It Was All Predicted

In 1993.

Sixteen years ago, two economists published a research paper with a delightfully simple title: “Looting.”

The economists were George Akerlof, who would later win a Nobel Prize, and Paul Romer, the renowned expert on economic growth. In the paper, they argued that several financial crises in the 1980s, like the Texas real estate bust, had been the result of private investors taking advantage of the government. The investors had borrowed huge amounts of money, made big profits when times were good and then left the government holding the bag for their eventual (and predictable) losses.

. . .

Mr. Akerlof and Mr. Romer finished writing their paper in the early 1990s, when the economy was still suffering a hangover from the excesses of the 1980s. But Mr. Akerlof told Mr. Romer — a skeptical Mr. Romer, as he acknowledged with a laugh on Tuesday — that the next candidate for looting already seemed to be taking shape.

It was an obscure little market called credit derivatives.

Via John Cole.

In another post on the financial industry John said, "And for the record- I want so much regulation of the financial sector that if someone at Goldman Sachs wants to take a piss, he has to get a hall pass from Dennis Kucinich."

Overkill but I know how he's feeling.

Home Work Assignment

Last week Congress sent the Big 3 automakers home with their tails tucked between their legs. The Big 3 were told to draw up business plans of how they would go forward and change their business to prove they deserved to be bailed out.*

I'll say this now, the federal government, and hence American tax payers, will bail out the automakers. And ultimately, although I'm torn, we probably should. 100,000s of jobs, concentrated in a one region, are directly connected to the auto industry. The ripple effect of the Big 3 failing is estimated as high as 3 million jobs.

* Many people don't want to call this a bail out. The money would be in the form or loans or an equity stake in the companies. But if these were good investments then the government wouldn't have to do it. Private cash would be flowing in. Ultimately we may get some money back out of them. We might even make a profit. But it's a bad bet and this is a bailout.

Election Night Predictions

Testing... bring the table up.

2008 Predicted Prez Results

	OBAMA	McStaighTalk
EV TOTALS	359	179
AL - 9		9
AK - 3		3
AZ - 10		10
AR - 6		6
CA - 55	55
CO - 9	9
CT - 7	7
DE - 3	3
DC - 3	3
FL - 27	27
GA - 15		15
HI - 4	4
ID - 4		4
IL - 21	21
IN - 11		11
IA - 7	7
KS - 6		6
KY - 8		8
LA - 9		9
ME - 4	4
MD - 10	10
MA - 12	12
MI - 17	17
MN - 10	10
MS - 6		6
MO - 11	11
MT - 3		3
NE - 5		5
NV - 5	5
NH - 4	4
NJ - 15	15
NM - 5	5
NY - 31	31
NC - 15	15
ND - 3		3
OH - 20	20
OK - 7		7
OR - 7	7
PA - 21	21
RI - 4	4
SC - 8		8
SD - 3		3
TN - 11		11
TX - 34		34
UT - 5		5
VT - 3	3
VA - 13	13
WA - 11	11
WV - 5		5
WI - 10	10
WY - 3		3

The Pros Come Around To My Thinking

Back before Valentines Day I said:

A lot of these caucus states - Kansas, Nebraska, Nevada (he lost but got more delegates) - are traditional Republican states. He may not win many or even any of them, but he's got a ground game there. The Gopper nominee is will have to pay attention to them. Spend money and spend time there. That will limit his time in Ohio, Penn, and Florida.

Over at TNR today, Noam Scheiber wonders if Obama could win in Kansas.

In some ways I guess I'm tooting my own horn here but Scheiber is also looking at it from another perspective. McCain and his surrogates have taken actions that might hurt them in Kansas. Scheiber points out that Hillary and Obama poll the same against McCain in Kansas. This is telling of the Goppers general weakness and some changing dynamics in the state in general. To my way of thinking this is a big advantage for Obama though with his post-identity politics message.

I still question how many of the traditional Gopper states he (or she) can win this time around but McCain will not be able to take all of them for granted this fall.

Inevitability

Rudy! got (9-11!) 24,706 votes in Michigan yesterday. (9-11!) Uncommited got 17,971 votes. Did I mention 9-11!?

How could he lose? Rudy! is inevtiable.

To think, I predicted he would win the nomination in late November.

The Caucus Before Hand

Candidates are telling their supporters to caucus for Obama if they aren't viable.
Kucinich

Richardson

Biden: This one is a little disturbing from a democratic point of view.

BTW...
tonight's predictions

Dems: Obama, Clinton, Edwards
Goppers: Huckabee, Romney, McCain

Dodd and Gravel drop out before the end of the day Friday.

Answering Zorns Questions

Zorn has a 20 questions poll up to predict events in 2008. I'll play.

Will the feds indict Gov. Rod Blagojevich on corruption charges?
NO

Will Chicago get a casino?
YES (WILD GUESS, I'M NOT SURE)

Will Chicago still be in the running to host the 2016 Summer Olympics when the International Olympic Committee issues its short list of nominees?
YES

Will Planned Parenthood’s controversial abortion clinic still be operating in Aurora?
YES

Will searchers find missing Bolingbrook resident Stacy Peterson?
NO

Will prosecutors indict Drew Peterson on charges related to the disappearance of his wife?
NO (HE MAY GET CHARGED WITH OBSTRUCTION OF JUSTICE OR PERJURY BUT NOT AN ACT SPECIFICALLY ABOUT THE DISAPPEARANCE)

Will R. Kelly be found guilty at his upcoming trial?
YES

Will Tony Rezko be found guilty at his upcoming trial?
YES

Will Amy Jacobson get a job in TV news?
NO

Will the price of regular unleaded gasoline exceed $4 a gallon in Chicago?
YES (IF WE'RE LUCKY)

Who will win the Democratic presidential nomination?
OBAMA

Who will win the Republican presidential nomination?
MITT ROMNEY (THIS IS DIFFERENT THAN A PREVIOUS GUESS)

Which party will win the White House?
THE DEMOCRATIC PARTY

Will Sen. Dick Durbin get at least 66 percent of the vote when he runs for re-election in November?
YES

Who will win the race in the 10th U.S. Congressional District (North Shore)?
DAN SEALS

Who will win the race for the 14th U.S. Congressional District (West suburban) seat formerly held by Dennis Hastert?
OBERWEIS (UNFORTUNATELY)

Will the Cubs win the National League pennant?
NO

Will Rex Grossman remain with the Chicago Bears?
NO

Will there be a foreign or domestic terrorist attack in the U.S. that kills more than 100 people?
NO

Will Osama bin Laden be killed or captured?
NO

Smoking Ban

As I put on my coat this morning I nearly gagged. I had dinner at Sedgwick's last night and the coat reeked of stale smoke. It was out and out disgusting. But today is the December 4th. Only 28 more days, counting today, for smokers to light up in bars. As of January 1, no more smoking in any work place in the state of Illinois!!! It can't come soon enough.

A lot of people who have been and continue to be against the ban, including the restaurant association, claim that the ban will hurt business. In fact, most evidence from California and other places with bans is that business does just fine and even increases. But by the middle of January look for an out cry about loss of business. The restaurant association will be jumping up and down and their lobbyists will be calling state senators and representatives calling for a repeal. And they'll provide sales numbers showing a decrease. When you hear this keep this in mind, January is the slowest month for restaurants and bars. Always has been. Always will be. People spend so much money for the holidays and new year celebrations that they lay low for several weeks. The same thing happened in some southwest suburbs last year (Orland Park I think) and the local communities repealed their bans.

Hopefully, our state representatives will be have the testicular verility to stand up to these calls and keep the ban in place. Everyone, including the businesses, will be better for it.

I was asked, so I predict

A friend of mine has challenged a group of us to predict the presidential tickets for both the Republicans and Democrats for 2008. The one who gets it right wins a free dinner at the restuarant of his/her choice. The deadline for entries is November 20th.

The Deadline has arrived... and I'm clueless.

Two weeks ago I was convinced I knew who the players were going to be. Today, I feel like I'm throwing darts with a blind fold on. Clinton is slipping but will have staying power. Obama is surging but may not have the strength to hold on. Giuliani, who I was convinced was going to win two weeks ago, is in 3rd place in polling in both NH and IA. Romney is dominating in both states and has boat loads of cash, but I can't see him surviving The South. I have no idea how NV will play on the national polls being sandwiched between IA and NH.

The one thing I feel I can say decisively is that Mike Huckabee is going to finish a very strong 2nd in Iowa (if Romney some how collapses, Huckabee will win IA).

My officially submitted prediction:
Gopper Ticket
prez: Rudy Giuliani
vp: Mike Huckabee

Democratic Ticket
prez: Barak Obama
vp: Mike Easley