The Market Ticker
Commentary on The Capital Markets

Perhaps the apparent transmission of ebola to two health care workers in the Duncan case is nothing more than a statistical aberration.  Random chance does occur, you know.  But..... I want you to consider a few things.

First, the "non-transmissible" nature of ebola absent physical contact with the body fluids of a symptomatic person with the disease comes from our experience with the bug in Africa.  Unfortunately there is a correlation between whether viruses and bacteria in evolved droplet form remain in the air or fall to the ground and it is related to the humidity of the environment.  Specifically, and surprisingly, high humidity environments actually appear to inhibit transmission via this route.

This could be trouble.  I will point out that I do not know if it is trouble, simply that it could be -- that is, our view of how this disease can be transmitted may be out of date and incorrect in the United States, particularly in homes, businesses and the clinical environment that tend to have climate-controlled spaces -- all with relatively low humidity.

I'm not ready to ring the alarm bells on this yet, but the person who pointed this out as a potential theory isn't a random nut and it facially there's enough there for me to think about it -- and thus there should be for you too.  The implication is that it may be far easier to transmit ebola through the air in a relatively dry environment -- that is, one that has active HVAC -- than we commonly believe.

Second, I was reminded of a NIH outbreak of an antibiotic-resistant strain of bacteria that causes pneumonia -- at their flagship location.  Genetic testing proved that the bug they were seeing had been transmitted from patient to patient despite high-grade isolation and excellent infection control both at the personal and facility level.  They wound up ripping out the plumbing in their attempts to control the bug, which kept coming back -- and ultimately killed six.

So while I am not raising the "bug-in" flag, it is wise to consider that those who claim to know everything often are proved wrong, and tragically so. This is particularly true when diseases cross some boundary of novelty and thus experience with them in that particular environment is (relatively-speaking) limited.

Life finds a way (from the movie "Jurassic Park"), even if it's a sort of life, in this case a virus, that we'd rather not exist at all.

View this entry with comments (registration required to post)

It would appear that there are now two foreign nations that simply do not believe us when it comes to ebola and the contagious status, or lack thereof, of Americans.

Specifically the nation of Belize first allegedly refused to allow an American cruise ship to dock because one of the passengers had been involved in the Duncan case.  The passenger was not reportedly showing symptoms of being ill and was a lab technician -- not an actual care-giver, although lab techs can be exposed due to handling the samples they work with if they are not careful.  In a later update the cruise line said that the ship did dock there.  Hmmmm....

Then, Mexico also refused a second cruise ship, this time intending to put passengers ashore in Cozumel for a port call, which has since departed back for its home port.  That ship also had a person on board that was a lab supervisor; he is also asymptomatic and voluntarily isolated himself (presumably in his cabin.)

The Mexican case is particularly galling.  Here we have a nation that repeatedly allows its citizens (and anyone else who wants) to attempt to cross their border with the United States, outrageously violating our sovereignty.  Who knows what all those "migrants" came into the US with -- especially the kids.

But our government, despite Mexico deciding that nobody from that ship could get off in Cozumel and enjoy their vacation, still refuses to close our border to people from Mexico that have a far higher potential of carrying disease than this lab technician does.

Obama's outrageous lack of action on the border, never mind both Republican and Democrat parties generally, continues -- even when we're slapped in the face by the very nation that is doing the most damage in that regard.

View this entry with comments (registration required to post)

2014-10-17 06:45 by Karl Denninger
in Editorial , 308 references

The bemusement I felt while reading this is something else.

Dear Unknown Driver:

On September 10, 2014, sometime between 8 and 10 p.m., you were driving northbound on Rt. 11 – Main Street – in Woodstock, Virginia. You were right in front of our quaint, small town movie theatre in the heart of Shenandoah County.

Of course, you know that part already.

You drifted to the right on the two-lane road, side-swiped my parked car damaging both doors, and sent my side mirror sailing 40 feet down the street.

Yeah, yeah, yeah.

The punch line?

Soon the officers rolled on and I was crawled in my car window to make the short drive home.

Sure, I was frustrated to know I would be dealing with police reports, insurance and a body shop for the next week, but what really bothered me was their assessment.

“People just aren’t honest anymore.”

This bothered you?

Let's see.  The government spends more than it makes on a continual basis, and you call that what?  Honesty?

We have a government that knowingly arms drug lords and looks the other way while their money is laundered.  You call that what?  Honesty?

We have banks that rip people off wholesale with worthless synthetic instruments, knowingly sell securities to people they claim internally are "vomit" and more -- and this is called what?  Honesty?

Every single second of the business day while the market is open we have dozens if not hundreds or thousands of firms and people who break black-letter law by submitting quotes into the market for securities they have no intention to actually buy or sell, an act that is prohibited and has been for decades and we call that what?  Honesty?

We have a medical system that robs us of over $2 trillion a year through monopoly pricing (which is supposed to be illegal), refusal to quote prices at all (which is supposed to be illegal), billing you for someone else's procedures (supposed to be illegal) and in fact sometimes billing you for procedures not even performed (utterly illegal, even today.)  What do you call that?  Honesty?

Those very same officers have probably lied about why they stopped someone for this or that, claimed that people engaging in consensual adult conduct were in fact doing something "wrong" and thus should be put in a metal cage (even though nobody complained about any of it) and more.  What do we call all of that?  Honesty?

I could go on and in fact have -- since 2007, chronicling the frauds, scams, and, well, dishonesty.

And now, Jason, you're surprised, bothered, and ask that someone prove them wrong by owning up to hitting your car?


I'll tell you what -- you're welcome to dream of candy-crapping unicorns if you wish, but until and unless you see a material percentage of the scams outlined above, and those outlined in literal thousands of Tickers over the last seven+ years called to a close and people jailed for their part in them you're outright delusional if you expect anything better -- or different.

View this entry with comments (registration required to post)

Lockheed-Martin apparently believes they are on the cusp of a breakthrough when it comes to nuclear fusion.  Color me skeptical, but very interested.

Fusion is what powers the sun, of course.  It also brings the promise of (relatively) clean nuclear energy, since the reaction products are not dangerous.  There remains radiation (and lots of it!) emitted during operation, and activation of materials in the reactor still occurs, but the production of radioactive isotopes as a consequence of the consumption of the fuel does not occur.  For this reason it is a dramatically superior nuclear process, but for one problem: it's damn hard to make happen, and thus obtaining more energy out, in commercially-viable amounts, than you put in has not been achieved.

It has always been "10 years" away from viability.  It was 50 years ago, 40, 30, 20 and now.  The reason for this is that creating the conditions under which fusion takes place requires an environment of extreme heat and pressure, and that takes energy to achieve.  You need to somehow not lose that energy put in to the environment or the reaction you get provides insufficient payback on your energy investment for your fusion reactor to make economic (and operational) sense.

I note that despite the alleged crowing if you read carefully you will find that Lockheed-Martin is not claiming that they have achieved an energy surplus, say much less a large one.  But they think they are on the path to do so.

If true, this would be revolutionary -- both in terms of the economic and geopolitical impacts.  Specifically, it marks the end of the "dig it out of the ground" oil economy as the only means of obtaining liquid hydrocarbons (you can make them from any carbon source, given available energy) and it further means that fresh water deficits can be cured, since there is no shortage (anywhere), nor will there ever be, of sea water.




View this entry with comments (registration required to post)


There are times that all I can do is laugh.  This "revelation" by Matt Stoller is one of them.

In other words, Greenberg’s case is revealing that the bailouts were done selectively, and there was an attempt to cover up what happened. The Federal Reserve and the Treasury ended up treating Goldman/JP Morgan/Citigroup shareholders and employees exceptionally well, AIG shareholders less well, and the public like irrelevant peasants. 

Well, sort of.

What's really at issue here is that The Fed and Treasury (along with the Insurance Commissions involved) acted illegally, both in the first instance (either there was a duty to regulate if there was systemic risk and these were regulated industries, in which case they failed to do so, or there was no systemic risk in which case let 'em fail was the only proper outcome) and in the second instance in that the actions The Fed took were not authorized at the time by law and then everyone scrambled for retroactive means to cover their ass.

This narrative is fundamentally dishonest. Opponents of the bailouts said a lot of things at the time about the motives of the people in charge. It turns out that bailout opponents were largely correct, and the bailout apologists were lying and/or wrong. Increasingly, the public, judges, and politicians will recognize that the way the corrupt manner in which bailouts were done turned property rights into an explicit reflection of arbitrarily exercised political power.

This is not news.

Nor is it news that Bernanke lied regarding to the commercial paper market; he claimed TARP was necessary to protect it, TARP was passed, Paulson knew before it was passed that he had modified its intent to not rescue commercial paper but did not tell Congress this and then Bernanke set up his own facility at The Fed to perform that rescue -- without TARP, thereby proving it was unnecessary for that purpose (in other words, proving up his own lie.)  Neither Bernannke or the Fed ever answered for that lie or the myriad others he told during that period of time, despite myself and others calling him on the carpet for same.

One of the most-outrageous examples of these "fibs" was Bernanke's testimony shortly after the collapse occurred that he had been "adding liquidity" into the maw of the collapse itself.  As I pointed out at the time from data published by the NY Fed itself The Fed did no such thing -- it in fact drained system liquidity into the maw of the collapse.

GM was another example.  Those who held GM credit were unlawfully dispossessed of their right to recover in bankruptcy what was theirs because payouts were made to others who held inferior positions in the capital structure (primarily the UAW via their benefit programs.)  Those who were disadvantaged sued and lost.

Then there were those who bought various structured products that were designed so that in order to look at the documentation necessary to make a claim for fraud you needed a supermajority that included the super-senior tranche holders.  You could never get there, since those people were kept whole even if everyone else lost 100% of their money and, what's worse, since investigations and document production cost money to perform and that must come from the trust beneficiaries the super-senior holders not only had no incentive to cooperate they had an active incentive to obstruct any such attempt so long as their position was paid out. 

This little clever bit of design made it effectively impossible for any holder of these "products" to sue for fraud on the premise that the underlying loan quality was intentionally misrepresented because they could not gain the documentation necessary to file a suit and actually win, as you can't sue on speculation, you must sue on facts.  That in turn has led to those suits being thrown out.


View this entry with comments (registration required to post)

Main Navigation
Full-Text Search & Archives
Archive Access
Get Adobe Flash player
Legal Disclaimer

The content on this site is provided without any warranty, express or implied. All opinions expressed on this site are those of the author and may contain errors or omissions.


The author may have a position in any company or security mentioned herein. Actions you undertake as a consequence of any analysis, opinion or advertisement on this site are your sole responsibility.

Market charts, when present, used with permission of TD Ameritrade/ThinkOrSwim Inc. Neither TD Ameritrade or ThinkOrSwim have reviewed, approved or disapproved any content herein.

The Market Ticker content may be reproduced or excerpted online for non-commercial purposes provided full attribution is given and the original article source is linked to. Please contact Karl Denninger for reprint permission in other media or for commercial use.

Submissions or tips on matters of economic or political interest may be sent "over the transom" to The Editor at any time. To be considered for publication your submission must include full and correct contact information and be related to an economic or political matter of the day. All submissions become the property of The Market Ticker.