Banks Are Only Human

If a corporation is a person – as Laura points out in reference to GM, below — then a major bank should be seen as nothing more that a big, fallible human being.

I have a checking account at a particularly silly bank where, month after month, they show a balance 15 cents higher than the balance I arrive at counting on my fingers. This isn’t calculus. It’s addition and subtraction, and they should be good at that.

True, it’s a trifling amount, and it’s conceivable that I’ve made a mistake in counting the fingers I’m counting on.

At the other extreme, Bank of America just discovered a fat-finger error of $4 billion that no one had noticed for over five years – not the accounting department, not the finance committee of the board of directors, not their outside auditor, not the Federal Reserve or the Treasury Department with all their stress tests. As one bank analyst is quoted in the New York Times,

“There are signs that controls are not as tight as they need to be.”

Oh, Really? Shame on the Times. Even you or I could have given them a better quote than that. For example:

“They didn’t notice? Right. How big a lump do you have to have in your mattress before you wake up screaming?”

As the Times reported Tuesday, it’s clear that BofA’s management should have caught the error but less clear who else should have caught it. For instance, the $4 billion gap was hiding in the bank’s submissions to the Fed, related to stress tests.

Still, the reporter generously allows, “It should be noted that the submissions contained thousands of numbers …”

Presumably the Fed gets to be counted as a person, too. Any of us could get drowsy sorting through thousands of numbers, and maybe some teller or night watchman or customer who has fewer numbers to deal with should have alerted BofA to the gaping hole in their arithmetic.

In fact, I should probably call my bank about that mistake they’re making in my checking account. Today, it’s only 15 cents, but one tiny leak in the dike and who knows where it might end?

Little Things That Count

We have a line on an exquisite scale model 1/12 the size of a 1934 Daimler Benz roadster, progenitor of today’s Mercedes C-Class coupe but more flamboyant, which some antique car fanciers regard as the most beautiful car ever made.

The model is offered in a mail order catalogue forwarded to our discriminating tastes by Dr. Steve, who occasionally writes here about the Jew and the two liberals in Oklahoma. The catalogue is called Lilliput, which fittingly specializes in miniatures – and of course harmonicas, which are miniature church organs.

The Daimler Benz model costs $2599.50. We were tempted, but that last fifty cents put us over budget. As a mental arithmeticker, I quickly calculated that this 18-inch model costs about the same as the full-size edition did in 1934, and the original had an engine. That comparison ignores inflation, a fun thing to do, and in any event I couldn’t quite pin down the value of a deutschemark in 1934 (shortly after a hyperinflation, during a great depression, and just as Hitler was rising to power, partly by debasing the deutschemark).

We do know, however, that $2599.50 was enough to buy ten Model T Fords during the 1920s and nearly that many Model A’s in the early 30’s, again sluffing off inflation’s effects and the fact that you could buy coffee back then for 12 cents a pound. In good condition, those ten Model T’s would now be worth close to a million dollars if auctioned to antique car aficionados, so let’s turn to harmonicas.

Lilliput offers a Hohner Marine Band – a small, ten-hole harmonica – for $136. I bought one for myself at age 12 for $2.50. The definition of an unexamined life is one devoted to ignoring inflation and playing a small harmonica.

The Secret of Total Failure

For various reasons – book leave, sick leave, new leaf leaves – we haven’t been posting for a while, so we really can’t expect anyone to be left in the audience. Still – before the turnstiles are rusted shut entirely – we may have a few afterthoughts, and surely there’s nothing wrong with talking to yourself.

This afterthought is devoted to General Motors and the lessons we’ve divined from their court filings.

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GM has asked a federal bankruptcy judge to swat down a gathering swarm of lawsuits stemming from its mishandling of a defective ignition switch — and to bar similar cases in the future — all in one grand dismissal.

That’s one of the potential advantages of bankruptcy – a Get Out Of Jail Free card so you won’t be pestered and penalized or have to pay money just because you’ve killed a few people and endangered millions of others.

Thus, the lesson:

If you’re going to screw up on engineering, production, consumer safety, ethics, and honesty in dealing with customers, be sure you also botch your finances badly enough to get into bankruptcy court to escape responsibility for your sins.

Unless, of course, the judge finds a flaw in the ignition of GM’s argument.

How to Smuggle Water

This isn’t science; it’s arithmetic. My ancient TI30 calculator tells me that it takes 500 gallons of water to produce the beef for a Quarter Pounder at McDonald’s. God help us trying to find enough water to make a Big Mac.

It takes only 7 gallons to grow vegetables for your 3-ounce salad. So in terms of scarce water, a Quarter Pounder costs 70 times as much as a salad.

The raw figures were supplied by James McWilliams’ Op-Ed piece in Saturday’s New York Times. A shocking four million gallons of water are required to raise a ton of meat.

In the Imperial Valley of drought-stricken California, McWilliams reports, farmers use the water to grow alfalfa, most of which is then shipped to Asia as alfalfa hay to feed cattle.

By this route, the alfalfa growers are sending 100 billion gallons a year of California water to beef and pork eaters halfway around the world.

I’ve known serious thinkers who expect water wars in this century between the U.S. and Canada. As far-fetched as that may sound, it’s not nearly as crazy as exporting 100 billion gallons a year from water-starved California to the far-off fanciers of Kobe beef.

Our descendants will wonder — “What on earth were they thinking?”

PIGGY BANKERS

As small children, we were less concerned with the metaphysical questions (Why is my bank a pig?) than the practical (Now that I’ve learned to put coins in the slot, how do I get them back out?)

Having since grown in wisdom, in age, and in grace, we’re finally ready for the worldly whys (Why are bankers such pigs?)

We’re not talking here about Jimmy Stewart in the local savings & loan – more like Orwell’s pigs in Animal Farm. These days, that means the big investment banks with their own version of the one-way slot where your dollars go to die.

After the piggy bankers blew up the economy in 2008, some of us started to wonder if they were overpaying themselves with the help of our tax money. We noticed they were gloriously overcompensated all year long and then got huge bonuses on top of that. For what?

Don’t ask. It’s a wonderful life.

Understandably, in the U.S. and Europe there’s been a recent move to clamp down on excessive bonuses. Surely two or three times a banker’s annual salary is enough?

But no! But no! rose the terrible squeal of porcine lobbyists in unison:

“How is an investment bank supposed to attract top talent merely by paying bloated salaries and then tripling them at year’s end?”

Still, bankers are clever pragmatists, else why would we pay them so much? Once they had grasped that the word “bonus” had acquired a pigpen aroma, they got out the thesaurus to find other words – innocent terms that the new regulations had failed to anticipate.

Instead of bonuses, some banks now speak of allowances. Didn’t we all used to get allowances? Some call their bonuses “role based pay” or “reviewable salary” and, under such banners, are managing to hand out bonuses ranging to more than five times an employee’s already majestic annual wage.

Orwell’s pigs had learned to talk like humans. Ours have graduated to fluency in weasel words.

Flunking Science

The excerpt below is from this week’s Economist. Their story is about a debate between creationist Ken Ham and Bill Nye (“the science guy”), who worried that allowing creationism a veneer of scientific respectability would harm America by producing scientifically illiterate students:

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“Most Americans reject young-earth creationism. But the share of Republicans who believe that humans evolved fell from 54% in 2009 to 43% last year.

“Democrats, do not look so smug: your lot are likelier to believe in UFOs, ghosts, and astrology. Also, that the moon landings were faked, that the CIA introduced crack to inner cities, and that America’s government conspired in the September 11th attacks.

“It’s enough to make an ape weep.”

On the Wings of a Dove

It was a lovely idea, redolent of symbolism.

Last Sunday, as thousands watched from St. Peter’s Square, the Pope appeared at his window with two children who then released two white doves of peace.

A crow attacked one of the doves and a seagull attacked the other. The Pope must have felt like the driver who ran into a deer and then heard his children bawling, “Daddy killed Bambi!”

His Holiness spread his arms, looked skyward, and cried out, “Very funny, big guy!”

Actually that last part is apocryphal, but the Pontiff should have consulted his raven before staging such an event. It’s been an odd season for birds, as endangered Spotted Owls are crowded out of their shrinking habitat by barn owls in the northwest U.S. and Snowy Owls have moved south in great numbers from the Arctic Circle, first to Boston, then the Chesapeake, Washington D.C., Louisiana, Florida, even Bermuda.

As for the dove (usually a domesticated pigeon), it’s a symbol of peace and also of love because that’s what it rhymes with — “On the wings of a snow white dove, He sends his pure, sweet love…”

In the Old Testament, Noah confuses the issue by sending a dove out from the ark to look around for some dry land. The dove returns with a sprig from an olive tree in its beak, which for some reason makes both the dove and the olive branch symbols of peace instead of hope, rescue, flood relief, or olive oil.

The owl, of course, is a symbol of wisdom – spotted, snowy, or barn wisdom –although it’s also a ferocious predator.

It may be this ambivalence that induces the owl suddenly to turn its head 180 degrees.

The Crow (like Poe’s Raven) is a symbol of prophecy, and both it and the gull are symbols of scavenging – of eating damn near anything, including the handkerchiefs women pin to their hair when they’re not wearing a hat but have to cover their heads to go into St. Peter’s Basilica.

There’s a deeper meaning in all of this, and we expect to discover it any minute.

Operation Henhouse

Rumors are not exactly flying, but they’re peeping around corners, wondering if Fox News is actually a data mining project of NSA.

Covert designation: Operation Henhouse, more than likely.

It would be ironic if it turned out that all those conspiracy buffs addicted to Fox News have missed the one conspiracy that they’re addicted to.

To the rest of us, the tipoff came in a recent survey by Fairleigh-Dickinson University to test the knowledge of current events possessed by people who habitually watched or listened to one news outlet or another.

Fox News viewers rated lowest of all – even lower than people who neither watch, read, nor listen to any news whatever.

And on top of the list? The dreaded bicoastal liberals who tune into NPR. Also highly rated was the Daily Show.

NSA’s agenda – this is only speculation, mind you – would be one of data mining to trick the most ignorant people in the country to self-identify by their Fox News allegiance. Once they’ve fingered the “clucks” (spook-speak), agents would be ready to round up, disarm and possibly deport enough of them to restore the nation’s intellectual and judgmental balance.

Fairleigh-Dickinson researchers failed to disclose if there were any Supreme Court Justices in the survey sample.

The Truth About Truth

Don’t tell anyone, but in our vast test kitchens and cavernous research facilities under Yucca Mountain, we often face the dilemma of conflicting conclusions reached by different research teams — and then, in the interest of objectivity, we’re forced to flip a coin.

We use a tamper-proof 1899 Morgan silver dollar.

Since you can’t very well subject peerless researchers to peer review, we’ve never had to disclose our coinflip methodology to a peer-reviewed journal; but you can imagine our relief when we learned that everybody else’s research is comparably flawed, whether or not they admit it.

I’m not referring to the stock market recommendations of sell-side analysts on Wall Street or the studies sponsored by tobacco companies or drug companies, all of which are Easter egg hunts for new arguments to support foregone conclusions – as are the climate change denying studies covertly funded by coal and oil companies and the ubiquitous Koch brothers.

No, I mean real research by good scientists in pursuit of genuine discoveries – but who also have careers to build, tenure to seek, grants to obtain, and passionate beliefs in their own theories.

Get thee behind me, Satan, so you can push a little harder.

In Tuesday’s Science Times, George Johnson recalls a 2005 paper published by Dr. John Ioannidis – a scientist whose research subject is research itself. It was titled, “Why Most Published Research Findings Are False.”

Dr. Ioannidis noted the human tendency to see what we want to see, magnified by competition and a shrinking pool of grant money, along with some error-prone experimental designs – a context within which it’s easy to fool yourself, even with the best of conscious intentions.

Other scientists wondered if Dr. Ioannidis’ findings might have been skewed by his own biases.

But then he published a definitive report on the most highly regarded research papers of the previous decade (e.g. on the effects of a daily aspirin on cardiac patients, the risks of hormone replacement therapy for older women), finding that in most cases the reported results were later altered or contradicted.

Since then other researchers have come forward with kindred views.

One recalled that while working at Amgen he and his colleagues tried to replicate the findings of 53 landmark cancer papers. In 47 of the 53 cases they were unable to do so, even when they got the original researchers to collaborate.

Now that the alarm has been sounded, various journals and institutes are looking for ways to reform the process. But as Johnson points out in the Times, the scientific literature “has roughly doubled in size every 10 or 15 years since the days of Isaac Newton.”

He says the National Library of Medicine’s PubMed database alone containes 23 million citations.

How can we help? We’re thinking of sending them our 1899 silver dollar.

Fantasies in Propagandaland

In case you’re too busy to keep up with Russian and Iranian news agencies, Michael Moynihan provides an update in the Daily Beast. Highlights:

> From Edward Snowden’s stash, the Russian secret service has learned that Washington DC is now controlled by Nazi space aliens.

> North Korea is the only country boasting 100% literacy (though that’s easier to attain when there’s only one book).

> The Schoolchildren’s Palace in Pyongyang has facilities that would shame Eton and Harrow.

Fair and balanced, wouldn’t you say? This must be what Fox News sounds like to an Iranian.

The sources Moynihan cites are RT News (Russian), Fars News Agency (Iranian “semi-official”) and PressTV (official Iranian propaganda). You can find them all on YouTube, along with those of some other countries.

You won’t get late breaking antics of the Great Satan on Iran’s official site, though. Most of the “news” I found there is six months to three years old, somewhat redeemed with an up-to-date recipe for cooking abgoosht.

RT reports that the US dollar has lost all value and is about to crash.

A civil war is imminent here, and all the gold has apparently disappeared from Fort Knox (as revealed by a reporter named Rooster Teeth). The Germans had asked to see the bullion and were told No by the Fed.

Fars picked up a spoof from the Onion and ran it as actual news – announcing poll results showing that 70% of Americans would rather have beer with Ahmadinejad than Obama.

Both Fars and RT love stories of UFOs and ETs and carry them as mainstream news.

And conspiracy theories. Fars claims that “the Green Movement” hacked their site and shut it down for hours. I believe that one because the Green Movement hacked my lawn last spring and I had to mow it all summer until a cold snap killed their virus, along with the Stink Bugs, which had been smuggled in from China.