Behavioral Targeting and Online Privacy is taking an interesting turn. Yesterday I wrote about Privacy groups proposal to create �Do-Not-Track� for online behavioral targeting just like �Do-Not-Call� list to stop telemarketers from contacting the people on the list.
To counter these groups, AOL took a proactive step by announcing the launch of Privacy education program for Behaviorally Targeted Advertising.
AOL is doing exactly what I wrote in April of this year in an article related to privacy
"I believe that if consumers are provided proper education then they can in fact benefit from Behavioral Targeting. It will be a win-win situation for all the parties involved. Proper education and disclosures by advertisers, publishers and networks will ease the concerns regarding Behavioral Targeting. Consumers have the right to opt out of Behavioral Targeting but what is lacking is proper education on how to do so."
According to an AOL press release:
Program Will Provide Greater Transparency, Enhanced Notice of How Targeted Advertising Works, and Patent-Pending Technology to Protect Consumers' Opt-Out Choices; The Program Will Reach More Than 91% of Online Consumers
�Our goal with this program is to engender greater trust for targeted advertising by communicating with consumers in a more visible way, and by providing them more information about their choices,� said Curt Viebranz, President of Platform-A. �AOL believes that doing more to explain to users the choices they have over the way their data is used, and helping them exercise those preferences will help them feel more in control.�
I also wrote in the previous article:
�The networks currently opt-in users by default; however, in my opinion the proper process should be opt-out by default and opt-in if user chooses to opt-in, just like we do for emails and newsletters. This process will move the burden from users to the advertisers, publishers and networks.�
I don�t think we are going to get opt-in process in near future, here is what AOL talked about the opt-out process:
The expanded use of the TACODA opt-out technology will help better preserve consumer choices. Today, users who opt-out of behavioral targeting by using an opt-out cookie risk having their preference lost if they later delete their cookies. TACODA leverages a Web cache technique to preserve a consumers' opt-out choice even if they delete their browser cookies, something other opt-out systems cannot currently do. AOL is also exploring opportunities to license this technology on a royalty-free basis for use exclusively in consumer privacy protection programs.
�We want to make the opt-out process as simple and transparent as possible,� said Jules Polonetsky, Chief Privacy Officer, AOL. �We urge the industry to join us in ensuring that users who take steps to minimize the data they provide have their choices maintained.�
In another article titled �Online Marketers Joining Internet Privacy Efforts� NYTimes.com writes:
AOL says it is setting up a new Web site that will link consumers directly to opt-out lists run by the largest advertising networks. The site�s technology will ensure that people�s preferences are not erased later.
There is a silver lining for marketers, however: the AOL site will try to persuade people that they should choose to share some personal data in order to get pitches for products they might like. Most Web sites, including AOL, already collect data about users to send them specific ads � but AOL is choosing to become more open about the practice and will run advertisements about it in coming months.
I think this is a very smart move by AOL/Tacoda, if it can convince consumers about the benefit of Behavioral Targeting then why not take one step further and have these consumers provide more information about themselves.
Other posts that I recommend
1. Privacy
1. Behavioral Targeting
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Wednesday, October 31, 2007
Which Comes First: The Cart or the Horse?
Before we get to the cart and the horse, let's answer a reader question that just came in: "What prevents the Fed from sending every household $100k?"
Just Five Things
1) Lack of authority
2) People would use it to pay off debt
3) Banks do not want to be paid back with money that is worthless
4) The Fed will act to bailout banks, not consumers
5) Hyperinflation ends the game. The Fed is simply not in the business of destroying itself.
Rest assured the Fed is going to do almost everything under the sun to encourage more borrowing. That includes slashing the discount rate, the Fed Fund's Rate, loosening rules on collateral, etc. Some of those we have already seen. This is likely the first inning.
But the one thing the Fed is not going to do is send everyone $100,000 or $10,000 or even $5,000. If for some reason I am mistaken and the Fed starts sending out checks or depositing money into people checking accounts to a significant degree, then I am willing to eat my deflation hat. Just so we are clear on this, another piddly $300 from Congress is not enough.
The Cart and the Horse
There was an interesting editorial article on Gold Eagle last week by Peter Schiff.
Prices Are The Cart, Money Supply Is The Horse
My take, complete with an image of the cart and the horse, can be found in Inflation: What the heck is it?
Peter Schiff did make an error, however. That error is in the phrase "only the Fed can create it". When it comes to credit, the statement is simply wrong. Money (credit actually) and there is a difference, is borrowed into existence every day. This is a systemic problem and the Fed is clearly not in control of it.
Money As Debt
There is an educational 5 part You-Tube series on money and debt. It covers in nice cartoon animation what has happened to money over time, fractional reserve lending, how money is created today, why interest rates are so low, why we get unsolicited credit offers, and why debt is exploding.
The video concludes that it is taking exponential increases in debt (money) to stave off a collapse of the entire banking system, and that this cannot go on forever.
Click here (not on the image above) to see this 5 part series on debt.
I agree with the video that there are practical limits on how high debt can get. So does economist Paul Kasriel at the Northern Trust. (See An Interview with Paul Kasriel)
Interesting Quotes from the Video:
Unfortunately, the government cannot decide what has value or not. Only the free market can do that. Otherwise you have bridges built to nowhere based on political clout, needless wars and other malinvestments of capital.
If government printing led to prosperity we would be talking about Zimbabwe, the Weimar Republic, and the Soviet style command economy of the 1940's through 1980's in glowing terms. The proposed solution is ridiculous.
The video also incorrectly blames the gold standard for problems created by fractional reserve lending. However, the video does a reasonable job of pointing out many of the problems with the current system of debt creation in a very entertaining and (for the most part) educational way. On that basis, I recommend watching all five parts.
Ability to Take on Debt is not Infinite
At the top of this article I outlined 5 reason why the Fed was not going to give money away. If one believes that rationale, then one must logically accept there is a practical limit to debt, at least at the consumer level.
Proof of concept is easy enough to find. Massively rising delinquencies, foreclosures, and bankruptcies should be proof enough. Additional proof can be found in a Drop in Revenue Growth at State and Federal Level.
At the state level, it's easy to see what is going to happen. Unlike the Federal Government, states are required to have balanced budgets. That means one of three things.
This is yet another version of Economic Zugzwang where there are no winning answers (at least as far as politicians are concerned).
The proper solution is to let free market forces work. If that means banks fail, then banks should fail. If that means the stock market collapses, the stock market should collapse.
Letting (encouraging) the dollar fall to zero is not a solution for the simple reason it does not create any jobs where they are needed, which is right here right now.
Given the amount of credit in the system vs. actual cash, and given global wage arbitrage and slower consumer spending, it would take a mammoth effort from Congress and the Fed to forestall the inevitable once again.
A Sure Thing?
Right now the surest bet in the world is that when the dollar drops the US stock markets rise. How long that remains is anyone's guess.
There is going to come a time when borrowing dollars to invest in equities is going to blow up. Of course the carry trade may blow up first (sinking everything in its wake). Perhaps a massive derivatives unwind sinks everything first. Then again, perhaps the trigger is something from way left field that no one is watching.
The fuse is now lit. The structural imbalances worldwide have never been greater and the fuel at the end of the fuse is enormous. In addition, amount at risk increases every day.
The interesting thing is that no one knows how long the fuse is. For some inexplicable reason everyone acts as if they can get out before the stick ignites. It's simply not possible.
Mike Shedlock / Mish
http://globaleconomicanalysis.blogspot.com/
Just Five Things
1) Lack of authority
2) People would use it to pay off debt
3) Banks do not want to be paid back with money that is worthless
4) The Fed will act to bailout banks, not consumers
5) Hyperinflation ends the game. The Fed is simply not in the business of destroying itself.
Rest assured the Fed is going to do almost everything under the sun to encourage more borrowing. That includes slashing the discount rate, the Fed Fund's Rate, loosening rules on collateral, etc. Some of those we have already seen. This is likely the first inning.
But the one thing the Fed is not going to do is send everyone $100,000 or $10,000 or even $5,000. If for some reason I am mistaken and the Fed starts sending out checks or depositing money into people checking accounts to a significant degree, then I am willing to eat my deflation hat. Just so we are clear on this, another piddly $300 from Congress is not enough.
The Cart and the Horse
There was an interesting editorial article on Gold Eagle last week by Peter Schiff.
Prices Are The Cart, Money Supply Is The Horse
The sad truth is that despite the best efforts of monetary economists everywhere, fundamental misconceptions about inflation remain entrenched in government, business, and the media.That is a near perfect explanation by Peter Schiff. Certainly, his definition of inflation is perfect: "Inflation is by definition an increase in the supply of money and credit."
In an exchange earlier this week on CNBC, a guest explained that rising oil prices can not cause inflation because prices for other goods must fall as spending is diverted to pay for more expensive oil. That explanation prompted host Becky Quick to ask: "If rising oil prices do not cause inflation, then what does?" Since that question was left unanswered on the air, I thought I would take the time to answer it here.
Inflation has only one cause and that is the Federal Reserve itself. In the United States, the supply of money and credit is regulated by the Fed. Since inflation is by definition an increase in the supply of money and credit, only the Fed can create it.
If the money supply were held constant, increases in some prices would be offset by decreases in others. The result would be no overall inflation. In fact, without government created expansions of the money supply, the natural tendency of prices would be to decline as technology allowed for more efficient production of goods and services. So while most regard the Fed as the primary inflation fighter, in reality it is the sole inflation creator.
My take, complete with an image of the cart and the horse, can be found in Inflation: What the heck is it?
Peter Schiff did make an error, however. That error is in the phrase "only the Fed can create it". When it comes to credit, the statement is simply wrong. Money (credit actually) and there is a difference, is borrowed into existence every day. This is a systemic problem and the Fed is clearly not in control of it.
Money As Debt
There is an educational 5 part You-Tube series on money and debt. It covers in nice cartoon animation what has happened to money over time, fractional reserve lending, how money is created today, why interest rates are so low, why we get unsolicited credit offers, and why debt is exploding.
The video concludes that it is taking exponential increases in debt (money) to stave off a collapse of the entire banking system, and that this cannot go on forever.
Click here (not on the image above) to see this 5 part series on debt.
I agree with the video that there are practical limits on how high debt can get. So does economist Paul Kasriel at the Northern Trust. (See An Interview with Paul Kasriel)
Interesting Quotes from the Video:
- "Debt... That's what our money system is. If there were no debts in our money system, there wouldn't be any money." Marriner S. Eccles. Chairman and Governor of the Federal Reserve Board.
- This is a staggering thought. Someone has to borrow every dollar we have in circulation, cash or credit. We are absolutely, without a permanent money system. When one gets a complete grasp of the picture, the tragic absurdity of our hopeless position is almost incredible, but there it is." Robert H. Hemphill, Credit Manager, Federal Reserve Bank, Atlanta Georgia.
- "One thing to realize about our fractional reserve banking system is that, like a child's game of musical chairs, as long as the music is playing there are no losers." Andrew Gause, Monetary Historian
- "Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist." Kenneth Boulding, economist
- I have never yet had anyone who could through the use of logic and reason, justify the Federal Government borrowing the use of its own money... I believe the time will come when people will demand that this be changed. I believe the time will come in this country when they actually blame you and me and everyone connected with Congress for sitting idly by and permitting such an idiotic system to continue." Wreight Patman, Congressman 1928-1976, Chairman, Committee on Banking and Currency 1963-1975
- The modern banking system manufactures money out of nothing. The process is perhaps the most astounding piece of sleight of hand that was ever invented. Sir Josiah Stamp, Director, Bank of England 1928-1941
Unfortunately, the government cannot decide what has value or not. Only the free market can do that. Otherwise you have bridges built to nowhere based on political clout, needless wars and other malinvestments of capital.
If government printing led to prosperity we would be talking about Zimbabwe, the Weimar Republic, and the Soviet style command economy of the 1940's through 1980's in glowing terms. The proposed solution is ridiculous.
The video also incorrectly blames the gold standard for problems created by fractional reserve lending. However, the video does a reasonable job of pointing out many of the problems with the current system of debt creation in a very entertaining and (for the most part) educational way. On that basis, I recommend watching all five parts.
Ability to Take on Debt is not Infinite
At the top of this article I outlined 5 reason why the Fed was not going to give money away. If one believes that rationale, then one must logically accept there is a practical limit to debt, at least at the consumer level.
Proof of concept is easy enough to find. Massively rising delinquencies, foreclosures, and bankruptcies should be proof enough. Additional proof can be found in a Drop in Revenue Growth at State and Federal Level.
At the state level, it's easy to see what is going to happen. Unlike the Federal Government, states are required to have balanced budgets. That means one of three things.
- Cutting Spending
- Raising Taxes
- Floating Bonds to Postpone the Problem
This is yet another version of Economic Zugzwang where there are no winning answers (at least as far as politicians are concerned).
The proper solution is to let free market forces work. If that means banks fail, then banks should fail. If that means the stock market collapses, the stock market should collapse.
Letting (encouraging) the dollar fall to zero is not a solution for the simple reason it does not create any jobs where they are needed, which is right here right now.
Given the amount of credit in the system vs. actual cash, and given global wage arbitrage and slower consumer spending, it would take a mammoth effort from Congress and the Fed to forestall the inevitable once again.
A Sure Thing?
Right now the surest bet in the world is that when the dollar drops the US stock markets rise. How long that remains is anyone's guess.
There is going to come a time when borrowing dollars to invest in equities is going to blow up. Of course the carry trade may blow up first (sinking everything in its wake). Perhaps a massive derivatives unwind sinks everything first. Then again, perhaps the trigger is something from way left field that no one is watching.
The fuse is now lit. The structural imbalances worldwide have never been greater and the fuel at the end of the fuse is enormous. In addition, amount at risk increases every day.
The interesting thing is that no one knows how long the fuse is. For some inexplicable reason everyone acts as if they can get out before the stick ignites. It's simply not possible.
Mike Shedlock / Mish
http://globaleconomicanalysis.blogspot.com/
Tuesday, October 30, 2007
Do-Not-Track List: An attempt to kill Behavioral Targeting
An article in AdAge reports that Privacy Groups Propose Do-Not-Track List.
According to the article:
"Demands of these groups would Hinder Marketers' Behavioral-Targeting Practices Online.
Privacy advocates are expected to propose the creation of a do-not-track list, a sort of internet version of the Do Not Call Registry, at a news conference tomorrow.
In addition to the list, the proposal calls for a requirement that advertisers, as part of their online ads, instantaneously disclose details of what they intend to track. According to a media alert announcing the news conference, the groups behind the proposal include the Center for Democracy and Technology, Consumer Action, Consumer Federation of America and the Electronic Frontier Foundation, among others.
...Typically, advertisers and online media sellers use web cookies to track and maintain information about online consumers. A cookie might be used to figure out what's in a user's shopping cart on a retail website or to record a user's login for a particular site so that user doesn't have to re-enter a login name and password every time they revisit the site. Cookies can also be used to track surfing behavior and offer up ads based on a user's surfing history.
Thanks to such behavioral-targeting technology, a user looking at a specific type of auto on a car-review site, for example, could be targeted with an ad for that particular make and model even when they move onto a general-interest site. Behavioral targeting tends to create more valuable inventory and be more effective, according to many advertisers and publishers familiar with the technology.
�However, consumer-privacy advocates charge that collecting such information in order to target ads creates "a privacy imbalance that has deprived Americans of the right to control their personal information."
So my questions to these groups are:
In my previous posts concerning privacy I proposed that Behavioral Targeting should be �Opt-In� instead of �Opt-out�, let the users make a call if they would like to be tracked to see more relevant ads.
Here is what wrote
"I believe that if consumers are provided proper education (I will write about consumer benefits in one of my future posts) than they can in fact benefit from Behavioral Targeting. It will be a win-win situation for all the parties involved. Proper education and disclosures by advertisers, publishers and networks will ease the concerns regarding Behavioral Targeting. Consumers have the right to opt out of Behavioral Targeting but what is lacking is proper education on how to do so. The networks currently opt-in users by default; however, in my opinion the proper process should be opt-out by default and opt-in if user chooses to opt-in, just like we do for emails and newsletters. This process will move the burden from users to the advertisers, publishers and networks.
In short run this could result in a lower reach for BT providers. But if the benefits to consumers are properly stated then most of the consumers will be willing to participate. If you (network or advertiser) tell a consumer that he/she does not need to go looking for deals or offers of products/services that he/she is in the market for, these deals/offers will be provided to him/her based on her online behavior no matter where in the network she is in, I think consumer will love it. If a consumer knows the process and she knows that she is willingly participating in the BT, the click-through rate on the ads will be higher too. Why force users into Behavioral Targeting and raise privacy concerns when you can offer them what they want (when they want) and make them your raving fans."
Comments?
According to the article:
"Demands of these groups would Hinder Marketers' Behavioral-Targeting Practices Online.
Privacy advocates are expected to propose the creation of a do-not-track list, a sort of internet version of the Do Not Call Registry, at a news conference tomorrow.
In addition to the list, the proposal calls for a requirement that advertisers, as part of their online ads, instantaneously disclose details of what they intend to track. According to a media alert announcing the news conference, the groups behind the proposal include the Center for Democracy and Technology, Consumer Action, Consumer Federation of America and the Electronic Frontier Foundation, among others.
...Typically, advertisers and online media sellers use web cookies to track and maintain information about online consumers. A cookie might be used to figure out what's in a user's shopping cart on a retail website or to record a user's login for a particular site so that user doesn't have to re-enter a login name and password every time they revisit the site. Cookies can also be used to track surfing behavior and offer up ads based on a user's surfing history.
Thanks to such behavioral-targeting technology, a user looking at a specific type of auto on a car-review site, for example, could be targeted with an ad for that particular make and model even when they move onto a general-interest site. Behavioral targeting tends to create more valuable inventory and be more effective, according to many advertisers and publishers familiar with the technology.
�However, consumer-privacy advocates charge that collecting such information in order to target ads creates "a privacy imbalance that has deprived Americans of the right to control their personal information."
So my questions to these groups are:
- If consumer don�t like the irrelevant ads but still prefer free ad-supported content to paid ad-free content, how are these groups going to provide that?
- How are they going to create Do Not Target list without (Personally Identifiable Information) PII information?
- One solution is used by NAI, that is to drop a cookie to indicate that user should not be tracked. But if a user deletes NAI cookie then the user is back in �Do-Track� list since most of the targeting solutions are �Opt-Out� systems (user is opted-in by default).
- Another solution is to create a universal cookie that might be able to get by without any PII information but who is going to maintain that? Google? Microsoft? Yahoo?(Just Kidding)
- Is anonymous tracking really a privacy concern? Do consumers really care about Privacy? Or is this mostly a concern of these groups? Anonymous cookie tracking is still better than what these users provide online to the social networking sites. Look at facebook.com, myspace.com where users voluntarily provide information everyday about their whereabouts, likes, dislikes, friends etc.
In my previous posts concerning privacy I proposed that Behavioral Targeting should be �Opt-In� instead of �Opt-out�, let the users make a call if they would like to be tracked to see more relevant ads.
Here is what wrote
"I believe that if consumers are provided proper education (I will write about consumer benefits in one of my future posts) than they can in fact benefit from Behavioral Targeting. It will be a win-win situation for all the parties involved. Proper education and disclosures by advertisers, publishers and networks will ease the concerns regarding Behavioral Targeting. Consumers have the right to opt out of Behavioral Targeting but what is lacking is proper education on how to do so. The networks currently opt-in users by default; however, in my opinion the proper process should be opt-out by default and opt-in if user chooses to opt-in, just like we do for emails and newsletters. This process will move the burden from users to the advertisers, publishers and networks.
In short run this could result in a lower reach for BT providers. But if the benefits to consumers are properly stated then most of the consumers will be willing to participate. If you (network or advertiser) tell a consumer that he/she does not need to go looking for deals or offers of products/services that he/she is in the market for, these deals/offers will be provided to him/her based on her online behavior no matter where in the network she is in, I think consumer will love it. If a consumer knows the process and she knows that she is willingly participating in the BT, the click-through rate on the ads will be higher too. Why force users into Behavioral Targeting and raise privacy concerns when you can offer them what they want (when they want) and make them your raving fans."
Comments?
The Litigation Scorecard
Now that the World Series is over, many fans are suffering withdrawal symptoms over the need to keep a current scorecard of exciting day to day sports action. Weekend football just is not sufficient and Hockey belongs in Canada. Yes, there is basketball, but something is needed to replace baseball.
I have just the ticket: The Litigation Scorecard. Action has been fast and furious since October 18.
For example: Merrill Lynch (MER) and Countrywide (CFC) were both hit hard by their respective opponents in boxing matches earlier today. Earlier this month New Century was accused of illegal procedure in a football game with a young couple. Bank of America (BAC) stands accused of reneging in a high stakes Euchre Game. Details will follow but let's first consider the October Litigation Scorecard.
Litigation Scorecard
On October 30 Merrill Lynch was hit with shareholder lawsuit over subprime
Here's an interesting illegal procedure case from October 24: Couple sues subprime lender New Century Mortgage Co
On October 19th HSBC was sued over subprime bond valuation
The Massachusetts attorney general's office has sued Fremont Investment and Loan, once the state's second-largest subprime lender, accusing it of using predatory lending practices to sell loans to some borrowers who eventually lost their homes or had to file bankruptcy.
The attorney general is seeking fines from Fremont for violating the state's 2004 antipredatory lending law, which bars lenders from making loans that customers are unable to pay, as well as compensation for borrowers.
In a statement, Fremont General Corp., the Brea, Calif., parent company of Fremont Investment, said that it continues to work with regulators around the country to modify loans for customers struggling to make their payments. The company said it is "regrettable that the Massachusetts attorney general has abandoned these cooperative efforts to help borrowers keep their homes."
The above is a clear case of encroachment. Fremont is accused of sticking its neck into disallowed territory.
On October 2 State Street Sued by Prudential Over Subprime Losses
This is but a drop in the bucket of an upcoming firestorm of litigation. Have your scorecards ready. Be sure to keep track of all the penalties. Also note on your scorecards the sport or game being played.
Mike Shedlock / Mish
http://globaleconomicanalysis.blogspot.com/
I have just the ticket: The Litigation Scorecard. Action has been fast and furious since October 18.
For example: Merrill Lynch (MER) and Countrywide (CFC) were both hit hard by their respective opponents in boxing matches earlier today. Earlier this month New Century was accused of illegal procedure in a football game with a young couple. Bank of America (BAC) stands accused of reneging in a high stakes Euchre Game. Details will follow but let's first consider the October Litigation Scorecard.
Litigation Scorecard
- October 30 - Merrill Lynch (MER) hit with shareholder lawsuit
- October 30 - Mozilo and Countrywide (CFC) hit with shareholder lawsuit
- October 25 - American Home accuses Lehman Bros. (LEH) of hitting American Home below the belt with improper margin calls in July and demanding money the company says it did not owe.
- October 24 - A couple sues New Century for illegal procedure in loan disclosure documents
- October 24 - HSBC sued by Canadian firm Aastra Technologies Ltd. over asset-backed commercial paper investments. Aastra's puck (assets) have been frozen since August.
- October 23 - American Home is accusing Bank of America (BAC) of reneging on swap agreements in a high stakes Euchre Game. American Home seeks $25 million for the reneg.
- October 19 - Luminent Mortgage Capital Inc. (LUM) is seeking a penalty kick in an international soccer match with HSBC.
- October 18 - Book publisher Unisystems Inc., on behalf of all all retirement plans that invested in State Street-managed bond funds sues State Street (STT) for being offsides in an investment gamble by investing pension plan funds meant for low-risk investments into high-risk mortgage-backed securities
- October 06 - Fremont sued by Massachusetts attorney general for predatory lending encroachment
- October 02 - In a battle between middle-heavyweights, State Street (STT) was Sued by Prudential (PRU) Over Subprime Losses
On October 30 Merrill Lynch was hit with shareholder lawsuit over subprime
An investor lawsuit has been filed against Merrill Lynch & Co Inc (MER.N), contending that the company issued false and misleading statements about its exposure to risky mortgage investments, the plaintiffs' lawyers said on Tuesday.On October 30, Countrywide shareholders sued CEO Mozilo, board
The complaint accused Merrill of issuing materially false and misleading statements about its financial exposure to collateralized debt obligations (CDOS) containing subprime mortgage securities.
The company's statements "were materially false due to their failure to inform the market of the ticking time bomb in the company's CDO portfolio due to the deteriorating subprime mortgage market," the complaint said.
Countrywide Financial Corp Chief Executive Angelo Mozilo has been sued by a pension fund that accused the largest U.S. mortgage lender of helping executives pocket improper gains by artificially inflating its stock price through share buybacks.On October 25 American Home Sued Lehman Bros.
The New England Teamsters & Trucking Industry Pension Fund accused Mozilo, other Countrywide executives and the company's board of directors of gross mismanagement for improperly using $2 billion of cash to repurchase stock.
It said the move allowed executives to sell $842 million of Countrywide shares at artificially high prices between April 2004 and October 2007, at the expense of ordinary shareholders.
In addition to Mozilo, the lawsuit names President and Chief Operating Officer David Sambol; Executive Managing Directors Carlos Garcia, Ranjit Kripalani and Andrew Gissinger III; Chief Legal Officer Sandor Samuels and Chief Financial Officer Eric Sieracki.
It also names board members Oscar Robertson, Michael Dougherty, Robert Donato, Jeffrey Cunningham, Harley Snyder, Martin Melone, Keith Russell, Robert Parry and former directors Stanford Kurland, Ben Enis, Edwin Heller, Henry Cisneros, Kathleen Brown, as well as Countrywide's auditor KPMG.
Bankrupt lender American Home Mortgage Investment Corp. has sued Lehman Bros., accusing the investment bank of essentially stealing from the company as it struggled to stay on its feet.Improper margin calls are clearly hitting below the belt.
The lawsuit, filed Wednesday in the U.S. Bankruptcy Court in Wilmington, Del., accuses Lehman Bros. of hitting American Home with improper margin calls in July and demanding money the company says it did not owe.
When the Melville, N.Y.-based lender couldn't meet Lehman's second margin call, for $7 million, Lehman foreclosed on $84 million worth of subordinated notes issued in American Home's structured-finance operation.
"In so doing, Lehman Bros. did nothing short of 'stealing' property" of American Home, the company said.
Here's an interesting illegal procedure case from October 24: Couple sues subprime lender New Century Mortgage Co
A Lowell couple is suing their subprime mortgage lender in Hammond federal court in an attempt to rescind their $126,000 home-equity loan, alleging the company did not disclose the terms of the deal.On October 24, in a corporate hockey match, HSBC sued over asset-backed commercial paper, subprime
Kerry and Susan Burke argue the New Century Mortgage Co., which went bankrupt earlier this year amidst the subprime industry meltdown, should have disclosed their mortgage payments were due each month.
The case was filed by Chicago class-action lawyer Daniel Edelman, who said the Burkes and other people in the same situations could have their home-equity mortgages rescinded.
"If you can rescind it, you can have all the payments applied to the principal," Edelman said. "So it could solve your predatory lending problem."
The Burkes' case is based on a legal technicality. Although their mortgage paperwork states at least 11 times that the payments are monthly, a separate form called the Federal Truth-In-Lending Disclosure Statement does not explicitly make that statement.
The ability to rescind a mortgage for violating the Truth-in-Lending Act in this way only applies to home-equity loans, not mortgages used to buy new or existing homes.
HSBC Holdings Plc�s Canadian unit became the first financial adviser in the country to be sued over investments in asset-backed commercial paper that were frozen following the U.S. subprime mortgage industry collapse.On October 23 American Home Units Sue BofA For $25M
Aastra Technologies Ltd., which makes telecommunications equipment, filed the suit today in Ontario Superior Court, alleging HSBC and adviser Nicolas Del Sorbo gave bad advice in recommending asset-backed commercial paper investments.
The assets have been frozen since August. Asset-backed commercial paper consists of short-term notes issued by special-purpose trusts created to hold longer-term investments.
Del Sorbo �acted negligently in failing to perform the necessary investigations'� of the investments, Aastra said in its complaint. �But for Del Sorbo�s representations, Aastra would not have made the investment.'�
Three affiliates of bankrupt American Home Mortgage Holdings Inc. have accused Bank of America NA of reneging on swap agreements in which they are entitled to more than $25 million.I have inside knowledge on this one. I know for a fact that the game being played was Euchre. Those who guessed Bridge simply guessed incorrectly. $25 million for a reneg in Euchre is indeed quite high stakes.
Broadhollow Funding LLC, Melville Funding LLC and a unit of American Home filed an adversary suit on Monday in a Delaware bankruptcy court which seeks to hold BofA accountable for a shortfall in their sale of American Home...
On October 19th HSBC was sued over subprime bond valuation
U.K. banking group HSBC is being sued by U.S. real-estate fund Luminent Mortgage Capital Inc. over allegations the bank's U.S. mortgage-trading operations took advantage of the recent credit crisis to profit at the fund's expense, according to a report in the Wall Street Journal. Luminent is claiming that HSBC applied an improperly-low valuation to several subprime-mortgage bonds that were used as collateral for loans, the newspaper reported. The complaint says HSBC bought the bonds at a deep discount to their fair value, the Journal said.On October 18th State St. Sued Over Subprime Investment "Gamble"
State Street Bank and Trust Co. and its advisory firm have been hit with a purported class action for allegedly investing pension plan funds meant for low-risk investments into high-risk mortgage-backed securities which tanked after the subprime mortgage meltdown.On October 6th, Subprime lender Fremont sued under predator law
The Massachusetts attorney general's office has sued Fremont Investment and Loan, once the state's second-largest subprime lender, accusing it of using predatory lending practices to sell loans to some borrowers who eventually lost their homes or had to file bankruptcy.
The attorney general is seeking fines from Fremont for violating the state's 2004 antipredatory lending law, which bars lenders from making loans that customers are unable to pay, as well as compensation for borrowers.
In a statement, Fremont General Corp., the Brea, Calif., parent company of Fremont Investment, said that it continues to work with regulators around the country to modify loans for customers struggling to make their payments. The company said it is "regrettable that the Massachusetts attorney general has abandoned these cooperative efforts to help borrowers keep their homes."
The above is a clear case of encroachment. Fremont is accused of sticking its neck into disallowed territory.
On October 2 State Street Sued by Prudential Over Subprime Losses
Prudential Financial is suing State Street because of $80 million in losses in two State Street funds caused by "undisclosed, highly leveraged" investments including subprime mortgages. Prudential says the losses were in accounts held by 28,000 individuals in 165 retirement plans that it markets.Obviously the above is a boxing match between two middle-heavyweights.
This is but a drop in the bucket of an upcoming firestorm of litigation. Have your scorecards ready. Be sure to keep track of all the penalties. Also note on your scorecards the sport or game being played.
Mike Shedlock / Mish
http://globaleconomicanalysis.blogspot.com/
It has been a while...
It has been a while since my last post. I am kind of busy.
I will resume posting as soon as I can decide what my next camera will be... the Canon 5D is very tempting with the recent price drop, yet I don't feel like carrying around a 2 lb. over-sized camera. I also need a small P&S and I am thinking about buying the Canon G9...
Stay tuned!
I will resume posting as soon as I can decide what my next camera will be... the Canon 5D is very tempting with the recent price drop, yet I don't feel like carrying around a 2 lb. over-sized camera. I also need a small P&S and I am thinking about buying the Canon G9...
Stay tuned!
Ponte City's Transformation
A couple years ago I posted briefly about Ponte City, a 1970s high-rise with a distinct cylindrical shape and hollow core. Located in Johannesburg, South Africa, the building is undergoing a transformation from...
to...
Yes folks, it's New Ponte! While gussying up the concrete core with color and some balconies does little to betray the building's qualities, the exterior rendering below resembles a mediocre development in Chicago, New York, Vancouver, or some other North American city. The design and the marketing make me wonder how much else the South African development borrows from American precedents. From a brief look at New Ponte's web page, it looks like a lot, from the amenities package to the focus on "luxury" living and open floor plans.
Given the fact that Ponte City was a rough and tumble place that happened to have a unique design, the transformation is impossible to dismiss outright, though I'd contend that a development geared at a mix of incomes rather than solely the upper classes might make the transformation less contentious. But given the great swing of (social) change envisioned, architecture is just one piece of the puzzle.
What struck me as perhaps the most important (and unsettling) element in this transformation is the project's "urban renewal." While it's not clear if Johannesburg had the below charter pre-New Ponte, or if it was created with the input of developers to help these and other potential urban-renewal projects, the security element of the charter below appears to be another unfortunate extension of the American influence hypothesized above.
As the web page indicates: "The City of Johannesburg is committed to developing the Inner City as a place where people want to live. The Inner City Regeneration Charter commits the City to the following:
to...
Yes folks, it's New Ponte! While gussying up the concrete core with color and some balconies does little to betray the building's qualities, the exterior rendering below resembles a mediocre development in Chicago, New York, Vancouver, or some other North American city. The design and the marketing make me wonder how much else the South African development borrows from American precedents. From a brief look at New Ponte's web page, it looks like a lot, from the amenities package to the focus on "luxury" living and open floor plans.
Given the fact that Ponte City was a rough and tumble place that happened to have a unique design, the transformation is impossible to dismiss outright, though I'd contend that a development geared at a mix of incomes rather than solely the upper classes might make the transformation less contentious. But given the great swing of (social) change envisioned, architecture is just one piece of the puzzle.
What struck me as perhaps the most important (and unsettling) element in this transformation is the project's "urban renewal." While it's not clear if Johannesburg had the below charter pre-New Ponte, or if it was created with the input of developers to help these and other potential urban-renewal projects, the security element of the charter below appears to be another unfortunate extension of the American influence hypothesized above.
As the web page indicates: "The City of Johannesburg is committed to developing the Inner City as a place where people want to live. The Inner City Regeneration Charter commits the City to the following:
:: Highly Visible �bobby-on-the-beat� system, by increasing resources to the South African Police Services, and the Johannesburg Municipal Police Department over the next three years.(Thanks to Juliet for the head's up!)
:: Install 216 CCTV cameras in and around the Inner City, connected to a control center manned 24 hours a day by JMPD and SAPS.
:: Zero-tolerance to law-enforcement, including all by-laws.
:: Injecting R99-million into Pikitup in the 2007/8 financial year to build a new system of waste management and street cleaning in the Inner City.
:: Eliminate all Bad Buildings in the Inner City.
:: Eliminate all unlicensed and non-compliant liquor outlets by the end of 2009.
:: Upgrade all the city streets for pedestrians, through new paving, planting street trees, replacing and putting in new lighting, cleaning up litter etc."
[PDF link]
Stock Buybacks: A Good Thing Or Slipped DISCs?
When a company announces share buybacks, is that a sign that good things are coming? Does management really know what it is doing? Do analysts following those CEOs know what they are doing? If a guy is a CEO he must know what he is doing, right?
Let's explore those questions starting with a February press release from Ambac (ABK), followed by set of Emails I received last weekend from a contact at Morgan Stanley. The Emails are about stock buybacks and internal research at Morgan Stanley related to Ambac.
Here is the press release from Ambac.
Director (former CEO) Phillip B. Lassiter Dumps Shares
click on chart for a sharper image
Current CEO Robert Genader Dumps Shares
Click here for all Ambac insider transactions over the last 2 years
Ambac (ABK) Daily Chart
Flashback August 16, 2007
Morgan Stanley cuts Ambac target on possible CDO losses
At current share prices Ambac has lost $200 million+- on share buybacks, not counting interest on the debt and transaction fees.
Meanwhile, former CEO Phillip B. Lassiter somehow had the foresight to dump $10.37 million worth of shares that would now be worth $5.18 million+-. In addition, current CEO Robert Genader had the foresight to dump $10.20 million worth of shares that would now be worth $5.00 million+-.
Clearly these guys are worth the big bucks because they alone know how to make these kind of mission critical decisions.
Non-Performance Rewarded
Professor David Nelson is asking Does Executive Compensation Pass the Smell Test?
What do we have to show for it?
1) Increase dividends
2) Stop managing earnings
3) Reduce executive compensation
4) Reduce option expenses
Imagine there was one major homebuilder that instead of buying more and more land at ever increasing prices was instead paying huge dividends for the past 5 years. Who would be ahead of the game now? The answer should be clear, both the corporation and the shareholder. Arguably the CEO would be behind because of stock options.
Stock options encourage excessive risk taking to the point of ridiculousness. But when the inevitable collapse comes, the CEOs don't care, they have all cashed out hundreds of millions. In the case of Countrywide, over a $billion. It's sad to say, but in many corporations shares were repurchased with borrowed money even as insiders were bailing.
Question: With the company reeling from recent financial losses and the stock down significantly how does a shareholder maintain confidence that management is working on their behalf?
Answer: One can't. If you start with that assumption you will be far better off.
Addendum
Thanks to EconShift for the following information:
The selling plan used by the Director was implemented on Jan 31st, 2007. That was while the DISC was being finalized.
The selling plan for Genader was cleverly implemented after the fact on March 31st 2007.
Mike Shedlock / Mish
http://globaleconomicanalysis.blogspot.com/
Let's explore those questions starting with a February press release from Ambac (ABK), followed by set of Emails I received last weekend from a contact at Morgan Stanley. The Emails are about stock buybacks and internal research at Morgan Stanley related to Ambac.
Here is the press release from Ambac.
Feb. 12, 2007--Ambac Financial Group, Inc. (ABK) today announced the closing of 6.15% $400 million Directly-Issued Subordinated Capital Securities (DISCS(SM)). The DISCs were sold at a discount to par to yield 6.199%. Ambac will use all of the net proceeds from the offering and additional funds to purchase $400 million worth of shares of its common stock. The common stock will be purchased through an accelerated share repurchase agreement.Morgan Stanley Comments Feb 2007
Ambac Financial announced AMC that they have closed on a $400mln offering of Directly-Issued Subordinated Capital Securities (DISCs).My contact at Morgan Stanley, who for obvious reasons wishes to remain anonymous made the following sarcastic comments at the time of the stock buyback announcement.
This is a positive surprise since most investors did not expect/saw any meaningful share repurchases in 1Q06 or 4Q06.
Ken Zerbe is increasing his price target following his recent meeting with the CEO of ABK. Ken felt the meeting was positive and provided him with greater confidence in the long-term story of ABK. His price target increases from $98 to $100 and EPS estimates remain above the street at 2007 $7.97 and 2008 $8.78.
Ambac Financial, a New York-based insurance and financial services company, has just issued $400 million worth of new debt in complex hybrid debt notes, so-called Directly-Issued Subordinated Capital Securities (DISCs). ...Inquiring minds are wondering what the CEO and former CEO (current director) were doing with their own money shortly after the buyback announcement.
Why issue 400mln worth of debt to buy 400mln worth of stock, when one can issue 800mln worth of debt to buy 800mln worth of stock? Another question for another time would be: if the company generates so much extra cash flow to pay the very substantial cost of this transaction plus the very substantial interest on the debt, why not just buy the stock in the open market with its own cash?
Think about the complexity of the deal; think about the work that has been done by lawyers, underwriters, analysts, brokers, compliance people, technology professionals, etc. All of them need to be paid. Think about the very complex nature of this debt, which will be sitting in someone's books as an asset; think about all the even more complex derivatives that will be, without question, created based on this debt.
Heck, we should all be grateful to ABK: This deal, as absurd as it is, has done its small part to maintain all this complexity for another 15 minutes.
Director (former CEO) Phillip B. Lassiter Dumps Shares
click on chart for a sharper image
Current CEO Robert Genader Dumps Shares
Click here for all Ambac insider transactions over the last 2 years
Ambac (ABK) Daily Chart
Flashback August 16, 2007
Morgan Stanley cuts Ambac target on possible CDO losses
The brokerage, which has an "overweight" rating on Ambac, cut its price target on the stock to $92 from $100 and said Ambac could face losses of $1.3 billion to $5.0 billion. Analyst Ken Zerbe said he was building in a subprime/CDO loss expectation of $1.8 billion pretax, which he assumed the company will take beginning in 2008 through 2011.Let's do the Math
At current share prices Ambac has lost $200 million+- on share buybacks, not counting interest on the debt and transaction fees.
Meanwhile, former CEO Phillip B. Lassiter somehow had the foresight to dump $10.37 million worth of shares that would now be worth $5.18 million+-. In addition, current CEO Robert Genader had the foresight to dump $10.20 million worth of shares that would now be worth $5.00 million+-.
Clearly these guys are worth the big bucks because they alone know how to make these kind of mission critical decisions.
Non-Performance Rewarded
Professor David Nelson is asking Does Executive Compensation Pass the Smell Test?
Page after page has been written about Merrill Lynch (MER), the $8 bln loss and the failure of risk managers at not just Merrill but many of the U.S.' top financial institutions.Forgive me for being so cynical but why should anyone think management is acting on behalf of shareholders? Time and time again, history has proven otherwise. Insider greed has never been greater.
When Robert Nardelli was ousted as Chairman and Chief Executive of Home Depot (HD) he received over $200 mln in severance compensation. Now we find that Stan O�Neil, the controversial and soon to be ex-CEO of Merrill Lynch, would have received over $200 mln if there was a change of control at Mother Merrill.
With the company reeling from recent financial losses and the stock down significantly how does a shareholder maintain confidence that management is working on their behalf?
What do we have to show for it?
- Overbuilding of houses by homebuilders (TOL, WCI, PHM, DHOM, CTX, etc).
- A "Dancing Price", SIV problems, and Enron Accounting at Citigroup (C).
- Banking problems everywhere related to mortgages.
- Two Bears Stearns (BSC) hedge funds go to zero.
- Enormous shareholder dilution in the number of options granted to insiders at Google (GOOG), Broadcom (BRCM), and for that matter many tech companies.
- Countrywide (CFC) CEO Mozilo cashes out $1 billion worth of stock a while running the company into the ground.
- Earnings are "managed" to beat the street by a penny practically everywhere even if it means holding assets off the balance sheet, stuffing the channel with merchandise, playing games with pension assumptions, stretching to the limit accounting practices, etc..
- Insiders have been bailing like mad, and in some instances borrowing money to do so.
- Dividends are in the sewer.
1) Increase dividends
2) Stop managing earnings
3) Reduce executive compensation
4) Reduce option expenses
Imagine there was one major homebuilder that instead of buying more and more land at ever increasing prices was instead paying huge dividends for the past 5 years. Who would be ahead of the game now? The answer should be clear, both the corporation and the shareholder. Arguably the CEO would be behind because of stock options.
Stock options encourage excessive risk taking to the point of ridiculousness. But when the inevitable collapse comes, the CEOs don't care, they have all cashed out hundreds of millions. In the case of Countrywide, over a $billion. It's sad to say, but in many corporations shares were repurchased with borrowed money even as insiders were bailing.
Question: With the company reeling from recent financial losses and the stock down significantly how does a shareholder maintain confidence that management is working on their behalf?
Answer: One can't. If you start with that assumption you will be far better off.
Addendum
Thanks to EconShift for the following information:
The selling plan used by the Director was implemented on Jan 31st, 2007. That was while the DISC was being finalized.
The selling plan for Genader was cleverly implemented after the fact on March 31st 2007.
Mike Shedlock / Mish
http://globaleconomicanalysis.blogspot.com/
Today's archidose #148
Rooftop louver mock-ups for Art Institute addition, Renzo Piano, originally uploaded by Atelier FLIR.
Mock-up of the rooftop louvers for the Art Institute of Chicago addition by Renzo Piano Building Workshop.
To contribute your Flickr images for consideration, just:
:: Join and add photos to the archidose pool, and/or
:: Tag your photos archidose
Monday, October 29, 2007
Canon recalls unsold EOS-1D Mark III cameras
Canon has recalled all unsold EOS-1D Mark III cameras from shops amid concerns over a problem on some units linked to 'adjustment of the AF Sub Mirror'.
The recall is detailed in a letter sent by Canon to UK dealers which is circulating on the internet.
Commenting on the letter a Canon UK spokeswoman confirmed to Amateur Photographer: 'I have seen the [internet] link to the letter. We think it is genuine� basically there will be an official announcement out on Wednesday regarding this.'
Chris Cheesman and Barney Britton
more : amateurphotographer
The recall is detailed in a letter sent by Canon to UK dealers which is circulating on the internet.
Commenting on the letter a Canon UK spokeswoman confirmed to Amateur Photographer: 'I have seen the [internet] link to the letter. We think it is genuine� basically there will be an official announcement out on Wednesday regarding this.'
Chris Cheesman and Barney Britton
more : amateurphotographer
Canon recalls unsold EOS-1D Mark III cameras
Canon has recalled all unsold EOS-1D Mark III cameras from shops amid concerns over a problem on some units linked to 'adjustment of the AF Sub Mirror'.
The recall is detailed in a letter sent by Canon to UK dealers which is circulating on the internet.
Commenting on the letter a Canon UK spokeswoman confirmed to Amateur Photographer: 'I have seen the [internet] link to the letter. We think it is genuine� basically there will be an official announcement out on Wednesday regarding this.'
Chris Cheesman and Barney Britton
more : amateurphotographer
The recall is detailed in a letter sent by Canon to UK dealers which is circulating on the internet.
Commenting on the letter a Canon UK spokeswoman confirmed to Amateur Photographer: 'I have seen the [internet] link to the letter. We think it is genuine� basically there will be an official announcement out on Wednesday regarding this.'
Chris Cheesman and Barney Britton
more : amateurphotographer
Pentax and Hoya merger plan statement
In a change of plan Hoya will 'merge' with Pentax on 31 March 2008, instead of Pentax becoming a 'wholly-owned subsidiary' of Hoya. The move is designed to strengthen Pentax businesses by enabling Pentax management to put plans into practice more quickly.
The two companies had originally planned to merge in an agreement first discussed in December last year.
But subsequent talks led to Hoya buying around 90% of Pentax shares, thereby making Pentax a wholly-owned subsidiary of Hoya.
Chris Cheesman
more : amateurphotographer
The two companies had originally planned to merge in an agreement first discussed in December last year.
But subsequent talks led to Hoya buying around 90% of Pentax shares, thereby making Pentax a wholly-owned subsidiary of Hoya.
Chris Cheesman
more : amateurphotographer
Pentax and Hoya merger plan statement
In a change of plan Hoya will 'merge' with Pentax on 31 March 2008, instead of Pentax becoming a 'wholly-owned subsidiary' of Hoya. The move is designed to strengthen Pentax businesses by enabling Pentax management to put plans into practice more quickly.
The two companies had originally planned to merge in an agreement first discussed in December last year.
But subsequent talks led to Hoya buying around 90% of Pentax shares, thereby making Pentax a wholly-owned subsidiary of Hoya.
Chris Cheesman
more : amateurphotographer
The two companies had originally planned to merge in an agreement first discussed in December last year.
But subsequent talks led to Hoya buying around 90% of Pentax shares, thereby making Pentax a wholly-owned subsidiary of Hoya.
Chris Cheesman
more : amateurphotographer
E-3 demo events in the UK and Ireland
Get to know the E-3 at Olympus dealer events around the UK and Ireland
We have received a calendar of events around the UK and Ireland where the new Olympus E-3, and many components from the E-System, will be demonstrated. If the events aren't too crowded you should have an opportunity to get some time with the E-3 and some of the new lenses.
The following list may be subject to change, so please verify with your dealer before setting off:
Ian Burley
more : fourthirds-user
We have received a calendar of events around the UK and Ireland where the new Olympus E-3, and many components from the E-System, will be demonstrated. If the events aren't too crowded you should have an opportunity to get some time with the E-3 and some of the new lenses.
The following list may be subject to change, so please verify with your dealer before setting off:
Ian Burley
more : fourthirds-user
E-3 demo events in the UK and Ireland
Get to know the E-3 at Olympus dealer events around the UK and Ireland
We have received a calendar of events around the UK and Ireland where the new Olympus E-3, and many components from the E-System, will be demonstrated. If the events aren't too crowded you should have an opportunity to get some time with the E-3 and some of the new lenses.
The following list may be subject to change, so please verify with your dealer before setting off:
Ian Burley
more : fourthirds-user
We have received a calendar of events around the UK and Ireland where the new Olympus E-3, and many components from the E-System, will be demonstrated. If the events aren't too crowded you should have an opportunity to get some time with the E-3 and some of the new lenses.
The following list may be subject to change, so please verify with your dealer before setting off:
Ian Burley
more : fourthirds-user
Problems Delayed Are Not Problems Solved
Reuters is reporting Stressed US borrowers use plastic to delay default.
In this case, the problem is the house. Reeves cannot afford it. With maxed out credit cards, a small reduction in a loan rate is not going to help much either given Barba's admission that "credit cards will be a problem later".
Reeves ought to be talking to a bankruptcy lawyer. Instead, Barba is doing everything possible to keep the albatross around Reeves' neck.
Barba says "Right now, the main concern is the house." In actuality, the main concern should be how to get rid of the house, not how to keep it. The house has to go. It can go now or it can go later after more money is wasted making minimum payments on credit cards.
Life would be so much simpler if Reeves started all over renting an apartment she and her husband can comfortably afford, while saving money for a rainy day (or a house they can afford sometime down the road). Instead they are paying usurious credit card rates and sinking further behind on a house that is likely declining in value.
Everyone is doing their part to make people debt slaves forever. Even financial counselors are in on the act.
Mike Shedlock / Mish
In August 2006, Reeves and her husband bought a $214,000 home with almost no money down, leaving them with a monthly payment of $1,636 -- higher than they planned on, especially with her husband's furniture sales job largely commission-based and business not good due to the U.S. housing slowdown.How much bad advice is being given by credit counselors to keep them in their homes? If Barba is any guide, perhaps a ton of it. Postponing problems is not a solution, it merely makes them worse. And certainly maxing out credit cards to pay the mortgage is not clear thinking.
But as part of her efforts to avoid defaulting on the mortgage, Reeves said she has "maxed out" all her credit cards, spending to the limit on basic needs. "Now all I'm doing is making the minimum monthly payments."
"When credit conditions dry up, marginal borrowers turn to plastic," said Merrill Lynch North American Economist David Rosenberg. "We're seeing signs of that already."
In an October 5 research note, Rosenberg called rising credit- card delinquency rates as the "next skeleton in the closet."
"Our biggest concern right now is that there are lot of people who will face a choice between bankruptcy or foreclosure," he said. "Either way, it's going to suck."
HOLDING OFF THE TIDE?
Nancy Barba -- a financial counselor at a local community group, the Resurrection Project -- helped Johari Reeves negotiate her latest attempt at a repayment schedule for her mortgage.
"The credit cards will be a problem later," Barba said. "But right now, the main concern is the house."
In this case, the problem is the house. Reeves cannot afford it. With maxed out credit cards, a small reduction in a loan rate is not going to help much either given Barba's admission that "credit cards will be a problem later".
Reeves ought to be talking to a bankruptcy lawyer. Instead, Barba is doing everything possible to keep the albatross around Reeves' neck.
Barba says "Right now, the main concern is the house." In actuality, the main concern should be how to get rid of the house, not how to keep it. The house has to go. It can go now or it can go later after more money is wasted making minimum payments on credit cards.
Life would be so much simpler if Reeves started all over renting an apartment she and her husband can comfortably afford, while saving money for a rainy day (or a house they can afford sometime down the road). Instead they are paying usurious credit card rates and sinking further behind on a house that is likely declining in value.
Everyone is doing their part to make people debt slaves forever. Even financial counselors are in on the act.
Mike Shedlock / Mish
Adorama Camera Posts Tip #50, Reaches Halfway Point in "100 in 100" Photography Tips Series
AIRC (Adorama Imaging Resource Center) enters week 8 of 100 tips in 100 days.
New York, NY (PRWEB) October 29, 2007 -- Adorama Camera today posted tip number 50, marked the halfway point in "100 in 100: 100 Photography Tips in 100 Days"
(http://www.adorama.com/catalog.tpl?article=100in100&op=academy_new), its ongoing series of free photography tips for snapshooters and camera enthusiasts. Started on September 10, tips are posted every day through December 18, 2007. "100 in 100" is the latest addition to the AIRC (Adorama Imaging Resource Center), Adorama Camera's online photo magazine.
"As we reach the halfway point in this series, is most gratifying to hear from photographers around the world who are enjoying the 100 in 100 series and seeing an improvement in their photography as a direct result," says AIRC editor Mason Resnick. "100 in 100 is further reinforcing Adorama's position as go-to resource for anyone who wants to learn more about photography, and as a reliable source for photographic their supplies."
Visitors to "100 in 100" this week will learn: How to detect and minimize DSLR sensor dust; using ISO to increase sharpness in macro photography; how to get ghost-like images when shooting flash; creating a zooming effect in Adobe Photoshop; creating a hand-colored look in digital prints; techniques for avoiding distracting backgrounds; and quick basic guide to Photoshop's "Layers" feature.
Last week's tips included: how to achieve sharper images by using a flash; what a histogram for an overall dark image should look like; how to create a sunshower in your backyard; the benefits of shooting on a cloudy day; how flash diffusers affect shadows; using contrasting colors in compositions; a great tool for macro photography; and how to minimize dust on an SLR sensor.
The tips are written in relatively non-technical language, so anyone can learn, no matter what experience they have. "It only takes a minute to read each day's tip," notes Resnick. "But based on the feedback we've received, many photography enthusiasts report they're already seeing an improvement in their work based on our tips."
Resnick is inviting bloggers and webmasters with photo-related content to link to "100 in 100," (http://www.adorama.com/catalog.tpl?article=100in100&op=academy_new). "If you have photography-related content on your site, this will add value to it," he notes.
Daily and weekly summaries will be available via the AIRC's News Desk RSS feed (http://www.adorama.com/catalog.tpl?op=NewsDesk_Home).
Online photo magazine at a retail site?
AIRC - Adorama Imaging Resource Center (http://www.adorama.com/catalog.tpl?op=academy) is the choice destination for photographers at all levels of experience who want to improve their picture-taking and image-editing skills. AIRC has over 275 how-to photography articles, buying guides and picture-selling advice, as well as daily breaking news about the photography industry, written by a team of top photography experts.
Why would Adorama, a well-respected New York-based camera retailer, publish what is essentially an online photo magazine? Resnick says, "we believe the more information and knowledge we can provide, the more people will trust Adorama both as a reliable information source and as a place where they can feel comfortable buying their photographic gear."
source : yahoo
New York, NY (PRWEB) October 29, 2007 -- Adorama Camera today posted tip number 50, marked the halfway point in "100 in 100: 100 Photography Tips in 100 Days"
(http://www.adorama.com/catalog.tpl?article=100in100&op=academy_new), its ongoing series of free photography tips for snapshooters and camera enthusiasts. Started on September 10, tips are posted every day through December 18, 2007. "100 in 100" is the latest addition to the AIRC (Adorama Imaging Resource Center), Adorama Camera's online photo magazine.
"As we reach the halfway point in this series, is most gratifying to hear from photographers around the world who are enjoying the 100 in 100 series and seeing an improvement in their photography as a direct result," says AIRC editor Mason Resnick. "100 in 100 is further reinforcing Adorama's position as go-to resource for anyone who wants to learn more about photography, and as a reliable source for photographic their supplies."
Visitors to "100 in 100" this week will learn: How to detect and minimize DSLR sensor dust; using ISO to increase sharpness in macro photography; how to get ghost-like images when shooting flash; creating a zooming effect in Adobe Photoshop; creating a hand-colored look in digital prints; techniques for avoiding distracting backgrounds; and quick basic guide to Photoshop's "Layers" feature.
Last week's tips included: how to achieve sharper images by using a flash; what a histogram for an overall dark image should look like; how to create a sunshower in your backyard; the benefits of shooting on a cloudy day; how flash diffusers affect shadows; using contrasting colors in compositions; a great tool for macro photography; and how to minimize dust on an SLR sensor.
The tips are written in relatively non-technical language, so anyone can learn, no matter what experience they have. "It only takes a minute to read each day's tip," notes Resnick. "But based on the feedback we've received, many photography enthusiasts report they're already seeing an improvement in their work based on our tips."
Resnick is inviting bloggers and webmasters with photo-related content to link to "100 in 100," (http://www.adorama.com/catalog.tpl?article=100in100&op=academy_new). "If you have photography-related content on your site, this will add value to it," he notes.
Daily and weekly summaries will be available via the AIRC's News Desk RSS feed (http://www.adorama.com/catalog.tpl?op=NewsDesk_Home).
Online photo magazine at a retail site?
AIRC - Adorama Imaging Resource Center (http://www.adorama.com/catalog.tpl?op=academy) is the choice destination for photographers at all levels of experience who want to improve their picture-taking and image-editing skills. AIRC has over 275 how-to photography articles, buying guides and picture-selling advice, as well as daily breaking news about the photography industry, written by a team of top photography experts.
Why would Adorama, a well-respected New York-based camera retailer, publish what is essentially an online photo magazine? Resnick says, "we believe the more information and knowledge we can provide, the more people will trust Adorama both as a reliable information source and as a place where they can feel comfortable buying their photographic gear."
source : yahoo
Adorama Camera Posts Tip #50, Reaches Halfway Point in "100 in 100" Photography Tips Series
AIRC (Adorama Imaging Resource Center) enters week 8 of 100 tips in 100 days.
New York, NY (PRWEB) October 29, 2007 -- Adorama Camera today posted tip number 50, marked the halfway point in "100 in 100: 100 Photography Tips in 100 Days"
(http://www.adorama.com/catalog.tpl?article=100in100&op=academy_new), its ongoing series of free photography tips for snapshooters and camera enthusiasts. Started on September 10, tips are posted every day through December 18, 2007. "100 in 100" is the latest addition to the AIRC (Adorama Imaging Resource Center), Adorama Camera's online photo magazine.
"As we reach the halfway point in this series, is most gratifying to hear from photographers around the world who are enjoying the 100 in 100 series and seeing an improvement in their photography as a direct result," says AIRC editor Mason Resnick. "100 in 100 is further reinforcing Adorama's position as go-to resource for anyone who wants to learn more about photography, and as a reliable source for photographic their supplies."
Visitors to "100 in 100" this week will learn: How to detect and minimize DSLR sensor dust; using ISO to increase sharpness in macro photography; how to get ghost-like images when shooting flash; creating a zooming effect in Adobe Photoshop; creating a hand-colored look in digital prints; techniques for avoiding distracting backgrounds; and quick basic guide to Photoshop's "Layers" feature.
Last week's tips included: how to achieve sharper images by using a flash; what a histogram for an overall dark image should look like; how to create a sunshower in your backyard; the benefits of shooting on a cloudy day; how flash diffusers affect shadows; using contrasting colors in compositions; a great tool for macro photography; and how to minimize dust on an SLR sensor.
The tips are written in relatively non-technical language, so anyone can learn, no matter what experience they have. "It only takes a minute to read each day's tip," notes Resnick. "But based on the feedback we've received, many photography enthusiasts report they're already seeing an improvement in their work based on our tips."
Resnick is inviting bloggers and webmasters with photo-related content to link to "100 in 100," (http://www.adorama.com/catalog.tpl?article=100in100&op=academy_new). "If you have photography-related content on your site, this will add value to it," he notes.
Daily and weekly summaries will be available via the AIRC's News Desk RSS feed (http://www.adorama.com/catalog.tpl?op=NewsDesk_Home).
Online photo magazine at a retail site?
AIRC - Adorama Imaging Resource Center (http://www.adorama.com/catalog.tpl?op=academy) is the choice destination for photographers at all levels of experience who want to improve their picture-taking and image-editing skills. AIRC has over 275 how-to photography articles, buying guides and picture-selling advice, as well as daily breaking news about the photography industry, written by a team of top photography experts.
Why would Adorama, a well-respected New York-based camera retailer, publish what is essentially an online photo magazine? Resnick says, "we believe the more information and knowledge we can provide, the more people will trust Adorama both as a reliable information source and as a place where they can feel comfortable buying their photographic gear."
source : yahoo
New York, NY (PRWEB) October 29, 2007 -- Adorama Camera today posted tip number 50, marked the halfway point in "100 in 100: 100 Photography Tips in 100 Days"
(http://www.adorama.com/catalog.tpl?article=100in100&op=academy_new), its ongoing series of free photography tips for snapshooters and camera enthusiasts. Started on September 10, tips are posted every day through December 18, 2007. "100 in 100" is the latest addition to the AIRC (Adorama Imaging Resource Center), Adorama Camera's online photo magazine.
"As we reach the halfway point in this series, is most gratifying to hear from photographers around the world who are enjoying the 100 in 100 series and seeing an improvement in their photography as a direct result," says AIRC editor Mason Resnick. "100 in 100 is further reinforcing Adorama's position as go-to resource for anyone who wants to learn more about photography, and as a reliable source for photographic their supplies."
Visitors to "100 in 100" this week will learn: How to detect and minimize DSLR sensor dust; using ISO to increase sharpness in macro photography; how to get ghost-like images when shooting flash; creating a zooming effect in Adobe Photoshop; creating a hand-colored look in digital prints; techniques for avoiding distracting backgrounds; and quick basic guide to Photoshop's "Layers" feature.
Last week's tips included: how to achieve sharper images by using a flash; what a histogram for an overall dark image should look like; how to create a sunshower in your backyard; the benefits of shooting on a cloudy day; how flash diffusers affect shadows; using contrasting colors in compositions; a great tool for macro photography; and how to minimize dust on an SLR sensor.
The tips are written in relatively non-technical language, so anyone can learn, no matter what experience they have. "It only takes a minute to read each day's tip," notes Resnick. "But based on the feedback we've received, many photography enthusiasts report they're already seeing an improvement in their work based on our tips."
Resnick is inviting bloggers and webmasters with photo-related content to link to "100 in 100," (http://www.adorama.com/catalog.tpl?article=100in100&op=academy_new). "If you have photography-related content on your site, this will add value to it," he notes.
Daily and weekly summaries will be available via the AIRC's News Desk RSS feed (http://www.adorama.com/catalog.tpl?op=NewsDesk_Home).
Online photo magazine at a retail site?
AIRC - Adorama Imaging Resource Center (http://www.adorama.com/catalog.tpl?op=academy) is the choice destination for photographers at all levels of experience who want to improve their picture-taking and image-editing skills. AIRC has over 275 how-to photography articles, buying guides and picture-selling advice, as well as daily breaking news about the photography industry, written by a team of top photography experts.
Why would Adorama, a well-respected New York-based camera retailer, publish what is essentially an online photo magazine? Resnick says, "we believe the more information and knowledge we can provide, the more people will trust Adorama both as a reliable information source and as a place where they can feel comfortable buying their photographic gear."
source : yahoo
Hoya Q2 profit down on memory disks, LCD equipment
TOKYO, Oct 29 - Hoya Corp posted a 4.5 percent fall in quarterly operating profit, hit by sluggish sales of liquid crystal display-making equipment and a delay in the production of advanced glass disks used in hard disk drives. Hoya, which acquired digital camera and medical equipment maker Pentax Corp earlier this year, benefited from brisk sales of optical lenses for digital cameras and higher sales of glass used in the production of semiconductors.
But a delay in the production of hard disks with a so-called "perpendicular recording method" weighed on its quarterly earnings, while price competition hurt sales of glass used to make LCDs.
Operating profit at Hoya, which competes with Konica Minolta Holdings Inc in the hard disk substrate business, came to 26.85 billion yen in July-September, compared with a 28.13 billion yen profit a year earlier.
The result is roughly in line with Hoya's forecast for 26.36 billion yen. Merrill Lynch had estimated 26.5 billion yen.
Net profit slid 8.2 percent to 21.02 billion yen on sales of 100.98 billion yen, up 1.9 percent.
"One area in which we struggled a little was recording media, where we had some difficulty in the perpendicular method," Hoya Chief Financial Officer Kenji Ema told reporters on Monday.
Hard disks with a perpendicular recording method can hold more data than conventional disks.
"Optical lenses for mobile phones did not grow as much as we had thought, but we had stronger-than-expected orders for digital camera lenses, which are better business for us than cellphone lenses," Ema said.
"I think this trend will continue for a bit longer."
Hoya shares lost ground after the midafternoon announcement, ending down 1.9 percent at 4,150 yen, underperforming the Nikkei 225 share average , which gained 1.17 percent.
The company will not issue full-year forecasts until the end of the October-December fiscal third quarter.
Hoya said it now plans to absorb Pentax on March 31 next year, instead of making it a wholly owned subsidiary, to speed up its decision-making.
Pentax, which will be delisted from the Tokyo Stock Exchange on Nov. 30, said on Monday its quarterly operating profit more than doubled on strong sales of its digital cameras and medical endoscopes, which are used to examine internal organs.
Operating profit at Pentax, the world's fifth-largest maker of digital single-lens reflex cameras in 2006, came to 2.16 billion yen in July-September, up from 920 million yen a year earlier.
Digital SLR cameras, high-end models with interchangeable lenses, are the fastest-growing and most lucrative segment of the digital camera industry.
Following the announcement, shares in Pentax ended up 3.8 percent at 758 yen.
Hoya shares fell 8.8 percent in the year to Friday, while Pentax lost 2.7 percent over the same period and the Nikkei lost 4.2 percent.
source : yahoo
But a delay in the production of hard disks with a so-called "perpendicular recording method" weighed on its quarterly earnings, while price competition hurt sales of glass used to make LCDs.
Operating profit at Hoya, which competes with Konica Minolta Holdings Inc in the hard disk substrate business, came to 26.85 billion yen in July-September, compared with a 28.13 billion yen profit a year earlier.
The result is roughly in line with Hoya's forecast for 26.36 billion yen. Merrill Lynch had estimated 26.5 billion yen.
Net profit slid 8.2 percent to 21.02 billion yen on sales of 100.98 billion yen, up 1.9 percent.
"One area in which we struggled a little was recording media, where we had some difficulty in the perpendicular method," Hoya Chief Financial Officer Kenji Ema told reporters on Monday.
Hard disks with a perpendicular recording method can hold more data than conventional disks.
"Optical lenses for mobile phones did not grow as much as we had thought, but we had stronger-than-expected orders for digital camera lenses, which are better business for us than cellphone lenses," Ema said.
"I think this trend will continue for a bit longer."
Hoya shares lost ground after the midafternoon announcement, ending down 1.9 percent at 4,150 yen, underperforming the Nikkei 225 share average , which gained 1.17 percent.
The company will not issue full-year forecasts until the end of the October-December fiscal third quarter.
Hoya said it now plans to absorb Pentax on March 31 next year, instead of making it a wholly owned subsidiary, to speed up its decision-making.
Pentax, which will be delisted from the Tokyo Stock Exchange on Nov. 30, said on Monday its quarterly operating profit more than doubled on strong sales of its digital cameras and medical endoscopes, which are used to examine internal organs.
Operating profit at Pentax, the world's fifth-largest maker of digital single-lens reflex cameras in 2006, came to 2.16 billion yen in July-September, up from 920 million yen a year earlier.
Digital SLR cameras, high-end models with interchangeable lenses, are the fastest-growing and most lucrative segment of the digital camera industry.
Following the announcement, shares in Pentax ended up 3.8 percent at 758 yen.
Hoya shares fell 8.8 percent in the year to Friday, while Pentax lost 2.7 percent over the same period and the Nikkei lost 4.2 percent.
source : yahoo
Hoya Q2 profit down on memory disks, LCD equipment
TOKYO, Oct 29 - Hoya Corp posted a 4.5 percent fall in quarterly operating profit, hit by sluggish sales of liquid crystal display-making equipment and a delay in the production of advanced glass disks used in hard disk drives. Hoya, which acquired digital camera and medical equipment maker Pentax Corp earlier this year, benefited from brisk sales of optical lenses for digital cameras and higher sales of glass used in the production of semiconductors.
But a delay in the production of hard disks with a so-called "perpendicular recording method" weighed on its quarterly earnings, while price competition hurt sales of glass used to make LCDs.
Operating profit at Hoya, which competes with Konica Minolta Holdings Inc in the hard disk substrate business, came to 26.85 billion yen in July-September, compared with a 28.13 billion yen profit a year earlier.
The result is roughly in line with Hoya's forecast for 26.36 billion yen. Merrill Lynch had estimated 26.5 billion yen.
Net profit slid 8.2 percent to 21.02 billion yen on sales of 100.98 billion yen, up 1.9 percent.
"One area in which we struggled a little was recording media, where we had some difficulty in the perpendicular method," Hoya Chief Financial Officer Kenji Ema told reporters on Monday.
Hard disks with a perpendicular recording method can hold more data than conventional disks.
"Optical lenses for mobile phones did not grow as much as we had thought, but we had stronger-than-expected orders for digital camera lenses, which are better business for us than cellphone lenses," Ema said.
"I think this trend will continue for a bit longer."
Hoya shares lost ground after the midafternoon announcement, ending down 1.9 percent at 4,150 yen, underperforming the Nikkei 225 share average , which gained 1.17 percent.
The company will not issue full-year forecasts until the end of the October-December fiscal third quarter.
Hoya said it now plans to absorb Pentax on March 31 next year, instead of making it a wholly owned subsidiary, to speed up its decision-making.
Pentax, which will be delisted from the Tokyo Stock Exchange on Nov. 30, said on Monday its quarterly operating profit more than doubled on strong sales of its digital cameras and medical endoscopes, which are used to examine internal organs.
Operating profit at Pentax, the world's fifth-largest maker of digital single-lens reflex cameras in 2006, came to 2.16 billion yen in July-September, up from 920 million yen a year earlier.
Digital SLR cameras, high-end models with interchangeable lenses, are the fastest-growing and most lucrative segment of the digital camera industry.
Following the announcement, shares in Pentax ended up 3.8 percent at 758 yen.
Hoya shares fell 8.8 percent in the year to Friday, while Pentax lost 2.7 percent over the same period and the Nikkei lost 4.2 percent.
source : yahoo
But a delay in the production of hard disks with a so-called "perpendicular recording method" weighed on its quarterly earnings, while price competition hurt sales of glass used to make LCDs.
Operating profit at Hoya, which competes with Konica Minolta Holdings Inc in the hard disk substrate business, came to 26.85 billion yen in July-September, compared with a 28.13 billion yen profit a year earlier.
The result is roughly in line with Hoya's forecast for 26.36 billion yen. Merrill Lynch had estimated 26.5 billion yen.
Net profit slid 8.2 percent to 21.02 billion yen on sales of 100.98 billion yen, up 1.9 percent.
"One area in which we struggled a little was recording media, where we had some difficulty in the perpendicular method," Hoya Chief Financial Officer Kenji Ema told reporters on Monday.
Hard disks with a perpendicular recording method can hold more data than conventional disks.
"Optical lenses for mobile phones did not grow as much as we had thought, but we had stronger-than-expected orders for digital camera lenses, which are better business for us than cellphone lenses," Ema said.
"I think this trend will continue for a bit longer."
Hoya shares lost ground after the midafternoon announcement, ending down 1.9 percent at 4,150 yen, underperforming the Nikkei 225 share average , which gained 1.17 percent.
The company will not issue full-year forecasts until the end of the October-December fiscal third quarter.
Hoya said it now plans to absorb Pentax on March 31 next year, instead of making it a wholly owned subsidiary, to speed up its decision-making.
Pentax, which will be delisted from the Tokyo Stock Exchange on Nov. 30, said on Monday its quarterly operating profit more than doubled on strong sales of its digital cameras and medical endoscopes, which are used to examine internal organs.
Operating profit at Pentax, the world's fifth-largest maker of digital single-lens reflex cameras in 2006, came to 2.16 billion yen in July-September, up from 920 million yen a year earlier.
Digital SLR cameras, high-end models with interchangeable lenses, are the fastest-growing and most lucrative segment of the digital camera industry.
Following the announcement, shares in Pentax ended up 3.8 percent at 758 yen.
Hoya shares fell 8.8 percent in the year to Friday, while Pentax lost 2.7 percent over the same period and the Nikkei lost 4.2 percent.
source : yahoo
Sony A700 review - letsgodigital
Sony A700 review : Finally Sony are making good their promise to bring a real Alpha system on the market that not only appeals to the amateur but the semi-pro and even the professional photographer alike with the introduction of the Sony Alpha 700. I do not wish to claim the Sony A700 to be the ultimate tool for professionals. These photographers most possibly use a DSLR of the same brand they already own as a second camera. However; a start has been made. Many people were eagerly awaiting the Sony DSLR-A700. During the presentation of the Sony Alpha A700 in Italy, I was able to work briefly with Sony's new addition. Thereafter Sony gave us the opportunity to make an in-depth review about the Sony A700, read our experiences with this DSLR camera in the following review.
Dennis Hissink
more : letsgodigital
Dennis Hissink
more : letsgodigital
Sony A700 review - letsgodigital
Sony A700 review : Finally Sony are making good their promise to bring a real Alpha system on the market that not only appeals to the amateur but the semi-pro and even the professional photographer alike with the introduction of the Sony Alpha 700. I do not wish to claim the Sony A700 to be the ultimate tool for professionals. These photographers most possibly use a DSLR of the same brand they already own as a second camera. However; a start has been made. Many people were eagerly awaiting the Sony DSLR-A700. During the presentation of the Sony Alpha A700 in Italy, I was able to work briefly with Sony's new addition. Thereafter Sony gave us the opportunity to make an in-depth review about the Sony A700, read our experiences with this DSLR camera in the following review.
Dennis Hissink
more : letsgodigital
Dennis Hissink
more : letsgodigital
Frequently Asked Photo Questions for October
RAW explained, shooting in infrared, sharpening close-ups, and more.
What's on your mind? If you have a question about digital photography, send it to me. I reply to as many e-mails as I can, and I round up the most interesting ones about once a month here in the newsletter.
Want to read more FAQs? Browse reader questions from July, August, and September.
more : pcworld
What's on your mind? If you have a question about digital photography, send it to me. I reply to as many e-mails as I can, and I round up the most interesting ones about once a month here in the newsletter.
Want to read more FAQs? Browse reader questions from July, August, and September.
more : pcworld
Frequently Asked Photo Questions for October
RAW explained, shooting in infrared, sharpening close-ups, and more.
What's on your mind? If you have a question about digital photography, send it to me. I reply to as many e-mails as I can, and I round up the most interesting ones about once a month here in the newsletter.
Want to read more FAQs? Browse reader questions from July, August, and September.
more : pcworld
What's on your mind? If you have a question about digital photography, send it to me. I reply to as many e-mails as I can, and I round up the most interesting ones about once a month here in the newsletter.
Want to read more FAQs? Browse reader questions from July, August, and September.
more : pcworld
100 in 100: How to Spot Sensor Dust
If you have a digital SLR and change lenses, you probably have small dark spots on your images caused by dirt particles on the sensor. They in size, density and sharpness. You may see them on one image and not on the next.
Sensor dust spots are much more obvious at small apertures, and against clean areas such as a sky. In images shot with medium apertures they are larger and lighter gray. With wide enough apertures many may not show at all. They are also less obvious in very bright or very dark areas. Here is a portion of a sky shot with a dirty sensor.
more : adorama
Sensor dust spots are much more obvious at small apertures, and against clean areas such as a sky. In images shot with medium apertures they are larger and lighter gray. With wide enough apertures many may not show at all. They are also less obvious in very bright or very dark areas. Here is a portion of a sky shot with a dirty sensor.
more : adorama
100 in 100: How to Spot Sensor Dust
If you have a digital SLR and change lenses, you probably have small dark spots on your images caused by dirt particles on the sensor. They in size, density and sharpness. You may see them on one image and not on the next.
Sensor dust spots are much more obvious at small apertures, and against clean areas such as a sky. In images shot with medium apertures they are larger and lighter gray. With wide enough apertures many may not show at all. They are also less obvious in very bright or very dark areas. Here is a portion of a sky shot with a dirty sensor.
more : adorama
Sensor dust spots are much more obvious at small apertures, and against clean areas such as a sky. In images shot with medium apertures they are larger and lighter gray. With wide enough apertures many may not show at all. They are also less obvious in very bright or very dark areas. Here is a portion of a sky shot with a dirty sensor.
more : adorama
Manfrotto 190X Pro-B Tripod & 804RC2 Head: Review
Manfrotto make good professional tripods at affordable prices - the 190X Pro-B being no exception.
190X Series
Replacing the 190 series in the UK, the Manfrotto 190X Pro-B aluminium tripod comes in at a svelte 1.8kgs, but is capable of holding up to 5kgs. This means the vast majority of DSLR and lens combos will sit snugly on top - even pro bodies with batteries and fat f/2.8 70-200mm zooms will make the grade.
Its not only light, but compact too, measuring just 57cms when closed, and extending to 146cm maximum. Plus it's good value... so it's not going to break the bank nor the back.
On Location
Without the availability of wind tunnels or research labs in the ThinkCamera offices, it was to the fields to test: Wind and water? No problem!
Those aluminium legs are designed to be light and strong, the quick release latches easy to handle; essentially you could throw this off the top of a house and it'd still be in one piece (don't try this at home, kids).
Hardened photo-backpackers may know the experience of picking up a heavy tripod and it feeling as though the cold frame has welded itself to your hand - the 190X has some excellent 'spongy' upper legs that thankfully wont freeze your mitts off.
Legs are arranged in three columns, each adjustable by the quick release flip level leg locks (try saying that quickly without sounding like a slurring drunk). Whilst these locks look a little 'plasticy' - and without actually trying to wrench them off - they hold their own with no issues. The legs themselves are manoeuvrable enough to befit many angles and much terrain whilst still standing up to the job.
Mike Lowe
more : thinkcamera
190X Series
Replacing the 190 series in the UK, the Manfrotto 190X Pro-B aluminium tripod comes in at a svelte 1.8kgs, but is capable of holding up to 5kgs. This means the vast majority of DSLR and lens combos will sit snugly on top - even pro bodies with batteries and fat f/2.8 70-200mm zooms will make the grade.
Its not only light, but compact too, measuring just 57cms when closed, and extending to 146cm maximum. Plus it's good value... so it's not going to break the bank nor the back.
On Location
Without the availability of wind tunnels or research labs in the ThinkCamera offices, it was to the fields to test: Wind and water? No problem!
Those aluminium legs are designed to be light and strong, the quick release latches easy to handle; essentially you could throw this off the top of a house and it'd still be in one piece (don't try this at home, kids).
Hardened photo-backpackers may know the experience of picking up a heavy tripod and it feeling as though the cold frame has welded itself to your hand - the 190X has some excellent 'spongy' upper legs that thankfully wont freeze your mitts off.
Legs are arranged in three columns, each adjustable by the quick release flip level leg locks (try saying that quickly without sounding like a slurring drunk). Whilst these locks look a little 'plasticy' - and without actually trying to wrench them off - they hold their own with no issues. The legs themselves are manoeuvrable enough to befit many angles and much terrain whilst still standing up to the job.
Mike Lowe
more : thinkcamera
Manfrotto 190X Pro-B Tripod & 804RC2 Head: Review
Manfrotto make good professional tripods at affordable prices - the 190X Pro-B being no exception.
190X Series
Replacing the 190 series in the UK, the Manfrotto 190X Pro-B aluminium tripod comes in at a svelte 1.8kgs, but is capable of holding up to 5kgs. This means the vast majority of DSLR and lens combos will sit snugly on top - even pro bodies with batteries and fat f/2.8 70-200mm zooms will make the grade.
Its not only light, but compact too, measuring just 57cms when closed, and extending to 146cm maximum. Plus it's good value... so it's not going to break the bank nor the back.
On Location
Without the availability of wind tunnels or research labs in the ThinkCamera offices, it was to the fields to test: Wind and water? No problem!
Those aluminium legs are designed to be light and strong, the quick release latches easy to handle; essentially you could throw this off the top of a house and it'd still be in one piece (don't try this at home, kids).
Hardened photo-backpackers may know the experience of picking up a heavy tripod and it feeling as though the cold frame has welded itself to your hand - the 190X has some excellent 'spongy' upper legs that thankfully wont freeze your mitts off.
Legs are arranged in three columns, each adjustable by the quick release flip level leg locks (try saying that quickly without sounding like a slurring drunk). Whilst these locks look a little 'plasticy' - and without actually trying to wrench them off - they hold their own with no issues. The legs themselves are manoeuvrable enough to befit many angles and much terrain whilst still standing up to the job.
Mike Lowe
more : thinkcamera
190X Series
Replacing the 190 series in the UK, the Manfrotto 190X Pro-B aluminium tripod comes in at a svelte 1.8kgs, but is capable of holding up to 5kgs. This means the vast majority of DSLR and lens combos will sit snugly on top - even pro bodies with batteries and fat f/2.8 70-200mm zooms will make the grade.
Its not only light, but compact too, measuring just 57cms when closed, and extending to 146cm maximum. Plus it's good value... so it's not going to break the bank nor the back.
On Location
Without the availability of wind tunnels or research labs in the ThinkCamera offices, it was to the fields to test: Wind and water? No problem!
Those aluminium legs are designed to be light and strong, the quick release latches easy to handle; essentially you could throw this off the top of a house and it'd still be in one piece (don't try this at home, kids).
Hardened photo-backpackers may know the experience of picking up a heavy tripod and it feeling as though the cold frame has welded itself to your hand - the 190X has some excellent 'spongy' upper legs that thankfully wont freeze your mitts off.
Legs are arranged in three columns, each adjustable by the quick release flip level leg locks (try saying that quickly without sounding like a slurring drunk). Whilst these locks look a little 'plasticy' - and without actually trying to wrench them off - they hold their own with no issues. The legs themselves are manoeuvrable enough to befit many angles and much terrain whilst still standing up to the job.
Mike Lowe
more : thinkcamera
PENTAX BOBCAR MOBILE SHOWROOMS SCOOT AROUND MANHATTAN
NEW YORK, NY (October 26, 2007)� PENTAX Imaging Company is showing off its digital camera line-up on the streets of Manhattan throughout the holiday shopping season using a unique approach � BobCar Showrooms. The new BobCars are three-wheeled, energy efficient, mini-vehicles that offer a unique form of outdoor advertising to engage and educate consumers right on the street. The PENTAX mobile showrooms feature the latest PENTAX digital SLR and compact digital cameras and offer consumers hands-on demonstrations, literature and special incentives being offered by PENTAX for purchasing selected products.
Two PENTAX BobCars are scooting around a 15 mile radius in New York City from mid-October until the end of December. The vehicles make stops at strategic locations in close proximity to retail dealers where consumers may purchase PENTAX products. As a form of field marketing that offers non-traditional and flexible methods, BobCar Media was created by Snap Marketing in New York, an experiential marketing shop. The format supports the PENTAX aim at building strong consumer relationships and loyalty that is further reinforced by the recent launch of the company's two new Web sites www.pentaxphotogallery.com and www.pentaxian.com.
A complete schedule of the 2007 Holiday Season PENTAX BobCar tour follows:
more : pentaximaging
Two PENTAX BobCars are scooting around a 15 mile radius in New York City from mid-October until the end of December. The vehicles make stops at strategic locations in close proximity to retail dealers where consumers may purchase PENTAX products. As a form of field marketing that offers non-traditional and flexible methods, BobCar Media was created by Snap Marketing in New York, an experiential marketing shop. The format supports the PENTAX aim at building strong consumer relationships and loyalty that is further reinforced by the recent launch of the company's two new Web sites www.pentaxphotogallery.com and www.pentaxian.com.
A complete schedule of the 2007 Holiday Season PENTAX BobCar tour follows:
more : pentaximaging
PENTAX BOBCAR MOBILE SHOWROOMS SCOOT AROUND MANHATTAN
NEW YORK, NY (October 26, 2007)� PENTAX Imaging Company is showing off its digital camera line-up on the streets of Manhattan throughout the holiday shopping season using a unique approach � BobCar Showrooms. The new BobCars are three-wheeled, energy efficient, mini-vehicles that offer a unique form of outdoor advertising to engage and educate consumers right on the street. The PENTAX mobile showrooms feature the latest PENTAX digital SLR and compact digital cameras and offer consumers hands-on demonstrations, literature and special incentives being offered by PENTAX for purchasing selected products.
Two PENTAX BobCars are scooting around a 15 mile radius in New York City from mid-October until the end of December. The vehicles make stops at strategic locations in close proximity to retail dealers where consumers may purchase PENTAX products. As a form of field marketing that offers non-traditional and flexible methods, BobCar Media was created by Snap Marketing in New York, an experiential marketing shop. The format supports the PENTAX aim at building strong consumer relationships and loyalty that is further reinforced by the recent launch of the company's two new Web sites www.pentaxphotogallery.com and www.pentaxian.com.
A complete schedule of the 2007 Holiday Season PENTAX BobCar tour follows:
more : pentaximaging
Two PENTAX BobCars are scooting around a 15 mile radius in New York City from mid-October until the end of December. The vehicles make stops at strategic locations in close proximity to retail dealers where consumers may purchase PENTAX products. As a form of field marketing that offers non-traditional and flexible methods, BobCar Media was created by Snap Marketing in New York, an experiential marketing shop. The format supports the PENTAX aim at building strong consumer relationships and loyalty that is further reinforced by the recent launch of the company's two new Web sites www.pentaxphotogallery.com and www.pentaxian.com.
A complete schedule of the 2007 Holiday Season PENTAX BobCar tour follows:
more : pentaximaging
Is Google�s Behavioral Targeting Flawed?
By now it is well know that Google uses in-session Behavioral Targeting. Eric Lander of Search Engine Journal points out some interesting issues with Google�s Behavioral Targeting
I can see how Google�s BT can be concerning for some advertisers and consumers. Google Behavioral Targeting (BT) by no means is an advanced one. They just use the current search words with the last search words in the same session to figure out user�s intent and then serve the relevant sponsored links.
However, it raises two questions in my mind.
What do you think? Would you, as an advertiser, want to see your sponsored links show up out of context (content) but relevant to the user? As a consumer, do you consider sponsored links as advertisements or as a part of the search results?
I can see how Google�s BT can be concerning for some advertisers and consumers. Google Behavioral Targeting (BT) by no means is an advanced one. They just use the current search words with the last search words in the same session to figure out user�s intent and then serve the relevant sponsored links.
However, it raises two questions in my mind.
- How many times a consumer jumps from one city specific search to another?
If I live in Seattle, most of my searches are in Seattle area. I hardly switch from �Seattle Care Dealer� searches to �Los Angeles (or any other city) lawn care� search. Does anybody have any study that shows how people switch cities in their searches?
If I do a search for a �Seattle car dealer� and then a search for a �lawn care�, am I not the same person who was in interested in �Car dealers�? Then don�t you think showing a car dealer ad while searching for �lawn care� is relevant to me? If you agree then I don�t see where is the issue with Google�s Behavioral Targeting? The whole promise of Behavioral Targeting is to show the write ad/content/offer/product to the user based on their behavior instead of the context (in this case showing a �car dealer� ad even though user is searching �lawn care�). - Do consumers (searchers) consider the sponsored links as advertisements or a part of the search result? If they consider these as a part of search results, then yes showing the unrelated results definitely will add to the frustrations consumers� experience with Search. But if consumers consider them as advertisements more than as a part of search results then, IMHO, it is ok to show out of context ads as long as they are relevant to the consumers. Several studies have shown that Click Through Rate (CTR) on the organic results are far more than CTR on Paid (Sponsored) results indicating that users considers these paid listings more of an advertisements than search results.
What do you think? Would you, as an advertiser, want to see your sponsored links show up out of context (content) but relevant to the user? As a consumer, do you consider sponsored links as advertisements or as a part of the search results?
Sunday, October 28, 2007
Pent Up Housing Supply
Recent data shows U.S. Home Vacancies Rise to New Record.
There are 15.83 million vacant homes just sitting there. How long can that last?
That is a huge potential supply of homes that for some reason or other is not listed yet. I suspect many of those are REOs (real estate owned ) by banks and mortgage companies like Countrywide. Every passing month those REOs sit on the books waiting for higher prices is lost property taxes, upkeep costs, and balance sheet impairment.
Every month the figures get worse. For example, Countrywide has 13,000+- REOs for sale, but they also have 82,000 foreclosures. That alone represents significant pent up supply as those foreclosures become REOs. See Option Arm & REO Problems At Countrywide for more information.
Add to that pent up supply are those with a second home who want to sell it as soon as they can "get even" on it. In the meantime those people are "content" to rent. That contentment will turn to sour milk given enough time, or any problems necessitating a sale sooner rather than later.
This kind of supply can last for years. In fact, as home prices sink, this kind of supply can grow as people become disgusted with the idea that "real estate prices always goes up".
The siren song from Realtors is that now is the best time to buy ever. Straight up it's easy to see that is a lie. The best time to buy was 10 or more years ago and the best time to sell was in 2005. It's still a long way down from here. Rising inventory, falling prices, and pent up supply should be proof enough.
Mike Shedlock / Mish
http://globaleconomicanalysis.blogspot.com/
A record 17.9 million U.S. homes stood empty in the third quarter as lenders took possession of a growing number of properties in foreclosure.Let's stop right there. Did you catch it?
The figure is a 7.8 percent gain from a year ago, when 16.6 million properties were vacant, the U.S. Census Bureau said in a report today. About 2.07 million empty homes were for sale, compared with 1.94 million a year earlier, the report said.
New foreclosures have risen to a record, led by defaults in adjustable-rate loans to people with tainted or limited credit histories, according to the Mortgage Bankers Association. Home- price declines and tougher lending standards are making it difficult for owners who fall behind in mortgage payments to sell or refinance into better loans.
The U.S. homeownership rate fell for the fourth consecutive quarter to 68.1 percent, seasonally adjusted, from 68.9 percent a year ago, the report said.
- A record 17.9 million U.S. homes stood empty in the third quarter.
- A mere 2.07 million empty homes were for sale.
There are 15.83 million vacant homes just sitting there. How long can that last?
That is a huge potential supply of homes that for some reason or other is not listed yet. I suspect many of those are REOs (real estate owned ) by banks and mortgage companies like Countrywide. Every passing month those REOs sit on the books waiting for higher prices is lost property taxes, upkeep costs, and balance sheet impairment.
Every month the figures get worse. For example, Countrywide has 13,000+- REOs for sale, but they also have 82,000 foreclosures. That alone represents significant pent up supply as those foreclosures become REOs. See Option Arm & REO Problems At Countrywide for more information.
Add to that pent up supply are those with a second home who want to sell it as soon as they can "get even" on it. In the meantime those people are "content" to rent. That contentment will turn to sour milk given enough time, or any problems necessitating a sale sooner rather than later.
This kind of supply can last for years. In fact, as home prices sink, this kind of supply can grow as people become disgusted with the idea that "real estate prices always goes up".
The siren song from Realtors is that now is the best time to buy ever. Straight up it's easy to see that is a lie. The best time to buy was 10 or more years ago and the best time to sell was in 2005. It's still a long way down from here. Rising inventory, falling prices, and pent up supply should be proof enough.
Mike Shedlock / Mish
http://globaleconomicanalysis.blogspot.com/
Monday, Monday
My weekly page update:
Courtyard House in Los Angeles by Ripple Design.
Some unrelated links for your enjoyment:
Courtyard House in Los Angeles by Ripple Design.
Some unrelated links for your enjoyment:
designverb
"Designverb covers elements in design that excite, inspire, captivate, and rattle our goofy creative minds through curious and refreshing finds in art, design, technology, food, culture, experiences, lifestyles, entertainment, and all the other mind-provoking ideas that come with it!" (added to sidebar under blogs::design+technology)
AndrewBlum.net
A collection of articles on architecture, urbanism, design, art, technology and travel from a contributing editor at Wired and Metropolis magazines. (added to sidebar under architectural links::criticism)
Photography of the Unexpected and the Neglected Architecture
A work by Yves Marchand & Romain Meffre.
Nikon D Series Ranks Highest in Customer Satisfaction
Nikon D Series Ranks Highest in Customer Satisfaction With Digital SLR Cameras in J.D. Power and Associates 2007 Digital Camera Satisfaction Study
Nikon D Series Cameras rank "Highest in Customer Satisfaction with Digital SLR cameras," according to the latest J.D. Power and Associates 2007 Digital Camera Satisfaction Study. On a 1,000-point scale, Nikon�s D series digital SLR cameras earned a score of 822 index points, making them the highest-ranked camera line among digital SLRs in four areas of customer satisfaction: picture quality, performance, operation, and appearance and styling.
"We are thrilled to have received this prestigious honor from J.D. Power and Associates. This study represents the true voice of consumers and Nikon is proud to receive a highest ranking," said Edward Fasano, general manager for Marketing, SLR Systems Products, at Nikon Inc. "Nikon engineers work extremely hard to design and develop digital SLR cameras that offer extraordinary image quality and performance. Every Nikon digital SLR camera is designed first for the end user�s requirements. So, whether the customer is a seasoned professional, a passionate enthusiast or a first-time D-SLR user, their satisfaction is assured. Receiving this award demonstrates our confidence that Nikon�s digital SLR cameras are fulfilling, and often exceeding, our customers� expectations."
Nikon�s D series digital SLR cameras include such popular models as the D200, D80, D40x and D40 as well as professional models such as the recently introduced D300 and D3 digital SLR cameras. Nikon digital SLR cameras are engineered for use with up to 55 world-renowned NIKKOR optics and a host of other Nikon system accessories including Nikon Speedlights and Nikon Capture NX image editing software.
The J.D. Power and Associates 2007 Digital Camera Satisfaction Study is based on the responses of nearly 7000 consumers who purchased a digital camera within the last 12 months.
Nikon D Series Cameras rank "Highest in Customer Satisfaction with Digital SLR cameras," according to the latest J.D. Power and Associates 2007 Digital Camera Satisfaction Study. On a 1,000-point scale, Nikon�s D series digital SLR cameras earned a score of 822 index points, making them the highest-ranked camera line among digital SLRs in four areas of customer satisfaction: picture quality, performance, operation, and appearance and styling.
"We are thrilled to have received this prestigious honor from J.D. Power and Associates. This study represents the true voice of consumers and Nikon is proud to receive a highest ranking," said Edward Fasano, general manager for Marketing, SLR Systems Products, at Nikon Inc. "Nikon engineers work extremely hard to design and develop digital SLR cameras that offer extraordinary image quality and performance. Every Nikon digital SLR camera is designed first for the end user�s requirements. So, whether the customer is a seasoned professional, a passionate enthusiast or a first-time D-SLR user, their satisfaction is assured. Receiving this award demonstrates our confidence that Nikon�s digital SLR cameras are fulfilling, and often exceeding, our customers� expectations."
Nikon�s D series digital SLR cameras include such popular models as the D200, D80, D40x and D40 as well as professional models such as the recently introduced D300 and D3 digital SLR cameras. Nikon digital SLR cameras are engineered for use with up to 55 world-renowned NIKKOR optics and a host of other Nikon system accessories including Nikon Speedlights and Nikon Capture NX image editing software.
The J.D. Power and Associates 2007 Digital Camera Satisfaction Study is based on the responses of nearly 7000 consumers who purchased a digital camera within the last 12 months.
Half Dose #38: Secret Sauna
The following text and images are courtesy vision division, a young Swedish architecture firm with a penchant for the clever.
"If you want to build something in Sweden, you have to neglect your architectural aspirations and desires, and build something comprehensible and conventional to please the Swedish building regulations with their obsessed traditional values."
"So at a first glance this sauna may appear to be an anonymous wooden cabin, with no architectural features or ambition. The front fa�ade is windowless; a water proof drape covers the fa�ade on the other side. The sauna has a pointed traditional roof as well, to accomplish this intriguing scam."
"The front fa�ade is actually a door, and when it is opened, the cabin changes its appearance completely."
"Now you have a magnificent view over the archipelago, and the door/wall creates an intimate space with the guest hut next to the sauna."
"The wall prevents the neighbors from peaking in as well."
"If you want to build something in Sweden, you have to neglect your architectural aspirations and desires, and build something comprehensible and conventional to please the Swedish building regulations with their obsessed traditional values."
"So at a first glance this sauna may appear to be an anonymous wooden cabin, with no architectural features or ambition. The front fa�ade is windowless; a water proof drape covers the fa�ade on the other side. The sauna has a pointed traditional roof as well, to accomplish this intriguing scam."
"The front fa�ade is actually a door, and when it is opened, the cabin changes its appearance completely."
"Now you have a magnificent view over the archipelago, and the door/wall creates an intimate space with the guest hut next to the sauna."
"The wall prevents the neighbors from peaking in as well."
Basket of Insanity at OPEC
I am somewhat leery of this news source, but let's presume for a moment that OPEC will study currency basket for pricing.
Here are the relative weightings
Pricing oil in a basket of currencies makes no sense either, even if one eliminates oddballs like the Swedish Kroner. I am assuming that "basket" means some sort of blended price just as the U.S. dollar index is.
People buy things with local currencies. It makes no more sense to price oil in a basket of currencies than it does to price a loaf of bread at the grocery store in a basket of currencies.
I expect dollar bears are gloating over this nonsense. However, even if OPEC was to proceed with this insanity, it simply would not change a thing. In less than a day there would be individual quotes for oil in any and every currency individually, just as there is now.
Practical Example of the Silliness of Basket Pricing
If bread or T-Bone steaks in the U.S. were priced in Euros (or a basket of currencies) tomorrow, would it change the price in dollars? The answer is of course not. All that would happen is that the frequency of quoted price changes would increase.
For example, if T-Bone steaks were advertised at $4.99 lb for a week they would remain on sale at $4.99 lb for as week even though a quote in Euros or a basket of currencies would change daily. It would not make any sense to advertise T-Bone steaks in a basket of currencies because no one is carrying a basket of currencies in their wallet or their checking accounts. It would also be enormously confusing to consumers.
Hopefully, this simple example shows it would actually be complete foolishness for butchers and bakers to price bread and steaks in a basket of currencies. The same applies to oil.
Pricing Units vs. Reserve Units
Pricing oil in Euros or Yen would not matter one bit. Given that currency conversions are instantaneous, 24 hours a day, 7 days a week, as a practical matter oil is already priced in any currency anyone wants. One does not need dollars to buy oil.
Furthermore, if one is sure the Yen or British Pound is going to rise vs. the dollar then one should hold Yen or Pounds (not dollars) to buy oil with. Yes, it really is that simple.
I have said this before and I will keep saying it until everyone understands it: It does not make any difference what currency oil is priced in, and that logic can be expanded to include baskets of currencies.
However, It does however matter where the oil producers hold their reserves. I failed to bring up this point in What Factors are Affecting the U.S. Dollar?
Pricing units are one thing, willingness to hold dollars is another. Indeed, decreasing willingness by the oil producers to hold dollars likely accounts for some of the recent strength of the Euro.
Furthermore, this decreased willingness by the oil producers (and other countries including China) to hold dollars is part of a growing anti-dollar sentiment. Sentiment, at least in the short term, is the most powerful force driving currencies.
Misguided Mad Dash Into Euros
Fundamentally speaking, the ongoing mad dash out of dollars into Euros is misguided.
My rationale is:
1) Europe is printing money faster than the U.S.
2) Credit in Europe is expanding as fast as in the U.S.
3) Interest rates are higher in the U.S. than Europe (at least for now).
A mad dash into Yen would make more sense from a monetary perspective, but that play is avoided because interest rates in Japan are too low.
Eventually, all currencies (except gold) go to zero. The only difference is the speed at which they get there. Warranted or not on relative merits, the U.S. dollar is winning the race among major currency pairs.
Politics Vs. Need
Let's return the article for one last look:
"The need to establish a basket of currencies ... will probably be a point of discussion in the next OPEC summit," Ramirez told reporters during an evening event in the presidential palace.
As discussed above there is absolutely no "need" for OPEC to do anything.
Given that both Venezuela and Iran already hold no dollar reserves, it is highly likely this story is nothing but a political ploy by Venezuela, with no practical relevance.
Ignoring the political aspects, if OPEC actually does have a discussion on pricing oil in a basket of currencies that is not dismissed in 1 minute flat, they are wasting time at best or proving themselves to be complete fools at worst.
Mike Shedlock / Mish
http://globaleconomicanalysis.blogspot.com/
OPEC is likely to discuss creating a basket of currencies for oil pricing at its next summit due to the steady decline in the dollar, Venezuela's Energy Minister Rafael Ramirez said.Consider for a moment the US Dollar Index
"The need to establish a basket of currencies ... will probably be a point of discussion in the next OPEC summit," Ramirez told reporters during an evening event in the presidential palace.
Here are the relative weightings
- Euro 0.576
- Yen 0.136
- Sterling 0.119
- Canadian Dollar 0.091
- Swedish Kroner 0.042
- Swiss Franc 0.036
Pricing oil in a basket of currencies makes no sense either, even if one eliminates oddballs like the Swedish Kroner. I am assuming that "basket" means some sort of blended price just as the U.S. dollar index is.
People buy things with local currencies. It makes no more sense to price oil in a basket of currencies than it does to price a loaf of bread at the grocery store in a basket of currencies.
I expect dollar bears are gloating over this nonsense. However, even if OPEC was to proceed with this insanity, it simply would not change a thing. In less than a day there would be individual quotes for oil in any and every currency individually, just as there is now.
Practical Example of the Silliness of Basket Pricing
If bread or T-Bone steaks in the U.S. were priced in Euros (or a basket of currencies) tomorrow, would it change the price in dollars? The answer is of course not. All that would happen is that the frequency of quoted price changes would increase.
For example, if T-Bone steaks were advertised at $4.99 lb for a week they would remain on sale at $4.99 lb for as week even though a quote in Euros or a basket of currencies would change daily. It would not make any sense to advertise T-Bone steaks in a basket of currencies because no one is carrying a basket of currencies in their wallet or their checking accounts. It would also be enormously confusing to consumers.
Hopefully, this simple example shows it would actually be complete foolishness for butchers and bakers to price bread and steaks in a basket of currencies. The same applies to oil.
Pricing Units vs. Reserve Units
Pricing oil in Euros or Yen would not matter one bit. Given that currency conversions are instantaneous, 24 hours a day, 7 days a week, as a practical matter oil is already priced in any currency anyone wants. One does not need dollars to buy oil.
Furthermore, if one is sure the Yen or British Pound is going to rise vs. the dollar then one should hold Yen or Pounds (not dollars) to buy oil with. Yes, it really is that simple.
I have said this before and I will keep saying it until everyone understands it: It does not make any difference what currency oil is priced in, and that logic can be expanded to include baskets of currencies.
However, It does however matter where the oil producers hold their reserves. I failed to bring up this point in What Factors are Affecting the U.S. Dollar?
Pricing units are one thing, willingness to hold dollars is another. Indeed, decreasing willingness by the oil producers to hold dollars likely accounts for some of the recent strength of the Euro.
Furthermore, this decreased willingness by the oil producers (and other countries including China) to hold dollars is part of a growing anti-dollar sentiment. Sentiment, at least in the short term, is the most powerful force driving currencies.
Misguided Mad Dash Into Euros
Fundamentally speaking, the ongoing mad dash out of dollars into Euros is misguided.
My rationale is:
1) Europe is printing money faster than the U.S.
2) Credit in Europe is expanding as fast as in the U.S.
3) Interest rates are higher in the U.S. than Europe (at least for now).
A mad dash into Yen would make more sense from a monetary perspective, but that play is avoided because interest rates in Japan are too low.
Eventually, all currencies (except gold) go to zero. The only difference is the speed at which they get there. Warranted or not on relative merits, the U.S. dollar is winning the race among major currency pairs.
Politics Vs. Need
Let's return the article for one last look:
"The need to establish a basket of currencies ... will probably be a point of discussion in the next OPEC summit," Ramirez told reporters during an evening event in the presidential palace.
As discussed above there is absolutely no "need" for OPEC to do anything.
Given that both Venezuela and Iran already hold no dollar reserves, it is highly likely this story is nothing but a political ploy by Venezuela, with no practical relevance.
Ignoring the political aspects, if OPEC actually does have a discussion on pricing oil in a basket of currencies that is not dismissed in 1 minute flat, they are wasting time at best or proving themselves to be complete fools at worst.
Mike Shedlock / Mish
http://globaleconomicanalysis.blogspot.com/
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