Have they forgotten that they are modes of transportation and not hotels? that is like a taxi driver refusing to pick you up until you have spent three hours at the party. Does it not occur to them that regardless of when, people who fly somewhere pretty much always need to go back at some point? I don't see how this solves the fuel issue at all. I mean, if I go to Chicago, I still need to come home whether it is the next day or the next week, and I'm thinking that me staying over for more days doesn't change the amount of gas used in hauling my butt back home. And the disadvantage to business travelers is completely ridiculous. Does a salesman deserve to miss out on time with his family just because his job requires travel and the asshat airlines are demanding he stays in Toledo over the weekend? If I worked at any sort of company where travel was involved I would immediately start implementing any changes possible (telecommunications for example) that would reduce if not eliminate all travel just to say "suck it" to the airlines.The "asshat airlines" have a tremendous problem and I have sympathy for their vulnerability to oil prices. Consumers have to pay high fuel prices also and they will understand the rising costs. But for the airlines to decide to just make things harder as well as more expensive is idiocy of the first order. If ticket prices are too low just suck it up and raise them. I believe thye must be getting advice from that guy in the Comcast advertisements who once read a book about business school.
June 23 (Bloomberg) -- Refinery executives are buying more
of their own stock than at any time since 2000, prompting
investors to bet that a retreat in oil will boost profits and
reverse the biggest share decline in a decade.Executives at 10 refining companies snapped up $2 million of
their shares last month, twice what they sold, according to data
from the Washington Service, which analyzes insider patterns for
500 institutional clients. That helped raise the average level of
purchases to the highest in eight years, data from Argus Research
Co. compiled by Leuthold Group show. Before March, insiders
dumped more shares than they bought every week since 2003.Insiders added to stakes following a 42 percent slide in oil
and gas processors in Standard & Poor's indexes as of last week,
the largest drop since at least 1995, after a 40 percent gain in
crude pushed down profits. Caxton Associates LLC, Citadel
Investment Group LLC and Renaissance Technologies Corp., which
oversee $64 billion in hedge-fund assets, also boosted bets that
the shares will rebound, according to data compiled by Bloomberg.
CANBERRA (Reuters) - When Ian Usher's partner of 12 years left him broken-hearted, he decided the best way to move forward was to auction his whole life, in one job lot. From Sunday, June 22 for one week, Usher's life is up for sale on eBay with the package including his $420,000 (US$397,000) three-bedroom house in Perth, Western Australia, a trial for his job at a rug store, his car, motorbike, clothes and even friends.
Article here. Thanks to Marginal Revolution for the pointer.
No, I have not lost my mind. I’m fully aware that inflation is not kind to bonds, so offering a kind word for inflation is de facto offering an unkind word about my own business. Investment managers don’t tend to do that. But facts are facts. And the essential fact right now is that the American economy needs an inflation rate above the Fed’s comfort zone. Needs, you ask?
Yes. Soaring commodity prices, particularly for petroleum and food, and especially in recent months, are an unambiguous negative real terms of trade shock to America. For those not familiar with the term, a nation’s terms of trade is the ratio of what it must give up to get what it imports. The easiest way to understand the concept, at least for me, is to think of the number of hours of work necessary, at the average national hourly pay rate, to buy a barrel of oil – a real variable compared to another real variable. The chart below (above here) tells that simple story.
Paul McCulley is an expert on the fed and always worth reading.
In our opinion, the inflation scare is overdone.Plus Congress is now getting involved and thee only time they don't act at the wrong time is when they act at a worse time.
The run-up in commodity prices is dominating media headlines and is spooking investors. However, the annual rate of change in food and energy prices is now at an extreme, which is unsustainable. Crude oil prices have risen 100% from year-ago levels and would need to surge close to $200/bbl by the end of 2008 just to maintain the current pace of inflation. Moreover, the macro backdrop in the developed world is not conducive to sustained underlying price pressures
Bloomberg:
Melanoma Stopped in Patient With 5 Billion Copies of Own CellBy Michelle Fay Cortez
June 19 (Bloomberg) -- Researchers used 5 billion copies of a single immune cell from a man to wipe out signs of his advanced melanoma for more than two years, according to a report in the New England Journal of Medicine.
Copies of an infection-fighting CD4 T cell were grown in a laboratory, and then used to attack the 52-year-old patient's tumor, the report said. Previously, scientists had difficulty isolating and copying immune system cells, the researchers wrote in the report.
The man had recurrent melanoma that failed to respond to therapy or surgery when he enrolled in a clinical trial at the Fred Hutchinson Cancer Research Center in Seattle. The disease had spread to his lungs and a lymph node before he received the two-hour infusion of the lab-grown immune system cells. Sixty days later, all signs of the disease were gone. He remained in remission for the following two years, researchers said.
Instapundit.com
The Subprime Six1. Senator Chris Dodd-(D-Conn.)
2. Kent Conrad (D-ND.)
3. Alphonso Jackson (D-HUD Secretary)4. Donna Shalala-(D-HHS Secretary)
5. Richard Holbrooke (D-ASecretary of State)(and future Sec. State?)
6. James Johnson (D-Obama Veep Selection)Were there no Republicans involved?
UPDATE: Ah, Alphonso Jackson is a Republican. I seemed to remember this as a bipartisan scandal.
That fallout from the housing bubble is just beginning to hit its
stride in terms of mortgage delinquencies and foreclosures. As I noted
in my April 14 comment (Which “Inning” of the Mortgage Crisis Are We In?),
since the progression of foreclosures has mirrored the pattern of
adjustable mortgage rate resets, mid-2008 will most likely represent
the highest rate of change in cumulative foreclosures, after which they
will continue to rise but at a moderating rate.
Measuring Inflation? You try setting the rules!
At " A Dash" we are continually amazed at the difficulty in stimulating anyone to reconsider existing opinions. This seems especially true on the subject of measuring inflation. There are plenty of self-proclaimed experts. Taking a step away often helps us shake off biases and get a fresh look at the problem.
Here is a little test. Try to give an honest answers to each question below. We (Dash) shall suggest the relevance in the conclusion.
The two most important market trends I see today:
1) Banks and brokerages are being forced to de-lever as they bring their SPE (Special Purpose Entities) on to the B/S (balance sheet):
- Increased margin requirements are forcing hedge funds to de-lever.
- De-leveraging will lead to a decrease in consumer, corporate and commercial real estate credit.
This will cause decreased spending for consumers, poor credit businesses and commercial real estate.
2) Legislation:
- CNBC talked about legislation adding margin requirements to CDSs (Credit Default Swaps, a $45 trillion world market). Many in the commodities market have been using some form of CDS instead of commodities futures because there currently are little to no margin requirements. If rules for CDSs are changed, it would force a lot of selling of commodity CDSs.
- There are also possible legislative limitations on commodity trading, which would produce similar or add to CDS requirements.
- It is clear to me that the increase in asset allocation (money flow) to commodities by pensions and the public has been a major contributor to the driving of higher oil and other commodity prices. And if commodity buying dries up (prices looking awfully high), there should be one strong down draft.
Click and read the whole thing.Now that Senator Barack Obama has become the Democrats' nominee for
President of the United States, to the cheers of the media at home and
abroad, he has written a letter to the Secretary of Defense, in a tone
as if he is already President, addressing one of his subordinates.The letter ends: "I look forward to your swift response."
``This is what I wish,'' Mohammed, speaking in English, told a judge who warned that he might be executed if convicted. ``I am looking to be martyred for a long time.''My suggestion for the judge's answer: I grant your wish to be martyred and sentence you to be drowned in pig fat."
For oil, Soros said that the price appreaciation resulted from four factors:1. Declining productivity of existing fields and increased cost and difficulty of finding new oil fields
2.
Backwards sloping supply curves in supplier nations who deem it
attractive to defer development of oilfields when prices are high and
appreciating
3. Increasing demand from countries such as China
and India which are growing rapidly but also subsidizing the price of
oil and thus not presenting buyers with true costs
4. The role of index investors
Soros
stressed that there would have been increases in oil prices without
speculative factors, which are acting on top of an upward sloping
curve. While he said that curve had become parabolic, which was a sign
of a bubble, he said he did not expect prices to fall soon (although he
did say that when bubbles break, the reversion is sharp). He mentioned
softening demand from emerging markets as a possible trigger.
Fourth Apollo Company Flips Its PIK Toggle
According to The Financial Times, a fourth company owned by the private
equity giant has started paying interest on some of its debt by issuing
more notes, instead of paying cash. The decision by Momentive Performance Materials
is a reminder of the excesses of the buyout boom, which popularized the
so-called pay-in-kind toggle that allows a company to pile on debt
instead of paying it off
Wall Street Says -2 + -2 = 4 as Liabilities Get New Bond MathBy Bradley Keoun
June 2 (Bloomberg) -- Leave it to Wall Street to profit from
its own distress.Merrill Lynch & Co., Citigroup Inc. and four other U.S.
financial companies have used an accounting rule adopted last year
to book almost $12 billion of revenue after a decline in prices of
their own bonds. The rule, intended to expand the ``mark-to-
market'' accounting that banks use to record profits or losses on
trading assets, allows them to report gains when market prices for
their liabilities fall.The new math, while legal, defies common sense. Merrill, the
third-biggest U.S. securities firm, added $4 billion of revenue
during the past three quarters as the market value of its debt
fell. That was the result of higher yields demanded by investors
spooked by the New York-based company's $37 billion of writedowns
from assets hurt by the collapse of the subprime mortgage market.continued here
Central bankers will continue to use "open mouth operations" to manage
inflation expectations, but will be reluctant to tighten given the
downside risks to growth and ongoing tensions in the banking system.
