Archive for June, 2012

Fed Wrestles With How Best To Bridge U.S. Credit Divide

June 24, 2012

Wall Street Journal, Tuesday, June 19, 2012

Fed Wrestles With How Best To Bridge U.S. Credit Divide, by Jon Hilsenrath

“The U.S. Recovery is hobbled by an economic divide that separates Americans not by income or wealth but by their access to credit.”

Many investors are “now walled off from the low interest rates engineered by the Federal Reserve to spur the economy…”  However, “millions with good credit, meanwhile, are taking advantage of the easy money, a windfall in many cases for people who don’t especially need it.”

Clemens Lawyer Finds Right Pitch in Latest Acquittal

June 23, 2012

The Wall Street Journal, Wednesday, June 20, 2012

U.S. News

Clemens Lawyer Finds Right Pitch in Latest Acquittal, by Ashby Jones and Devlin Barrett

Baseball great, Roger Clemens, “had been charged with lying to Congress about using steroids, and the government relied heavily on testimony of Brian McNamee, a former trainer of Mr. Clemens,” who said that he had injected the player with steroids in 1998, 2000 and 2001.  Mr. Hardin, Clemen’s lawyer’s  investigations were supported by his “homespun courtroom deliveries.”  He found the “right pitch.”  Clemens was found not guilty.  

On the mound baseball pitchers search for the right pitch to throw to the batters.  Clemen’s lawyer found the right pitch in his delivery to a jury not a baseball batter.

Free Exchange: Surf’s Up

June 16, 2012

The Economist, May 19th 2012

“Merger waves mean that markets can consolidate rapidly.  The next one is coming…

In 1900 America had aound 500 carmakers; by 1908 it had 200.  In 1960 Britain had 16 banks; ten years later it had just six.  From soft drinks to steelworks, plenty of other industries have seen similar patterns.  Mergers happen in waves, so the number of firms collapses suddenly rather than dwindling over time.  And the next one may soon crest… 

These findings suggest conditions are now aligning for a perfect merger wave.  A global shock has hit most industries, and there is plenty of spare capacity.  Many businesses, particularly in Europe, face deregulation as lagging economies seek to boost competitiveness through structural reform.  The merger impulse is there.”

Watch for the perfect wave so you can surf it properly!

Lawyers Deliver Final Pitches in Clemens Case

June 15, 2012

The Wall Street Journal, Wednesday, June 13, 2012

U.S. News

Lawyers Deliver Final Pitches in Clemens Case, by Devlin Barrett

WASHINGTON–“Federal prosecutors urged a jury Tuesday to convict baseball legend Roger Clemens, saying that as unpleasant as the task may be, he should be found guilty of lying to Congress about alleged steroid use…

Mr. Clemens, a seven-time Cy Young Award winner, is fighting charges of obstruction of Congress and perjury for allegedly lying when he told a congressional panel in 2008 he had never used performance-enhancing drugs.  If convicted, he faces about a year and a half in prison, according to federal sentencing guidelines.”

The lawsuit is in its final appeals to a jury in the U.S. District Court in Washington.  Final pitches or appeals by the prosecution and defense are directed to the eight-woman, four-man jury.   Which will be strikes?  Which balls?  Baseball idioms for a baseball legend case!

Washington Post, June 18: “Roger Clemens was acquitted Monday of all charges in his lengthy perjury trial, just blocks from where he had been accused of lying to Congress about never having taken performance-enhancing drugs.”

 

Sandusky Trial: “McQueary Was a Slam Dunk”

June 15, 2012

The Wall Street Journal, Wednesday, June 13, 2012

U.S. NEWS

Tears and Anger at Sandusky Trial, by Kris Maher and John W. Miller

Bellefonte, Pa.—“Two prosecution witnesses in the Jerry Sandusky trial Tuesday gave detailed accounts of the former Pennsylvania State University assistant football coach’s alleged sexual encounters with boys…”

Mike McQueary, a Penn State assistant football coach was one of the witnesses.  He described a scene in one of the university’s showers he had seen in February of 2001 in which Mr. Sandusky “had sex with a minor, a boy.”   

“Wes Oliver, a professor at Widener Law School in Harrisburg who watched the trial, said it was another strong day for the prosecution.  ‘McQueary was a slam dunk,’  he said.”

Sports idioms often occur, not only because the metaphor is a good way to make a point, but because of the publicity and viewing of that particular sport in the media, in this case basketball.  The NBA (National Basketball Association) playoffs have begun.  A “slam dunk”  is an easy shot.

China Fund Retreats From Euro Zone Trying to Keep Their Powder Dry

June 11, 2012

THE WALL STREET JOURNAL, Friday, June 8, 2012

GLOBAL ECONOMIC TURMOIL

China Fund Retreats From Euro Zone: In Rare Interview, Chairman of $410 Billion Sovereign-Wealth Fund Says Rising Risk of Bloc’s Breakup Has Forced a Pullback

BEIJING–By Lingling Wei, Andrew Browne and Almar Latour

“The head of China’s giant sovereign-wealth fund sees mounting risks of a breakup of the euro zone, and says the fund has scaled back its holdings of stocks and bonds across the continent…

Mr. Lou said the rest of the world will be vulnerable to the european debt crisis, though its impact on Asia is likely to be relatively small. Still, the debt woes in Europe have caused a sharp slowdown in China’s exports, Mr. low said.  ‘Nobody can keep their powder dry if everyone else’s is wet,’ he said.”

This is a hunting/shooting metaphor.  Hunting with black powder guns is susceptible to weather, and, in the above case, euro dynamics. If the powder is wet, the powder does not ignite and therefore the gun does not fire.  In Pennsylvania, where I live, there is a rod an gun club whose motto is:  “Keep the powder and martinis dry.”

The Federal Reserve “Sets the Bank-size Bar Low” for Capital Requirements

June 11, 2012

THE WALL STREET JOURNAL, Friday, June 8, 2012

MONEY & INVESTING:  Capital Rule Is One Size Fits All, by Victoria McGrane, Matthias Rieker and Dan Fitzpatrick

WASHINGTON– “The federal Reserve shocked bankers Thursday by approving a proposal that would force even the smallest lenders to comply with the elaborate international bank-capital standards known as Basel III…

Setting the bank-size bar so low will mean ‘a real wake-up call’ for small banks, said Karen Shaw Petrou, managing partner of consultant Federal Financial Analytics Inc., Washington.”

Lowering the bar at a track event makes it less competitive. The runner or jumper does not have to jump as high over the bar when it is low as when it is high.

Fighting Back Against Lowball Appraisals

June 6, 2012

The Wall Street Journal, Saturday/Sunday, June 2-3, 2012

WEEKEND INVESTOR:  THE NEW BASICS

“Fighting Back Against Lowball Appraisals,”  By Ruth Simon

“Record-low interest rates are a boon for home buyers and for homeowners seeking to refinance.  But low appraisals are making it difficult or even impossible for some borrowers to take advantage…

After almost six years of falling home prices, such experiences have become common.  About one-third of real-estate agents reported that low appraisals had resulted in the cancellation, delay or renegotiation of a purchase, according to an April survey by the National Association of Realtors.”

Many sales run into appraisal problems.  To help obtain accurate appraisals, the article speaks to the following:

1) Look at comparable sales from the last three to six months before seeking a mortgage.  2) Borrowers can accompany the appraiser pointing out improvements and comparable sales. 3) Start over, if necessary, by resubmitting the application to a different lender. 3) Have examples of recent comparable sales that weren’t considered by the appraiser.  4) If unhappy with an appaisal, ask to have it reviewed.  5) Start over, but it may cost you if the bank won’t pay for the new appraisal, and you must have a good reason for a reappraisal.  

The metaphor, the low ball in low ball appraisals, is a gambling term from poker.  From Wikipedia:

Some forms of poker, often called lowball, sometimes called low poker, reward poor poker hands (in the traditional sense). There are four common variations on this idea, differing in whether aces are treated as high cards or low cards, and whether or not straights and flushes are used. The methods are:

  • Ace-to-five low: The lowest possible hand is 5-4-3-2-A, called a wheel. Aces are low and straights and flushes are ignored. This is the most common method.
  • Ace-to-six low: Also called 6-4 low, since the lowest possible hand is 6-4-3-2-A. Aces are low and straights and flushes count as high hands.
  • Deuce-to-seven low: Also called 7-5 low, since the lowest possible hand is 7-5-4-3-2. Almost the direct inverse of traditional “high hand” poker. Aces are high and straights and flushes count as high hands. Since aces are high, A-5-4-3-2 is not a straight, but just ace-high no pair.
  • Deuce-to-six low: The other, mostly unused, possibility would be 6-5 low. Aces are high, straights and flushes are ignored.

The European Commission Puts the Ball into Google’s Court

June 1, 2012

The Economist, May 26th 2012

Google and antitrust

Over to you, and hurry:   The European Commission puts the ball into Google’s court

“Eighteen months ago Mr. Alumunia, the European Union’s competition commissioner, began a formal investigation.  Several times a decision has seemed imminent.  On May 21st Mr Aluminia said he wanted to get a move on. ‘I believe’, he said, ‘that these fast-moving markets would particularly benefit from a quick resolution.’

Mr. Almunia did not present a formal case (a ‘statement of objections’ in Europespeak), but offered Google a chance to settle.  He has four main ares of concern, and wants the company to propose remedies to each ‘in a matter of weeks’.  If he is not satisfied, the formalities will resume.  Then he will impose his own answers and maybe a fine, too.”  

The French Open is going on as I write this.  Sports idioms in the news seem to reflect current sports that are popular at the time.