U.S. sues S&P; It’s about time.

Reported by Huffpo:

But the government's lawsuit paints a picture of a company that misled investors knowingly, more concerned about making money than about accurate ratings. It says S&P delayed updating its ratings models, rushed through the ratings process and was fully aware that the subprime market was flailing even as it gave high marks to investments made of subprime mortgages. In 2007, one analyst forwarded a video of himself singing and dancing to a tune about the deterioration of the subprime market, with colleagues laughing. Ratings agencies like S&P are a key part of the financial crisis narrative. When banks and other financial firms wanted to package mortgages into securities and sell them to investors, they would come to a ratings agency to get a rating for the security. Many securities made of risky subprime mortgages got high ratings, giving even the more conservative investors, like pension funds, the confidence to buy them. Those investors suffered huge losses when housing prices plunged and many borrowers defaulted on their mortgage payments.

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Scouts and Honor and Fair

My relationship with the Boy Scouts of America was not the most pleasant.  I was an oddity, to be sure.  I think I was at one time the only—only—second class scout to be a patrol leader. Second class.  For those who may not have been through the quasi-military organization, the…

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Tax hikes for everybody

According to Public Citizen's Consumer Blog, Compared to 2012, the Just-Enacted Tax Bill Hikes Taxes for Nearly Every U.S. Worker.

A tax increase for middle-class working class families is exactly what the new tax legislation -- The American Taxpayer Relief Act (ATRA) -- effectively imposes, compared to what those families had been paying. And the President, the Democrats, and the Republicans knew this when they supported ATRA. Why are workers' taxes going up? Because ATRA allowed the 2011 and 2012 payroll tax "holiday" to expire, meaning that, as of January 1, 2013, payroll taxes on wage income increased from 4.2% to 6.2%. But not on all wage income. The payroll tax is doubly regressive: Everyone pays the same rate, regardless of income, and only the first $113,700 in wage income is taxed.

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HSBC’s Get-Out-of-Jail-Free Card

Former Prosecutor Neil Barofsky explains that HSBC is too big to fail, just like several other Wall Street banks. The evidence is that prosecutors had the goods on HSBC--it was clear that HSBC knowingly laundered $800 Million in Columbian drug money, but used its political influence to cut a deal to write the whole thing off as a relatively small cost of doing business. As Barofsky explains on Cenk Uygur's show, we need to break up and "neuter" the big banks, but he's not optimistic that this can happen before yet another crash.

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Why older folks get ripped off more often

In this article in the WP, it is reported that older folks are much more trusting than younger people, and they often miss cues that broadcast untrustworthiness. This correlates with the fact that older folks are victims of fraud much more than younger people.

To see if older people really are less able to spot a swindler, Taylor and colleagues showed photos of faces considered trustworthy, neutral or untrustworthy to a group of 119 older adults (ages 55 to 84) and 24 younger adults (ages 20 to 42). Signs of untrustworthiness included averted eyes; an insincere smile that doesn’t reach the eyes; a smug, smirky mouth; and a backward tilt to the head. The participants were asked to rate each face on a scale from minus-3 (very untrustworthy) to 3 (very trustworthy). In the study, appearing online last week in the Proceedings of the National Academy of Sciences, the “untrustworthy” faces were perceived as significantly more trustworthy by the older subjects than by the younger ones.

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