The Associated Press's list of the Top 10 Quotes of 2008 featured two from Nobel-winning economist Paul Krugman. But Krugman, it turns out, was not actually quotable enough to merit credit for either.
The financial sector is heavily and sufficiently regulated! It's a familiar refrain, but last year it was coming from rich-people-ponzi-scheme operator Bernie Madoff, who added that financial criminals were always caught very quickly.
Oh God SHUT UP: Your company/industry/economy did not fail because of a "perfect storm," a chance, disastrous combination of outside events. It failed because you sucked!
Everyone's ready for the Greatest Depression to be done. Economists think it will be over by the middle of next year. What if it isn't?
Michael Hirsh has a question: where is Joseph Stiglitz? Well, he's in Brazil or something, but where is he in the Obama administration? The liberal Nobel-winning economist, who will be forever in our hearts for the animosity between him and Larry Summers, was right about basically everything, of course, and the Obama administration hasn't even called him, going with Tim Geithner and Summers instead. Now all the whiny liberals are whining about how there are no liberals in the Obama cabinet!
Hey, one more ominous day in the increasingly ominous life of the New York Times Co. The fact that the Times Co. announced plans to mortgage or sell its fancy headquarters building on the same day that the Tribune Co. took a step towards bankruptcy is really bad karma. Check this out, people: The New York Times Co. will eventually go bankrupt if it does not make a drastic change. No amount of fanboy love for Frank Rich or outcry from the journalism establishment will change this fact. Who will step in with a plan to save the paper of record? We will, improbably!
John Maynard Keynes is one of the most important economists ever, and after a lengthy period during which rejection of his ideas of government intervention led us directly to financial ruin, he is suddenly back in favor. Barack Obama's economic team, in particular, will be looking to Keynesian economics for a way out of the current crisis. But did you know he was a ravenous sex fiend who obsessively recorded each and every one of his hot gay hookups? It's true! And his secret second sex diary is in code!
Back in September, we reported rumors that deluxe listings magazine Time Out New York was having trouble paying its bills. There was speculation that the magazine "won't make it to the end of the year." TONY dismissed the rumors and assured its staff: "Happily, our New York investors, who understand the value of the brand you have all built and have been entirely supportive over the past 14 years, remain fully committed to us." Can you guess what happened today? Yes, those investors are putting the magazine up for sale:
What's this—monetary distress for Donald Trump, the richest man in the universe? Trump is being sued by Deutsche Bank for failing to pay off a loan for his new Chicago high rise tower, which he personally guaranteed to the tune of $40 million. That makes it a great time to raise the perpetual question, "How much is Trump really worth?" A safe guess: far less than he was the last time anybody took the trouble to calculate:
It turns out the news media had a pretty shameful weekend. A British couple came forward to say that while they were hiding from terrorists at the Taj Mahal Palace hotel in Mumbai, CNN broadcast details of their specific hiding place in the facility, resulting in a fresh search by the gunmen in control of the hotel at the time. The Indian government blacked out local TV after claiming the terrorists were gaining tactical information from the broadcasts. And now David Carr weighs in via the Times with a column about how U.S. newspapers were complicit in whipping shoppers into the frenzy that culminated in a deadly Wal-Mart stampede:
Floundering maker of autos GM got slammed for flying its executives to Washington on private jets to beg for a government bailout. They were denied, so now they've decided to cut back on every last unnecessary expense. And today, the company announced that it's going to end its $8 million per year endorsement contract with Tiger Woods. Though GM swears that, hey, this has nothing to do with their desperate quest for a bailout—"the timing...is purely coincidental." (Bullshit, judging purely on outward appearance). Where else is the company cutting costs? Everywhere, starting with the paper towels!:
Former Treasury Secretary Robert Rubin is basically one of the most respected men in the entire Democratic Party. The Citigroup "Senior Counselor" (he joined Citigroup as temporary chair after legislation he shepherded through congress allowed Citigroup's creation, natch) has close ties to just about every other Democratic economic policy guru with influence, and he's especially close to just about all of President-elect Barack Obama's proposed economy-fixing team. Of course, until about a year ago, there'd never been a bad word written about Rubin in the press, but the guy should probably be exiled to an island somewhere and forced to think about what he's done to our fine nation. What did Rubin do in the Clinton White House? He and Alan Greenspan joined forces to swing the Democratic Party's economic policies so far to the right that the terms of the debate never recovered. Now, economic leftism is Eisenhower Republicanism and the right-wing's economic policy is basically to hand over as much Treasury money and tax cuts as possible to the wealthy and occasionally force some underfunded mandates through congress because why not? Rubin encouraged Clinton to pass NAFTA before tackling health care, to this day he shudders at the idea of demanding worker protection before passing more free trade pacts, and then, for his final act before returning to the private sector, he resisted calls for the regulation of derivatives and strongly encouraged the repeal the Glass-Stengall act, thus leading directly to our current economic crisis. Of course he is still the Democratic party's most respected and powerful economic thinker. Then he left to join Citigroup, and we all know how well that went. So Barack Obama's economic policy team is probably made up of long-time free-market critics like James K. Galbraith and Joseph Stiglitz, right? Hah.
Reports tonight surfaced that the federal government is offering to buy tens of billions of Citigroup's worst holdings. A bailout is impossible, because Citigroup is just too big, with $3 trillion in inflated "assets" on the "books." Maybe we could nationalize Citigroup, but what about, uh, the nation of Switzerland? Its two largest banks hold about 10 times the nation's total GDP on their balance sheets, which means writedowns could require an Iceland-style bailout by other counties. Once that happens, it may only be a matter of time before the kingdom of Great Britain and Northern Ireland declares bankruptcy.
We're hearing from a good source that Tom Curley, the head of the Associated Press, just held a town hall meeting to tell employees that the AP "will lose 10% of its staff next year." At a current headcount of over 4,000 employees, that would translate to at least 400 jobs lost, which could theoretically come through either layoffs or voluntary buyouts. Several cash-strapped newspapers—including the entire Tribune Co.—have recently announced plans to drop their AP subscriptions. Still, this would be a massive cut for what has always been one of the steadiest possible realms of journalism. AP employees with more details on this, email us. UPDATE: The AP has sent us a statement, which doesn't contain any numbers but acknowledges that cuts may be coming—though mostly through attrition, they hope:
Mark "The Maverick, when it comes to blogs and also finance" Cuban is proclaiming his innocence, in detail! Cuban, the mouthy tech billionaire owner of the Dallas Mavericks, was charged with the world's least sophisticated insider trading scheme by the SEC earlier this week. He issued a rote statement the same day denying the charges, and lamented that he wished he could say more. Well now he's saying more! Cuban's basic defense: Yes, I sold a bunch of stock after the CEO of a company I partially owned told me confidential, nonpublic information that I knew would hurt the stock price. But I never agreed to keep the information confidential, so there! Then he says (through his lawyer) that the CEO of said company is full of shit because he can't even remember the conversation. They posted this excerpt of an interview with the CEO:
Arianna Huffington is branching out and branching out some more! Fresh off her adventurous night subbing as the host of Rachel Maddow's show, the accented mogul (and current non-friend to us) announced today that the Huffington Post "is going to raise money to fund investigative journalism projects." How does she plan to come up with the cash for this, the most expensive type of reporting? She won't say! Yet. According to Reuters, she said there won't be any details for three months. Perhaps in that time the economy will improve and donors will look to throw money at investigative journalism? Ha, no. So where will this cash come from? Some guesses:
The New York Times is folding Play, its quarterly sports-focused magazine. FishbowlNY spoke to Play editor Mark Bryant, who said that although the mag broke even last year, "The company needs to make some pretty considerable cuts going forward," and his magazine was one of them. This is a bad sign. T, the Times' fashion magazine, turns enough of a profit to prop up a lot of money-sucking newsgathering operations; the NYT doubtless hoped that Play could do the same. Not in this ad market, apparently. Scratch that off the dwindling list of lifelines for the Times. [FBNY; anybody with more info can email us.]
