Archive for March 26, 2008

From Reuters 
Goldman Sachs forecasts global credit losses stemming from the current market turmoil will reach $1.2 trillion, with Wall Street accounting for nearly 40 percent of the losses.

U.S. leveraged institutions, which include banks, brokers-dealers, hedge funds and government-sponsored enterprises, will suffer roughly $460 billion in credit losses after loan loss provisions, Goldman Sachs economists wrote in a research note released late on Monday.

Losses from this group of players are crucial because they have led to a dramatic pullback in credit availability as they have pared lending to shore up their capital and preserve their capital requirements, they said.

Goldman estimated $120 billion in write-offs have been reported by these leveraged institutions since the credit crunch began last summer.

“U.S. leveraged institutions have written off less than half of the losses associated with the bursting of the credit bubble,” they said. “There is light at the end of the tunnel, but it is still rather dim.”

Of the cumulative losses expected by these leveraged players, bad residential home loans will represent about half, while poor-performing commercial mortgages will represent 15 percent to 20 percent.

The rest of the losses will come from credit card loans, car loans, commercial and industrial lending and non-financial corporate bonds, Goldman economists said.

Facing more credit losses, leveraged institutions have raised about $100 billion in new capital from domestic and foreign investors and reduced dividend payouts. This amount is more than three-quarters of the write-offs to date, the report said.





Bidding War for Biowarfare Labs

The Germs Next Door


What would it take to convince you that your town should play host to the world’s most feared human and animal pathogens? Believe it or not, five states are locked in fierce competition over a proposed bioterror lab that would have them doing just that.

In 2002, the newly created Department of Homeland Security (DHS) was given control of Plum Island Animal Disease Center in New York. Now DHS is seeking a home in the heartland for a National Bio and Agro-Defense Facility (NBAF) that would take over Plum Island’s work, along with its potent microbial cultures. The fact that many diseases are now known to jump between humans and animals, combined with this decade’s terror-fixation, has led the federal government to convert the agricultural problem of sick livestock into the national-security problem of bioterrorism.

Do I hear a bid?

Lying off the east end of New York’s Long Island, Plum Island (which was under the Department of Agriculture until 2002) is the only place in the nation where scientists have previously been allowed to handle the pathogens that cause foot-and-mouth disease, rinderpest, Rift Valley fever, African swine fever, and other horrific maladies that, if let loose on the mainland, could cause billions in agricultural losses and even threaten human populations.

NBAF will be a “biosafety level 4” (BL-4) facility, providing the highest degree of isolation for the world’s most dangerous organisms (Plum Island was one notch down, at BL-3, because it was isolated by water). Locations being eyed as possible sites include the University of Georgia campus in Athens; the campus of Kansas State University in Manhattan; Flora, Mississippi, near the capital city of Jackson; a research farm 17 miles northeast of Duke University in North Carolina; and a former ranch near San Antonio, Texas.

There is cutthroat competition for the lab, with DHS being courted with the kinds of incentives that go to all big potential employers. The University of Georgia has offered 66 acres of prime real estate worth $15 million and $4.5 million in road and utility improvements. The Kansas Senate approved the issue of $164 million in bonds to pay for land, roads, and security for NBAF. Now, DHS is reportedly demanding that the lab, wherever it is sited, have its own energy source, a natural gas-fired power plant. Governor Kathleen Sebelius immediately agreed to throw that into the Kansas bid.

A big bio-gamble

Every potential location for the bioterror facility lies close to large human and animal populations. In Manhattan, Kansas, for example, the lab would be located not only in an agricultural region, and not only in the nation’s second most tornado-prone state, but also within hailing distance of a senior-citizen home, a student housing area, an affordable-housing complex, a student recreation facility, a football stadium, and a basketball arena.

Kansas State University biology professor Walter Dodd will be have the new bioterror lab a mile north of his workplace if his state wins the sweepstakes. He says that in the struggle over the lab, it’s impossible to compare risks. “There has been no formal risk assessment of the BSL-4 facility that is available to the public. Likewise, knowing the risk from terrorists introducing new pathogens is difficult.” Although, he says, “We need to do this type of research because we must control diseases if possible,” he worries about the proposed locations: “Putting the facility near a city or agricultural production strips one level of protection away.” Dodd has recommended putting the lab in a desert or back on Plum Island.

Last year, DHS held a series of public meetings at the five candidate sites for the lab, soliciting comment on environmental, health, safety, and socioeconomic issues. The Department compiled almost 4000 such comments, the majority of them apparently negative. Residents raised a host of alarms about accidents, sabotage, natural disasters, ecosystem damage, water contamination, human or animal epidemics, use of the lab for secret, sinister research, and the general ineptitude of DHS. The Department is working on its responses.

When the bioterror lab is awarded to one of the five contenders this fall, residents of the “winning” location will be asked to accept such vaguely defined risks in good patriotic spirit, to protect the nation’s cities, towns, pastures, and feedlots from a hypothetical terrorist attack. But the facility will be run by administrators drawn from the same pool as those who responded to the only actual bioterror attack in this country to date — the anthrax mailings of October, 2001 — and who have made virtually no progress in solving them.

Furthermore, as I argued on the CounterPunch site in 2004, any agroterrorists who might want to see their mission accomplished in rural America need only sit back and watch. Agrocapitalism is already doing their work for them: poisoning water supplies, releasing antibiotic-resistant, highly pathogenic bacteria into streams and dust clouds, and contaminating our food supply.

Even bioterror alarmists admit that the increasing concentration of US agriculture, and its increasingly industrial infrastructure, are precisely what make it more vulnerable. The US Government’s General Accounting Office acknowledged in a 2005 report that

the highly concentrated breeding and rearing practices of our livestock industry make it a vulnerable target for terrorists because diseases could spread rapidly and be very difficult to contain. For example, between 80 and 90 percent of grain-fed beef cattle production is concentrated in less than 5 percent of the nation’s feedlots. Therefore, the deliberate introduction of a highly contagious animal disease in a single feedlot could have serious economic consequences.

The GAO didn’t go on to discuss the damage that can be done by such a highly concentrated farming system even if terrorists never cast their shadow onto the churned soil of the American Plains. And now the federal government plans to take a laboratory that harbors some of the planet’s most menacing animal and human germs and place it closer than ever to the cattle feedlots and slaughterhouses of Kansas or Texas, the hog-confinement facilities of North Carolina, or the vast poultry operations of the Deep South.Critics charge that bioterror-lab boosters at the universities contending for NBAF have nothing but visions of fat grants dancing in their heads. Vigorous opposition in Columbia, Missouri and Madison, Wisconsin got those cities taken off the list of potential sites. Last spring, when Columbia was still in contention for the lab, Eddie Adelstein, an associate professor of pathology at the University of Missouri and the county’s Interim Medical Examiner, wrote that his university was

developing a corporate structure to allow us to furnish our own income, ignore the needs of the state and pay our top-level executives CEO wages… To achieve … financial independence, members of the local welcoming committee for the proposed research center are willing to risk the life of every man, women, child, dog, cat, horse, cow and chicken in our homeland… Yielding to their self-imposed pressure to become fiscally independent, these leaders in business and education have and are attempting to lure to Columbia a high-tech government facility that belongs in a safer place. The desires of economic growth have overridden all aspects of science and common sense. They would place this facility near homes, schools and nursing facilities… When accidents occur, we would provide interesting but frightful data as these organisms have a predilection for children, older adults or just young people.

Dismal track records

Continue reading

The competition for the NBAF is heating up. Consider the following from Online Athens.

“At least one finalist – Kansas – is publicly sweetening its deal, adding more than $100 million in incentives to entice Homeland Security”.

“The U.S. Department of Homeland Security recently asked five finalists for the National Bio- and Agro-defense Facility to revise their proposals for the $451 million lab, and the finalists have until the end of the month to respond”

DHS  gave the 5  finalist,(what is this the Ms. Foot and Mouth pageant) a March 31 dateline to revise their proposals”. 

The swimsuit competition will include the taxpayers taking a bath over the increased taxes to their communities  and one must not forget the evening gown competition.  Only the evening gowns  won’t be needed because this time the taxpayers will not be going to dinner before they get screwed, heck the taxpayers don’t even get a kiss.

A University of Georgia-led group is considering spending more money to draw a federal bioresearch laboratory to Athens, but taxpayers might never know.

Releasing the updated offer would give the competition – consortia in Kansas, Mississippi, North Carolina and Texas – inside knowledge of Georgia’s bid, while Georgia would be left in the dark about other finalists’ pitches, Lee said. “That could scuttle it right there,” he said.

The transparency portion of this competition has been canceled due to the lack of  participants.  Turn’s out that, “We’re not obligated to release information that may put us at a competitive disadvantage,” God forbid someone have a competitive disadvantage in this competition.  I can’t wait to see who gets to wear the tiara but my personal favorite was not allow to compete, they were not on the mainland.

My point is the competition for the NBAF  just gets more absurd with time.  Shouldn’t the citizens know the extent of the cost-sharing burden being offered by each state? The answer is a resounding yes! So much for the promised transparency.

 In the end the citizens will have the final say in this competition. It will be in the form of an election process  and removing those in public office responsible for this debacle.  

To read the entire article I refered to in the post “Biolab pitch a Secret” go here.

%d bloggers like this: