation then, one is one's brother's business keeper. Any seller must therefore make sure the buyers can still buy.

How long could such a period of "NON BUYING" last. This is the eyeopener. In 1929, when my father turned 18, and his father died, he went off to college. Then in 1933 when he worked for a few years before going into the service---till the Korean War...the fact that the depression lasted from 1929 to 1950 meant that a whole generation of folks waded through twenty years of "NON BUYING".

The pundits have said that thank goodness we know a lot more about economics now than then. Show me.

Tales From Normal, Mn: High Level Penguin Negotiator Sought for Tariff Talks

 Just got the news out of Normal, Mn where all the bass fishermen are gathered at Betty Lou's Coffee shop, where all the bass fishermen gather each morning.  The bold poster in the Brainerd Daily Times caught their eye". "HIGH LEVEL PENGUIN NEGOTIATOR SOUGHT". 

Must be able to negotiate with island of Penguins where no human has been able to survive.  Only the fittest must apply for this position.  No hint of past surrender to penguins will be tolerated.  Conservative patriots preferred.  Alcohol use or drug use is acceptable.  Some history of business fraud preferred.  

Stay tuned as I follow this story.