Ward on Words

Innovation in the financial sector is once again turning Wall Street into the biggest roller coaster in America. It was a "glitch," apparently, that sent the markets down a very steep trajectory yesterday. According to the NY Times article on the crash, at least half of all trading is done via these "high frequency" trades. A computer is programed to do the buying and selling that once were the sole domain of the trader. "'We have a market that responds in milliseconds, but the humans monitoring respond in minutes, and unfortunately billions of dollars of damage can occur in the meantime,' said James Angel, a professor of finance at the McDonough School of Business at Georgetown University"(as quoted in the NY Times .) I love computers as much as anyone. But innovation coming out of the financial sector is a little scary these days. From the Times story: "The near-instantaneous swings left brokers dumbfounded." Traders weren...

Anyone remember the big Soviet demonstrations of military might on May Day? It used to be that every year on May 1st, the Soviets would unveil the power of all their many weapons by parading samples of them down some expansive street in Moscow. Grim soldiers would walk in precise steps past the aged members of the Politburo. It was indeed an impressive display of strength, impressive enough to foster "the arms race." Moscow's May Day is, of course, ancient history, taking place back when our only enemy, it seemed, was communism. Today, we face various dangerous enemies on many fronts. And in a story with a May 1st dateline, the Wall Street Journal gives us a glimpse into a mighty enemy that today threatens the United States. You can find the description of this enemy in the story they call "Number of the Week." This is one of the enemies we face today: "$132 billion." That's the dollar amount of the total losses generated by synthetic mezz...

Things I'd blog about if I had the time to blog these days: – Paulson's book – The game that got us to this point ( Liar's Poker ) – A review of Atlas Shrugged – Musings on the fate of Ken Lewis, and how the Merrill deal has destroyed his legacy, even with Paulson's stamp of approval There is more. But there is less time than usual these days. Work/life balance out of whack these days... (at least I'm working, right?!)

Brad Delong, economics professor, blogger , expert on money stuff, has a sidebar on his blog noting that he's signed up for a speaker's bureau because "the Eighteen-Year-Old is going to college next year, which means that I need to think about making more money." Which makes it a bit odd that he's got a guest post on the Berkely Blog called Is It Fair for Education to Be Cheap ? A man now on the hustings to raise money for college is well aware that "cheap" and "college" are not a likely pair. What he's referring to is the subsidized higher education one can acquire at a public university. In my state, the in-state tuition is about $22,000 a year, which makes the cost of a four-year degree close to six figures when it's all said and done. That's not "cheap" education. Or if it is, I'd like to know how a family that makes today's average income of $50K can afford to send multiple children off to school an...

It will take a while, but you'll find him if you look hard. Page past the metal-clad Gucci model... Past the the starved-looking girl in the Juicy Couture ad (note to Juicy Couture marketing execs: nothing juicy about anorexia!)... Past Kate Moss wearing little more than a purse in a cab... Past the spread on "the Warrior Way" (which has nothing to do with warriors and everything to do with "tattered minis strapped with shoulder armor and breastplates")... Past the story on Tina Fey (but before the pic-heavy story on Robert Pattison)... And there you'll find him. Tim Geithner going Vogue , "on the money," spilling his guts about the bailout, all in the March issue of Vogue magazine. Who needs the New Yorker and Atlantic profiles when Vogue is there to chat with the US Treasury Secretary about TARP and bonuses and all the other topics so dear to the hearts of Vogue readers? The article opens with this: "If last year'...

A video by OK GO 'This too shall pass." (And if this innovative production doesn't leave you with a smile, don't despair. Spring is coming...) Having spent a portion of my career in production, I know this one-shot video was no easy task!

The Chi-rish are about to let loose. It's St. Patty's weekend in Chicago. Which means the Metra today let us know that there would be no glass objects or alcohol allowed on the trains this weekend. Yes, we love our St. Patty's day in Chicago - it's our way to let loose during Lent. Unlike New Orleans, we still feel compelled to party hard during the time of abstinence. We dye the river a bright, unnatural green. And we all add an O' or a Mac after our name, no matter where our ancestors came from. Everyone is Irish on St. Patty's Day! At least in Chicago. Not sure what it's like elsewhere. I've heard that until recently, St. Patty's day was a day to go to church in Ireland. That was until the Americans flooded the place wondering where the parade was. I had no idea that booze was allowed on trains on other days! Just thought the people surreptitiously drinking beer out of gigantic cans during non-festive days was their surreptitious way of ...

Bank of America has posted its third consecutive quarterly loss. Apparently, the double whammy of paying back TARP and defaults on consumer loans has packed quite a punch to the firm's bottom line. From Bloomberg : "'Economic conditions remain fragile and we expect high unemployment levels to continue, creating an ongoing drag on consumer spending and growth,' [Bank CEO Brian] Moynihan said in a statement. 'We are encouraged by signs the economy is improving, as we have seen in the stabilization of our credit costs, particularly in the consumer business.'" Specks of sun are breaking through, perhaps, but clouds of high unemployment and sluggish consumer spending remain heavy and dark everywhere you look. Given the gloom surrounding the current economic outlook for consumers outside of Wall Street, why would BoA consider taking the hit now to repay TARP? Wasn't TARP designed to help struggling, massive banks recapitalize? More from Bloomberg: ...

The man reluctant to cut his vacation short to help Katrina victims is working with Bill Clinton to help Haitian earthquake victims? Is this a dream or the transformation of George W. Bush into a philanthropist? From a story in the Washington Post : "Bush said that his heart, and that of former first lady Laura Bush, 'are broken when we see the scenes of little children struggling without a mom or a dad or the bodies in the streets.' He pledged to work alongside Clinton to encourage Americans to dig into their pockets. In the near term, he urged people to avoid donating blankets or other items but to just 'give your cash' to aid organizations that can spend it wisely. (Just had a flashback to those pallets filled with $12 billion in cash that vanished in Iraq in 2003 - 2004. Is Halliburton involved in anyway with the relief effort?) Strange that a man who failed to mobilize the FEMA forces during the worst natural disaster to hit America has found himse...

GM predicts a profitable year in 2010. Now that IS bold! The company, clawing its way out of bankruptcy. The economy, still shedding jobs by the tens of thousands each month (down from the hundreds of thousands shed in a few months ago - leading many to predict the beginning of the jobless recovery.) And a prediction unprecedented in optimism. The Wall Street Journal characterized GM's statement as a "bold and surprising forecast," and noted the company has not seen a profitable year since 2004. The WSJ also noted that "significant hurdles remain to repairing GM's bottom line, namely winning back tens of thousands of customers and improving the profitability of vehicles sold." And the newspaper gives us another curious statement: "When GM started piling up billions of dollars in losses in 2005, Rick Wagoner, its CEO at the time, stopped offering financial guidance." Does this mean the CEO shut down from stress? Failed to steer the shi...