Explaining Southern California's economy

Reportings: Big accounting tricks; Liz Warren; California booming; business class takes a hit

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Elizabeth Warren, chairman of the TARP Congressional Oversight Panel, testifies at a hearing on Capitol Hill, on July 22, 2009 in Washington, DC.

Were you wondering why some big banks are reporting big profits, even as markets are driving down their share prices? Blame it on...accounting: "'This is the most vilified accounting rule I've ever seen. It's amazing how universally despised it is,'" said Robert Willens, author of the Willens Report, which analyzes corporate accounting and tax matters." (Reuters)

 

Somebody loves Massachusetts Senate candidate Elizabeth Warren: "She is provocative and assertive in her critique of corporate power and the well-paid lobbyists who protect it in Washington, and eloquent in her defense of an eroding middle class." (NYT)

 

What it was like in SoCal when aerospace was booming: "...dozens of airfields dotted the landscape; test-rocket firings flashed and echoed in the foothills; and the local economy became yoked to the boom-and-bust cycles of defense spending. In the process, aerospace helped drive the extraordinary metamorphosis of California from a rural, agrarian state to the sixth-largest economy in the world." (Zócalo)

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Reportings: Solyndra scandal; central banks; Lehman Day

Libertarians attack! Megan McArdle at the Atlantic and my old pal Tim Cavanaugh of Reason focus on the political football that bankrupt California solar startup Solyndra has become. Megan: "Its technology was essentially a large bet that prices of silicon would stay high, making its product competitive." And Tim: "[T]he real outrage is that the government is proudly putting your money into companies that private investors are unwilling to put their own money into. Once this violation of common sense has taken place, the story can only end, as it appears to have ended here, in suffering and crime." (The Atlantic, Reason)


Central banks to the rescue! For now... "The European Central Bank said it will coordinate with the U.S. Federal Reserve, the Bank of England, the Bank of Japan and the Swiss National Bank to offer three-month dollar loans to banks through the end of this year. The move is an effort to prevent Europe's debt crisis from derailing the global economy's rebound from recession." (AP, via the LAT)

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