All Things in Moderation

I saw this over at Hot Air and thought it might be an interesting topic for lawyers and laypeople alike.  In a nutshell, the article claims that the individual mandate’s penalty constitutes duress and therefore negates the validity of the insurance contract. Further, since insurance companies will have to accept all comers, they are under duress as well.

The questions asked are, to me, really interesting. Whataya think?

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Prepared Testimony

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It will be interesting to see how the press covers Romney’s win in Michigan last night.

An article on Yahoo Calls it an important win.

Meanwhile, Dan Balz has a more measured take on the win. He questions whether a frontrunner should really have such a hard time winning a state where a grew up, where his dad was governor and where he won 4 years ago. A fair question in my opinion.

On a slightly more wonkish note, Romney’s Michigan win netted him only 14 delegates while Santorum got 12. This is because Michigan broke GOP rules by moving their primary up a week and lost a few delegates and also because the race was very close.

It will be interesting to see if Romney can turn the two wins into some real momentum heading into Super Tuesday and whether Santorum can successfully counter the perception that Romney had two big wins on Tuesday. Then again momentum may be red herring if the real reason for Romney’s wins were that he has more money and is better organized. Scott, care to opine?

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We sometimes call ATiM a grand experiment.

I’ve been given a chance at another grand experiment.  Fifteen grand of an experiment, give or take.

The theme is “Yay Me!  Yay Us!”  Interpret that as you will.  The budget is $15,000.

How would you spend it and what’s the result?

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Vital Statistics:

World markets are slightly firmer this morning on the back of in increased commitment from the ECB to lend to European banks. The ECB said it will lend 529.5 billion euros, much higher than previous commitments and higher than economists were predicting. Most sovereign yields are lower this morning with the exception of Portugal, which is blowing out again.

4Q GDP (this is the 2nd of 3 reports) came in at 3% vs the initial 2.8% reports. Personal consumption improved to 2.1%. The GDP price index and core PCE came in higher than expected. Bonds and mortgage backed securities are slightly stronger on the data.

The banking system is on the mend. The FDIC released its quarterly report on the state of the banking system yesterday, noting that lending has increased and problem loans have decreased. Profits have increased, but decreases in loan-loss provisions have been the main driver in that increase. Return on Assets is a paltry .76%, as financial repression (Bill Gross’s term for ZIRP) continues to weigh on bank profitability.

HUD Secretary Shaun Donovan testified before the Senate Committee on Banking, Housing and Urban Affairs yesterday. The questioning focused on the health of the FHA and Administration initiatives to help prevent foreclosures. The second panel included acting FHFA Director DeMarco, and the questioning focused on allowing principal modifications for Fannie and Freddie loans. This issue has been a bone of contention between the liberal wing of the Democratic Party who want mass principal forgiveness and DeMarco who is charged with maximizing value for taxpayers.

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Yesterday, I read through lms’s hiatus post and the comments on it. I’m not here much because of time constraints and health reasons, but I feel a connection to this discussion that goes back to a time on the Plum Line maybe a couple of years ago when I raised the issue of women’s voices in the public sphere. There was a wide ranging conversation that included a request of Greg to add a woman poster.

I  won’t try to reprise all the arguments here. But oddly perhaps, the one comment I remember most was from Cao. He said that the only scientifically proven psychological difference between genders was in competitiveness. I don’t know about the accuracy of that or what studies he was basing it on. But I think it offers one construct that may be useful in thinking about what happens on this blog and others.
 
While I know how very competitive women can be, it’s my sense that men and women differ in the nature of how we’re competitive, and that it has to do with both stakes and practicality. I’m going to offer only one anecdotal example here. I know my son and son-in-law will compete over something as trivial as who is quicker at solving the riddles on their kids’ Popsicle sticks, while the women in the family wouldn’t.
 
Translating this to the world of the blog is maybe a big leap, but I’ll try anyway. I think a lot of discussion on this blog and others has to do with the difference between constructing a point and winning a point. I know that when I’ve raised an issue to discuss and tried to state my case as clearly as I can that I don’t feel like trying to beat down every opposing comment, particularly if it feels tangential. I may try to state my position in another way that I hope will clarify it, but if there is still a lot of opposition noise that I don’t agree with, I am generally ready to exit the discussion. It’s not because I feel vanquished. It’s more because I see no point in trying to convince someone who by opinion and/or temperament won’t be convinced. I have other things to do.
 
I think ATiM is a great experiment, and it would be sad for it to collapse over a difficulty that has a lot to do with how a discussion is carried on. And it’s particularly sad to think that, as hard as lms has worked on this experiment, the climate may no longer feel welcome to her and perhaps to some of the other women. So let me ask this of those men who found themselves entrenched on the other side of the argument about women’s health: does trying to win a point that others may see as strained really make it worth coming across as indifferent to an issue of bedrock importance to the women who live it?

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Vital Statistics:

Markets gave back most of their earlier gains on the back of a disappointing Durable Goods report. January Durable goods orders dropped 4% and durables ex-transportation dropped 3.2%. Cap goods were also weaker than expected.

S&P / Case-Schiller for December came in down 4% YOY. Atlanta showed the biggest decline, while Detroit showed the biggest gains. A couple of highlights from the report:

“After a prior three years of accelerated decline, the past two years has been a story of a housing market that is bottoming out but has not yet stabilized. Up until today’s report we had believed the crisis lows for the composites were behind us, with the 10-City Composite originally hitting a low in April 2009 and the 20-City Composite in March 2011. Now it looks like neither was the case, as both hit new record lows in December 2011. The National Composite fell by 3.8% in the fourth quarter alone, and is down 33.8% from its 2nd quarter 2006 peak. It also recorded a new record low.”

“In general, most of the regions also posted weak data in December. Eighteen of the cities saw average home prices fall in December over November. Seventeen of the cities have seen monthly declines for at least three consecutive months. In addition to both monthly composites, 10 of the cities saw home prices fall by more than 1.0% during the month of December. The pick-up in the economy has simply not been strong enough to keep home prices stabilized. If anything it looks like we might have reentered a period of decline as we begin 2012.”

Yesterday, we got Warren Buffet’s letter to shareholders; today we get Bill Gross’s investment outlook. The theme is defensive investing, which makes sense for a bond guy when interest rates are as low as they can go. Since the early 80s, the Fed has been printing money and providing bond guys like Gross built-in capital gains in addition to income. Bill’s punch line:  “Recognize zero bound limits and systemic debt risk in global financial markets. Accept financial repression but avoid its impact when and where possible.”

The FHA has released some details on the pilot REO-to-Rental program for the Hardest-Hit Areas. They are auctioning of 320MM of properties in 8 MSAs.  The FHA is recognizing the recent strength in rental prices as well as the glut of foreclosed properties and attempting to solve two problems at once. We’ll see if this gets any traction.

Chart:  S&P Case-Schiller Index:

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jnc posted these links in the open thread last night, but in light of today’s primary in Michigan, I thought they were worthy of their own post.

For those who haven’t seen this, it’s worth a read:

“Goodbye to Goldwater
Rick Santorum’s Republican crusade for big government.”
Jonathan Rauch from the December 2005 issue

The rise of Rick Santorum does not make a whole lot of sense to me and the article makes it even more baffling. My only theory is that he seems to speak honestly and people recognize and appreciate it (either that or Republicans really just don’t think much of Romney). While I disagree with a whole lot of what Santorum says, I do appreciate that he generally just says what he thinks and avoids non-answers that we here from most other candidates, Republican and Democrat alike. I’ll admit I have not watched the Republican primaries all that closely, so maybe my perception is incorrect. However, even having said the above, as a Democrat I am at a bit of a loss to understand Santorum’s rise, any insight from our conservative brethren would be appreciated.

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