Dan Froomkin of The Huffington Post reports on some very interesting research finding that the investment portfolios of members of Congress substantially outperform the stock market.
I’d expect their portfolios to do a bit better than the market average, but the study found Congress beat the stock market by an average 6 percent a year over sixteen years. Senators beat the market by a stunning 10 percent a year. And Democrats beat the market by nine points, while Republicans beat it by just two—a finding Froomkin buries at the end of the piece.
The most logical explanation for these market-beating returns: insider trading.
The report speculates, but does not conclude, it could have something to do with the ability members of Congress have to trade on non-public information or to vote their own pocketbooks — or both.
Whatever, this study ought to get a wide airing.
— Matt Taibbi pulls some source documents from the Levin-Coburn report to show how Goldman Sachs misled Congress on its big short.
He zeroes in on the testimony of Goldman executive Joshua Birnbaum, the guy least able to conceal his disdain for Congress in hearings last year. Taibbi pulls this quote from Birnbaum’s self-evaluation on his desk’s 2007 mortgage short:
By June, all retained CDO and RMBS positions were identified already hedged. As Graph#1 indicates, SPG trading reinitiated shorts post BSAM unwind on an outright basis with no accompanying CDO or RMBS retained position longs. In other words, the shorts were not a hedge.”
Unfortunately for Birnbaum, he swore to Congress that he could not recall whether the short was a hedge. Even more unfortunate for him, he didn’t know that Levin had got a hold of his self-evaluation:
“Unfortunately, Mr. Birnbaum did not have a copy of that document at the time he responded to the May 24 questions and, therefore, could not use it to refresh his recollection of events that occurred several years ago. Curiously, nothing in the questions indicated that your staff had incorporated quotations from a document, unlike the many other questions posed where they [sic] your staff clearly indicated that it was quoting from documents that had been provided to Mr. Birnbaum. We cannot understand what legitimate reason the staff would have for neither providing the document nor even disclosing that it was quoting a particular document in posing these questions. Without the benefit of that document, Mr. Birnbaum was notable to answer all of the questions in his written responses. In fact, his response to the questions at issue specifically noted that he did not have the documents necessary to refresh his recollection.
This was the biggest trade of his life, and the guy couldn’t recall basic details he knew vividly two years earlier? Sure thing.
— This is a week old, but well worth noting.
Clifford Marks of National Journal reports on how media coverage is slanted toward covering the deficit story rather than joblessness.
Mentions of unemployment have been dwindling since they spiked to 154 in the month ending August 15, 2010; over the month ending Sunday, there were 63. Deficit mentions, meanwhile, surged up to 261 in the month ending December 15, 2010, when the leaders of President Obama’s deficit commission released their final report. Mentions of the deficit remained higher after the commission’s work wrapped up and as House Republicans and then the White House unveiled dueling proposals. In the month ending Sunday, there were 201 mentions.
Not good. Guess what? The deficit will go down as jobs go up.
Here’s the good kicker:
More likely, the broadening gap demonstrates just how effective conservatives have been at changing the narrative of economic policy from one dominated by talk of fiscal stimulus to one now in lockstep with notions of fiscal austerity.
That major newspapers and other media outlets have covered the deficit with greater intensity in recent months should come as no surprise given the focus of the politicians and policymakers they cover. The declining mentions of unemployment are perhaps more surprising, as the issue remains salient for millions of Americans.
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