Crime & Federalism

More on David Viniar's Statment Regarding Goldman Sachs v. Sergey Aleynikov

Sergey Aleynikov, a former Goldman Sachs employee, allegedly stole software from Goldman Sachs that, according to Goldman Sach's lawyer, Assistant United States Attorney Joseph Paul Facciponti, "could [be] use[d] it to manipulate markets in unfair ways."  In a bail hearing held before Magistrate Judge Kevin N. Fox, Facciponti said that the software would cauue Goldman’s “profit margin [to be] be eroded.”  According to Facciponti, Goldman faced damages in the “millions upon millions of dollars.”

On Tuesday, July 14, 2009, Goldman Sach's Chief Financial Officer, David Viniar, stated: “We still have all of the code.  It is not like the code had been lost to Goldman Sachs. And even if it had been, it is a small piece of our business.”  What is going on?

It could be that Facciponti commited fraud on the Court.  That possibility was explored in this post.  It could also be that Viniar is attempting to do damage control.  There is a good explanation why.

No one knows what Goldman's stolen software does.  Does it allow Goldman Sachs to front run trades?  On theory is that the software allows Goldman to learn about trades milliseconds before those trades are finalized.  Goldman Sachs then front runs those trades.

Front running works like this: Imagine you're going to sell some stock.  The current bid price is $10.02.  You tell your broker (via eTrade or Fidelity or whatever) that you want to sell you stock for $10.02.  You hit "Confirm the transaction."  

Well, stock prices fluctuate according to the laws of supply and demand.  There are always a lot of people in line willing to sell their stock.  If a bunch of people want to sell their stock for $10.02, then the stock price will fall.  You want to be in front of the line before stock prices fall.

Thus, Goldman Sachs, sensing market movement, uses its software to get in front of you.  They sell their shares for $10.02.  By the time it's your turn in the line, your stock is only work $10.02.  

Jumping to the front of the line is called front running, and yes, it's a felony.  It seems probable that the Goldman software allows Goldman to front run the market.  

When Goldman learned that Aleynikov had the software, Goldman panicked.  If Aleynikov had uploaded the software or explained what it had done, even the same SEC and DOJ that allowed Bernie Madoff to bilk investors over decades would be forced to do something.  Goldman might actually face government scrutiny.

As it turns out, Aleynikov did not have all of the software code.  He downloaded roughly less than 10% of the code.  Thus, no one will know what this black box software will do.  Aleynikov only has part of the puzzle.  Goldman Sachs has the rest.

Thus, Goldman Sachs is backing away from its initial theory of the case.  Now the sofware, which according to Joseph P. Facciponti, "could [be] use[d] it to manipulate markets in unfair ways," is no big deal.  

Assistant United States Attorney swore an oath to uphold the Constitution.  Facciponti works for the taxpayers of the United States of America.  He is not - though his behavior suggests otherwise - Goldman's personal lawyer.  If Facciponti wants to represent Goldman Sachs, he is free to quit his job for the private sector.

Facciponti has an ethical and constitutional obligation to determine why Goldman Sachs, through Viniar, is now proclaiming that this software that can "manipulate markets in unfair ways" is suddenly no big deal.

Either Facciponti lied, or Viniar is lying.  Which is it, Attorney Facciponti?

Joseph Facciponti Lied at Aleynikov Bail Hearing

Sergey Aleynikov allegedly stole some software from Goldman Sachs.  While on the job, Aleynikov, a former quant at Goldman Sachs, would allegedly downlownd Goldman's software.  Assistant United States Attorney Joseph Facciponti is prosecuting Aleynikov for theft of trade secrets.  At Aleynikov's bail hearing, Facciponti argued that Aleynikov should not be released on bail.  Yes, this is a trade secrets and not a murder prosecution. 

In oral argument before Magistrate Judge Kevin N. Fox, Facciponti stated:

If this code is allowed to go to a competitor or to an entity that is not necessarily legal but can start trading with this, the bank itself stands to lose its entire investment in creating this software to begin with, which is millions upon millions of dollars.

The bank’s profit margin will be eroded -- and I’ll explain why in a minute -- by the other competit activity. In addition, because of the way this software interfaces with the various markets and exchanges, the bank has raised a possibility that there is a danger that somebody who knew how to use this program could use it to manipulate markets in unfair ways.

Bail Tr. at 8 (emphasis added).  (You may read the transcript here.)  Facciponti later stated:

In other words, they can take steps, they can start building a new program, they can -- I’m not exactly sure what steps they can take. But even if they could take steps, my understanding from them is that any dissemination of this program would be a substantial loss to them, a very substantial loss to them.

Bail Tr. at 10 (emphasis added).  Goldman Sach's Chief Financial Officer just issued a statement that directly contradicted Faciiponti's representations to Judge Fox.  Reuters is reporting:

After more than a week of silence, Goldman Sachs finally commented publicly on the alleged theft of computer codes by former programmer Sergey Aleynikov calling losses sustained as a result would be “very, very immaterial.”

Those words were spoken by David Viniar, Goldman’s Chief Financial Officer, in response to a Reuters question during a conference call with reporters to discuss the company’s robust second quarter earnings.

Aleynikov, a former Goldman computer programmer, was arrested on July 3.

“We still have all of the code,” Viniar said. “It is not like the code had been lost to Goldman Sachs. And even if it had been, it is a small piece of our business.”

There are many things suspicious about the Aleynikov prosecution.  Most suspicious: Allegedly Goldman Sachs called the FBI to report Aleynikov's theft on Wednesday, July 1, 2009.  Two days later, Aleynikov was arrested.  Aleynikov's bail hearing was held on July 4, 2009.  That's swift "justice."

During the bail hearing that occured just three days after Goldman Sachs allegedly called the FBI, Facciponti argued that Aleynikov should not be released because there was a chance that Aleynikov might release code that, according to Facciponti but which Goldman Sachs claims is a lie, "would be a substantial loss" to Goldman Sachs.

This prosecutions stinks.  Facciponti is up to no good.  Attempting to hold Aleynikov without bail - in a trade secrets case - was remarkably shady.  What's worse is that we have now learned that Facciponti lied in his failed attempt to keep Aleynikov in jail.

We all need to keep a watch on this unethical prosecutor who seems to be working as nothing more than a private lawyer for Goldman Sachs.  If anyone knows Magistrate Judge Kevin N. Fox, please pass on the Goldman Sachs report to him.  It's important for him to know that Facciponti committed fraud on the Court. 

It's also important that the trial judge - whomever that might be - know about Facciponti's fraud on the Court.  Facciponti has already been caught in one lie.  Let's let the trial court know in advaice that Facciponti is willing to break the rules in order to serve the interests of Goldman Sachs.

Conservatives and Liberals Have United

Have people on the Left and Right realized that Goldman Sachs is manipulating the markets and stealing billions from taxpayers? Have they realized that Goldman began running the Federal Reserve during George W. Bush's Administration, and continues running the Fed during the Barack Obama Administration? I guess you'll have to watch this video to see what has created such bipartisanship.

Buy the Latest Issue of Popular Mechanics

The cover speaks for itself:

As the Country Falls, Goldman Sachs Rises

Is Elliot Spitzer the only former elected official in the United States who understands the evil of Goldman Sachs?  We know that Barney Frank is on the payroll.  What of Barack Obama.  Is Obama ignorant or in cahoots?

Oh, and before you say it - as if this is a "point."  Yes, Elliot Spitzer slept with a hooker.  If sexual partners are relevant to a speaker's discussion of these issues, then you'll most certainly note that while Spitzer was consorting with a young woman, Barney Frank was sleeping with a Fannie Mae executive.

Sergey Aleynikov Fan Club

If you are on Facebook, join the Sergey Aleynikov Fan Club.  Aleynikov is the whistleblower who copied Goldman Sachs' illegal, market-manipulating computer software.  Aleynikov, who should be heradled as a hero, is being prosecuted by the United States Department of Justice - even though Goldman Sachs has admitted that its software is designed to manipulate the stock market.

Show your support for Aleynikov.

Goldman Sachs Makes Bernie Madoff Look Like Pick Pocket

Goldman Sachs has admitted that it's trading software allows it to manipulate the market:

 

July 9 (Bloomberg) -- Never let it be said that the Justice Department can’t move quickly when it gets a hot tip about an alleged crime at a Wall Street bank. It does help, though, if the party doing the complaining is the bank itself, and not merely an aggrieved customer.

Another plus is if the bank tells the feds the security of the U.S. financial markets is at stake. This brings us to the strange tale of Goldman Sachs Group Inc. and Sergey Aleynikov.

Aleynikov, 39, is the former Goldman computer programmer who was arrested on theft charges July 3 as he stepped off a flight at Liberty International Airport in Newark, New Jersey. That was two days after Goldman told the government he had stolen its secret, rapid-fire, stock- and commodities-trading software in early June during his last week as a Goldman employee. Prosecutors say Aleynikov uploaded the program code to an unidentified Web site server in Germany.

It wasn’t just Goldman that faced imminent harm if Aleynikov were to be released, Assistant U.S. Attorney Joseph Facciponti told a federal magistrate judge at his July 4 bail hearing in New York. The 34-year-old prosecutor also dropped this bombshell: “The bank has raised the possibility that there is a danger that somebody who knew how to use this program could use it to manipulate markets in unfair ways.”

Read that last line again: "There is a danger that somebody who knew how to use this program could use it to manipulate the market in unfair ways."

Goldman Sachs knows how to use the program.  Indeed, it the program was stolen from Goldman Sachs.  Can anyone now see what conclusion follows from those premises.  

Will the federal prosecutor who tripped over himself to protect Goldman Sachs, instead investigate Goldman Sachs? 

The tone of the Bloomberg article is evidence of a perspective change.  Bloomberg is pro-business and pro-Wall Street.  The first line takes a direct swipe at the United States Government: "Never let it be said that the Justice Department can’t move quickly when it gets a hot tip about an alleged crime at a Wall Street bank." 

The article implies something we all know: Federal prosecutors will not investigate market-based crimes unless a large bank is a victim.  Bernie Madoff cheated people out of billions.  The SEC ignored evidence that Madoff was running a Ponzi Scheme.  Who cares about the people?  Even Bloomberg seems to have had enough of the Department of Justice's three wise monkeys.  

Will the United States Depart of Justice, as the SEC did with Madoff, ignore Goldman Sach's admission that Goldman possesses a program that allows it to "manipulate market in unfair ways"?  

If unemployment continues to rise, there might be lynchings on Wall Street.  As it is now, I'm almost ready to lead the mobs.

Here is a video report:

Literary Output

A novelist who writes 250 words a day is a success: That's a novel a year.  A lawyer who writes 250 words a day is a failure: That's barely a billable hour.  How then can a lawyer consider herself anything but a writer?  

It could be quipped that quantity does not equal quality.  Or that there are really bad novelists who publish 250 words each day.  People often make quips rather than embrace the truth - and subsequent consequences - of a statement.  

Even accomplished novelists read about writing.  How many lawyers have ever even read a book on writing?  How can a writer - which all lawyers are - justify this neglect?

I'm 44 pages into "Clear and Simple As the Truth: Writing Classic Prose," perhaps one of the best books on writing I've ever read.  Highly recommended, if for no other reason than because good writing is contagious.  Our subconscious minds will be invaded somehow.  Better classic prose than a commercial staring soap suds, toilet bowls, and scrubber bubbles.

Ira Sorkin Got Paid... For What?

What exactly did Bernie Madoff's lawyer, Ira Sorkin, actually do?

Madoff turned himself in.  Sorkin didn't try Madoff's case.  Sorking didn't prepare for trial; sort through boxes; have armies of associates write motions and writs; prepare witnesses; hire priviate investigators; and, for good measure, pad bills.  

Sorkin had to fight to keep Madoff out on bond.  How many hours of work does that require?

The latest news is that Madoff is not going to appeal his 150-year sentence.  Story here.  This means Sorkin won't have to write any appellate briefs.  Unless Madoff starts filing prisoner Section 1983 suits, Sorkin's work is done.  Thus, now is the time to start asking questions.

It's time for an audit.  So far as I can tell, Sorkin got paid with money that belonged to victims of Madoff's Ponzi scheme.  After all, what money did Bernie Madoff have that wasn't tainted by his fraud?   How much work did Sorkin actually do?  How many millions was Sorkin paid?  How many of these millions should be returned to Madoff's victims?

No one is asking any of these questions.  Why not?  Is there some sort of buddy-buddy arrangement that Sorkin has with the trial judge or prosecutor?  I'm far away from New York; so maybe I am missing something obvious.  Perhaps Sorkin has an "in" with everyone.  

I did some Googling and did not see, as is usually the case, any evidence that the prosecutor tried preventing Sorking from getting paid.  If so, that would be highly unusual.  Whenever a defendant is charged with a crime, prosecutors freeze assets.  Prosecutors, as a matter of strategy, try preventing rich defendants like Madoff from spending money on lawyers.  

Unless I'm obvlivious to something obvious: Something funny is going on.  

Does anyone know?

Interesting Discusson on Sham Affidavit Rule

Plaintiff-deponent gave testimony that would tend to not establish liability.  Based on plaintiff-deponent's testimony, there would be no triable issue of material fact; defendant should win. The plaintiff-deponent then introduced evidence from other witnesses that tended to establish liability. Permissible in light of the sham affidavit rule? Yes.  Nelson v. City of Davis (here) (contains a nice discussion of sham affidavit rule).

Batson and Comparative Juror Analysis: Stephen Wagstaffe is a Racist and Unethical Prosecutor

Ali v. Hickman (CA9) is going to be tedious - but required - reading.  Hickman (here) discusses comparative juror analysis in detail.  A comparative juror analysis is common sense, but until recently, wasn't the law.

Under Batson v. Kentucky, a prosecutor cannot discriminate against black prospective jurors.  Prosecutors still do.  A prosecutor will make up an excuse to strike a black juror.  "Judge, I don't like jurors who wear red shoes.  Red shoes are distracting to me.  Thus, I want this black guy off the jury.  He is wearing red shoes."  Far too many judges don't care about black people.  They accept whatever reason the prosecutor gives.

Well, what if the prosecutor does not strike a red-shoe-wearing white juror? 

Before, judges excused prosecutorial intellectually inconsistentcy.  A defense lawyer would say: "But, your honor, the white juror is wearing red shoes!  If the prosecutor doesn't like red-shoe wearing jurors, why didn't he strike the white juror?!  That the prosecutor did not strike this white juror is proof that he was lying earlier when he struck the black juror."  That argument wouldn't work.  

The prosecutor would say, "Your honor, the difference is that this juror is wearing blue socks.  I have found that when a person is wearing blue socks with red shoes, then the red shoes do not distract me as much." 

Judges usually then say, "Prosecutors are officers of the court.  I will take what the prosecutor has said at face value.  Your objection is overruled."  On appeal, you'd raise the issue again.  You would lose, since appellate judges are reluctant to say, "There's no rational way a judge could have bought into the prosecutor's explanation."  Instead, the panel - at best - would say, "While we might have disagreed with the trial court's ultimate determination: Trial courts are afforded great discretion in the conduct of trials."

 

In California, anyway, judges and prosecutors will have more trouble getting away with their racism.  Hickman, which discusses a recent California Supreme Court opinion, People v. Lenix, 44 Cal. 4th 602 (2008), gives you the details.  If you're a criminal trial lawyer in any jurisdiction, Hickman is required reading.  Even though non-binding in your jurisdiction, Hickman has good arguments to harvest.

Incidentally, the racist prosecutor in Ali v. Hickman was Chief Deputy District Attorney Stephen Wagstaffe.  The Ninth Circuit panel actually identified Wagstaffe, by name, in the opinion.  Kudos to the Ninth Circuit for standing up to racist prosecutors.  All too often judges identify unethical conduct or prosecutorial misconduct.  The panel then refuses to identify the prosecutor.  

Perhaps, in light of some very public prosecutorial misconduct, the Ninth Circuit has decided: "Enough is enough.  If you are unethical, we will not protect you from public scrutiny.  We will identify you as a shaming sanction; and to deter other prosecutors from violating their ethical duties."  One can hope.

"Cognitive Daily"

Interesting blog to add to reading rotation.

Textbook False Rape Conviction

This sad story has all the telltale signs.  You could make a check list.  A drunk woman who claims she was raped.  She was too drunk to remember what happened; but somehow not too drunk to know she did not give consent.  No DNA evidence from the acussed rapist is present.  DNA evidence from another sexual partner is present.  All-white jury; black defendant.  Very disturbing story.

Using iPhones to Avoid Speed Traps

Now this is cool: 

Area drivers looking to outwit police speed traps and traffic cameras are using an iPhone application and other global positioning system devices that pinpoint the location of the cameras.

That has irked D.C. police chief Cathy Lanier, who promised her officers would pick up their game to counteract the devices, which can also help drivers dodge sobriety checkpoints.

The police chief is upset, because:

"I think that's the whole point of this program," she told The Examiner. "It's designed to circumvent law enforcement -- law enforcement that is designed specifically to save lives."

People who aren't morons, though, will zoom in on this line:

Photo radar tickets generated nearly $1 billion in revenues for D.C. during fiscal years 2005 to 2008.

The police chief was lying.  Red-light cameras cause traffic accidents.  

Do you want the speed-trap beating apps?  Via the New York Times Blog:

NMobile and Trapster are two mobile applications that provide up-to-date, detailed maps of speed-enforcement zones with live police traps, speed cameras or red-light cameras. After launching, each application pulls up a map pinpointing the locations of speed traps within driving distance. An audio alert will sound as vehicles approach an area tagged as harboring a speed trap.

Fight the power.

Women More Racist than Men; Liberals as Racist as Ever

I always outrage feminists with this claim: Men are less racist than women.  Proof: Men have more diversity in their dating lives than women.  Really; it's true.  How many of your proper white female friends have ever dated or have relations a black guy?  How many of your male friends have been with a black chick?  It's a fun question.  Start asking.... and listening to rationalizations. 

It really is fun to pull the, "Your life is a disparate impact claim waiting to happen!" card.  If GE doesn't have enough favored minorities on its payroll, then GE has racist hiring practices.  Yet in our own lives, our lack of friendship diversity is probative of nothing.  Why? 

Anyhow, evidence continues to support my assertion that women are more racist than men:

Consider "Racial Preferences in Dating," a study of more than 400 graduate and professional students who participated in speed dating sessions at Columbia University organized by Raymond Fisman, Sheena S. Iyengar, Emir Kamenica and Itamar Simonson. The researchers conclude: "Even in a population of relatively progressive individuals who have self-selected into participation in a multi-cultural Speed Dating event, we observe strong racial preferences."

“Women of all races exhibit strong same race preferences, while men of no race exhibit a statistically significant same race preference.”

These are Columbia students!  The Columbia student body is "progressive."  Of course, it just shows that liberals are as racist conservatives (allegedly) are.

None of this should surprise anyone here.  It doesn't matter what a person's ideology is.  Ideology is what we tell others and ourselves what we believe to make ourselves feel like we are good people.  Observe actions, no ideology.

Ninth Circuit Issues Two Potentially Big Cases on Class Certification

In Vinole v. Countrywide Home Loans, and Mevorah v. Wells Fargo, the same three-judge panel hols that home loan consultants aren't a proper wage-and-hour class.  Mevorah explains why, and thus is the best of the two to read for an understanding of the court's reasoning.

How the Legal Blogosphere has Changed

There's an interesting post about the changes which have occurred in the blogosphere in general.  It's a good summary.  

The legal blogosphere has changed dramatically since I began blogging over 5 years ago.  It's a lot worse than it once was.  I probably read 5 or 6 law blogs.

The biggest - and worst - change to the legal blogosphere has been the Rise of the Marketers.  It used to be that a lawyer would publish a blog for the sake of blogging.  Blogging was intrinsicly good.  He or she would give a name and professional bio.  But the posts didn't read like lawyer billboards.  Blog posts had actual substance.  

Lawyers shared their knowledge of their specialities to other lawyers and lay persons.  Blogs were actually edyifing.  Now most law blog posts are filled with lines like, "You need a personal injury attorney," with a concomitant link to the blogger's law firm.  Blogging is about closing sales.

Because of the excessive marketing, I barely venture out into the legal blogosphere.   Most of the law blogs I read aren't even law blogs.  Although written by lawyers, the blogs discuss non-law issues that interest me.

Law blogging logging has also gotten very cliquish.  

Law professors have their space.  They link to each other rather than the greater legal blogosphere.  Before, there was a lot of cross-discussion between professors, lawyers, and law students.  All comers were taken seriously.  People were judged based on their message rather than their perceived status.

With only a 100 or so legal blogs, you didn't have much choice.  If you wanted to converse, you had to respect the diversity.  You had to engage others outside of your status or social class.

With so many legal blogs (thousands?), no one is forced to interact with others.  If you want to gripe about how much you hate prosecutors, or how butt hurt you are that law professors don't link to you; you have a niche.  You can name your fraternity the "practical blawgosphere."  

If you're a law professor, how will linking to a law student or lawyer help you get tenure or more academic prestige?  So you boot lick other law professors, by linking to their blogs.

Law blogging is like high school or college.  The black kids, white kids, and Asian kids are all sitting at separate tables.  The law professors, lawyers, and law students all link to members of their respective subcultures.  There thus isn't much debate worth reading.  

It's bad enough that we have to glad-hand in real life.  On my own time, I am not inspired to read the latest ass-kissing post of the day.

The modern legal blogosphere sucks because it's been overrun by legal marketers, and because people who might be able to engage in actually-interesting conversations are too busy sucking up to their e-friends and e-colleagues.  

Obama Becoming a Beta?

This is pathethic.  Barack Obama is the President of the United States.  Yes, dealing with Russians is challenging.  Russians are natural alphas.  Nevertheless, the Presient of the United States must communicate, "No, fuck you.  I'm the President.  You come to shake my hand."  This picture is revolting; makes me less proud to be an American; and offers an easy case of alpha-beta body language:

 

Das Experiment/The Experiment

Leave it to the Germans to make a movie dramatizing the Stanford Prison Experiment.  In the Stanford Prison Experiment, the researchers stopped once people started losing it - just six days.  In "The Experiment," the experiment goes on.  I don't know how to do movie reviews, so here is a good one.  

"The Experiment" is highly recommended, but I agree with this line from the movie review: "The vicious humiliation to which the prisoners are subjected is horrifying and makes for an absolutely draining viewing experience."  In that sense, "The Experiment" is scary in the way "Silence of the Lambs" is scary.  Yes, there are real people like that.  Worse still, is that the moral of the Stanford Prison Experiment is: We are those people whom we are most afraid of.  A must-see for those interested in psychology, prison-inmate interaction, or power dynamics more generally.

Why One Cannot Take Paul Krugman or Other Keynesians Seriously

In his latest New York Times column, Krugman "argues" in favor of a second - this time much larter - stimulus.  Argues in in quotes, since Krugman doesn't really make an argument.  Rather, like a holy man or witch doctor with a direct line to the supernatural, he makes assertions.  

Logical people can shut Krugman and other Keynesians up quickly.  Sadly, there are not many logical people in our superstitious world.  The right questions thus do not get asked.  

Here is all one need ask Krugman and the Keynesians: 

• How large of a stimulus must we have?  
• What must this stimulus contain?  
• What will GDP and unemployment numbers look like after your stimulus?

Be specific.  Even a range of say, +/- 3%, would be acceptable.

That's it.  Give us hard numbers.  They never will.  Which is why rational people cannot take such people seriously.

Krugman and most other macroeconimists are nothing more than religious leaders or prophets.  They know how to make plausible-sounding assertions.  They know how to speak with a tone of authority.  Most importantly, they know how to scare people. 

Remember, though, that they are all full of shit.

Out of Work? Start a Business

How many people will take advantage of the incredible opportunity that joblessness offers?  

It's cliche, but true: Often the best things in life happen after tragedy or trauma.  

If you had a job you didn't enjoy but could pay the bills with; how do you quit?  How do you justify that choice to people you might be supporting?  "Sorry, dear, I'm going to follow a dream."  If you've been fired or laid off, now is the time to re-invent yourself.  You have the perfect excuse to do something else.  "I got fired.  I can't find a job.  Now I'll do this."

Even if you are on your own, quitting a job is terrifying.  Our expenses grow directly proportional to our income.  In college, according to my SSA earnings statement, I made $13,421 during my senior year of college.  I was damned happy then.  Really, just thrilled to be alive.  I waited tables 20 hours each week and attended college full-time.  I could afford and had time to read all the books I wanted.  Am I happier at a higher income now?  Hah!

Instead of viewing joblessness as a once-or-twice-in-a-lifetime-opportunity (when else will you have so much free time?), people will whine and complain about what life has "given" them.  

"Given" or "dealt" are always interesting terms.  They imply that life is happening to you; rather than that you are happening to life.  Life doesn't give me shit.  I take from life.  

Yes, traumatic things outside of our control happen.  We are all a car accident or tumor away from bankruptcy.  Yet those are low-probability events.  

Most of what we do daily are within our control.  Life doesn't "deal" you the hand of working at an unrewarding job.  You are in control.  If you want a more interesting job (or to work for yourself), now is the time.

Being fired might be the best thing to have ever happened to you.

Perception and Reality: It's Still Fast Food

This blog should encourage thoughts about subjects other than fast food.  Must read.

How Shady are Bank Overdraft Fees?

Clusterstock is a finance news site with a very pro-capitalist readership.  Read the comments if you want to see the anti-banking sentiment.  When a bunch of capitalists agree that banks are robbing people, something very criminal is ocurring.

There are some good comments regarding the shady practice of overdraft fees.  It's definately time to reform overdraft fee process.  I am sure some libertarian will say that it's FREEDOM OF CONTRACT!  Those people would also say that Nero and Caligula did indeed publish the laws in Rome.  So what if no one could read the laws.  They were there.... somewhere.  

Here is my contribution to the horror stories:

Oh, and yes, I paid $26.40 for a Starbucks once. While in law school, my direct deposit hit my account a few hours late. This was before the days of online banking made it easy to simply check my account first thing in the morning. 

As a young, naive student, I thought a DEBIT card was different. It's a debit card, so if I don't have money in my account, it won't work. Right? Right? Isn't that why a DEBIT card is different from a CREDIT card? 

Had I know that my deposit was going to hit my account late, I would not have purchased my Starbucks. Why didn't my card just shut me off. Oh, that's right: The bank wanted to do me a FAVOR by authorizing the charge. 

This one (not mine) should make anyone's all-time-greatest list:

A friend of mine CLOSED an account before moving out of state. She forgot she linked her (rarely-used) iTunes to it. She made a $0.99 purchase months later. The bank let the charge go through against the CLOSED account, and charged her an overdraft. She hadn't left a forwarding address for her CLOSED account, so the bank had no way to contact her. 

The bank kept tacking on additional fees, all unbeknown to my friend, and finally put her on a private industry blacklist of check bouncing deadbeats, which there is no way to get off of, and now denies her access to any mainstream financial services, like opening a bank account, for SEVEN YEARS. 

As to myself? I once wanted to write a check for the full amount of my account balance. I checked the balance at the ATM, including getting a mini-statement to know if my last checks had cleared. Then I wrote a check for the amount on the balance statement. Guess what? They charged me $1 for the statement, AFTER it was printed, so I got an overdraft fee. 

F**K these fees and these banks. It's deliberate exploitation, and has nothing to do with holding people responsible for their behavior as you claim.

Lessons from Bernie Madoff, Robert Allen Stanford, and Marc Rich

Bernie Madoff surrended himself to authorities.  He cooperated fully.  He put up no fight.  He got 150 years in prison - a death sentence.

J. Allen Stanford, who has not yet been convicted, returned from a foreign country to fight the criminal charges against him.  He could have fled, but he did not.

The moral of the story is clear: If you are rich, play litigation like it's a game of inches.  Madoff should have dragged out the legal proceedings against him.  He should have demanded his right to a trial.  He would have been convicted, but he would have bought himself the one thing money can't buy - time.

While Madoff couldn't have fled the country, since he cheated too many Russian mobsters: Stanford could have.  Yet he hired a lawyer before surrending himself to federal authorities.  Now he sits in jail, because some judge who doesn't care about the Constitution says Stanford is a flight risk.  No bail for you, Robert Allen.

Marc Rich, years ago, fled the United States.  Not only has he never been in prison; he got a full presidential pardon.

If you haven't been indicted and are rich, you can follow the example of Robert Allen Stanford or Marc Rich.  The United States Government has given you guidance on which strategy is most effective to preserving your liberty.

Jury Selection and the Five Factor/Big 5 Personality Factors

Snoop (here) focuses on the Big 5 personality factors.  Why care?  Because it seems that the Big 5 are correlated with actual juror behavior.  According to one study: 

Actual venire members ( N = 764) completed the Big Five Inventory before going through the jury selection process for 1 of 11 criminal or 17 civil trials. In the 17 juries that deliberated to a verdict (n = 285), high levels of juror extraversion were associated with not guilty verdicts or verdicts for the defendant, especially in criminal cases. Extraversion was also associated with being selected as a jury foreperson, and foreperson extraversion was associated with longer jury deliberation times and perceived foreperson influence in criminal cases.

Clark, J., Boccaccini, M. T., Caillouet, B., and Chaplin, W. F. (2007). "Five factor model personality traits, jury selection, and case outcomes in criminal and civil cases."  Criminal Justice and Behavior, 34, 641-660. 

Even though there is a correlational relationship, the study notes: "Jury selection decisions by attorneys were not associated with juror personality traits but were associated with juror race and sex, especially in criminal cases."  Twelve years of grade school, jr high, and high school (or prep school for the richies); four years of college; and three years of law school.  Yet few still look more than skin deep.   

For more on the Big 5, check out this nice overview: 

UPDATE: Here is a link to a hard-copy of the article cited, above. 

Have You Heard?

Michael Jackson died, Bernie Madoff got 150 years, and the United States Supreme Court sided with the white firefighters.  Life would be unintesting if everyone stopped talking about the same things as everyone else.  And if everyone else decided to stop being interested in the same things, life would be a bore.  Because there is nothing quite as exciting as sameness.  Now please excuse me while I take my MacBook to Starbucks where I'll send text messages from my iPhone about Michael Jackson, Bernie Madoff, and the United States Supreme Court's white guys.

Western Centric Bias, Pascal's Wager, and Muslim "Freedom"

An ignorant 19-year-old from a farming community, I found Pascal's Wager reasonable.  "Pascal's Wager (or Pascal's Gambit) is a suggestion posed by the French philosopher Blaise Pascal that even though the existence of God cannot be determined through reason, a person should wager as though God exists, because so living has everything to gain, and nothing to lose."

If Christians are wrong (because there is no God) but you live "morally," then when the lights go out, they stay out.  It's not as if living a moral life will lead you to unhappiness.  Everyone wants to be a polygamist, but nobody wants to get herpes.  Living "morally" is usually, at worst, a wash.

On the other hand, if you bet that there is no God but are wrong, you will burn in Hell for eternity.  If you're going to make a bet, the smart money is on God.

Blaise Pascal was a Frenchman who lived in the 1600s.  He didn't have exposure to world culture and world religions.  Instead, he was a product of the Western World.  In the Western World, there is but one God.  Sure, Christians burned Lutherans at the stake and tortured Catholics due to disagreements over the True Nature of God.  But most agreed that God was this white-looking guy who looked down upon all us.

Today's world is much larger than Pascal's.  There are thousands of religions.  Many religions, due to the need to terrify people into believing the unbelievable, have their own version of Hell.  Pascal's Wager is thus much less reasonable.  How can one decide which religion to choose?  After all, many of them are mutually exclusive.  You can't be a Christian and a Muslim.  Who gets the golden streets, the 72 virgins, and the molten-hot pitch prostate massage?  

In a big world, the choice is no so clear.  Pascal's Wager thus no longer makes sense.  There is no smart bet.

Yet thinking about Pascal's Wager has led me away from thinking about Pascal's Wager.  Let's think more broadly - about the general bias we have by product of our Western living and Western mind.  

Ken at Popehat has a post discussing the French Solution to the Muslim Problem, namely, make women remove their garmets of oppression.  Ken thinks that the French are being Orwellian: It does not make a woman more free by telling her she cannot be a slave.  As a Western man, I would agree.

Ken writes:

Leaving people free to make choices means that some will make choices we don’t like under pressures we deplore. Libertarians tend to advocate making drug use and prostitution legal, but that doesn’t mean we like to see women become prostitutes or people engage in heavy drug use — we just think that the alternative, letting the state treat us like children, is unacceptable. Some Muslim women will wear the burka under threat of pariah status at best and physical violence at worst.

Does it really make sense to speak of "free choices," though, when discussing Muslim women?  As a Western man, I do indeed make many free choices that limit my freedom.  Can we really say the same is true of Muslim women?  

When we make Ken-like arguments, aren't we really just falling into Pascal's trap?  To us, of course it makes sense to recognize that Muslim women have the right to make choices that limit their freedom.  Are Muslim women really making a free choice?  Or is that simply how it looks to those of us in the Western world?  

UPDATE: Engaging comments here.

"The Private Lives of Jurors"

In the most recent Los Angeles Lawyer is an article exploring the legal and ethical issues of having a private investigator, investigate jurors.  (It's here.)  It's written by two associates from the best investigative firm in California, Batza & Associates.  This ancedote was especially interesting:

As part of the effort to profile jurors, some litigators hire investigators to perform what is sometimes called a drive-by. This involves a visit to, and careful observation of, a juror’s residence and neighborhood. While an investigator cannot directly contact a juror or a juror’s family members or interview a juror’s neighbors or acquaintances, a drive-by is permissible and can sometimes yield valuable information regarding the juror’s economic, cultural, and social environment. 

One investigator, for example, performed a drive-by of a juror in a high-profile tobacco industry case and observed a vehicle parked in the driveway of the juror’s home bearing a bumper sticker that read, “Cigarettes Kill!”

I'm betting the juror, during voir dire, said, "Of course I can be fair and impartial!"  Read the whole thing here.

Blogger Crosses Fine Line

It's one thing to say, "I wish you were dead!"  It's quite another to post your photo, work address, references to colleagues of yours who had been killed, etc.  Details here.

Are California's IOUs an Unconstitutional Bill of Credit?

California is broke. It's going to start issuing IOUs to creditors. Article One, Section 10 of the United States Constitution provides: "No State shall ... emit Bills of Credit []."

Is an IOU a "bill of credit"?

I don't know. Do you?