Trust But Verify - How Airbnb and Lyft Finally Got Americans to Trust Each Other

In about 40 minutes, Cindy Manit will let a complete stranger into her car. An app on her windshield-mounted iPhone will summon her to a corner in San Francisco’s South of Market neighborhood, where a russet-haired woman in an orange raincoat and coffee-colored boots will slip into the front seat of her immaculate 2006 Mazda3 hatchback and ask for a ride to the airport. Manit has picked up hundreds of random people like this. Once she took a fare all the way across the Golden Gate Bridge to Sausalito. Another time she drove a clown to a Cirque du Soleil after-party.

“People might think I’m a little too trusting,” Manit says as she drives toward Potrero Hill, “but I don’t think so.”

Manit, a freelance yoga instructor and personal trainer, signed up in August 2012 as a driver for Lyft, the then-nascent ride-sharing company that lets anyone turn their car into an ad hoc taxi. Today the company has thousands of drivers, has raised $333 million in venture funding, and is considered one of the leading participants in the so-called sharing economy, in which businesses provide marketplaces for individuals to rent out their stuff or labor. Over the past few years, the sharing economy has matured from a fringe movement into a legitimate economic force, with companies like Airbnb and Uber the constant subject of IPO rumors. (One of these startups may well have filed an S-1 by the time you read this.) No less an authority than New York Times columnist Thomas Friedman has declared this the age of the sharing economy, which is “producing both new entrepreneurs and a new concept of ownership.”

The sharing economy has come on so quickly and powerfully that regulators and economists are still grappling to understand its impact. But one consequence is already clear: Many of these companies have us engaging in behaviors that would have seemed unthinkably foolhardy as recently as five years ago. We are hopping into strangers’ cars (Lyft, Sidecar, Uber), welcoming them into our spare rooms (Airbnb), dropping our dogs off at their houses (DogVacay, Rover), and eating food in their dining rooms (Feastly). We are letting them rent our cars (RelayRides, Getaround), our boats (Boatbound), our houses (HomeAway), and our power tools (Zilok). We are entrusting complete strangers with our most valuable possessions, our personal experiences—and our very lives. In the process, we are entering a new era of Internet-enabled intimacy.

This is not just an economic breakthrough. It is a cultural one, enabled by a sophisticated series of mechanisms, algorithms, and finely calibrated systems of rewards and punishments. It’s a radical next step for the ­person-to-person marketplace pioneered by eBay: a set of digi­tal tools that enable and encourage us to trust our fellow human beings.

Manit is 30 years old but has the delicate frame of an adolescent. She wears a thin kelly-green hoodie and distressed blue jeans, and her cropped dark hair pokes out from under her purple stocking cap. Yet despite her seemingly vulnerable appearance, she says she has never felt threatened or uneasy while driving for Lyft. “It’s not just some person off the street,” she says, tooling under the 101 off-ramp and ticking off the ways in which driving for Lyft is different from picking up a random hitchhiker. Lyft riders must link their account to their Facebook profile; their photo pops up on Manit’s iPhone when they request a ride. Every rider has been rated by their previous Lyft drivers, so Manit can spot bad apples and avoid them. And they have to register with a credit card, so the ride is guaranteed to be paid for before they even get into her car. “I’ve never done anything like this, where I pick up random people,” Manit says, “but I’ve gotten used to it.”

Then again, Manit has what academics call a low trust threshold. That is, she is predisposed to engage in behavior that other people might consider risky. “I don’t want to live my life always guarding myself. I put it out there,” she says. “But when I told my friends and family about it—even my partner at the time—they were like, uh, are you sure? This seems kind of creepy.”

by Jason Tanz, Wired |  Read more:

Image: Gus Powell

Glenn Greenwald and Michael Hayden Debate Surveillance

Every year, Canada's Munk debates feature high-level, high-profile debates on burning policy issues. This year, they debated surveillance, and the participants were Glenn Greendwald and Reddit co-founder Alexis Ohanian on the anti-surveillance side and former NSA and CIA chief Michael Hayden and Harvard law professor Alan Dershowitz on the pro-surveillance side. Although the debating partners do a lot in this, the real freight is carried by Hayden and Greenwald, both of whom are more fact-intensive than the others.

I have a bias here, but I think that Greenwald wiped up the floor with Hayden (the post-debate polls from the room support this view). It was particularly useful to have Hayden being grilled by a well-informed opponent who was allowed to go after the easy dismissals and glib deflections. Normally, he gets to deliver some well-polished talking points and walk away -- this was something I hadn't seen before.

This is just about the best video you're going to watch on the surveillance debate. It kicks off around the 30m mark.

by Cory Doctorow, Boing Boing

Can't Explain

[ed. Repost. Original version here.]

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The Life of a Stolen Phone

Alex called AT&T, said he'd figured out who'd stolen his phone, and asked if the company could help get it back — perhaps by flagging the phone if the thief tried to register it in a new name. No dice. AT&T gave him two options: Either deactivate the phone and buy a new one, or find a cop willing to subpoena AT&T for information, file a lengthy police report, and go through a long bureaucratic process.

It was, Alex says, "the most B.S. story I've ever heard."

He called Apple and was invited to try the same "find my phone" app he'd already been using.

Alex realized that if he wanted the phone back, he'd have to get it himself. He got in his car and headed to Clayton.

It turns out the dismissive responses that Alex received in his quest to find the stolen iPhone were typical of telecom companies and service carriers. Apple and AT&T have little reason to help someone recover a device — even if it's within reach. Smartphone theft is a lucrative business, and not just for the small-time crooks who lift gadgets off of BART seats. The manufacturer profits by hawking a replacement phone; the carrier profits double, by locking the crime victim into a new contract, then opening an account with whomever ends up with the stolen phone. Telecom companies even profit from the specter of phone theft, by selling expensive insurance policies to protect their users.

"We've tried to blow the whistle on this for years," Capt. Jason Cherniss of the San Francisco Police Department says. "And these companies have had the ability to prevent it for years." In the meantime, he adds, people have been violently robbed — even killed — and millions of dollars have changed hands on the black market.

Alex would quickly find out that the entire smartphone industry functions as a protection racket. And culpability doesn't just lie with the unhelpful customer service representatives.

by Rachel Swan, SF Weekly |  Read more:

Image: uncredited

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Documenting Darkness

How a Thug State Operates

Here, at least, is a place to start: intelligence officials have weighed in with an estimate of just how many secret files National Security Agency contractor Edward Snowden took with him when he headed for Hong Kong last June. Brace yourself: 1.7 million. At least they claim that as the number he or his web crawler accessed before he left town. Let’s assume for a moment that it’s accurate and add a caveat. Whatever he had with him on those thumb drives when he left the agency, Edward Snowden did not take all the NSA’s classified documents. Not by a long shot. He only downloaded a portion of them. We don’t have any idea what percentage, but assumedly millions of NSA secret documents did not get the Snowden treatment.

Such figures should stagger us and what he did take will undoubtedly occupy journalists for months or years more (and historians long after that). Keep this in mind, however: the NSA is only one of 17 intelligence outfits in what is called the U.S. Intelligence Community. Some of the others are as large and well funded, and all of them generate their own troves of secret documents, undoubtedly stretching into the many millions.

And keep something else in mind: that’s just intelligence agencies. If you’re thinking about the full sweep of our national security state (NSS), you also have to include places like the Department of Homeland Security, the Energy Department (responsible for the U.S. nuclear arsenal), and the Pentagon. In other words, we’re talking about the kind of secret documentation that an army of journalists, researchers, and historians wouldn’t have a hope of getting through, not in a century.

We do know that, in 2011, the whole government reportedly classified 92,064,862 documents. If accurate and reasonably typical, that means, in the twenty-first century, the NSS has already generated hundreds of millions of documents that could not be read by an American without a security clearance. Of those, thanks to one man (via various journalists), we have had access to a tiny percentage of perhaps 1.7 million of them. Or put another way, you, the voter, the taxpayer, the citizen -- in what we still like to think of as a democracy -- are automatically excluded from knowing or learning about most of what the national security state does in your name. That’s unless, of course, its officials decide to selectively cherry-pick information they feel you are capable of safely and securely absorbing, or an Edward Snowden releases documents to the world over the bitter protests, death threats, and teeth gnashing of Washington officialdom and retired versions of the same.

Summoned From the Id of the National Security State

So far, even among critics, the debate about what to make of Snowden’s act has generally focused on “balance”; that is, on what’s the right equilibrium between an obvious governmental need for secrecy, the security of the country, and an American urge for privacy, freedom, and transparency -- for knowing, among other things, what your government is actually doing. Such a framework (“a meaningful balance between privacy and security”) has proven a relatively comfortable one for Washington, which doesn't mind focusing on the supposedly knotty question of how to define the “limits” of secrecy and whistle-blowing and what “reforms” are needed to bring the two into line. In the present context, however, such a debate seems laughable, if not absurd.

After all, it’s clear from the numbers alone that the urge to envelop the national security state in a blanket of secrecy, to shield its workings from the eyes of its citizens (as well as allies and enemies) has proven essentially boundless, as have the secret ambitions of those running that state. There is no way, at present, to limit the governmental urge for secrecy even in minimal ways, certainly not via secret courts or congressional committees implicated and entangled in the processes of a secret system.

In the face of such boundlessness, perhaps the words “whistleblower” and “leaker” -- both traditionally referring to bounded and focused activities -- are no longer useful. Though we may not yet have a word to describe what Chelsea (once Bradley) Manning, Julian Assange, and Edward Snowden have done, we should probably stop calling them whistleblowers. Perhaps they should instead be considered the creations of an overweening national security state, summoned by us from its id (so to speak) to act as a counterforce to its ambitions. Imagine them as representing the societal unconscious. Only in this way can we explain the boundlessness of their acts. After all, such massive document appropriations are inconceivable without a secret state endlessly in the process of documenting its own darkness.

One thing is for certain, though no one thinks to say it: despite their staggering releases of insider information, when it comes to the true nature and extent of the NSS, we surely remain in the dark. In the feeling that, thanks to Manning and Snowden, we now grasp the depths of that secret state, its secret acts, and the secret documentation that goes with it, we are undoubtedly deluded.

by Tom Englehardt, TomDispatch |  Read more:

Image: uncredited

"Laser Madness", 1980
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Solo in Paris

Some go to La Coupole, the 87-year-old Art Deco brasserie in Montparnasse, to commune with friends; others, to dine with ghosts — Picasso, Piaf, Sartre, all former patrons. I went alone, to live in the present.

I sliced through an oyster with my cocktail fork, loosening it from its shell. A pulpy Utah Beach, it was brimming with lemon juice and its own slightly salty liquor. I lifted it with a thumb and forefinger, and tilted it to my lips.

It was early spring in Paris. To my left, a white-haired woman with red lipstick disappeared behind a newspaper. To my right, a man and a woman flirted over starters. We were at the center of one of the last sprawling brasseries of the 1920s, where a large basin into which the artists’ model Kiki de Montparnasse used to climb has been replaced with a comparatively demure sculpture of a couple forming an orb with their outstretched limbs. A waiter paused at my table to rotate the platter of oysters so that the overturned shells faced the empty chair across from me.

“Voilà,” he said.

I leaned back against the banquette, bathed in the whir of nearby tête-à-têtes, sipping my Chablis.

It was easy in Paris to surrender to the moment. But why? What alchemy transmuted ordinary activities, be it a walk across a bridge or the unwrapping of butter, into a pleasure? My default speed in New York is “hurtle,” yet in Paris I dragged the edge of a fork across an oyster with a care better suited to sliding a bow across a violin.

This was not simply because I was in Paris, though it has long held a kind of magic for many Americans. It was because I was there on my own. In a city that has been perfecting beauty since the reign of Napoleon III, there are innumerable sensual details — patterns, textures, colors, sounds — that can be diluted, even missed, when chattering with someone or collaborating on an itinerary. Alone one becomes acutely aware of the hollow clack of pétanque balls in a park; the patina of Maillol’s bronze “Baigneuse se Coiffant” that makes her look wet even on a cloudless day in the Tuileries; how each of the empty wine bottles beside sidewalk recycling bins is the embodiment of someone’s good time. There is a Paris that deeply rewards the solo traveler.

Indeed, the city has a centuries-old tradition of solo exploration, personified by the flâneur, or stroller. Flânerie is, in its purest form, a goal-less pursuit, though for some it evolved into a purposeful art: Walking and observing became a method of understanding a city, an age. Baudelaire described the flâneur as a passionate spectator, one who was fond of “botanizing on the asphalt,” as the essayist Walter Benjamin would later put it. Typically, it was a man. No longer.

To be a sidewalk botanist, one must walk. But please, no sneakers. C’est Paris. A fashion journalist friend suggested I be slightly transgressive and don a men’s shoe. A nod to my predecessors. This is how I came to average 20 miles a day in bronze cap-toe oxfords.

by Stephanie Rosenbloom, NY Times |  Read more:

Image: Agnes Dherbeys for The New York Times

ballet #157 (by chrisfriel)
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A Bleak Visit to San Francisco’s ‘Google Glass Bar’

Back in February, social media guru Sarah Slocum was allegedly attacked for wearing Google Glass in a bar in San Francisco. She called it a “hate crime.” After the story went viral, other people who were at the bar came forward offering conflicting accounts of what happened, saying that she instigated people by filming them without asking permission.

Then Slocum released a longer video, in which she called people at the bar white trash, and it became clear that the whole story was—at the very least—way more complicated than she originally let on.

After the incident, and to respond to the anti-tech backlash that’s swept the city, a few bars in San Francisco banned Google Glass. Taking the opposite approach, the Stanford Court Hotel—a former Marriott that remodeled itself in 2013 to coddle to the booming tech industry after almost going bankrupt a few years prior—started offering free drinks to anyone wearing the superfluous $1,500 face computer.

“The complimentary drink is geared toward the local tech crowd who own a pair, and might feel like an outcast or nuisance due to the recent string of negative press,” explained a hotel spokesperson to SF Gate. “[We] want them to feel at home.”

I figured this bar would offer a bleak glimpse of what the world might look like in 5-10 years, should “wearables” invade. I headed over at happy hour on a Thursday.

The Stanford Court Hotel sits castle-like on the apex of Nob Hill. The castle metaphor isn’t a hyperbolic stretch: On the high-walled south side of the place there’s actually a defensive tower. I wondered if those standing guard would dump boiling oil on any non-tech peasants, should they storm the fortress demanding breadcrumbs.

The entrance is concrete and cavernous, like a parking garage, or to extend the castle metaphor, it functions sort of like a barbican. At first I wasn’t sure if it was the correct entrance, but noticed a cement fountain in the center, and some bored valets, so I moseyed in. I was initially worried they’d stop me—I had biked there, uphill, from my apartment in the Mission, and had sweat through my shirt.

Walking in the door, there was a welcome mat with #GDBYE, which stands for either “goodbye” or “god boye.” If the former is true, then it was facing the wrong way, saying “goodbye” to everyone entering. There were iPads at the front desk, sitting vertically in stands, that read “#hello.” I thought these were odd design touches that fundamentally misunderstood the point of hashtags.

The lobby was crowded with pilots and flight attendants. Above, there was a faux-stained glass dome—the glass was painted different primary colors. Toto’s “Hold The Line” played over the lobby’s speakers. An electric motorcycle was parked next to a sign that read “take charge.” There were Macs lined up along a window that looked out into the entrance area, their screensavers flashing images of the hotel rooms, I suppose in case guests forgot what their rooms looked like.

I walked to the bar, passing a couch with pillows that read CTRL, ALT, DEL. I wondered what these pillows signify—perhaps the couch freezes often?—and snapped a photo. I briefly considered flipping the pillows out of order, to see if anyone noticed.

The bar was quiet. Nobody was wearing Google Glass. A Warriors game was ending on a flatscreen TV at the far end of the bar. In front of it sat a 50-something tourist couple. Three chairs up from them a 30-someting guy pecked at his laptop, and on the other end two women sat drinking white wine and talking loudly but incomprehensibly. The only thing I could make out was when one of them said, “Have you ever watched ‘Devil Wears Prada’?”

I sat down between the tourist couple and the guy on his laptop, who was apparently locked out. He kept trying different passwords, hitting enter, watching the screen shake to say “no,” and then letting out a long sigh.

I ordered a beer from a tired, middle-aged bartender, a Big Daddy, which cost $7.61. In my neighborhood you could get it for $5 outside of happy hour. As he filled the glass I noticed they had Vodka on tap.

The tourist couple next to me sat quietly, definitively not the kind of people the hotel was hoping to draw, digging through the dish of assorted nuts in front of them with their fingers, picking out the M&Ms. The wife—dressed like a mannequin from Chicos—sipped her red wine, as the husband—sneakers with high athletic socks, jeans and a windbreaker—waited for her to finish, empty beer glass in front of him.

He spoke to me after I ordered, in a Sam Elliott baritone. “Big Daddy, huh? Ever had that before?”

“Yeah,” I replied.

“Where’s it from?”

“Here.”

He thought about this for a moment, then looked as his wife, satisfied. “Must be a local or something.”

A long moment passed.

“Big Daddy,” he repeated to himself.

The guy to my left suddenly slammed his MacBook shut, and crossed the bar to the CTRL-ALT-DEL couch, where he was charging his phone at a nearby outlet.

I sat and drank.

The bartender replaced the peanut dish in front of the tourists with another full container.

“That’s just what we need,” the guy said sardonically.

It suddenly occurred to me that the bartender never offered me a dish of nuts. I thought about complaining—what, you think I’m too sweaty for some assorted nuts?

The laptop guy returned, opened his computer, furiously tried a few more passwords, and then angrily asked the bartender to change the TV channel. The game had ended, and players were being interviewed.

“What do you want to watch?”

“Anything, I don’t care, just a game. As much as I love watching interviews,” he said.

Only a few seconds after the channel was changed for him, he closed his laptop, and wandered off to one of the Macs in the lobby. He sat in one of the awkward spherical beanbag chairs, that were too low to the ground and made him look like a 6-year-old at the wheel of a large automobile. He immediately visited Espn.com and scrolled through, bored.

I texted my friend: “This bar is the opposite of fun.”

A fly circled and then landed in my beer.

by Joe Viex, deathandtaxes |  Read more:

Image: SF Gate

Raquel Zimmermann in “Heat Wave” by Josh Olins for Vogue UK, June 2011
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How to Shop for the Apocalypse

An architect friend who usually designs Manhattan skyscrapers was recently asked to pitch for a far more interesting project. The client, a senior partner at Goldman Sachs, wanted him to design a family house in upstate New York with a difference. It wouldn’t just be completely ‘off the grid’, with its own power and water supplies, but — and there isn’t yet an architectural term for this — it would be post-apocalypse. The conventional house would be mirrored below ground with pretty much identical living quarters that would be completely secure and so self-contained that there would be facilities to hydroponically grow plants and vegetables without soil.

‘Americans shouldn’t believe they’re immune to social unrest’ was all the prospective client would offer by way of explanation. He primarily wanted the house as a refuge for his own family but also, he revealed magnanimously, saw it as a possible rallying point for humanity in the event of some future catastrophe.

The strange thing was that when my friend rang a mechanical engineer for advice on a few technical details, rather than be gobsmacked, the engineer said he’d been working on pretty much the same brief for another Wall Street titan. Only he wanted a moat, too. ‘What do they know that we don’t?’ the architect asked me. (...)

There have been doomsday cults in the US since the off, and survivalist militias in combat gear were charging around the woods preparing to fight government baddies during the Clinton presidency. But that’s nothing on the cynical mood now. The chief reason has been Barack Obama winning a second term — many preppers believe he will start trying to separate citizens from their guns, sparking civil war. For the very rich, there is the added paranoia caused by the growing wealth gap and widespread predictions that it could lead eventually to serious social unrest. Drive along the East River into Manhattan’s financial district and you can’t miss a huge billboard advertising a storage warehouse. ‘The French aristocracy never saw it coming either,’ it reads. Endearingly cryptic … unless you’re a twitchy banker and then the threat is fairly obvious. A well-known Wall Street financial adviser, David John Marotta, recently told investors they should prepare for a financial apocalypse by carrying around an emergency ‘bug-out bag’ containing food, a gun and ammunition.

According to James Stevens, alias Doctor Prepper, who is the guru of a movement he prefers to call ‘family preparedness’, most preppers are white, middle-class and affluent. Black people aren’t interested, he says. Read prepper online forums and you’ll pick up on a definite elitism, a view that they’re the chosen few and that some people’s lives are too frivolous to be worth saving. One has to ask how many of these people are simply fantasising about an alternative world in which they are the hero.

Being that hero doesn’t come cheap. America’s ‘disaster preparedness’ economy is estimated to be worth some annual $500 million in sales to ordinary punters — several billion dollars when you include sales to businesses and the government. That’s just the stuff you fit in a backpack. If you have $2 million to spare, you can have your own decommissioned nuclear missile bunker as an end-of-the-world getaway. When a developer converted a 1960s-era missile silo in Kansas into a 174ft deep apartment complex, some sniggered but he quickly sold all 14 of the 1,820 sq ft units. There’s a long waiting list for further silo conversions that he plans. Survival Condo will have enough supplies of site-grown food, and purified well and rain water, to accommodate 70 people indefinitely, says the developer. The flats boast large HDTV panels simulating windows (giving views of a world that no longer exists). The silo also boasts a cinema, spa, classrooms, bar and pool. Zombies and other non-members will be kept out with ground-level security cameras, electric fences and the lethal contents of an onsite armoury.

For those who need to prepare on a tighter budget for D-day (preppers call it TSHTF, or ‘the shit hits the fan’), there are cheaper options such as a 40 ft long, 10 ft diameter corrugated steel tube that can house six and be buried in your back garden. It’s a snip at $72,000, although the fake tree or rock to conceal the air vent is extra. Early buyers were offered a free ten acres at a secret prepper settlement in Arizona so they could bury their tube near like-minded neighbours.

by Tom Leonard, The Spectator |  Read more:

Image: Castro

Too Big to Fail. Not Too Strong.

From Andrew Mellon’s nearly 11 years as Treasury secretary under Presidents Warren G. Harding, Calvin Coolidge, and Herbert Hoover to our time, when Timothy Geithner went from financial regulator at the New York Federal Reserve to Treasury secretary to investment executive, journalists have often employed the image of a revolving door to describe the flow of bankers between Wall Street and the U.S. Department of the Treasury. But few know that the White House and the Treasury are, arguably, a single building. A tunnel connects 1500 Pennsylvania Avenue with 1600. Presidents use this passageway to slip visitors in and out of the Oval Office.

Nomi Prins, in her new history All the Presidents’ Bankers, does not say it in so many words. But she shows that the tunnel from the White House to the Treasury extends, metaphorically, for 226 miles to Lower Manhattan. Prins digs into presidential libraries and national archives and mines a shelf of books. She also knows Wall Street from the inside. Equipped with degrees in mathematics and statistics, she worked at Chase, Lehman Brothers, Bear Stearns, and finally Goldman Sachs, where she was a managing director. Prins created something of a sensation eight years ago with one of her earlier books, Other People’s Money: TheCorporate Mugging of America.

Prins’s story begins in the ’80s—the 1880s. Science, engineering, and mass production were transforming what had been an agricultural nation into an industrial one, creating private fortunes that would have been beyond imagining before the Civil War. Rivers of cash flowed to titans of the Gilded Age. (...)

Prins notes that the bankers who mattered a century and more ago and the bankers who matter today have consistently numbered six, a group small enough to cooperate or collude during a crisis. On the overcast Thursday morning of October 24, 1929, the day of the crash that launched the Great Depression, Charles Mitchell of National City Bank, Al Wiggin of Chase, Seward Prosser of Bankers Trust (later bought by Deutsche Bank), and William Potter of Guaranty Trust (now part of JPMorgan) strolled to 23 Wall Street to meet with Thomas Lamont of J.P. Morgan and George Baker of First National Bank (later Citi), who had come in through a side door to avoid reporters. In 20 minutes, the six agreed to prop up the collapsing market; Lamont, standing in for J.P. Morgan Jr., who was in Europe, announced the plan.

In the 2008 banking collapse near the end of the George W. Bush administration, it was again the Big Six banks that set the terms. They met on September 12 and soon wrested from Congress more cash than the Defense Department spent that year. The banks’ champion was Bush’s Treasury secretary, Henry Paulson, who before serving in that office had run Goldman Sachs, the country’s biggest investment bank. (...)

In the 35 years from 1960 to 1995, fewer than 10,000 bank mergers took place. In the last half of the 1990s, when Clinton was occupied with impeachment, more than 11,000 bank mergers were consummated. Lobbyists ran up invoices, corporations and executives poured in campaign contributions, and most journalists accepted the meme that Glass-Steagall was outdated. The loophole that allowed Travelers and Citi to merge required the killing of Glass-Steagall by 1999. The inherent conflicts of interest Glass-Steagall had prevented, which few lawmakers or journalists understood, were now enabled. This in turn, Prins shows, fueled the unsound banking practices that were later to sink Bear Stearns, Lehman Brothers, and the whole economy. Meanwhile, in the early aughts Geithner proved a sightless sheriff at the New York Fed, ignoring accounting tricks, falsified warranties on mortgage securities, and weakened underwriting standards. He was told in 2005 that Fed supervision of Citigroup was inadequate but did nothing to strengthen it.

In late summer 2008, banking practices that Glass-Steagall would have barred combined with lax regulation to produce the worst financial disaster since 1929. Citigroup ended up getting a bailout of almost half a trillion dollars. The sum of money required to make good on all the bad bets and misconduct came to $12.8 trillion, Bloomberg News calculated—not much less than the output of the entire economy in 2009. (...)

Prins notes that the six big banks agreed to $80 billion in fines following the 2008 disaster. That sounds like a lot. She points out that the amount equals eight-tenths of 1 percent of their assets, the kind of insignificant penalty that The New York Times’ Gretchen Morgenson dismisses as the equivalent of a rounding error. (...)

America has nearly 7,000 banks. Just two of the biggest—Citigroup and Chase—hold $4.3 trillion in assets, or more than 30 cents out of every banking dollar.

by David Cay Johnson, American Prospect |  Read more:

Image: uncredited

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Christer Ehrling
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Cressida Campbell
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Finnish Man Invents a Better Wood-Splitting Ax

[ed. Damn, I wish I had one of these when I was heating my house with seven cords of wood each winter. Not only that, why didn't anyone tell me about the tire deal?!]

A Finnish woodcutter has designed an ax that could make a significant difference in the lives of some northerners.

Many people in the far north heat their homes year-round with wood.

Heikki Karnä says his “eccentric” ax, the Vipukirves in Finnish, makes splitting logs for firewood simpler, safer and a lot easier.

What makes his axe different?

“Everything,” Karnä says.

The design, which has been on the market for eight years in Europe, replaces the traditional straight-edge blade with a curved one.

When the ax head strikes the log, the blade is forced to the right and pulls the wood apart.

Karnä says the ax also adds more torque, so you don’t have to use as much force to get through the wood.

“All the kinetic energy turns to the left and the energy pushes the piece of wood away from the block, and then the ax head stops on top of the block. There’s no way it could continue on to your foot.”

by Alaska Dispatch | Read more:
Image: Heikki Karnä

Milan, Italy
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