Time out

My best friend is in ICU and not doing well. All I seem to be able to do is worry about her as I walk around in circles with a sick feeling in my stomach.

Keep fighting the good fight, possums.

Happy Columbus Day

I spy with my little eye.

Hope you are enjoying your day, possums.

Here's a little known fact for your cocktail chatter fun - Columbus's sailor, Rodrigo de Triana, was actually the first person on the ship to eye-spy-with-his-little-eye the new world. "He found the island the natives called Guanahani at approximately 2:00 AM on 1492. The exact location of this island is unknown, though it was somewhere in the Bahamas". (wICKipedia)

I wonder what he said, don't you?

Well, I'm still trying to get my motor rolling after that Maui interlude, my friends. It was soooo nice and I'm still in Hang Loose Maui mode and I'm trying to preserve the glow as long as I can.

Spent the morning making calls at GOP HQ. Thank you, I'll be here all week, Ladies and Gentlemen! People are having a hard time hearing us because the acoustics in the room are so bad and the phones are so cheap. Plus, they get really hot on the old earbone. No doubt giving us brain tumors as we speak, but what the hell, it's for a good cause. I'm too busy dialing to twitter, I think I probably called - let's see, 24 pages with 12 names apiece on them=288 people this morning. Given it was the holiday, I only spoke with a handful, perhaps 12. (Not counting the two rude hang ups. "Is there a category for a$$hole?" I asked our coordinator, Jericho, after the second one.) But out of those 12, I managed to sweet talk three of them into coming down and making calls with us this week. Hah-hah. Dinah can still schmooze with the best of them.

The list we're working is compiled of registered Republican voters that don't vote consistently. We're asking 6 questions pertaining to their support of McCain-Palin and the local Republican Senate and Congress candidate. The kicker is the question regarding the main issue driving their choice at the ballot box: a.) Economy/Jobs b.) Gas Prices c.)National Security d.)Health care. Today the responses were pretty evenly divided between a & c. A couple wanted an all of the above category and two made a choice but were quite vocal about pro-life issues being their main driving factor overall. I only had one who dissed the Republican ticket down the line. He was clearly an Obamoid, but he was polite and so was I. Can't ask for more than that. The entire list looked to be about eight inches thick and Jericho said he thought we'd make it through it by the end of the week

I'm told the list will change as it gets closer to election day with a huge push being scheduled to make tons of calls in the four day run up before Nov 4.

As Jericho reminded us today. Colorado is a swing state like New Mexico was in 2000 and Democrat Al Gore won New Mexico by a measly 366 votes. It would kill me if that happened this time around in CO.

Heck, those kind of numbers are a drop in the bucket for those fools over at ACORN.

Actually, 1.3 million new voters registered according to ACORN. The problem is, are they really voters? Up in Lake County, Indiana, they're finding out they are not. Some 5,000 applications came in, all filled out by ACORN, and there they are. They went through the first 2,100 of them, every single one of them, fraudulent.

This is going to be a real wing-ding of an election, my friends.

Tomorrow: The Case of the Missing McCain yard signs.

P.S. Hey, how about that market? ;^D Tomorrow should be very interesting...

Back to work

making calls at the local GOP HQ this am...

Somalia: A pu-pu platter of Pirate info from Hawaii

Just checking in, Possums before heading out to the beach for the morning walk. It's another beautiful day in Paradise here. The wedding was beautiful and the Hawaiian ceremony was interesting. We've got the Luau thing under our belt and it was great fun. But, it's back to the Mainland (and reality) on the redeye tonight.

What else has been going on?

The MV Faina remains locked in a standoff between the scurvy dogs and various navy vessels assembled against it. The situation is getting tense with the pirates threatening to blow the whole ship up, crew, weapons and scurvy dogs and all if their demands are not met in three days. Two more ships were attacked and another ship, a Greek chemical tanker has been seized. The Greeks say, 'hold up - the ship, the Axion -or- Action? That's not a Greek ship'. They don't say whose ship it is and given the spaghetti bowl of ship registration procedures, it may take a while to untangle. Of course, knowing the real name of the ship might help.

Meanwhile, the Iranians admit to paying the ransom to release the MV Iran Diyanat. The Diyanat was the ship rumored to be carrying a 'dangerous consignment' that had caused the mysterious deaths of the pirates that seized it...all of which the Iranians deny, deny, deny.

It looks like NATO is getting off it's duff and sending along three ships to patrol the Somalian shipping lanes. However, a joint UN and AU committee is warning Kenya that it has no authority to intervene in the MV Faina action.

Speaking of Kenya, the Kenyan Parliament's probe into the weapons shipment on the MV Faina continues. Port officials have been called in to testify and it's looking like they have been able to establish that similar weapons shipments intended for the Sudan have been imported in the ministry of defense's name. Finally, Andrew Mwangura, the co-ordinator of the Eastern Africa Seafarer's Assistance Program, seized by Kenyan officials for alleged collaboration with the Pirates and marijuana possession, got his 200, 000 shilling ($2700) bail has been posted and he has been freed.

Stay tuned.

Aloha Malihinis

Nice, huh?

Well, I can't tell you how beautiful it is here. Right now -it's like 5 AM and I'm on haole time so I'm awake and looking for something to do in the dark... I could be going down to the 24 hour Fitness Center - but NAH! I'm going to check in with my peeps, instead.

It is incredibly beautiful here, possums. The Kea Lani is just beautiful and the island weather is so silky and seductive. Just luscious. To tell the truth, I was bitching about having to travel all the way to Maui for this wedding - but hey, now I can kind of see why the happy couple decided to take the plunge here on the Islands. It's THEIR big day, after all. And of course, now I'm wishing that we were staying for a week instead of just 4 days.

But even here, the rudeness of today's economic situation intrudes. We enjoyed happy hour with our new friend, Tom, the bartender and fount of local knowledge of lore. He's also the master of the snappy one-liner, e.g. Q: "Do you know what Wailea means?" A: "Rich, white man." Well, Wailea might mean rich white man, but Tom wasn't laughing at the fact that we were the only 'rich white men' at the bar. He said the hotel had just been dead - they're occupancy rate is at between 40-45% and their sister property on the other side of the island is even worse with rates hovering around 20-25%. The kicker: When we asked him what the outlook was - he didn't seem too worried. The hotel owner has deep pockets, he said. "Being from Dubai and all." (Fact check, Tom: He's from Saudi Arabia and his name is Prince Alwaleed bin Talal.)

Well, daylight is breaking now, kiddos. The birds are chirping and I think it's time to go for a walk on the beach. Aloha for now and as they say on the islands, 'a hui hou' - until we meet again.

D.

P.S. I told you the situation in Iceland was grim. But going to Russians as the lender as last resort? Will the economic situation start cracking the geopolitical scene like an egg?

Near-bankrupt Iceland's €4bn ($5.43bn) loan from Russia is still not a done deal. Iceland's central bank Governor David Oddsson says that talks are still "ongoing" but that any aid from Russia would be "very much welcomed." You can understand why Iceland is desperate for a massive euro-injection in the current bank crisis: the Sedlabanki, the central bank in Reykjavik, urgently needs euros because it has only €4.5bn in its current reserves and the country’s banking system needs to refinance about €10bn before year end -- not easy when the Icelandic krona has fallen 40 per cent against the Euro currency so far this year.

But what price will the Russians demand for their bailout? A highly-placed source in Reykjavik tells Coffee House that Iceland might look kindly on requests from Russia's military to use America's former military base in Iceland. America closed its Naval Air Station at Keflavik Airport two years ago, handing back the Nato facility to the Icelandic government.

Now the word in Reykjavik is that the Russians could have use of it in return for the loan. Not that Keflavik would become a Russian air base -- Iceland is a member of Nato, so that is out of the question -- but it would suit the Kremlin to be able to use it for, say, refuelling and maintenance. Having use of such a facility only a few hours flying time from North America would be a major Russian propaganda coup and cause consternation in Washington.

Iceland is in two minds. It wants to remain a loyal Nato member. But it is also in financially desperate straits and there is some resentment about the abrupt manner in which the Americans left, leaving the massive facility to deteriorate. So Iceland might look more kindly on any Russian request than the rest of Nato thinks.

UPDATE: Sources in Reykjavik, who've now read our story, tell Coffee House that Iceland turned to Russia for a loan after the EU, the Scandinavian countries and the US Federal Reserve turned it down.


Chilling.

We're going to the Hukilau!

My favorite Hawaiian Song.
Hope to pick up a few moves for it while I'm gone.

The Hukilau Song
Jack Owens © 1948

Oh we're going to a hukilau

A huki huki huki huki hukilau

Everybody loves the hukilau

Where the laulau is the kaukau at the lû`au

We throw our nets out into the sea

And all the `ama`ama come a-swimming to me

Oh, we're going to a hukilau

A huki huki huki hukilau

What a beautiful day for fishing

That old Hawaiian way

Where the hukilau nets are swishing

Down in old Lâ`ie bay

Aloha! I'm off to Maui for a couple of days to attend a family wedding.
Blogging will be light for the next few, although I am taking the pc along.
Maybe I'll get some time to sneak off to the Hukilau and do some blogging.
I sure hope so.
This is not going to be my idea of fun... putting the nuclear in family and all that stuff!
Mahalo!

It is not looking good in Iceland...

Why a government should never act as a hedge fund.

Going down.

Address to the Nation by H.E. Geir H. Haarde, Prime Minister of Iceland

10/6/08

Fellow Icelanders

I have requested the opportunity to address you at this time when the Icelandic nation faces major difficulties.

The entire world is experiencing a major economic crisis, which can be likened in its effects on the world’s banking systems, to an economic natural disaster. Large and well established banks on both sides of the Atlantic have become victims of the recession and governments in many countries are rowing for all they are worth to save whatever can be saved. In such circumstances every nation thinks, of course, first and foremost of its own interests. Even the biggest economies in the world are facing a close struggle with the effects of the crisis.

The Icelandic banks have not escaped this banking crisis any more than other international banks and their position is now very serious. In recent years the growth and profitability of the Icelandic banks has been like something akin to a fairy tale. Major opportunities arose when the access to capital on foreign money markets reached its peak, and the banks together with other Icelandic companies, exploited these opportunities to launch into new markets.

Over this period the Icelandic banks have grown hugely and their liabilities are now equivalent to many times Iceland’s GNP. Under all normal circumstances larger banks would be more likely to survive temporary difficulties, but the disaster which is now engulfing the world is of a different nature, and the size of the banks in comparison with the Icelandic economy is today their main weakness.

When the international economic crisis began just over a year ago with the collapse of the real estate market in the US and chain reactions due to the so-called sub-prime loans, the position of Icelandic banks was considered to be strong, as they had not taken any significant part in such business. But the effects of this chain of events, have turned out to be more serious and wide ranging than anyone had expected.

In recent weeks the world’s financial system has been subject to devastating shocks. Some of the biggest investment banks in the world have become the victims and capital in the markets has in reality dried up. The effects have been that large international banks have stopped financing other banks and complete lack of confidence has developed in business between banks. This has caused the position of Icelandic banks to deteriorate very rapidly in the last few days.

You really should read it all. It's very sobering.

"After hopefully things settle down..."

"Pull!"

In "Throwing the bank babies out with the bath water" I pondered today's Global Market Meltdown, the Net Capital Requirement rule and wondered who in the *&%$# had been responsible for changing it.

I just couldn't believe that there would be ANYBODY that ...irresponsible.

Well, I found her. Yep. I found the person involved in the change of the Net Capital requirement rule on Wall Street. Unh-huh. And if she says she wasn't the one? Then why was she bragging all over the place about throwing it out the window, including in her official interview with the SEC Historical Society???

And who knew there even was such a thing as an SEC Historical Society. Did you? Me neither. Go figure. But back to our special someone. That special someone making my blood boil right about now.

Ms. Annette Nazareth, former SEC Commissioner.

Ms. Nazareth served as the Commission's Director of the Division of Market Regulation, a position she held from March of 1999 until August of 2005. As Director, Ms. Nazareth had primary responsibility for the supervision and regulation of the U.S. securities markets, principally through the regulation of brokers and dealers, exchanges, clearing agencies, transfer agents and securities information processors. Significant initiatives adopted by the Commission during her tenure include: execution quality disclosure rules, implementation of equities decimal pricing, short sale reforms, implementation of a voluntary regime for consolidated supervision of broker-dealer holding companies and modernization of the national market system rules. (Editor's note: i.e. The Consolidated Supervised Entity System)

True, Ms. Nazareth probably still has to go a ways to catch up with good old "Typhoid Jamie Gorelick" After all, Ms. Gorelick has her fingerprints all over BOTH 9/11 AND the Fannie-Freddie crisis! Talk about a one woman wrecking crew! Keep her out of the stables with Mrs. O'Leary's cow! But, it's early days yet and I've just started in on Ms. Nazareth when it comes to the google scratching, so we shall see what place she ends up in this Mistress of Disaster bake-off we're conducting.

The good news. It looks like someone in DC IS paying attention to the net capital oversight problem. Senator Chuck Grassley instigated an investigation into the collapse of Bear Stearns back in April and the SEC Inspector General reports were just issued on September 26. In the summary of their results, what do we find, first on the list, front and center?

The Consolidated Supervised Entity Program:

The audit noted that the Trading and Markets division (TM) failed to act in the face of potential red flags regarding Bear Stearns' "concentration of mortgage securities, high leverage, shortcomings of risk management in mortgage-backed securities and lack of compliance with the spirit of certain" international standards.

Specifically, among the Inspector General's findings were:

The CSE program's capital and liquidity requirements may not be adequate, given the collapse of Bear Stearns despite compliance with the capital and liquidity limits.

TM failed to limit Bear Stearns' mortgage securities concentration, despite being aware of the growing concentration of such securities beyond Bear Stearns own internal limits. TM should have required a leverage ratio limit on CSE firms, and should have forced Bear Stearns to reign in its leverage. Despite having knowledge of them, TM failed to encourage Bear Stearns to address serious deficiencies in their risk management and pricing models.

TM concurred with 20 of the 23 relevant recommendations.

What is the Consolidated Supervised Entity program? That's what replaced the Net Capital Requirement Law of 1975 and was the SEC program created to monitor market risk in it's place.

What does that mean? It means the division of the SEC responsible for monitoring firms leverage and risk and exposure and all that stuff? Well, their models were crap and then even when they kind of saw everything spiraling out of control at Bear Stearns? They didn't say anything!!!!

How do you like them apples?

But back to our woman of the hour, Ms. Nazareth. Here on the SEC Open Meeting Agenda for April 28, 2004 we find this little nugget:

Item 3: Alternative Net Capital Requirements for Broker-Dealers that are Part of Consolidated Supervised Facilities and Supervised Investment Bank Holding Companies.

The Commission will consider whether to adopt rule amendments and new rules under the Securities Exchange Act of 1934 ("Exchange Act") that would establish two separate voluntary regulatory programs for the Commission to supervise broker-dealers and their affiliates on a consolidated basis.

It goes into a bunch of other stuff that is venturing off into the tall weeds for now, but I'm not done with this thing yet and will report back. Perhaps I will attempt to contact Ms. Nazareth's former underlings at the SEC who worked on this project for further information:

For further information, please contact Linda Stamp Sundberg at (202) 942-0073, Bonnie Gauch at (202) 942-0765, Rose Wells at (202) 942-0143, David Lynch at (202) 942-0059, or Matt Comstock at (202) 942-0156.

But right now there are more pressing matters about Ms. Nazareth to address. For instance her view on the Net Capital Requirement Law of 1975 as expressed to the SEC historian, Kenneth Durr:

AN: "...everybody over the years had come saying we really have to do some sort of net capital reform, that the net capital rule needed updating."

KD: Explain that a little.

AN: We had a rule in place that, given modern risk management techniques, was considered somewhat rudimentary or antiquated. We imposed high capital charges for securities positions that did not take into account things like portfolio margining and value at risk analysis and the like, and there were a lot of people on Wall Street who believed that the Commission should be moving more in that direction as the banks had done with the Basel Accord. There was a lot of pressure to do that. It's a very, very complicated issue and we did ultimately make some significant changes, but something that I thought would be easy was not easy and I can say it took us nearly seven years to do it, I think if I hadn't been here so long it wouldn't have gotten done."

There you have it my friends, out of the mouths of SEC Commissioners. Which brings me to my next questions: Who were these "lot of people on Wall Street?" What were the real forces behind the move to emulate the Europeans and the Basel Accord, and why? Who was applying the pressure to move away from a regulatory requirement that had seemed to be working just fine up to this point? More questions than answers at this point possums. For now.

But this is really what I wanted to share. You'll be happy to know that Ms. Nazareth, a Democrat, is no longer with the SEC. (A screen capture is provided just in case the article starts to disappear like these Democrat things sometimes do.)

Okay - are you sitting? Have you swallowed your beverage to avoid screen spew? Good.

Get this. So now, Ms Nazareth, the one SEC Commissioner and DEMOCRAT that most certainly had a hand in lighting the fuse on this financial crisis is now going to work for "the most visible (law) firm on the front lines of the financial crisis."

How Barney Frank of her. I swear, just looking at her face and reading this makes my head want to explode.

Davis Polk fortifies its ranks: With Davis Polk the most visible firm on the front lines of the financial crisis — repping Freddie Mac, the Fed, the Treasury Dept and Citi — you wouldn’t think they need anymore firepower. But they’re getting it. Former SEC Commissioner Annette Nazareth (Brown, Columbia law) is joining the financial-regulation practice at Davis Polk, where she used to be an associate. Here’s the WSJ report.

“Right now my role is helping people navigate through this crisis and keeping them abreast of the changing landscape,” said Nazareth, 52. “There will be a big role going forward, after hopefully things settle down, with the restructuring of the financial-regulatory architecture.”

"After hopefully things settle down," she says. Like she was in Montserrat the whole time or something. It's just unconscionable.

Now, don't get me wrong. I know she isn't the ONLY one responsible for this fiasco but come on.... you name it, you claim it. If something like this had happened on my watch, I would be sitting in my room with a shaved head, drinking diet pepsi, wearing sack cloth and ashes....

Does this woman have no shame whatsoever?

The Pirates of Somalia: Hostages get to make an appearance

I wouldn't do well as a hostage, I don't think.

US Says crew on hijacked ship off Somalia appear okay.

The remaining crew appeared fine in a photograph taken Friday, when the pirates granted a request by the U.S. Navy to have the crew step out onto the deck. The picture, released by the Navy, shows the men, mostly expressionless, with gunmen nearby. The crew of Ukrainians, Latvians and Russians are leaning against the railing of the ship but not looking directly at the camera.

The Kenyan Parliament has called a crisis meeting to get to the bottom of the arms shipment found on the MV Faina. Was it intended for Kenya or was it part of an illegal arms shipment to the Sudan as alleged by Andrew Mwangura and the US Navy. They better be having a meeting, 'cause Kenya's got some splaining to do...

"... questions over the transparency of the Kenyan government about its arms purchases have been further raised by a report released Friday by the Stockholm International Peace Research Institute, which tracks the international movement of arms. The author of the report, Paul Holtom, tells VOA that in recent days, Ukraine filed with the U.N. Register of Conventional Arms as having exported 40,000 automatic rifles, sub-machine guns and over 400 grenade launchers to Kenya in 2007. China reported that it, too, had sent 32 armored vehicles to Kenya last year.

But Holtom says the Kenyan government has told the United Nations that it has not imported any arms at all in the past year."

Meanwhile Andrew Mwangura remains in Kenyan custody and it looks like Reporters Without Borders have begun to champion his cause and call for his release. But according to Iran Press (consider the source) the ship owner's are accusing him of connivance and collusion. Looks like Andrew's got some splaining to do as well.

Looks like the pirate business continues to be brisk these days...Pirates hit 6 more ships off Somalia this week.

"Pirates have attacked six more vessels off the coast of Somalia in just the past week, according to data fro NATO. ... And international tensions are ratcheting up by the day. The latest attacks brings the total number of "piracy-related incidents" in the Gulf of Aden and off the Somali coast to 93. A dozen vessels are currently being held for ransom -- their last known whereabouts are on the NATO slide, above. "Larger cargo/oil/gas/chemical tankers" are now the pirates' favorite target."


The Sri Lankan captain of the Great Creation, a Chinese vessel kidnapped on September17th, made contact with its Hong Kong shipping company today. Negotiations continue and a ransom is expected to be paid for the ships release. Hey China, how about lending the world a hand and not supporting Islamic terrorists for once?

The Baltic states check in on the situation. Latvia - No. But it is working with the Ukraniacs to free the Latvian citizen being held on the FAINA. Estonia - Yes. BUT because of limited resources it won't be able to provide ships or personnel for the mission. Lithuania applauds the effort BUT is not prepared to send troops. There you go.

Meanwhile, the Nuestrashimy has reportedly passed through the Strait of Gibraltar, where it is currently "replenishing it's reserves." Can't find out where. Perhaps here?

Stratfor has a great piece up on Russia and Somalia. Does the deployment of the Neustrashimy to Somalia mean the Russians are looking to get involved in Africa again? And what does that mean to the US and the war on terror in the region>

"...the strategic issue is that the Russians are involving themselves once again in the Horn of Africa. They had been involved there during the Cold War, and they are returning — on a very small scale for now. The Horn of Africa is critical to U.S. counterterrorism efforts; the region is watched through Africa Command, headquartered in Germany, and Djibouti hosts the Combined Joint Task Force-Horn of Africa.

This follows the pattern Russia established with Venezuela: recruiting allies whose interests diverge from those of the United States. The primary function at this point is to irritate Washington, since the primary deployment is naval — and so minimal that it presents no threat to U.S. naval sea-lane control. At the same time, the Somalian announcement that the Russians are welcomed ashore in Somalia opens the possibility of a Russian land base in the region, and the possibility of Russian troops helping to assert government control over Somalian chaos — or at least trying to."

Ring-ring-ring! Dinah's calling!

I'm voting for McCain-Palin. How about you?

This morning I'm heading off to the local GOP HQ to work the phones for McCain-Palin.
Wish me luck and remember!
Be nice if you get a call - it could be me...

I hope to twitter from there and have a full report later, as well.

Cheers, Dinah.

Egypt: Sexual assaults mar Eid - Again. Still.

Happy Eid Unless you happen to be a woman in Egypt, that is. Then it's happy sexual assault day. (But then again, pretty much every day is happy sexual assault day if you're a woman in Egypt.) Oh yeah, Islam honors women and the veil guards your modesty, that's right.

The Eid al-Fitr holiday marking the end of the holy month of Ramadan was once again marred by sexual harassment in the streets of Cairo when Egyptian police arrested dozens of young men suspected of sexually assaulting women in the streets, according to a local newspaper.

The independent al-Masry al-Youm reported that 150 young men assaulted female passers-by on Gamaat al-Duwal al-Arabiya street in the upper-class neighborhood of Mohandeseen. One woman’s clothes were ripped off her body and another had her veil torn, the newspaper reported. Police arrested 38 suspects, between 15 and 22, and questioned three of the female victims.

A report in July by the Egyptian Centre for Women's Rights found that almost half of Egyptian women are sexually harassed on a daily basis while almost two-thirds of Egyptian men -- 62 percent -- admitted to harassing women, including those wearing Islamic headscarves. But only 12 percent of women said they filed a complaint.

Muslim world: For women it's a special place in hell...

Safia Amajan.

Don't believe me?

"Three years ago, Kim Sengupta interviewed five women who wanted to build a new Afghanistan. Today, three are dead and a fourth has fled..."

Here is just one of their stories.

"Kandahar, the birthplace of the Taliban, is the scene of particular brutality towards women. "It is much worse down there than it is for us here [in Kabul], you must go down there," Shaima had said previously. One woman who worked tirelessly for women in Kandahar was Safia Amajan, 65, who stayed behind during the dark days of Taliban rule to teach girls in lessons held in secret. After the US-led invasion of 2001, she volunteered to work for the new government with great success, opening schools and workshops where at least 1,000 women learned to make and sell their goods at the market.

Amajan, or "dear aunt" as the girls she taught called her, survived the Taliban by learning the Koran by heart. But she was always independent, refusing a marriage arranged by her father and then eventually choosing her own husband, an educated and wholly supportive colonel in the army.

The couple lived on the outskirts of Kandahar, where she described, without any drama, the struggle of life for women under the Taliban. "Those of us who are around now are very lucky," she said. "There were others, very brave, who also tried to make things better for young girls through education and teaching them skills. They were caught and they suffered."

Amajan was killed in September 2006. Her husband had walked her to the main road where she was to be picked up by a taxi to be taken to work. Two young men approached on a motorcycle and one of them opened fire with a Kalashnikov. A Taliban commander, Mullah Hayat Khan, announced that she had been "executed" for defying orders to stop working.

I met the two men arrested for her murder last year at the Sarposa prison in Kandahar. They were in their early 20s, dishevelled and craven, repeatedly claiming that they were in danger from their own side as well as the authorities. They had killed Safia, they said, in return for $5,000 offered by a mullah in Pakistan. The men were caught when the mullah wanted proof that they had carried out their task and they attempted, by night, to dig up the body for a lock of hair."

Read it all. It will break your heart. And make you want to throw something right at Mr. Taliban - say a couple of AG 114 Hellfire missiles?

Afghanistan: More troubles for Karzai.

Ahmed Wali Karzai

First, the Taliban tell him to go shi% in his hat about the peace neotiations and now a drug dealing brother? Karzai's brother suspected of involvement in drug trade.

It's not the same brother who is the luxury villa real estate developer in Kandahar who is under a death threat from the Taliban.

No, it's brother, Ahmed Wali, who asserts a political motivation to the charge and denies everything but it's still causing friction between the US and Afghanistan and intensifying opposition to their anti-Taliban efforts.

The New York Times report on the subject (and they seem to be the main source) can be found here.

US: Paulson plan shaping up

Weighty Problem [Starting at the Bottom]
(1962), a pin-up illustration by Gil Elvgren

It looks like details are continuing to trickle out.

Paulson lays bailout implementation.

Among the firms under "consideration to lead the implementation" of the plan: Legg Mason, PIMCO, Black Rock and MKP Capital Management.
When PIMCO speaks I listen...

Mohamed Erian, co-chief executive of the giant asset management firm Pimco, told the newspaper that short-term credit trading for anyone other than the federal government remained at a "virtually nonexistent level" Friday, saying, "While constituting a necessary condition, the rescue package is not sufficient to radically counter the immediate disruptions."

"Not sufficient to radically counter the immediate disruptions." Not good.

Who will make out like bandits in all this? Can you say "the lawyers"?
Judge blocks Wachovia-Wells Fargo merger.

An battle may be brewing between Wells Fargo and Citigroup over which will end up obtaining Wachovia. CNN reported the proposed Citigroup-Wachovia purchase agreement contained an exclusivity agreement requiring Wachovia not seek another bidder or provide information or enter talks that might facilitate a rival bid.

Citing unnamed sources, The New York Times reported Citigroup is seeking $60 billion in damages from Wells Fargo for interfering with the initial transaction. The newspaper said the judge's order could be the opening round in a protracted legal battle between Citigroup and Wells Fargo.

Across the pond and around the globe...

Financial institutions continue to list and take on water...

And the leaders of the EU have ruled out a Eurobank rescue pool. But I'm sure you'll be happy to know they're all going to have a "global economic summit to examine whether overhauls are needed for the existing World War II-era international financial system."

French President Nicolas Sarkozy, Prime Ministers Gordon Brown of Britain and Silvio Berlusconi of Italy and German Chancellor Angela Merkel convened Saturday at an emergency meeting in Paris to discuss a concerted European response to the Wall Street financial crisis that has lead to a string of bank nationalizations in the U.S. and Europe.

Sarkozy, who has emerged as Europe's most vocal advocate of a continent-wide response, told reporters that for now, Europe's four leading economic powers have agreed to continue to address bank failures one case at a time. He said each country would use "its own means" to safeguard banks from collapse, but would do so "in a coordinated way." Merkel and Brown were particularly opposed to creating a Europe-wide pool for failing banks, the newspaper said.

Oktoberfest surprise. Are you surprised that banks would be sitting on their hands when it comes time to help out? Looks to me like they were waiting for the government to come through. Guess what? It looks like they still are. Major German Bank and 2nd biggest mortgage lender close to Collapse.

A spokesman for Hypo Real Estate said a consortium of banks refused to provide the $50 billion required by a government-sponsored rescue plan, the BBC reported. Analysts said they believe Hypo is within a few days of failure. Government officials and banking representatives were expected to meet Sunday to discuss alternatives. Hypo Real Estate has been hit hard by bad debt and the credit squeeze.

The Dutch Government is trying to put a finger in their leaky economic dyke, that of "embattled bank" Fortis by temporarily nationalizing it because its financial situation was more dire than expected.

The government's move came only days after the governments of the Netherlands, Belgium and Luxembourg announced a partial takeover of the Dutch lender. But Dutch banking officials said Friday Fortis needed more help, and so purchased its core assets for $55 billion, the British newspaper The Independent reported. Dutch officials said they made the moves to protect the country's assets and it was necessary to ensure "the continued proper functioning of vital financial functions for the Dutch economy," the newspaper reported.

Iceland's economic iceberg is leaving it looking like the Titanic.

Iceland has been hit hard by the credit crisis, with the government taking control of the country's third largest bank this week. The country's currency has been sliding, The Guardian reported. The kronur dropped 14 percent during the week and is now worth less than a cent. Gylfi Magnusson, a University of Iceland economist, said that the entire banking system is at risk. Because the three major banks, Kaupthing, Landsbanki and Glitnir, have assets about nine times the country's gross domestic product, the country "doesn't have the money to keep the banks afloat," he added. "This past week has been about as bad as it could get," he said. "People are very worried and have no real idea what the future might look like." Iceland, with a population of about 300,000, has been one of the fastest-growing European economies in recent years. But the growth has been built on easy credit, and its banks are now having trouble obtaining short-term loans.

Inky dinky parlay vous. It's now official. France slips into the stormy seas of a recession and the French socialists can barely contain their glee.

Somali Pirates: Follow the money, matey. Or the hawala. Or the freshly butchered halal cow.

Somali Islamists want MV Faina weapons. And their cut of the loot.

Are the Somali Pirates and al Qaeda's team, the Somali Islamists, getting ready to mix it up? Pirate squabbles since the beginning of time have usually centered around the dividing up of the spoils and the women. This appears to be no exception. The Islamists and the SOMALI GOVERNMENT are all lining up with their hand out to get their piece of the action. And it's not going well.

The Chatham House group has issued a report, Piracy in Somalia, which claims the Abdullahi Yusef government ACTUALLY benefits from the piracy. We know he has relatives in the region and that they are involved with the pirates. Hells Bells, it sounds like everybody is in on it. The locals, the pirates, the Islamists and the Government. What a damn racket!

"The fact that the pirates originate from Puntland is significant as this is also the home region of President Abdullahi Yusuf. As one expert said, ‘money will go to Yusuf as a gesture of goodwill to a regional leader’10 – so even if the higher echelons of Somali government and clan structure are not directly involved in organizing piracy, they probably do benefit."

The Somali President has yet to challenge this statement.

Pass the popcorn as we try to follow the money, possums.

Islamist insurgents have demanded to be given some of the weapons aboard a hijacked Ukrainian ship carrying 33 tanks but the pirates holding it have refused, a local official said on Sunday. The Islamist gunmen from the al Shabaab group opposing Somalia's weak interim government have also received a five percent cut of the $1.5 million paid out for a Spanish ship released several months ago, a resident told Reuters.

-snip-

"Al Shabaab wanted some weapons from the Ukrainian ship but the pirates rejected their demands," a local official who asked not to be named told Reuters. "Al Shabaab went away after they were rejected by the residents and the pirates. I am sure the group is not far from the area," he said.

Residents confirmed fears that ransom payments to pirates were being passed onto the Islamist movement and were fuelling the insurgency against President Abdullahi Yusuf's government. One resident and a relative of the pirates holding the Ukrainian vessel said the al Shaabab men received a five percent share of the last ransom paid but had been demanding more.

"Al Shabaab demanded more money from pirates and they disagreed," resident Hussein Ali told Reuters. "They met the pirates near Hobyo and asked for more money...but the pirates refused." They are also expecting a share of any money paid out for the Ukrainian ship and two Greek ships held at Hobyo, he said. "They are waiting for some money from these three ships held in our area. Most of the al Shabaab who asked for money are in the same sub-subclan with the pirates around Hobyo," Ali said.

And follow the cow...

Most of the money, usually 10-20 per cent of that demanded by the hijackers, is moved quickly along the line to the so-called 'Big Fish' in the clans - in the government of the provincial capital, in Mogadishu and in the Somalian diaspora in Nairobi and Dubai where those behind the piracy are allegedly to be found.

-snip-

John Chase, managing director for intelligence and crisis response at AKE, says while many groups originally employed the Islamic hawala banking system as a method to launder money, increasingly groups are asking for cash. 'There are some groups still asking for hawala, but there are other groups asking for money to be delivered by tug. And yes - that means sacks of money.'

Sometimes, however, it is not the money that is most challenging. 'The boats will be held for a while. If they are on their way to port they can be short of food. Then the demand is: "Bring us a cow or some goats killed in the halal way otherwise we are going to start lopping off some heads."'

Of course, al Guardian is all aboard with the "Pirate as eco-warrior" spin being bandied about by the Pirate's PR Spokesman, Ali Sugule. (I know, what has this world come to when Pirates have PR spokesmen?). The Scotsman report quotes Ali quite extensively, who tells us we should "think of them as the Coast Guard". Please.

And I'm sure you'll be happy to know that Portugal is offering their 'political support' to the fight. But won't commit to "military means." Don't knock yourself out, there Portugal. I've about had it with these EU handwringers standing on the sidelines offering their support. Support which usually consists of unbridled criticism of those that are trying to do something about the problem. (feh)

Taliban mighty miffed about latest missile attack.

We heard about this missile strike the day before yesterday...and now we have this news today.

Taliban mad over alleged U.S. strike. And not only are they mad - they're unusually mad. (I think that's meant as "mad" in the angry sense, not "mad' in the nuts sense. Although both would probably apply in this instance.)

The Taliban are unusually angry about the latest suspected U.S. missile strike in Pakistan, a sign a top militant may have died in the attack, officials and residents said Sunday amid reports the death toll rose by two to 24.

-snip-

The insurgents were moving aggressively in the area while using harsh language against locals, including calling them "saleable commodities" — a reference to people serving as government spies, the officials said.

Two local residents said Taliban fighters had warned people not to discuss the strike, including with the media, or to try inspecting the rubble at the site. The residents asked not to be named for fear of Taliban retaliation.

Gulf News is claiming that 'Arabs' got killed in this attack.

Hmm. Interestingly enough, the Pakistan Daily Times says that 'no Al qaeda were killed in attack'. But two of the bodies (er - make that body parts) were taken away and HIDDEN - not buried in the local cemetery with the rest of the Arabs.

'Two intelligence officials, citing reports from field agents and informants, told AP that eight Arabs and 14 Taliban died in the attack.

The Taliban included a Haqqani commander who had invited the others to dinner, they said. The commander, his father and two young sons were among the dead Taliban, the officials said.

Six of the Arabs were buried in the village on Saturday morning, while militants took the other two bodies to an undisclosed location, they said.'

Could this mean we got a big fish with this one? I'm still hoping there's a chance.

Please note: The fact that the our missiles are targeting the Haqqanis is good enough news for me.

The repeated US air strikes in Pakistan’s restive tribal regions are mainly directed at ‘Haqqani network’, the militant group led by one of the most influential Taliban commanders, Jalaluddin Haqqani, and his son Siraj Haqqani.

The officials said that Haqqani network was considered by the United States as the most dangerous group of militants fighting against the Nato-led International Security Assistance Force (ISAF) in Afghanistan and its dismantling was vital for success in the war-torn country.
-snip-

Jalaluddin and his son Siraj are blamed for close ties with Osama bin Laden and both Taliban commanders are the most wanted men in Afghanistan for their alleged involvement in deadly attacks and for recruiting and training terrorists for suicide bombings.

“Most of those killed in Friday’s strikes at the houses of two brothers, Daud Jan and Abdur Rehman, in Muhammad Khel village were foreign fighters. Not only those foreign fighters had links with Haqqani network but also Daud and Rehman were the important commanders of Haqqanis’ organisation,” said a senior official here Saturday requesting anonymity.

Adios, MF'ers.

Afghanistan: Taliban to Hamid Karzai...up yours!

Taliban commander rejects peace talks with 'Afghanistan's puppet government'.

Mullah Brother is back from the dead and calling Reuters on a satellite phone from an undisclosed location. And Mullah Brother must have been watching Whoopie Goldberg on the View while he's been recuperating.

"We reject an offer for negotiation by the Afghan's puppet and slave President Hamid Karzai," Mullah Brother said by satellite telephone from an undisclosed location. He said Karzai had no right to negotiate. "He only says and does what he is told by America."

The harsh rhetoric against Karzai is a departure from recent Taliban statements which have taken a softer line on the pro-Western president who has led Afghanistan since U.S.-led and Afghan forces toppled the Taliban after the September 11 attacks. It also appears to reverse a statement by Brother in March in which he said the Taliban could cooperate with Karzai's government and called for a negotiated ending to the fighting.

Brother served as a top military commander while the Taliban were in power in Afghanistan in the late 1990s and is now one of the movement's senior leaders. He repeated the Taliban's war aim of fighting till the more than 70,000 U.S. and NATO troops were driven from the country and said the insurgents would not negotiate while there were still foreign troops on Afghan soil.

So much for giving that freak Mullah Omar safe passage and asking him to join the Afghan government.

UK: I just like the sound of this headline...

From the Daily Mail: Minister who infuriated Muslims put in charge of immigration policy.

It's got a nice ring to it, doesn't it?

Pigs are flying and feminist heads are exploding. Heh.

Sarah Palin in Carson, California hiding from the press.

From Gretawire. Hat tip to the ever delicious Miss Velvet Hammer.

Just got this email from FNC embed producer….as soon as it came in and I saw it, my eyes popped out!! I know this woman!! I read it to my husband…and he agrees! This endorsement is going to really going to cause a storm!! Hang on to your seat! Read!

From: Gomez, Serafin
To:
Sent: Sat Oct 04 18:05:43 2008
Subject: Head of NOW. LA chapter Endorses Palin

Carson, CA-

The head of the LA chapter of National Organization for Women has just endorsed Gov Palin @ campaign rally. Not speaking NOW or her chapter she said but as an individual. ” This is what a feminist looks like,” she just before handing it over to SLP.

Serafin Gomez
Producer, FNC Political Unit
Washington Bureau

FYI - The Ace of Spades has a man on the scene report and more pics up here.

Al Jazeera goes to Say it ain't so Joe's hometown

What a bunch of happy horse shi& this is...

"On Thursday night, millions of television viewers around the globe caught a glimpse of something Northeast Pennsylvanians can see any night of the week: Scranton voters talking politics. However, local residents themselves will likely never see the footage of the live news show, broadcast on Al-Jazeera English from the upper room of Cooper's Seafood House in Scranton.

While the network is seen by an estimated 80 million people, it has almost no American viewers, but the fact the station chose Scranton as its locale to broadcast from on the night of the only vice presidential debate further supports how some pundits view the Electric City as a representative slice of the American Pie.

"Our goal is to make the international audience aware of what's going on here in America," producer Mariam Simpson, who flew in from Washington, D.C., on Monday to prepare for the show, explained afterward. The station has also broadcast from the Democratic and Republican national party conventions and is heading to Columbus, Ohio, next week for the second debate between Sens. Barack Obama and John McCain. Ms. Simpson scoped out several locations before deciding on Cooper's, and made dozens of calls to find the right people to represent Scranton to the world.

She chose Maggie Marriotti, Tom Egan and Kathy Moran for the panel.

All three are Catholic and pro-life, but the two women support Mr. Obama while Mr. Egan supports Mr. McCain."

You can watch the segment here, should you so choose. It's a double bagger, a barf bag is optional, but there is a douche bag alert because al Jazeera's Mike Kirsh is a douche bag of the first order.

Throwing the Bank babies out with the bathwater...

You scrub my back, I'll scrub yours.

We have a good deal of comfort about the capital cushions at these firms at the moment.” — Christopher Cox, chairman of the Securities and Exchange Commission, March 11, 2008.

I've been sitting here this week watching this whole market mess, scratching my head and trying to figure something out. How did these damn banks get so over-leveraged in the first place? I distinctly remember our firm having to comply with a net capital rule that required us to maintain levels of capital based on our trading positions. $ that would serve as a cushion in the event of market craziness or unexpected market downturns. This would have gone a long way in preventing the collapse of the investment banks and the current condition of the commercial banks.

It's been bugging me so I did a little google scratching and I found out why John McCain was calling for the head of Chris Cox, the chairman of the Securities and Exchange Commission. And why John McCain probably has a valid point.

The SEC threw that rule out the window and with it went any hope that sanity would prevail on Wall Street.

More about the net capital rule:
"The so-called net capital rule was created in 1975 to allow the SEC to oversee broker-dealers, or companies that trade securities for customers as well as their own accounts. It requires that firms value all of their tradeable assets at market prices, and then it applies a haircut, or a discount, to account for the assets' market risk. So equities, for example, have a haircut of 15%, while a 30-year Treasury bill, because it is less risky, has a 6% haircut. The net capital rule also requires that broker dealers limit their debt-to-net capital ratio to 12-to-1, although they must issue an early warning if they begin approaching this limit, and are forced to stop trading if they exceed it, so broker dealers often keep their debt-to-net capital ratios much lower."

What happened when the rule got thrown out the window:
The SEC allowed five firms — the three that have collapsed plus Goldman Sachs and Morgan Stanley — to more than double the leverage they were allowed to keep on their balance sheets and remove discounts that had been applied to the assets they had been required to keep to protect them from defaults.

How the rule got thrown out the window. (Why on Earth would we be following the EU's lead in this matter? I'm sure it had something to do with competition, but I still find it curious.)
In 2004, the European Union passed a rule allowing the SEC's European counterpart to manage the risk both of broker dealers and their investment banking holding companies. In response, the SEC instituted a similar, voluntary program for broker dealers with capital of at least $5 billion, enabling the agency to oversee both the broker dealers and the holding companies. This alternative approach, which all five broker-dealers that qualified — Bear Stearns, Lehman Brothers, Merrill Lynch, Goldman Sachs, and Morgan Stanley — voluntarily joined, altered the way the SEC measured their capital. Using computerized models, the SEC, under its new Consolidated Supervised Entities program, allowed the broker dealers to increase their debt-to-net-capital ratios, sometimes, as in the case of Merrill Lynch, to as high as 40-to-1. (gadzooks!) It also removed the method for applying haircuts, relying instead on another math-based model for calculating risk that led to a much smaller discount.The SEC justified the less stringent capital requirements by arguing it was now able to manage the consolidated entity of the broker dealer and the holding company, which would ensure it could better manage the risk.

Well, it looks like they were wrong. Another case of bad mathematical modeling and even worse judgment. To further complicate matters:

The SEC said it has no plans to re-examine the impact of the 2004 changes to the net capital rule, and last week, it put out a proposal to revise the rule once again. This time, it is looking to remove the requirement that broker dealers maintain a certain rating from the ratings agencies.

Now, I'm sure this is because of some pissing match between the SEC and the ratings agencies but this action even FURTHER erodes controls. (The failures of the rating agencies throughout this debacle are a WHOLE OTHER STORY, but that is getting off in the tall weeds for Dinah).

Look for this rule change to be the focus of the Dem show trials against the Repubs. You know they're coming. I'm starting to wonder if John McCain saw this handwriting on the wall and called for Chris Cox's head as a pre-emptive strike. If W would have gone along with him - it would have taken the issue off the table for the Dems. Or at least given John a leg to stand on when it comes up - and you know this is going to come up. You can already see the vague outlines taking shape in the Dems squawking points about DEREGULATION. I hate to admit it - but in this case they're right.

It was sheer lunacy to unleash the capital requirement constraints from these guys. And now I'm wondering who was behind the push for the rule change to begin with. Hmmm. Time to do more google scratching.

If you're still interested in learning about this clusterphuk, a more indepth article can be found here.

Iran: US Think Tank to 'open in Tehran'

However, I don't think it's such a good idea myself.

Washington has given rare approval for a research body to open an office in Iran, although it stressed United States policy had not changed.

The American Iranian Council was given a licence to establish a presence in Tehran by the US Treasury Department.

The Treasury's Office of Foreign Asset Control enforces US sanction on Iran.

The AIC is a policy think tank devoted to improving relations between the US and Iran, which have been mutually hostile since Iran's 1979 revolution.

Fomenting revolution is the only reason I can 'think' of for opening a think tank anywhere in Iran.

Somalia: Kenyan Government charges maritime official

Their ship has come in.

With making false statements and possession of marijuana. Dude!

On Thursday, the maritime official appeared in court in Mombasa, charged with making false and alarming statements to the media. He was also charged with possessing $3 worth of marijuana and ordered to be held until his next court appearance on Tuesday.

We're talking about Andrew Mwangura, the go to guy, the main man in the know about all things Somali Pirate. (Details of his recent arrest and background can be found here, if you're interested.)

But back to Andrew and the real news about the MV FAINA and that Ukrainian arms shipment. It looks like there's been a pattern of trafficking activity in the region and the good guys are onto it:

Separately, the U.S. Navy and defense officials in Washington said that they, too, had reports that the military cargo on the freighter was destined for Sudan. Mwangura have told the media that several other military shipments in the past year were sent to the southern Sudanese town of Juba through the port in Mombasa.

Kenyan and foreign media groups, quoting their own military sources and Western arms experts, have widely reported that South Sudan is believed to have more than 100 Russian-made tanks in its arsenal while the Kenyan military has none.

This report claims that Andrew is cooperating fully with authorities.

"He is assisting the government in investigations because he appears to have direct connections with the pirates, who have been hijacking ships," he said. "Pirates appear to call him directly or he has access to people, who have directly access to the pirates. He has appeared the last few times to be their official spokesman."

To give you an idea of how out in the open this whole pirate business is. Just dial Pirate 4-1-1.

Mwangura has been a key source of information for many groups, including journalists, on ship hijackings taking place off the coast of Somalia. He has said that his sources include pirates and their families, but that is not unusual. Many media organizations, including VOA, can easily reach pirates and people who know them via mobile and satellite telephones.

Even the New York Times has been ringing up the Pirate Shiver me Timbers Hot Line.

And in case you're wondering what's happening out at the ship:

As many as six U.S. Navy destroyers, cruisers, and amphibious ships are near the captured freighter, anchored about 11 kilometers off the town of Hobyo in central Somalia.

The Russians and the Ukrainians (or as Joe Biden would say: 'Ukrainiacs') are still burning up the phone wires discussing the situation. (Or maybe their plans to conduct a hostage rescue operation?) Russia also says they want to work with the US and EU in addressing the piracy scourge. Unh-huh. So does Egypt. Hey, Egypt how about working on your own garden variety Islamoterrorists in Egypt?