American households have rebuilt less than half of the wealth lost during the recession, according to a new analysis from the Federal Reserve, hampering the country’s economic recovery.

The research from the St. Louis Fed shows that households had accumulated net worth totaling $66 trillion at the end of last year. After adjusting for inflation and population growth, the bank found that meant families on average have only made up 45 percent of the decline in their net worth since the peak of the boom in 2007.

In addition, most of the improvement was due to gains in the stock market, according to the report, primarily benefiting wealthy families. That means the recovery for most households was even weaker. […]

The Fed is spending $85 billion a month to lower long-term interest rates and stimulate the economy. It has also kept short-term interest rates to near zero. That has helped push stock markets to record highs, while home prices have jumped by the most in seven years. Consumer confidence is at its highest point since February 2008. Officials hope those factors will eventually result in more consumer spending power.

{ Washington Post | Continue reading }

Uncertainty exists about how markets will reestablish normal valuations when the Fed withdraws from the market. It will likely be difficult to unwind policy accommodation, and the end of monetary easing may be painful for consumers and businesses. Given the Fed’s balance sheet increase of approximately $2.5 trillion since 2008, the Fed may now be perceived as integral to the housing finance system.

{ Federal Advisory Council via Zero Hedge | Continue reading }

On April 7, 1994, Federal Express Flight 705, a McDonnell Douglas DC-10-30 cargo jet ferrying electronics across the United States from Memphis, Tennessee to San Jose, California, experienced an attempted hijacking for the purpose of a suicide attack.

Auburn Calloway, a FedEx employee facing possible dismissal for lying about his previous flying experience, boarded the scheduled flight as a deadheading passenger with a guitar case carrying several hammers and a speargun. He intended to disable the aircraft’s cockpit voice recorder before take-off and, once airborne, kill the crew using the blunt force of the hammers so their injuries would appear consistent with an accident rather than a hijacking. The speargun would be a last resort. He would then crash the aircraft while just appearing to be an employee killed in an accident. This would make his family eligible for a $2.5 million life insurance policy paid by Federal Express.

{ Wikipedia | Continue reading }

art { Caleb Brown }

Edward Glaeser: If you look back 120 years ago or so, Detroit looked like one of the most entrepreneurial places on the planet. It seemed as if there was an automotive genius on every street corner. If you look back 60 years ago, Detroit was among the most productive places on the planet, with the companies that were formed by those automotive geniuses coming to fruition and producing cars that were the technological wonder of the world. So, Detroit’s decline is of more recent heritage, of the past 50 years. […] And it tells us a great deal about the way that cities work and the way that local economies function. […] If we go back to those small-scale entrepreneurs of 120 years ago–it’s not just Henry Ford; it’s the Dodge brothers, the Fisher brothers, David Dunbar Buick, Billy Durant nearby Flint–all of these men were trying to figure out how to solve this technological problem, making the automobile cost effective, produce cheap, solid cars for ordinary people to run in the world. They managed to do that, Ford above all, by taking advantage of each other’s ideas, each other supplies, financing that was collaboratively arranged. And together they were able to achieve this remarkable technological feat. The problem was the big idea was a vast, vertically integrated factory. And that’s a great recipe for short run productivity, but a really bad recipe for long run reinvention. And a bad recipe for urban areas more generally, because once you’ve got a River Rouge plant, once you’ve got this mass vertically integrated factory, it doesn’t need the city; it doesn’t give to the city. It’s very, very productive but you could move it outside the city, as indeed Ford did when he moved his plant from the central city of Detroit to River Rouge. And then of course once you are at this stage of the technology of an industry, you can move those plants to wherever it is that cost minimization dictates you should go. And that’s of course exactly what happens. Jobs first suburbanized, then moved to lower cost areas. The work of Tom Holmes at the U. of Minnesota shows how remarkable the difference is in state policies towards unions, labor, how powerful those policies were in explaining industrial growth after 1947. And of course it globalizes. It leaves cities altogether. […] It was precisely because Detroit had these incredibly productive machines that they squeezed out all other sources of invention–rather than having lots of small entrepreneurs you had middle managers for General Motors (GM) and Ford. […]

Russ Roberts: So, one way to describe what you are saying is in the early part of the 20th century, Detroit was something like Silicon Valley, a hub of creative talent, a lot of complementarity between the ideas and the supply chain and interactions between those people that all came together. Lots of competition, which encouraged people to try harder and innovate, or do the best they could. Are you suggesting then that Silicon Valley is prone to this kind of change at some point? If the computer were to become less important somewhere down the road or produced in a different way?

Edward Glaeser: The question is to what extent do the Silicon Valley firms become dominated by very strong returns to scale, a few dominant firms capitalize on it. I think it’s built into the genes of every industry that they will eventually decline. The question is whether or not the region then reinvents itself. And there are two things that enable particular regions to reinvent themselves. One is skills, measured education, human capital. The year, the share or the fraction in the metropolitan area with a college degree as of 1940 or 1960 or 1970 has been a very good predictor of whether, particularly northeastern or northwestern metropolitan areas, have been able to turn themselves around. And a particular form of human capital, entrepreneurial human capital, also seems to be critical, despite the fact that our proxies for entrepreneurial talent are relatively weak. We typically use things like the number of establishments per worker in a given area, or the share of employment in startups from some initial time period. Those weak proxies are still very, very strong predictors of urban regeneration, places that have lots of little firms have managed to do much better than places that were dominated by a few large firms, particularly if they are in a single industry. So, let’s think for a second about Silicon Valley. Silicon Valley has lots of skilled workers. That’s good. But what I don’t know is whether Silicon Valley is going to look like it’s dominated by a few large firms, Google playing the role of General Motors. Or whether or not it will continue to have lots of little startups. There’s nothing wrong with big firms in terms of productivity. But they tend to train middle managers, not entrepreneurs.

{ EconTalk | Continue reading }

image { Michael Wolf }

Is your child constantly causing trouble? […] If you live in South Carolina’s Chester or Richland Counties, you can send your kids to jail before they wind up there themselves. Through a program called STORM, parents can shell out a mere $25 to have their little troublemakers cuffed and booked for a sleepover in the slammer. Parents in nearby counties have to pay $5 more.

{ TruTV | Continue reading }

photo { Tim Head, Equilibrium, 1975 }

“I love nick [Brooks], but he wasn’t good for me. . . he holds me back. I’m always sad with him. He’s 24 for f sake . . . he wants porn sex! He wants to b drunk or stoned all the time . . . he doesn’t have any goals and stops me from mine.”

[…]

The elder Brooks killed himself with a mail-order helium-tank suicide kit in 2011 at his Upper East Side apartment. He was under indictment for drugging and sexually assaulting 13 starlets during “auditions” for nonexistent films.

{ NY Post | Continue reading }

A subtle, but significant tweak to Florida’s rules regarding traffic signals has allowed local cities and counties to shorten yellow light intervals, resulting in millions of dollars in additional red light camera fines.

{ 10 News | Continue reading }

A Manhattan fortune teller will be jailed for a year after taking more than $650,000 in cash from an Upper East Side woman by promising to “cleanse” the money.

Swindling soothsayer Janet Miller, 39, also tricked the wealthy victim into turning over paintings and jewelry as “sacrifices” to keep the devil away, and even conned her into buying and handing over a couple of Rolexes — all to exterminate “bad energy,” Manhattan prosecutors charged.

{ NY Post | Continue reading }

related { The blindfold is to minimise the shock which the flashlight could cause to the eyes of the medium, who is extremely sensitive during this stage of the phenomena }

Last night, the Metropolitan Museum of Art in New York hosted the 2013 Met Gala. This year’s theme was “Punk: From Chaos To Couture.” For many celebrities, this was the first time they had used the word “punk” in a sentence that wasn’t “Have my assistant get me Daft Punk tickets.”

[…]

“I skipped punk and went straight to couture. I never did punk.”
 —Andre Leon Talley, editor at large of Vogue/total fucking clown


“I did not [have a punk phase]. That’s why I think my version of punk for me is not probably the mohawk, typical punk that you’d sort of envision. A little bit more like ‘romantic punk.” 
—Kim Kardashian, notable reality TV shithead


“I don’t think I fully understood the theme.”
 —Kate Upton, human Viagra for Terry Richardson

{ Jaded Punk | Continue reading }

Are all telephone calls recorded and accessible to the US government? A former FBI counterterrorism agent claims that this is the case.

{ Guardian | Continue reading }

images { 1. Dave Willardson, Rolling Stone, 1976) | 2. Bug, 1975 }

The hipster haunts every city street and university town. Manifesting a nostalgia for times he never lived himself, this contemporary urban harlequin appropriates outmoded fashions (the mustache, the tiny shorts), mechanisms (fixed-gear bicycles, portable record players) and hobbies (home brewing, playing trombone). He harvests awkwardness and self-consciousness. Before he makes any choice, he has proceeded through several stages of self-scrutiny.

{ Christy Wampole/NY Times via | Gothamist | Continue reading }

Hurricane Sandy was the largest storm to hit the northeast U.S. in recorded history, killing 159, knocking out power to millions, and causing $70 billion in damage in eight states. Sandy also put the vulnerability of critical infrastructure in stark relief by paralyzing subways, trains, road and air traffic, flooding hospitals, crippling electrical substations, and shutting down power and water to tens of millions of people. But one of the larger infrastructure failures is less appreciated: sewage overflow.

Six months after Sandy, data from the eight hardest hit states shows that 11 billion gallons of untreated and partially treated sewage flowed into rivers, bays, canals, and in some cases, city streets, largely as a result of record storm-surge flooding that swamped the region’s major sewage treatment facilities. To put that in perspective, 11 billion gallons is equal to New York’s Central Park stacked 41 feet high with sewage, or more than 50 times the BP Deepwater Horizon oil spill. The vast majority of that sewage flowed into the waters of New York City and northern New Jersey in the days and weeks during and after the storm.

{ Climate Central | PDF }

On July 16, 2012, a painting by a little-known artist sold at Christie’s for $74,500, nearly ten times its high estimate of $8,000. The work that yielded this unexpected result — an acrylic teal-hued painting of a rocky coast called “Nob Hill” — was not the work of a 20-something artist finishing up his MFA. It was a painting created in 1965, and the artist, Llyn Foulkes, is 77 years old and has been working in relative obscurity in Los Angeles for the past 50 years. In March, the Hammer Museum in Los Angeles mounted a retrospective of his work, which will travel to the New Museum in June, marking the first time Foulkes will have had a retrospective at a New York museum. […]

The new interest in older artists isn’t just about scholarly rediscovery. The interest has less to do with the necessity of unearthing historical material to understand an artist’s career arc and more to do with feeding an insatiable market. “Unlike the past model where most galleries hosted one new exhibition every four to six weeks, many galleries now have two or more new exhibitions every turn-over,” said Todd Levin, and art advisor and director of Levin Art Group. “There’s a increasing need to fill the constantly expanding number of exhibition opportunities.”

Today, there are some 300 to 400 galleries in New York compared with the roughly 70 galleries in New York in 1970. As for the number of shows galleries mount each year, that has likewise increased: Gagosian mounted 63 last year at its galleries worldwide, David Zwirner had 14 shows at its spaces in New York and London, and Pace had 36 across its three galleries in New York, Beijing, and London.

{ Artinfo | Continue reading }

photo { Diane & Allan Arbus, Self-portrait, 1947 }

{ The guy on the roof… why is he hiding behind such heavy pixelation? }

In psychology literature, “ask for the moon, settle for less” is known as the “door in the face” (DITF) technique. Unlike the “foot in the door” technique, in which the fulfillment of a small request makes people more likely to fulfill a large request, DITF uses an unreasonable request as a way of making somebody more likely to subsequently fulfill a more moderate request. The technique was first demonstrated by Robert Cialdini’s famous 1975 experiment in which students became more likely to volunteer for a single afternoon after first being asked to volunteer for an afternoon every week for two years.

So, can research on DITF shed some light on why pursuing an assault weapons ban didn’t pan out?

{ peer-reviewed by my neurons | Continue reading }

Let’s say you ran one of the Fortune 10 companies. And for some reason, you wanted to ensure that this business would be hated by its customers, forever. What would you do? […] for long term contempt, you need stuff that nobody notices. […]

What I’d do is create a policy that makes it really hard for my company’s employees to ask questions of my company’s customers. I’d make it a struggle to collect feedback. In order to collect any form of feedback, I’d make it so that you had to first ask for permission from an underfunded and understaffed component of the central office of my corporation.

Of course I’d also make it take at least six months to get this approval. That way, most of the people who wanted to ask my customers a question were immediately discouraged from doing so. […] I’d staff this office with economists and lawyers. […]

Then, just to be especially perverse, what I’d do is encourage my company to use social media. I’d create policies around it, pushing my company to go online on Facebook and Twitter and stuff, and to have “authentic conversations” with our customers. I’d tell them that it was totally cool to use social media to informally do whatever they wanted, except to use that information to inform product or service decisions. This way, my employees will be completely cut off from their customers needs. And the only employees that actually make it to the customers are the people who know how to talk to the economists. That’ll make it so whatever inputs and outputs of my business are so incomprehensible that they’ll just create more frustration rather than solve problems. [And customers will] think they’re giving input to the company without that input actually making it anywhere useful.

It’s a machievellian scenario that, sadly, I didn’t make up. This “corporate policy” is actually a law that makes your government act like this, and it’s nefariously named the “Paperwork Reduction Act.” It was the last bill signed into law by Jimmy Carter in 1980.

{ Information Diet | Continue reading }

The US Congress has severely scaled back the Stock Act, the law to stop lawmakers and their staff from trading on insider information, in under-the-radar votes that have been sharply criticised by advocates of political transparency.

The changes mean Congressional and White House staff members will not have to post details of their shareholdings online. They will also make online filing optional for the president, vice-president, members of Congress and congressional candidates. […]

The Stop Trading On Congressional Knowledge – or “Stock” – Act prohibited them from buying or selling stocks, commodities or futures based on non-public information they obtain during the course of their work. It also banned them from disseminating non-public information regarding pending legislation that could be used for investment purposes. […]

Political watchdogs were dismayed. “Are we going to return to the days when public can use the internet to research everything except what their government is doing?” asked Lisa Rosenberg of the Sunlight Foundation, which monitors money in politics.

{ Financial Times | Continue reading }

The Federal Reserve said early Wednesday that it inadvertently e-mailed the minutes of its March policy meeting a day early to some congressional staffers and trade groups.

Late this afternoon, the central bank released to reporters a list of more than 150 e-mail addresses that it says received the early e-mail on Tuesday afternoon. (The minutes had been scheduled for release a day later.) The list includes e-mail addresses for dozens of congressional staffers, along with contacts — many of them government-relations executives — at major banks, lobbying firms and trade groups.

{ WSJ | Continue reading }

We will provide the full list of people who manipulate and cheat the market shortly, but for now we are curious to see how the Fed will spin that EVERYONE got an advance notice of its minutes a day in advance without this becoming a material issue with the regulators, and just how many billions in hush money it will take to push this all under the rug.

{ Zero Hedge | Continue reading }

Christopher Knight went into the central Maine wilderness 27 years ago. […]

He built a hut on a slope in the woods, where he spent his days reading books and meditating.

There he lived, re-entering civilization only to steal supplies from camps under the cover of darkness. During those nearly three decades, he spoke just once to another person – until he was arrested during a burglary last week.

In between, Knight told police, he committed more than 1,000 burglaries, always taking only what he needed to survive. […]

Knight said he stole everything he has, except for his aviator-style eyeglasses, which are the same pair he wore in 1986. […]

Knight went to great lengths to make the camp invisible from the ground and the air, even covering a yellow shovel with a black bag. Knight never had a fire, even on the coldest days, for fear of being detected. He covered shiny surfaces, like his metal trash cans, with moss and dirt and painted green a clear plastic sheet over his tent.

Knight even situated his campsite facing east and west to make the best use of the sun throughout the day. […]

Knight carefully avoided snow, stepped on rocks when he could and even avoided breaking branches in thick growth. Knight usually put on weight in the fall so he would have to eat less in the winter and thus avoid making treks for food and risk leaving prints in the snow.

{ Morning Sentinel | Continue reading }

Cops are looking for a man who smashed a woman over the head with a ketchup bottle while shouting anti-gay slurs at a Greenwich Village diner, cops said.

The attack took place in the Waverly Restaurant on Sixth Avenue at about 4:40 a.m. Monday, sources said.

The victim suffered head lacerations.

{ NY Post }

As I reported a couple of weeks ago, a recent Senate bill came with a nice bonus for the genetically modified seed industry: a rider, wholly unrelated to the underlying bill, that compels the USDA to ignore federal court decisions that block the agency’s approvals of new GM crops. I explained in this post why such a provision, which the industry has been pushing for over a year, is so important to Monsanto and its few peers in the GMO seed industry. […]

Sen. Roy Blunt (R-Mo.) has revealed to Politico’s ace reporter David Rogers that he’s the responsible party. Blunt even told Rogers that he “worked with” GMO seed giant Monsanto to craft the rider.

{ Mother Jones | Continue reading }

art { Cady Noland, Mutated Pipe, 1989 }

While many Americans assume that the Federal Reserve is a federal agency, the Fed itself admits that the 12 Federal Reserve banks are private. […]

Indeed, the money-center banks in New York control the New York Fed, the most powerful Fed bank. Until recently, Jamie Dimon – the head of JP Morgan Chase – was a Director of the New York Fed.

{ Washingtons Blog/Ritholtz | Continue reading }