for future thought…

Posted on Wednesday 12 August 2009


The Rove Interview Materials, Working Thread
By emptywheel
August 11, 2009

The House Judiciary Committee has just released all its materials from the Rove and Miers interviews. They are linked below…
BTW, here’s what HJC sent out in the press release. Key new facts revealed in the materials released today include:
  • 2005 White House “Decision” to fire David Iglesias
    It has previously been known that New Mexico Republicans pressed for Iglesias to be removed because they did not like his decisions on vote fraud cases.  New White House documents show that Rove and his office were involved in this effort no later than May 2005 (months earlier than previously known) – for example, in May and June 2005, Rove aide Scott Jennings sent emails to Tim Griffin (also in Rove’s office) asking “what else I can do to move this process forward” and stressing that “I would really like to move forward with getting rid of NM US ATTY.”   In June 2005, Harriet Miers emailed that a “decision” had been made to replace Iglesias.  At this time, DOJ gave Iglesias top rankings, so this decision was clearly not just the result of the White House following the Department’s lead as Rove and Miers have maintained.
  • Iglesias criticized by Rove aide for not “doing his job on” Democratic Congressional Candidate Patricia Madrid
    An October 2006 email chain begun by Representative Heather Wilson criticized David Iglesias for not bringing politically useful public corruption prosecutions in the run up to the 2006 elections.  Scott Jennings forwarded Wilson’s email to Karl Rove and complained that Iglesias had been “shy about doing his job on Madrid,” Wilson’s opponent in the 2006 Congressional race.  Just weeks after this email, Iglesias’ name was placed on the final firing list.
  • An “agitated” Rove pressed Harriet Miers to do something about Iglesias just weeks before Iglesias was placed on the removal list
    Karl Rove phoned Harriet Miers during a visit to New Mexico in September 2006 – according to Miers’ testimony, Rove was “agitated” and told her that Iglesias was “a serious problem and he wanted something done about it.”
  • Senator Domenici personally asked Bush’s Chief of Staff Josh Bolten to have Iglesias replaced
    In October 2006, Senator Domenici stepped up his campaign to have Iglesias replaced.  According to White House phone logs and emails, as well as Rove’s own testimony, Domenici spoke with President Bush’s Chief of Staff Josh Bolten about Iglesias on October 5, 2006, and during October 2006, Domenici or his staff spoke with Karl Rove at least 4 times.
  • Todd Graves removed in Rove-approved deal with Republican Senator
    Kansas City US Attorney Todd Graves was removed as part of a White House-brokered deal with US Senator Kit Bond.  In exchange for the Administration firing Graves, Senator Bond agreed to lift his hold on an Arkansas judge nominated to the Eighth Circuit federal appeals court. A White House email stated that “Karl is fine” with the proposal.
  • Miers obtained favorable statement on Rick Renzi in violation of DOJ policy
    When rumors of the FBI investigation of Rep. Rick Renzi surfaced in October, 2006, one of Rove’s subordinates contacted Harriet Miers, who called Deputy Attorney General McNulty seeking a possible statement that would have “vindicated” Renzi.  Even though this was contrary to standard DOJ policy, such a statement was issued several days later.
“I have provided a copy of the materials released today to special U.S. Attorney Nora Dannehy to assist in her effort to determine whether federal criminal charges are appropriate and to pursue any such charges,” said Conyers.
Miers Told House Panel of ‘Agitated’ Rove
Bush White House Counsel Said Adviser Called U.S. Attorney a ‘Serious Problem’
Washington Post

By Carrie Johnson
August 12, 2009

The dismissal of U.S. Attorney David C. Iglesias of New Mexico in December 2006 followed extensive communication among lawyers and political aides in the White House who hashed over complaints about his work on public corruption cases against Democrats, according to newly released e-mails and transcripts of closed-door House testimony by former Bush counsel Harriet Miers and political chief Karl Rove.

A campaign to oust Iglesias intensified after state GOP officials and Republican members of the congressional delegation apparently concluded that he was not pursuing the cases against Democrats in a way that could help then-Rep. Heather A. Wilson [R] in a tight reelection race in New Mexico, according to interviews and Bush White House e-mails released Tuesday by congressional investigators. The documents place the genesis of Iglesias’s dismissal earlier than previously known.

The disclosures mark the end of a 2 1/2 -year investigation by the House Judiciary Committee, which sued to gain access to White House documents in a dispute that challenged the Bush administration’s claims of executive power. House Judiciary Chairman John M. Conyers Jr. [D-Mich] on Tuesday characterized the role of Bush White House figures in the firing of Iglesias and eight other U.S. attorneys as improper.

"Under the Bush regime, honest and well-performing U.S. attorneys were fired for petty patronage, political horse-trading, and, in the most egregious case of political abuse of the U.S. attorney corps – that of U.S. attorney Iglesias – because he refused to use his office to help Republicans win elections," Conyers said.

In a statement Tuesday, Rove asserted that he "never sought to influence the conduct of any prosecution" and did not decide which prosecutors were fired. He also accused Democrats of making "false accusations and partisan innuendoes"…
Harriet Miers’ Testimony:
Q And tell us the best you can about what you recall what Mr. Rove had to say when he called?
A My best recollection is that he was very agitated about the U.S. Attorney in New Mexico. I don’t know that I knew the gentleman’s name at that time.
Q And what did he tell you about the U.S. Attorney in New Mexico?
A That he was getting barraged by a lot of complaints about the U.S. Attorney and his not doing his job
Q Did Mr. Rove raise with you complaints about voter fraud prosecutions?
A That’s my best recollection, that he did.
Q And what did he say about that?
A I don’t know what he said. I know it’s my impression that he talked about the complaints that the guy wouldn’t do his job. And I believe he mentioned voter fraud
Mickey @ 12:16 AM

the roster…

Posted on Tuesday 11 August 2009

This is a difficult time to keep up with the Torture Debate. It’s getting into the details and the connections and timelines become a blurry mass of memos and stories. At the end of this post, there’s a roster of the high value detainees for reference with capture dates and links to their biographies [see also emptywheel‘s timeline].

There’s nothing pretty about this story. This is a fairly virulent group for the most part. I’m actually impressed that we caught so many of them. But our part is pretty unsavory too. If they weren’t POW’s, then they were criminals, but they were treated as neither. Now they have been tortured in foreign prisons so that bringing them to trial is sticky.

In my mind, there are two distinct threads to this story. First, many of these "detainees" Are lethal actors.  Khalid Sheikh Mohammed apparently masterminded 9/11 and many of the other al Qaeda bombings, with his aid, al-Hasawi. It’s hard to know exactly what he did because he changes his story frequently, but apparently he’s been identified by plenty of others to have played a central role in things. Ibn Sheik al-libi and Abu Zubaydah were both trainers at the al Qaeda Terrorist Camps and involved in planning attacks on their own. Mohamed Mani Ahmad al-Kahtani, Zacarias Moussaoui, and Ramzi bin al-Shibh were candidates for the 9/11 20th highjacker position, but couldn’t get into the country.There were others who are accused of direct involvement in the al Qaeda bombings. They don’t seem like Prisoners of War. The seem like mass criminals, whether driven by religious fanaticism or other sadistic personal motives. To my way of understanding our laws, they seem like criminals.

But there is another thread. Our Supreme Commanders decided that these men should be tortured until they told us everything that they knew. There are multiple complaints about this decision:
  • Our International Agreements and our own laws prohibit the use of torture.
  • Our International Agreements and our own laws grant the rights of habeas corpus,  due process, and a fair trial to anyone accused of a crime.
  • The Legal decisions used to justify torture and the suspension of rights were obtained in secret, and rendered by a biased tribunal [of one or two people] in consultation with the very people who wanted the decisions.
  • There was either no oversight or inadequate oversight throughout.
  • By every artifice, the government evaded our own laws by sending these detainees to overseas CIA Sites or to countries that tortured them for us – both being crimes under our own and International Law.
  • Torture doesn’t work. It extracts false confessions [it always has].
  • We had interrogation techniques that were time honored and effective that did not step over the legal lines.
  • The use of torture makes the ultimate task of bringing these men to justice in a courtroom either very hard or impossible.
  • This behavior is antithetical to the American and UN standards of human rights.
  • It is very possible that zeal in interrogation was motivated to get confirmation of untruths that would justify our pre-emptive, unprovoked war with Iraq – again running counter to American policy.
  • We responded to the primitive and uncivilized attack on our country by taking the bait and behaving in a primitive and uncivilized manner.

Simply put – it was a massive mistake. It was a criminal mistake, one that was covered up by the 9/11 Commission, one that lead us into a disastrous War. As it plays out, these men will become better know to us. Here’s the roster:

capture date
detainee

August 16, 2001: Zacarias Moussaoui  
  He was arrested by agents in Minnesota and charged with an immigration violation. Later, he was incriminated in the 9/11 attack, tried, and convicted with life sentence without possibility of parole.
December 18, 2001: Ibn Sheikh al-Libi  
  Lybian al Qaeda trainer who was sent to Egypt where he was tortured and admitted to al Qaeda/Iraq ties. He later recanted that testimony. He ended up in a Lybian Prison where he died – reported as a suicide by hanging.
December 2001 Mohamed Mani Ahmad al-Kahtani  
  He was captured in the Battle of Tora Bora, thought to be a candidate for the 20th hijacker. He was tortured in GITMO. Charged with murder, but charges were dropped because he was tortured. He remains in custody.
December 2001: Yaser Esam Hamdi  
  An American citizen, he was captured in Afghanistan fighting for the Taliban. He sued as an unlawful detainee and won. He was released to Saudi Arabia.
March 28, 2002: Abu Zubaydah  
  A Saudi born al Qaeda operative. He was interrogated by the CIA in CIA operated prisons in Pakistan, Thailand, Afghanistan, Poland, Northern Africa, and Diego Garcia. He was waterboarded 83 times. He is one of the central figures in the Torture debate. Currently in Gitmo.
May 8, 2002: Jose Padilla  
  An American citizen taken into custody based on material warrant signed by Michael Mukasey and based on testimony from Abu Zubaydah. He was convicted of terrorism and sentenced to 17 years.
September 11, 2002: Ramzi bin al-Shibh  
  A Yemini citizen also suspected of being the 20th Hijacker. Failing to get into the US, he was in communication with Mohamed Atta. He was held in an undisclosed site for interrogation where he was tortured, and later transferred to Gitmo. Now delusional and may not be capable of being taken to trial.
October 2002: Abd al-Rahim al-Nashiri  
  A Yemeni al Qaeda bombmaker involved in the bombing of the US Cole.  He was held and interrogated in Dubai for a month then handed over to US custody in Gitmo. He was waterboarded twice. His charges have been withdrawn [torture].
December 3, 2002: Habibullah  
  Habibullah was an Afghani Mullah who died after being tortured while in US custody on December 4, 2002. His death was one of those classed as a homicide, though the initial military statement described his death as due to natural causes. His actual connections with al Qaeda are unknown.
December 10, 2002: Dilawar  
  He was an Afghan prisoner at the Bagram Collection Point military detention center in Afghanistan who died from being tortured. His connections to al Qaeda or the Taliban are unknown.
March 1, 2003: Khalid Sheikh Mohammed  
  A Kuwait citizen who was the mastermind of 9/11 and any number of al Qaeda plots and operations. He was extensively interrogated and waterboarded 183 times. He is currently being tried and a guilty plea in pending.
March 1, 2003: al-Hasawi  
  Khalid Sheikh Mohammed’s second in command. They were captured together.
March 5, 2003: Majid Khan  
  Khan is a Pakistani who grew up in America. He was arrested in a sweep. He spent three years at CIA black sites being tortured and is now at Gitmo. He may be totally innocent as he claims.
April 29, 2003: Walid bin Attash  
  A Saudi alleged to have helped in the preparation of the 1998 East Africa Embassy bombings and the USS Cole bombing and acted as a bodyguard to Osama bin Laden. He is formally charged with selecting and helping to train several of the hijackers of the September 11th attacks. He was tortured at several Black Sites and is currently in Gitmo.
April 29, 2003: Ali Abdul Aziz Mohammed  
  A Pakastani computer person alleged to be the paymaster for the al Qaeda Hijackers. He was held in CIA Black Sites and is now at Gitmo.
June 8, 2003: Mohamad Farik Amin  
  A Malaysian captured in Thialand scouting sites for al Qaeda bombings. Held at Black CIA Sites and now at Gitmo.
August 11, 2003: Mohammed Nazir Bin Lep  
  Also a Malaysian captured in Thialand scouting sites for al Qaeda bombings. Held at Black CIA Sites and now at Gitmo.
August 11, 2003: Hambali  
  Another Malaysian captured in Thialand scouting sites for al Qaeda bombings. Held at Black CIA Sites and now at Gitmo.
July 25, 2004: Ahmed Ghailani  
  A Tanzanian implicated in the Embassy bombings in Africa held in Black Sites abroad, then Gitmo. Now being tried in New York.

Mickey @ 8:07 PM

insoluable…

Posted on Tuesday 11 August 2009


Judge: CIA interrogations not relevant to 9/11 accused’s sanity
Miami Herald

BY CAROL ROSENBERG
August  10,2009

U.S. military defense lawyers for accused 9/11 conspirator Ramzi bin al Shibh cannot learn what interrogation techniques CIA agents used on the Yemeni before he was moved to Guantánamo to be tried as a terrorist, an Army judge has ruled. Bin al Shibh, 37, is one of five men charged in a complex death penalty prosecution by military commission currently under review by the Obama administration. He allegedly helped organize the Hamburg, Germany, cell of the Sept. 11, 2001, hijackers before the suicide mission that killed 2,974 people in New York, the Pentagon and Pennsylvania.

But his lawyers say he suffers a "delusional disorder,” and hallucinations in his cell at Guantánamo may leave him neither sane enough to act as his own attorney nor to stand trial. Prison camp doctors treat him with psychotropic drugs. Army Col. Stephen Henley, the military judge on the case, has scheduled a competency hearing for mid-September. Meantime, the judge ruled on Aug. 6 that "evidence of specific techniques employed by various governmental agencies to interrogate the accused is … not essential to a fair resolution of the incompetence determination hearing in this case.” The Miami Herald obtained a copy of the ruling Monday.

Prosecutors had invoked a national security privilege in seeking to shield the details from defense lawyers. They argue that Bin al Shibh is sane enough to stand trial with alleged mastermind Khalid Sheik Mohammed and three other alleged co-conspirators…

But Navy Cmdr. Suzanne Lachelier, the Yemeni’s Pentagon appointed defense attorney, said court-approved mental health experts – as well as the judge – need to know the specifics to assess her client’s mental illness. If he suffers a long-standing psychosis, she said, he may never be made competent for trial. But if he suffers post-traumatic stress disorder as a result of his CIA interrogations, there may be PTSD treatments that could make him competent.

Henley said he was relying on a recent U.S. Supreme Court decision that upheld Guantánamo detainees’ rights to contest their detention in refusing the military lawyers the details of Bin al Shibh’s secret "black site” interrogations before his September 2006 transfer to military custody. In Boumediene v. Bush, the judge noted, the justices said the courts must balance national security secrets with the right of an accused to challenge any evidence being used against him.
Ramzi Binalshibh is the "20th" hijacker and if the allegations are correct, was intimately involved in the planning of the September 11th attacks. His lawyer claims is that he is now too crazy to put on trial [delusional and hallucinating]. That usually means that he is so disturbed that he cannot participate in his defense. That he was interrogated after his capture a year later makes perfect sense. At issue is how he was interrogated.

Our legal system never has known exactly how to deal with people who commit criminal acts that are psychotic. If they are deemed incompetent to stand trial, then what? One designation is NGRI [Not Guilty by Reason of Insanity]. Whether they are given this moniker or not, nobody knows what to do with them. But this case has some very high stakes. If this man did the things he is charged with, he was an active participant is the murder of 3000 people. But there’s even another twist in this case.

Usually, the assumption is that the "insane" person was insane when he committed the crime. That’s the point of Not Guilty by Reason of Insanity category. In this case, a potential defense is that he was driven crazy by the C.I.A. during his interrogation – that he can’t stand trial because of his treatment after he committed the crime. The lawyer claims that either he is a chronically psychotic man who has not responded to psychotropic medication or he is a man driven mad by his interrogation. Then she suggests that maybe there’s some treatment that might reverse the madness caused by his interrogation, so he can stand trial. Frankly, I wonder myself what that treatment might be. Such cases are almost always impossible to resolve. What incentive would there be for the person to get "better?" So he could stand trial for a Capital Offense?

But if you step back from the specific fate of  Ramzi Binalshibh for a moment, there are two other questions that also arise from this case.
  • What is it about the treatment of Ramzi Binalshibh that needs to be kept secret for National Security reasons?
  • If his interrogation drove him insane, how can we argue that it wasn’t torture?
The answer to the first question is easy. There’s no reason to keep his interrogation method secret except that it’s embarassing. As for the second question, we should know if he was delusional and hallucinating when we captured him. That’s not something that subtle. Then we did something to him. Now he is now apparently delusional and hallucinating. In that case, whatever we did to him must be really bad for people’s mental health.

There are two trials here. In the first, a man is accused of being a suicide bomber who couldn’t go on the mission, but was probably an active accomplice in the bombing attack. In the second trial, our own leaders are accused of treating captives so inhumanely that we drove them crazy.

Insoluable? Probably…
Mickey @ 4:26 AM

teabaggers – the modern hippies…

Posted on Monday 10 August 2009

The counterculture of the 1960’s sits in our past waiting for an explanation, and it’s all over the Internet right now as we edge up on the 40th Anniversary of the Woodstock Concert. It’s odd to me. I don’t much relate to Woodstock as anything other than a large Rock Concert that came at the end of the 1960’s – a time when the nonviolent Civil Rights Movement and the opposition to the Viet Nam War gave way to a hedonic culture of Drugs, Sex, and Rock and Roll. It was a sad time to me. I guess it couldn’t be helped, but it gave the forces that it opposed a caricature to mock for the last 40 years without acknowledging their part in creating it.

Racial Segregation was an intolerable blight on the American Consciousness – and the resistance to Integration was vicious and shameful. The forces that created and pursued the Viet Nam War were equally shameful. The government’s response to the resulting dissent was as unacceptable as some of the fringy protests. The counterculture said to hell with it and acted like children. None of it was pretty.

What’s to say about it now? Nothing much that I can think of. Some good music. Some not so good. Ironic that the tea-baggers have adopted some of the "hippie" protest techniques. Maybe they’ll have a Rock Concert…
Mickey @ 10:16 PM

tortured logic…

Posted on Monday 10 August 2009

Mickey @ 9:20 PM

one hand clapping…

Posted on Monday 10 August 2009

As the economic indicators begin to improve, and the Stimulus package begins to be actually felt in our communities, we’ll be entering a new phase in our political and economic life. What we’ve seen in the aftermath of the Bush Administration is the emergence of a new kind of leadership for the large segment of our populace that self identifies as "the Right" or "Conservatives." I would call it the Irresponsible Right, though the term is filled with my own bias. It seems as if the Mantra of the group has made a substantial shift in the few months since Obama’s Inauguration.

Previously, it seemed like the battle cry had to do with Abortion, Stem Cell Research, and anything that had to do with Homosexuality. But I don’t hear much about that any more. Now it’s about Socialism, Communism, Fascism – things about Big Government taking over people’s lives, raising taxes, etc. I can’t help but wonder where all this is headed. I used to look at Rush Limbaugh’s website once a week, but I can even stand to look at it any more, it’s so ludicrous. I used to stop for a few minutes of Fox News if a public television was nearby, but now I just keep walking. There was a time when I enjoyed reading the blogs debunking the most recent outrageous Palinism or John Boehnerism, but it’s not funny to me now – it’s frightening.

The graphs on the right are the early signs of a major accomplishment – one to be proud of. By any measure, it’s getting close to a time when we should be giving a standing ovation to the people who have turned this thing around in six months [or at least stopped the major bleeding]. And what we read about in the news is "teabaggers" and not so vaguely disguised racist comments.

Somehow, I’ve lost the thread of what we’re even arguing about. It feels more like fighting for the sake of fighting, a power struggle for the sake of power. And I’m not even able to articulate what the Republican Party is fighting for. What is their idea about the health care crisis? What do they think about the "derivative" markets? What would they do about our crumbling infrastructure, or the War in Iraq, or the problems in the Middle East? How about Unemployment, the National Debt? I hear them screaming at the top of their lungs about everything that the Administration or the Congress tries to do, but I don’t hear the alternatives.

The only thing I know to do is ignore them and muddle along as best we can without their making any substantial effort at addressing any problems we actually have. It feels kind of absurd. I suppose the only thing that will stop these kind sof sheenanigans is for them not to work. Meanwhile, we’ll have to settle for the sound of one hand clapping..
 
Mickey @ 9:01 PM

good on Krugman…

Posted on Monday 10 August 2009


Averting the Worst
New York Times

By PAUL KRUGMAN
August 9, 2009

So it seems that we aren’t going to have a second Great Depression after all. What saved us? The answer, basically, is Big Government. Just to be clear: the economic situation remains terrible, indeed worse than almost anyone thought possible not long ago. The nation has lost 6.7 million jobs since the recession began. Once you take into account the need to find employment for a growing working-age population, we’re probably around nine million jobs short of where we should be.

And the job market still hasn’t turned around — that slight dip in the measured unemployment rate last month was probably a statistical fluke. We haven’t yet reached the point at which things are actually improving; for now, all we have to celebrate are indications that things are getting worse more slowly. For all that, however, the latest flurry of economic reports suggests that the economy has backed up several paces from the edge of the abyss.

A few months ago the possibility of falling into the abyss seemed all too real. The financial panic of late 2008 was as severe, in some ways, as the banking panic of the early 1930s, and for a while key economic indicators — world trade, world industrial production, even stock prices — were falling as fast as or faster than they did in 1929-30. But in the 1930s the trend lines just kept heading down. This time, the plunge appears to be ending after just one terrible year.

So what saved us from a full replay of the Great Depression? The answer, almost surely, lies in the very different role played by government. Probably the most important aspect of the government’s role in this crisis isn’t what it has done, but what it hasn’t done: unlike the private sector, the federal government hasn’t slashed spending as its income has fallen. Tax receipts are way down, but Social Security checks are still going out; Medicare is still covering hospital bills; federal employees, from judges to park rangers to soldiers, are still being paid…

In addition to having this “automatic” stabilizing effect, the government has stepped in to rescue the financial sector. You can argue (and I would) that the bailouts of financial firms could and should have been handled better, that taxpayers have paid too much and received too little. Yet it’s possible to be dissatisfied, even angry, about the way the financial bailouts have worked while acknowledging that without these bailouts things would have been much worse…

Last and probably least, but by no means trivial, have been the deliberate efforts of the government to pump up the economy. From the beginning, I argued that the American Recovery and Reinvestment Act, a k a the Obama stimulus plan, was too small. Nonetheless, reasonable estimates suggest that around a million more Americans are working now than would have been employed without that plan — a number that will grow over time — and that the stimulus has played a significant role in pulling the economy out of its free fall.

All in all, then, the government has played a crucial stabilizing role in this economic crisis. Ronald Reagan was wrong: sometimes the private sector is the problem, and government is the solution. And aren’t you glad that right now the government is being run by people who don’t hate government?…
Back during the debate over the Economic Stimulus Plan, Paul Krugman couldn’t say enough about how inadequate it was. The Republicans were yelling bloody murder about how excessive it was and Krugman said it wasn’t near enough. In spirit, I thought Krugman was right, but in practice, I thought Obama got all he could get at the time [only three Republican Senators voted for it]. Well, it’s several months later, and it looks like it worked, and to Krugman’s credit, he’s acknowledging that it today’s op-ed. I’m glad to see it. It was hard to have two of my favorite guys having a spat. Now is the time to turn to Regulation of the Markets. That’s going to require re-energizing the sleepy SEC and CFTC, but mostly regulation of the space in-between – the Derivatives Markets.
Mickey @ 12:33 PM

curious…

Posted on Monday 10 August 2009

This is the one year change in unemployment for May 2009. Some of it makes sense [Michigan and the Auto Industry]. But some of it escapes me. For example: Why are South Carolina and Alabama so much worse off than  Mississippi and Georgia? I haven’t a clue…
Mickey @ 9:04 AM

all things considered…

Posted on Monday 10 August 2009

I am pleased with my vote…
Mickey @ 8:09 AM

another plus…

Posted on Monday 10 August 2009


U.S. housing recovery seen possible now: Shiller

By Mary Angela Rowe
Jul 28, 2009

The U.S. housing market may finally have turned around after three years, given the rise in the widely-watched Case-Shiller home price index for May, the developers of the index told Reuters on Tuesday. The Case-Shiller home price index for May posted an increase of 0.5 percent, the first monthly rise since 2006, in instead of a forecast 0.5 percent decline, though prices have tumbled more than 32 percent from their peak in the second quarter of 2006.

"This is much more important than an up day on the stock market. It may mean that we may have changed direction," Yale University economist, Robert Shiller, and one of the developers of the index told Reuters Television. After seasonal adjustment, prices showed a 0.2 percent decline, but this was still an improvement in the recent trend, economists said. It is "a pretty significant indicator that we might be at or near a bottom," the other developer of the index, economist Karl Case, said in an interview. Other recent signs of a housing market turnaround were seen in new home sales data for June which jumped 11 percent, the biggest monthly gain in eight years, the U.S. Commerce Department said on Monday. Existing home sales rose for the third straight month in June, the National Association of Realtors said last week, feeding optimism about the beleaguered housing sector…

"I am worried that we’ll have five or more years of a weak economy because we’re seeing economic situations of fundamental uncertainty," Shiller said. The lesson of the housing bubble is that preventative risk-management must be a priority going forward, Shiller said. For example, changes to mortgage contract structure must be made to protect home-buyers in the event of a downturn. "The new standard for mortgages should be a continuous work-out mortgage," he said, which means that "if home prices fall then your mortgage payments will go down," Shiller said.

But the U.S. government bailouts of banks hit by losses on home mortgages in the past year may mean there will be less incentive for banks to engage in such risk management techniques, Shiller admitted. "The bailouts we’ve seen were extraordinary events that we want to prevent as much as possible in the future," he said. "We should be trying to encourage private risk management on a better scale."

The U.S. economic recession since December 2007 has prompted a much-needed "revolution in theoretical finance," with a renewed focus on a factor that economists once disdained: the psychology of the market. "The reason that so few economists saw this crisis coming is that they completely blocked out from their view anything about human behavior," Shiller said. Confidence in the U.S. financial system, which Shiller said is crucial for an economic recovery, can be best restored by having a clear regulatory framework for investors. "We have to do confidence-inspiring things, which means making sure that we stay a capitalist economy with clearer rules," he said…
 
At times like this, we take pleasure in small things – the upturn in the GDP, the small decrease in Unemployment, the continued rise in the CPI, and the first sign that the "Housing Bubble" may finally have found its bottom. The Case Shiller Index is a more recent economic indicator. It measures accurately the changes in house prices – shown here for the US as a whole. The current "uptick" is the first positive click since the "Housing Bubble" burst in 2005 [some of us sold our houses in 2004].

"‘The reason that so few economists saw this crisis coming is that they completely blocked out from their view anything about human behavior,’ Shiller said. Confidence in the U.S. financial system, which Shiller said is crucial for an economic recovery, can be best restored by having a clear regulatory framework for investors." Shiller’s a thoughtful guy who is trying to figure out the human factors in the behavior of the markets, specifically how financial bubbles work. And notice that all the Economists say the same things – Regulation
Mickey @ 6:29 AM