Worst Economic Predictions of 2008

Here are some of the worst predictions that were made about 2008. Savor them -- a crop like this doesn't come along every year, from Business Week/Yahoo.com.

1. "A very powerful and durable rally is in the works. But it may need another couple of days to lift off. Hold the fort and keep the faith!" -- Richard Band, editor, Profitable Investing Letter, Mar. 27, 2008

At the time of the prediction, the Dow Jones industrial average was at 12,300. By late December it was at 8,500.

2. AIG (NYSE:AIG - News) "could have huge gains in the second quarter." -- Bijan Moazami, analyst, Friedman, Billings, Ramsey, May 9, 2008

AIG wound up losing $5 billion in that quarter and $25 billion in the next. It was taken over in September by the U.S. government, which will spend or lend $150 billion to keep it afloat.

3. "I think this is a case where Freddie Mac (NYSE:FRE - News) and Fannie Mae (NYSE:FNM - News) are fundamentally sound. They're not in danger of going under I think they are in good shape going forward." -- Barney Frank (D-Mass.), House Financial Services Committee chairman, July 14, 2008

Two months later, the government forced the mortgage giants into conservatorships and pledged to invest up to $100 billion in each.

4. "I'm not an economist but I do believe that we're growing." —President George W. Bush, in a July 15, 2008 press conference

Nope. Gross domestic product shrank at a 0.5% annual rate in the July-September quarter. On Dec. 1, the National Bureau of Economic Research declared that a recession had begun in December 2007.

5. "I think Bob Steel's the one guy I trust to turn this bank around, which is why I've told you on weakness to buy Wachovia." —Jim Cramer, CNBC commentator, Mar. 11, 2008

Two weeks later, Wachovia came within hours of failure as depositors fled. Steel eventually agreed to a takeover by Wells Fargo. Wachovia shares lost half their value from Sept. 15 to Dec. 29.

6. "Existing-Home Sales to Trend Up in 2008" -- Headline of a National Association of Realtors press release, Dec. 9, 2007

On Dec. 23, 2008, the group said November sales were running at an annual rate of 4.5 million -- down 11% from a year earlier -- in the worst housing slump since the Depression.

7. "I think you'll see (oil prices at) $150 a barrel by the end of the year" -- T. Boone Pickens, June 20, 2008

Oil was then around $135 a barrel. By late December it was below $40.

8. "I expect there will be some failures. I don't anticipate any serious problems of that sort among the large internationally active banks that make up a very substantial part of our banking system." -- Ben Bernanke, Federal Reserve chairman, Feb. 28, 2008

In September, Washington Mutual became the largest financial institution in U.S. history to fail. Citigroup (NYSE:C - News) needed an even bigger rescue in November.

9. "In today's regulatory environment, it's virtually impossible to violate rules." -- Bernard Madoff, money manager, Oct. 20, 2007

About a year later, Madoff -- who once headed the Nasdaq Stock Market -- told investigators he had cost his investors $50 billion in an alleged Ponzi scheme.

10. "There's growing evidence that parts of the debt markets…are coming back to life." —Peter Coy and Mara Der Hovanesian, BusinessWeek, Oct. 1, 2007.

Oops.

UPDATE: Once again Business 2.0 magazine issues its annual feature, "101 Dumbest Moments in Business."

End of an Era for Denver Broncos

After a dismal end to the 2008 football season, the Denver Broncos canned veteran coach Mike Shanahan, the Colorado Springs Gazette reports.

"After giving this careful consideration, I have concluded that a change in our football operations is in the best interests of the Denver Broncos," [Pat] Bowlen said in a statement. "This is certainly a difficult decision, but one that I feel must be made and which will ultimately be in the best interests of all concerned.

"I appreciate the 21 years that Mike Shanahan has given to the organization as an assistant and head coach, and the two Super Bowl wins in that time. His contributions hold a special place in Broncos history."

How Could I Have Overlooked These Words of Wisdom?

Right Wing News quoted Bret Stephens earlier this year (part of a compilation of 12 favorite quotes for 2008):

"There is great virtue in the American way, which expects CEOs to perform on a quarterly basis, presidents and Congresses to reinvent politics in 100 days, generals to wipe out opponents in 100 hours without taking significant casualties, doctors to save life and limb every time, search engines to yield a million results in less than a second, and so on. There is also great virtue in the belief that what is bad can be made good, and that what is good can be made great, and that what is fractionally less than great is downright awful.

But these virtues can spawn vices. One is impatience. Another is a culture of chronic complaint. A third is the belief that every problem has a solution, that trial is possible without error, that risks must always be zero, that every inconvenience is an outrage, every setback a disaster and every mishap a plausible basis for a lawsuit."

This Hudna Didn't Quite Last a Decade

Another round of fighting has broken out between Israel and Hamas in the Gaza Strip, and once again the hudna (truce) was used by the terrorists to rearm. They fired off artillery and rocket rounds at Israel, which quickly retaliated with massive air strikes.

WorldNetDaily reports this curious flip-flop by the Palestinian Authority:

Palestinian Authority President Mahmoud Abbas and his office today slammed as "barbaric" and "unnecessary" Israel's air strikes in Gaza, but according to top diplomatic sources in Jerusalem, Abbas for months now has been petitioning Israel to launch a massive military raid against his Hamas rivals in Gaza. The sources, speaking to WND on condition of anonymity, said Abbas and his top representatives have waged a quiet campaign for months asking the Israeli government to target Hamas in Gaza just before his term in office is scheduled to expire on Jan. 9.

Free Republic has links to articles, pictures, and YouTube videos of this breaking story.

Thank You, Secret Santa!

One of the most heart-warming Christmas stories this year took place in Burnsville, Minnesota, where a fire destroyed 64 units of the Burncliff apartment complex Monday. In addition to the usual contributions of food and clothing from the public, an anonymous donor put up $1,000,000 to help the victims buy new furniture and other necesary items as they relocate. Other generous cash contributors included John Goodman, chairman of The Goodman Group, who gave $50,000, and Nasser Kazeminy of NJK Holdings Corp, who gave another $50,000.

Cool News Items, Just in Time for Christmas

Merry Christmas and a Happy New Year! And for our Jewish readers, Happy Hanukkah!

Newspaper misprint

NORAD's 50-year tradition of tracking Father Christmas goes back to a misprint in a Colorado newspaper advertisement in 1955.

A local child wanting to know Santa's whereabouts dialled the phone number printed, which connected to the Continental Air Defense Command (CONAD).

As more mistaken calls came in, the commander on the other end of the phone answered the queries and the tradition continued in 1958 when CONAD became NORAD.

The effort spread to the internet in 1998 and in 2007 NORAD's Santa tracking site saw more than 10m visitors from 212 countries.

Volunteers fielded nearly 95,000 phone calls and 140,000 e-mails.

This year when Santa takes flight from the North Pole, more than 1,000 volunteers will be on hand to help out.

NORAD's Santa Tracker: http://www.noradsanta.org/

Some cool pictures of ice sculptures at the 25th Harbin International Ice and Snow Festival.

MSNBC ran this story about ordinary citizens making sacrifices to give to their favorite charities and help people less fortunate than themselves.

In "God's Gifts," Michelle Malkin relates three stories of forgiveness, determination, dedication, and sheer nobility: Dong Yun Yoon, the man who forgave the fighter pilot whose plane wiped out four members of his family in San Diego three weeks ago; Haleigh Poutre, the 11-year-old girl who fought her way back to life after nearly being beaten to death by a brutal stepfather; and Master Sgt. Anthony Davis, who laid down his life while delivering humanitarian supplies in Biaj, Iraq.

BEFORE YOU SCREAM "ANIMAL CRUELTY..."

A lady was telling her neighbor that she saw a man driving a truck down the interstate, and a dog was hanging onto the tailgate for dear life!
She said if the pick-up truck driver hadn't been going so fast in the other direction, she would have tried to stop him.

A few weeks later, her neighbor saw this truck at the Bass Pro shop in Daphne, Alabama!



The pick-up truck driver is a local taxidermist with a great sense of humor!

Can you just imagine how many people try and stop this guy???

More News Stories Overlooked by the Legacy Media

Journalists faithfully follow the story of how burglars broke into Paris Hilton's home, stealing millions of dollars' worth of jewelry, but we have not forgotten about the real treasure that belongs to all of us: Soldiers who serve our country in Iraq and Afghanistan (see picture, left).

Count on the Washington Times and FOXNews to cover President Bush's compassion towards service members who were killed or wounded in the Global War on Terror. A couple of excerpts:

"The Times notes that people familiar with Bush's routine say he has written letters personally to every one of the families of the more than 4,000 troops who have died in Afghanistan and Iraq. The task has taken a toll, and Bush has relied on his wife, Laura, for emotional support, he said....

"Bush has met with more than 500 families of troops killed in action and with more than 950 wounded veterans, often during private sessions, White House spokesman Carlton Carroll told the newspaper."

Shoes Thrown at President Bush Becomes a Hot Item

After a slow-news week we have the following news story reported in Free Republic:


Turkish company sees boom in sales of 'George W. Bush attack shoes'
News.Com.Au

Posted on Friday, December 19, 2008 2:53:15 PM by Sub-Driver

Turkish company sees boom in sales of 'George W. Bush attack shoes'

Agence France-Presse

December 19, 2008 10:41pm

THE Turkish shoe company [Baydan Shoes of Istanbul] making the brand of footwear used by an Iraqi journalist who threw his shoes at US President George W. Bush has seen a surge in orders. Ramazan Baydan, owner of the shoe factory in Istanbul of the same name, told DPA that he had received orders in the past week for some 300,000 pairs of the model that was thrown at the US president.

"Someone even came from America seeking distribution rights," Baydan said.

The entrepreneur wants to rename the model, a brown leather shoe with a thick sole, as the "Bye Bye Bush shoes"....

See YouTube video here.

Reuters reports that an Egyptian offered his daughter in marriage to journalist Muntazer al-Zaidi, and that she approves of this idea.

Is Gov. Blagojevich's Hair an Indicator of Narcissistic Personality Disorder?

Wonkette has the following hot news item about Gov. Blagojevich's hair:

...If you’re going to be a little sad crybaby, whatever, just never go to Scott Ambers:

Gov. Blagojevich’s glossy locks — perfectly sculpted in rain or snow — may be an indication of a sickness beneath his scalp, said one local psychologist.

“It’s all part of managing his image, managing his image of being without a blemish, without a flaw,” said Scott Ambers, who has practiced clinical psychology in the city for more than two decades.

Several psychologists interviewed one day after the governor’s arrest agreed that he might be suffering from an affliction known as narcissistic personality disorder.

“This grandiose sense of self . . . doesn’t carry the implication that [Blagojevich] is a raving lunatic, crazy and out of touch with reality, but it does suggest he has a really overinflated view of his own importance,” Ambers said.

NOTE: For the benefit of readers who have to have everything explained to them, we believe that the above article was intended to be satirical. However, our position is that the crime for which Rod Blogojevich should be thrown into prison is the shamelessly luxuriant head of hair that he flaunts every day, especially to the follically challenged!!!

Just When You Thought It Was Safe to Buy State Bonds...

Goldman Sachs Bets Against State Bonds It Sold
Source: Subprimelosses.com

After raking in millions of dollars in underwriting fees for municipal bonds, Goldman Sachs turned around and told another group of investors that they could make big profits by buying insurance from the investment bank because those bonds could be headed for default. Goldman’s strategy is known as “shorting municipal credit,” and while technically not illegal, the actions reek of conflict of interest and questionable business conduct.

For years, traders have been able to make money short-selling stock, but shorting municipal bonds via credit default swaps is a relatively new phenomenon. Goldman Sachs is both a leading dealer of municipal credit default swaps, as well as a major underwriter of municipal securities.

This summer, Goldman collected $1 million in fees for helping the state of New Jersey sell $345 million in highway improvement bonds to investors. The fees are among some $15 million that the investment firm has earned since 2002 for selling hundreds of millions of dollars in New Jersey debt to investors, according to a Nov. 23 article in the Newark Star-Ledger.

In California, Goldman reportedly has earned about $25 million over the past five years in underwriting fees from bond issues.

In September, several news reports say Goldman began ramping up its strategy of shorting municipal credit, outlining plans in a 58-page report obtained by ProPublica, a New York-based not-for-profit group. According to the report, Goldman advised certain investors that states like New Jersey and five others might not be able to make their bond payments as planned because of pending budget shortfalls. As a result, investors buying default insurance stood to make big profits from their demise.

As for Goldman Sachs, it bit the hand of at least one client that fed it and profited all around. The investment firm not only collected millions of dollars in fees from the states where it sold bonds and found buyers, but also made money when it sold credit default swaps to investors and thereby bet those same states would be unable to make their scheduled payments....

NOTE: The anxiety level for the states that dealt with Goldman Sachs is going through the roof, as they don't want the value of their bonds to decline and the cost of borrowing money to increase at the same time.

Auto Bailout Put on Ice for the Time Being

A blog called The Conglomerate has this progress report:

The Auto Bailout Fails ... For Now
Posted by David Zaring

We've seen quickly crumbling Republican recalcitrance before, but this time it is the Senate, rather than the House, that is holding up a big bailout. And it is doing so in the face of lobbying in favor by Dick Cheney himself. If there is time to consider something else (Politico thinks it is unlikely), here's Bob Corker's proposal, Corker being the senator from Tennessee, which, entirely coincidentally, houses the headquarters and principal operations of Nissan North America:

The alternate plan offered by Mr. Corker calls for giving the holders of bonds issued by the auto companies 30 cents on the dollar to ease the companies’ debt burden; immediately bringing workers’ wages in line with foreign companies like Nissan and Volkswagen; and forcing the United Automobile Workers to eliminate payments to workers after their jobs have been eliminated.

EDITORIAL NOTE: Senate Majority Leader Reid was right in saying that there were not enough votes in the Senate to pass the bailout. We are opposed to simply handing billions of dollars of the people's money to the Big Three automakers without strict conditions, as that would be wasteful and tempt them to come back for more. Sacrifices have to be made, and it is a leadership function on their part to determine what they will be.

UPDATE: MSNBC supplied this update of a last-ditch bailout extended to General Motors and Chrysler. Unless this involves fundamental changes and sacrifices on the part of the United Auto Workers, the Big Three will come back begging for more after Barack Obama is inaugurated as our next President.

More Dangerous than Iraq?

It is quite strange that our news media has not paid much attention to the undeclared civil war in Mexico. Here's an excerpt from the Houston Chronicle:

CULIACAN, Mexico — A shootout between rival gangs killed 10 people in the drug-plagued state of Sinaloa, home of the powerful cartel of the same name, Mexican police said Thursday.

The gunbattle occurred in front of a state police station in the town of El Rosario, said Juan de Dios Beltran, an agent with Mexico's federal attorney general's office.

Two vehicles, nine assault rifles, several handguns and about 200 shells were found in the area after the shootout late Wednesday, he said. There were no arrests....

Many Mexicans are conflicted these days: they are tempted to emigrate to Norteamerica for their own safety, but word is out on the streets that jobs have dried up north of the border. The gun battles, beheadings, kidnappings, and other violent incidents, one would think, have reached a crisis level in that country.

Gov. Blagojevich Caught Trying to Sell Barack Obama's Senate Seat!

The hot story since yesterday has been the arrest of Gov. Rod Blagojevich for trying to sell the U.S. Senate seat being vacated by President-elect Barack Obama. Obama, of course, has been trying to distance himself from any involvement in this sordid deal, knowing he will be in deep trouble if prosecutors find a connection between him and a governor who is now in risk of losing both his job and his freedom. A good summary to day can be found at the Wall Street Journal. As of today, Obama called for Blagojevich to resign, but the governor refused.

Dean Kamen Redeems Himself after Inventing the Segway

The man who inflicted the Segway on an unsuspecting public has come up with a bionic arm that promises to benefit combat veterans and other amputees. Called the "Luke Arm" (after Luke Skywalker), it is lightweight, self-contained, and capable of picking up small objects, empty bottles, even electric drills.

"Kamen says the Department of Defense approached him and his company, DEKA, in 2005 about the project, not the other way around....

"The Luke Arm has four fingers and an opposable thumb, and was designed to be controlled by muscular movement in the wearer's remaining limbs.

"But thanks to neurological advances in "targeted renervation" by Dr. Todd Kuiken of the Rehabilitation Institute of Chicago, the Luke Arm can now connect directly to motor nerves, meaning it can be controlled purely by thought alone."

To see the Newsweek article, which has more information, click here.

A YouTube video with a demonstration of the "Luke Arm."

Here We Go Again! Chinese Dissidents Being Shipped Off to Mental Hospitals

It's not often I use this source, but this New York Times article has credibility in that the same tactic has been used by the Communist government in the former Soviet Union:

BEIJING — Local officials in Shandong Province have apparently found a cost-effective way to deal with gadflies, whistle-blowers and all manner of muckraking citizens who dare to challenge the authorities: dispatch them to the local psychiatric hospital.

In an investigative report published Monday by a state-owned newspaper, public security officials in the city of Xintai in Shandong Province were said to have been institutionalizing residents who persist in their personal campaigns to expose corruption or the unfair seizure of their property. Some people said they were committed for up to two years, and several of those interviewed said they were forcibly medicated.

The article, in The Beijing News, said most inmates were released after they agreed to give up their causes....

In a related story, Wang Wanxing was released after serving 13 years in a state-run mental asylum for "staging a brief demonstration on the anniversary of the 1989 crackdown on pro-democracy protesters in Tiananmen Square."

Bill Cosby Still on Message

The 71-year-old actor-turned motivational speaker offered some blunt comments about the need to teach children about the dangers of having sex - and maybe more of his comments were directed at young women than young men - but despite his language, the message appeared to be well taken by parents, teachers, and teens alike.

" There is no woman who has ever died because they didn't have sex," Cosby said. "And there is no boy who has ever died or had a bad orgasm from wearing a rubber."

Cosby also said that young women aren't getting "pregnant." Rather, he said, "they're getting knocked up..."

For the rest of the article, see ctnewsjunkie.com. It's too bad common sense ain't so common anymore.

Another Reason for Routing Your Flight Through IAH

This just in from the Houston Chronicle:

Karaoke has landed at George Bush Intercontinental Airport, just in time for the holiday season. Now you can clear security, step up to the microphone and belt out your travel frustrations by singing the Beatles' Nowhere Man or Help! Or, if you're not such a Grinch, you can croon Home for the Holidays or Sentimental Journey.

For the first time, the Houston Airport System is adding karaoke to its menu of holiday music entertainment. The first session is this afternoon, behind security between Terminals D and E.

"During the holidays we have a lot of our novice travelers," such as large families and older couples, [Caroline] Schneider said. "We thought while they are waiting, they can just sing a song."

Aspiring vocalists can choose from hundreds of song titles, Schneider said. Small prizes will be given to the singers.

Jeb Bush "Thinking" About Running for Senate

The following NewsMax article raises the possibility of a Senate run for the seat about to be vacated by Mel Martinez of Florida:

"Still popular in Florida, former Gov. [John Ellis] "Jeb" Bush said Wednesday that he's interested in the seat Sen. Mel Martinez is giving up, and the field of possible candidates could quickly narrow to make way for the president's younger brother...."

Reality check: Jeb is not at all like his brother, President George W. Bush, and could very well follow in the footsteps of his grandfather, Sen. Prescott Bush.

From the Dept. of the Blindingly Obvious

The fact that new postings have dropped off since the election does not mean that I have lost interest in the blog. Whenever something noteworthy comes along, you will read about it, especially if it has any connection with political/toilet humor.

We wish the incoming administration well (sound of pride being swallowed), since if Obama fails, we all lose. We will take the revolutionary position of supporting him whenever he makes the right decision, but if he makes a decision that is not good for the people, you will read about it on this blog!