Fed Governor Urges Housing Finance Fix

Headline of a Wall St Journal piece.  Fed Reserve governor Jerome Powell wants more private investors to buy into Fanny and Freddy, so that next time Fanny and Freddy go bust, private investors will lose money rather than taxpayers.  Everyone always thought that Uncle Sam stood behind Fanny and Freddy even though the fine print in the enabling laws did not so state. This wide spread belief allowed Fanny and Freddy to borrow money on the credit of the United States, which meant they could raise money for 3-4%, really cheap.   But when Fanny and Freddy went bust in 2008, Uncle decided us taxpayers were on the hook for $140 billion to avoid besmirching the reputation of the US treasury.
    Fanny and Freddy didn't cause much trouble until the 1980's when they started buying mortgages off banks.  The real estate industry loved this, it made more mortgage money available. Sell a mortgage to Fanny or Freddy, and presto, the bank has the cash to make yet another mortgage.  Fanny and Freddy recovered the money by selling bonds on Wall St.  They said "Look, these bonds are 'backed' by real estate."  Suckers fell for this, and for a while the bonds sold like hotcakes.
   The banks, now that they could unload their mortgages started writing really bad mortgages, "sub prime" and "alt-A" to borrowers who would never be able to pay off the mortgage.  No matter, long as we dump this worthless mortgage on Fanny and Freddy we are OK.  This continued until the sucker investors wised up to the fact that "backed by real estate" meant nothing.  They didn't have the right to foreclose and repossess the real estate.  So the bonds stopped selling, and Fanny and Freddy went Chapter 11.  For $140 billion.  This touched off Great Depression 2.0.
   In actual fact, we ought to shut Fanny and Freddy down, for good.  We don't need them to "make more mortgage money available".   Mortgages are profitable and safe. We used to say "Safe as houses". If the borrower fails to pay, the lender gets the house.  Home mortgage borrowers are strongly motivated to keep up the payments, who wants to explain to a spouse that they are getting evicted?  Far more secure than the stock market.
  Shut down Fanny and Freddy.  The real estate industry (brokers, builders, appliance makers, lumber industry) will cry a lot, but  life will go on. 

Prescription Rate for Opioids Falls

Headline of a Wall St Journal piece today.  But looking at the charts that accompany the piece, not very much.  Average prescribed dose did fall from maybe 60, down to maybe 48  "morphine milligram equivalents" what ever that may be.  Prescriptions per 100 patients peaked around 80 and is now down to 70.  Damn, 70 out of 100 patients get opioid prescriptions?  That's a lot.  In my whole life, just once a dentist prescribed percoset after a painful extraction.  That was 30 years ago, one prescription, which didn't put a buzz on me as good as a shot of bourbon did.  For that matter, aside from childhood earaches I don't remember having to deal with pain, not even the sort of pain that aspirin will deal with.  Somehow I find it hard to believe that 70 out of 100 patients are experiencing pain worthy of an opioid prescription. 
  The Journal piece did not discuss guidelines for prescribing opioids.  Surely there are some?  Other than recommendations for drug company salesmen? 

Eye catching photos

Front page color spread in the Wall St Journal.  Against a background of Mosul blow all to pieces, burned out cars and piles of rubble, we have a young girl, looked to be 7 years old or so.  Light brown hair, blue eyes, pink dress.  She could have come off any suburban street in the USA.  Makes you wonder how she wound up in war torn Mosul. 
   Same issue, page three, we have a photo of the US destroyer that collided with that container ship off Japan.  It's a formal photo from stock, tied up to the dock, crew is manning the rails.  Large ship, big enough to be a cruiser in WWII.  Clearly a new ship, all her topside structures have walls slanted in, (tumblehome) to reflect enemy radar beams up into the sky rather than straight back to the enemy receivers.  Just one popgun on the foredeck, looked to be 75 mm.  Which is a dinky cannon for ship that size.  Even army tanks carry 120mm guns these days.  I hope she has lots of missiles, and that the missiles work when needed. 

NORKs are gaining on missiles to nuke LA

They tested a missile yesterday that has the range to reach Anchorage Alaska.  Won't take 'em long to stretch the range enough to hit LA.  They have nukes.  If we let them proceed, get the nuke mounted on the missile and the range stretched just a bit, they will be a helova a lot harder to deal with.  You cannot threaten to do regime change on a regime with nukes.  They will nuke you.  We ought to deal with the NORKs before they get their nuclear tipped ICBM into action.  Like right now. 
   We have tried diplomacy, lets make a deal, for twenty years.  The NORKs never lived up to any of the deals they signed.  They aren't going change.
   We could start up the Korean War again.  This is so awful that nobody wants to go there.  The NORKs have more guns and stuff than they did back in the 1950's.  South Korea's capital is within artillery range of North Korea.  Needless to say, the South Korean are not in favor of having Seoul shelled into ruins. 
   We could do a surprise air strike to take out their nuclear and missile facilities.  Most people think the NORKs are so dispersed and so dug in that we couldn't destroy enough facilities to do any good. 
    We could attempt to destabilize the NORK regime.  Looks chancy, the Kims (Grandfather, Father, and Son) have been arresting and executing their political opponents for 60 years.  I don't think there are enough left alive to do us any good.
   We could pressure the Chinese to cut off the NORKs supplies of food and fuel.  The Chinese like having the NORKs around.  It gives them a buffer between the pushy South Koreans, who are hand in glove with the Americans.  And they enjoy having the NORKs sticking it to the Americans while their own hands remain clean.  Trump has tried, and all he has gotten is lip service. 
  We could tell the NORKs that the next missile we see standing on a launch pad gets attacked, right then and there. 
   We could off Kim Jong whats-his-face.  That would destabilize the heck out of the NORK regime.
   Anyone have any other ideas?

NPR said drug rehab doesn't work, just this morning

On the FM this morning, they had a piece about drug rehab.  It was not encouraging.  They said the success rate was down around 5%, i.e. 95% of the druggies who go thru rehab go back to using drugs shortly after they leave rehab.  They did say that more psychotherapy was needed in drug rehab programs.  They did not bother to describe the treatment plan in existing drug rehab programs. 

The Grunge Look rides again

Wall St Journal, Saturday's "Style and Fashion" page.  They are selling guys clothes this time.  Whole page of color photos of four to five guy groups of models, wearing the in things.  Despite the clothes being new and clean, the models manage to look scruffy.  The clothes are a jarring patchwork of colors that don't go together, and never were very good.  Gray, brown, lemon yellow, pink, black.  Real guy colors those. These guys never learned how to tie a tie, brush their hair or put on a happy face.  They all wear surly expressions. And a spread of man bags.    Call the whole page a no sale for me.
  Next page features blue jeans.  According to the Journal, lycra is out, the in jean is straight cotton denim.  They have a picture of a blonde model, standing in a parking lot, wearing denim jeans, a baggy white top, a silk scarf, and high black boots.  The show a spread of jean, all blue, all stone washed, starting at $850 from Dior, and working down to $80 from the Gap.  Last pair of jeans I bought was $35 from Sears.
  The Journal needs to work on their fashion writers.  Show me some stuff I might like to wear, rather than stuff that makes me laugh.

Night Line Legal. They run TV ads.

Great name.  Nearly as good as Midnight Auto.