naked capitalism

Yves here. One of the sources of risk in big and even moderately big banks that does not get the attention it deserves is information systems

By Philip Pilkington, a writer and research assistant at Kingston University in London. You can follow him on Twitter @pilkingtonphil

In the practical art of war, the best thing of all is to take the enemy’s country whole and intact; to shatter and destroy it is not so good.

– Sun Tzu

Now some new fodder for the gun-control debate that the horrid events in Connecticut suddenly stirred into a frenzy, though it had been snoozing through the daily drumbeat of murders in Oakland, CA, a few miles across the Bay from me, or in Richmond to the north, or really in any other city. The fodder is inconvenient, however. For both sides of the debate.

One of the popular conservative memes is to fulminate that lots of Americans have been living “rent free” in homes slotted for foreclosure, taking advantage of the fact that court dockets are crowded. An important Reuters piece documents the flip side of this picture: what happens when the servicer starts foreclosure but keeps the property in limbo-land, and the homeowner has decamped, on the mistaken assumption that foreclosure was imminent? The Reuters tag phrase for this syndrome, “zombie title” doesn’t begin to do justice to the horrorshow that borrowers experience.

By Philip Pilkington, a writer and research assistant at Kingston University in London. You can follow him on Twitter @pilkingtonphil

Shared psychotic disorder, or folie à deux, is a rare delusional disorder shared by two or, occasionally, more people with close emotional ties. An extensive review of the literature reveals cases of folie à trois, folie à quatre, folie à famille (all family members), and even a case involving a dog.

– Medscape Reference

We are delighted to post the latest offering of Project S.H.A.M.E., a media transparency initiative led by Yasha Levine and Mark Ames, and now in partnership with NSFWCORP.

By Dan Kervick, who does research in decision theory and analytic metaphysics. Cross posted from New Economic Perspectives

I thought I would take a break from the latest outburst of debt ceiling mania to call attention once again to the bipartisan plan of budget austerity and recession-tempting economic devastation that will be implemented in March in one form or another, and from which the debt ceiling debate is designed to distract us.

The Wall Street Journal has an exclusive story based on a whistleblower leak, apparently with supporting transaction records.

Never underestimate the greed of a billionaire. But I have to say separately that I will thoroughly enjoy the pigfight between former AIG chief Hank Greenberg’s C.V. Starr (now the biggest shareholder in AIG) versus the Federal government over the rescue of AIG. Any cost and embarrassment that the Administration suffers will be the direct result of the Bush-Obama policies of being concerned only about saving financial players rather than meting out any punishments, and for being incompetent negotiators.

By Eric Zuesse, an investigative historian and the author, most recently, of They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010, and of CHRIST’S VENTRILOQUISTS: The Event that Created Christianity.

The National Oceanic & Atmospheric Administration (NOAA) of the Federal Government has refused to investigate why it vastly underestimated the amount of oil spilled in BP’s Deepwater Horizon huge blowout in the Gulf of Mexico, and thus refused to understand why the actual liability of BP will never be able to be estimated accurately, for calculating BP’s penalties and compensation-payments.

By Philip Pilkington, a writer and research assistant at Kingston University in London. You can follow him on Twitter @pilkingtonphil

It is not only by dint of lying to others, but also of lying to ourselves, that we cease to notice that we are lying.

– Marcel Proust

Friedrich Hayek was an unusual character.

By lambert strether. Original version published at Corrente.

There’s been some loose talk lately that the blogosphere is no longer “vital.” And indeed some blogs are ripe for disintermediation; who needs partisan blogs when you’ve got The Party? And who needs who needs Kos when you’ve got Maxim?

But to those who say that blogging is dead, I say, take a look at this chart:

It shows how a single comment ignited a media and policy explosion* two-and-a-half years later. Does that look like a power curve to you, or what?