Confronting the Malefactors is an opinion piece from Paul Krugman.

With unions and a growing number of Democrats now expressing at least qualified support for the protesters, Occupy Wall Street is starting to look like an important event that might even eventually be seen as a turning point.

What can we say about the protests? First things first: The protesters’ indictment of Wall Street as a destructive force, economically and politically, is completely right.

I wonder if Paul Krugman saying this is enough to refute the people who have been saying that the protesters are idiotic.

The article IMF advisor says we face a Worldwide Banking Meltdown in Raw Story perhaps is the explanation for the violent swings in my bank stocks. I have been too busy with Occupy Boston related stuff to stay on top of the news.

Here is a teaser,

“This would be a crisis that would be in my view more serious than the crisis in 2008…. What we don’t know the state of credit default swaps held by banks against sovereign debt and against European banks, nor do we know the state of CDS held by British banks, nor are we certain of how certain the exposure of British banks is to the Ireland sovereign debt problems.”

And here is the video,

Here is a sign I will carry the next time we participate in Occupy Boston.

Direct link to the album of pictures of Our Visit to Occupy Boston.

The article Perry swings and misses on Buffett’s business acumen makes some interesting points.

When asked about the “Buffett rule,” which says Americans making more than $1 million a year should pay, at minimum, the same tax percentage that the middle class does, Perry said Buffett doesn’t know “what’s going on out there in the real world.”

…

During the decade that Perry has enjoyed a lifestyle made possible by Texas voters and taxpayers, the Berkshire Hathaway CEO has pumped a considerable portion of his company’s resources into Fort Worth.

…

In early 2010, Buffett acquired Fort Worth-based BNSF Railway.

That would be the BNSF that announced in February it would spend $3.5 billion this year to upgrade railroad tracks and buy equipment as the company reinvests to keep pace with a growing volume of freight shipments.

The BNSF that is slated to spend $450 million on 227 new locomotives and $350 million on new rail cars that will be built by GE Locomotive, which is moving to Alliance Airport — with the help of Texas Enterprise Fund money — in large part because of Buffett’s BNSF.

To paraphrase something I heard, “Perry is another George W. Bush, but without the business acumen.”

(For those who don’t get the joke, George W had no business acumen.)

If the lame stream media won’t cover it, the left wing film makers will do it for them.

Read how to .

This is the kind of action that the politicians on our side need in order to show they have the support of the people to stop the moneyed interests from taking over our democracy.

Back in May, I posted Harry Belafonte Discusses President Obama in which he explains far more eloquently than I have why it is that these protests are necessary.

This is the kind of action that the politicians on our side need in order to show they have the support of the people to stop the moneyed interests from taking over our democracy.

Back in May, I posted Harry Belafonte Discusses President Obama in which he explains far more eloquently than I have why it is that these protests are necessary.

The Boston Herald article Warren shines in debate debut is the source for the video below.

I haven’t had a chance to view the video to see if there are any shots of my orange Moxie hat. Let me know if you spot it or Sharon sitting beside me.

You can read the article linked above and compare it to the 90 minute video to see if you come to the same conclusion.

I was sitting there and came to a different conclusion.

I was not that impressed with Elizabeth Warren.

The format was a mix of long form answers that lasted 1 minute, and quick answers that were supposed to take 10 to 15 seconds. This is not a format that a champion debater has honed her skills on. Debate skills are almost useless in this format.

The skill you need is to quickly come up with a short answer to a surprise question that finds the pithiest reflection of your deepest beliefs. There was one person there who managed to do this for almost every question. That woman was Marisa DeFranco. I had never heard of her before. Until tonight, I didn’t know she was running.

I know nothing about her except what was in the printed program. She may be running a campaign on a shoestring. I don’t know if she has a large enough campaign organization and funds to mount a credible campaign. If debates were all that mattered, I think she would have a shot.

I noticed that Warren and DeFranco got together on stage after the debate. If there were a vice-Senator position, perhaps she would have been recruiting her. (Fill in whatever names for the pronouns you want in the subject and object of that sentence.)

Meet The Democratic U.S. Senate Candidates on the WBUR web site gives:

Ahead of their first debate on Tuesday, here’s a primer on the six (down from seven) candidates running in the U.S. Senate Democratic primary.

My highly biased assessment from a quick look at the info on this web page (without following the links to more info) is:

Elizabeth Warren thinks “We need to be able to invent things, make things, and sell things to the rest of the world.”  She gets this aspect of the problem, 1 point for her.

As she has said and needs to be quoted here, companies need customers for them to
want to invent things, make things,  and sell thing.  Capital gains taxes are not the problem.

Herb Robinson wants to “lowering the capital gains tax” to stimulate jobs. That proves he doesn’t get it and rules him out.  Perhaps he ought to challenge Scott Brown in a Republican primary.

Alan Khazei ‘…Alan will use [his] experience and an “all hands on deck” approach that leverages the public, private, and non-profit sectors to create good paying jobs and get unemployed Bay Staters back to work. …” ‘

Pretty platitudinous.  At least the quote from Warren put together with other things she has said borders on the substantive.

I was going to title this piece “The Idiocy Of The Press” or something like that.  I was making my judgment on an Associated Press story I read in The Boston Globe.  However, to link to the story, I wanted to use another source because of The Boston Globe‘s subscription paywall.  I found the “same:” story on CBS News.  However, the CBS News story had content that had been edited out of The Boston Globe story.

The Boston Globe story was headlined Bank of America draws some investors.  The two paragraphs that caused me to blow my stack were:

Other investors are enticed by the low price of the stock. At around $6 a pop, the shares of Bank of America are the cheapest among large U.S. banks. Goldman Sachs Group Inc. trades above $90.

“Bank of America right now is very, very cheap,” said Thomas Brown, CEO of hedge fund Second Curve Capital, who has been buying the stock in recent months.

Nobody knowledgeable about stocks would write this in an article.  When investment experts say a stock is cheap, they don’t mean it is cheap because it is $6 whereas the stock in some other company is $90.  The stock price is completely arbitrary when comparing two different companies.  Each company decides independently how many shares of their stock to put on the market.  Therefore, if the companies have vastly different numbers of shares and the sizes of the companies are vastly different, there is no information in the stock price of one compared to the stock price of another.

When I read the article Smart money is split on Bank of America on CBS News, I realized that the idiocy is in The Boston Globe business section editors.

The following paragraphs were in the CBS News version of the Associated Press story, but were not in  The Boston Globe version based on the same Associated Press story.

Bill Smith, the CEO of Smith Asset Management, also thinks the stock is cheap. Smith believes the stock lost more than what the whole business is worth. “Its parts are worth more than the whole,” Smith said.

The best measure of how investors’ value a company is market capitalization. Bank of America’s market cap now is $57 billion. However, that’s just a fourth of the bank’s “book” value, a measure that investors like Smith watch closely. Book value is the value of a company’s assets if it were to be liquidated. That value, calculated from the bank’s balance sheet — assets minus liabilities — is $230 billion.

Currently, stocks in the S&P 500 trade at almost twice their book value. While many other banks are also trading below book value currently because of worries about the economy, the gap at Bank of America is the worst among the large banks.

That valuation gap has led to market speculation that Bank of America could be forced to spin off its more profitable brokerage and investment banking operations under Merrill Lynch and put its troubled Countrywide unit into bankruptcy.

These paragraphs recognize the validity of my complaint above.  You cannot tell if a stock is cheap just by looking at its price per share.  You have to look at a lot more information before you can tell if $6 is a cheap price for Bank Of America stock.  You have to multiply the stock price times the number of shares outstanding to get the company’s market capitalization.  Even then you don’t have something to compare to another company.  You have to compare the market capitalization (the value the stock market says the company is worth) with some other way of measuring its value.  In this case, one analyst used the book value.  When you compare two measures then you start to get an idea of whether or not the stock is cheap.   There are many measures of value other than book value.  If it were as simple as only comparing two measures of value for a company, there would be no disagreement between the investors who think the stock is cheap and the investors who think it is too expensive.

Of course it is possible that these paragraphs were not in the Associated Press story when The Boston Globe received it and went to press.  Perhaps the CBS News story is based on a later version from the Associated Press.  Both The Boston Globe story and the CBS News story are available online and could be based on the latest versions from the Associated Press.  It is probably too much to expect that once The Boston Globe writes a story and posts it, that they will keep a constant eye on it in case there are updates to the story.

If I have failed to convey the problem, we can put it in simpler terms. Suppose a baker makes two equal sized pies that are as exactly alike as possible. The baker cuts one pie into 20 slices and the other pie into 10 slices. If the price of the smaller slice is $1.00 and the price of the larger slice is $1.50, is the price of the smaller slice cheap? It isn’t if you look at the price per ounce as opposed to the price per share (slice).

The complexity of determining value can also be compared to a boat navigation problem. If you measure the direction of a boat on a line from one landmark to the boat, you can draw a line on a chart and know the boat is somewhere on that line, but you don’t know where. If you get a direction form another land mark and draw that line on a chart, then you can say the boat is at the intersection of the two lines. There is some error in knowing the exact direction of either line if you are using a compass. To be absolutely sure, you can plot a line from a third landmark. Chances are that the intersections of the three lines will not be exactly in the same place. This gives you a measure of the uncertainty in your location.

Depending on how certain you need to be about your location (am I near a hidden rock, or am I approaching Boston), you may or may not need to take more measurements.