The new world order cometh...

In case you thought globalization and the new world order were on the wane, you may wish to take note of this proposed change in Accounting standards. If you want a sure fire way to know how global integration is going, check out how we count the money... Generally, this is probably a good idea, as it will allow more comprability across nations.

The adoption of international accounting standards by the United States would move the world toward one set of standards, which should make it easier for investors to compare companies operating in differing regions, and make it easier for firms to raise capital in whatever market seems most attractive.

My primary concern, as mentioned in the article, is that the International Standards place a premium on Auditor independence and judgment.

In a world with more professional judgment, the auditors would be expected to tell companies that a given accounting treatment violates a standard because it produces a misleading result. Whether they would be willing to do that, and whether all would be equally willing, could become an issue.

This is not necessarily a bad thing, but when the American accounting industry lays claim to a number of scandals invovling auditors covering or tacitly allowing shady corporate activity, you may end up with unintended consequences...

Infrastructure leases....

Today's NYT Business section features an article on the increasing use of private investment in public infrastructure, such as roads and bridges. This method of financing public infrastructure, which often are in a severe state of disrepair, is becoming more prevalent as state and local governments have become the lead agencies of maintaining and improving these assets. These governments are facing declining or stagnating revenues, growing debt burdens, and a significant reduction in federal aide, leaving the option of going to the private market a much more desirable option than in the past. There are tons of questions that come with such a change, the most salient of which should be recognized by those in Indiana as the lack of popular support for such a deal. (My Man Mitch got hammered when he "sold" the toll road.)

I have a number of concerns about this type of leasing of public assets to private companies, but the primary issues are accountability and social equity in fees. The private sector, of course, assures the governemnts through "concession agreements" that tolls will only be raised by X amount and that service will meet a certain level. Despite these agreements, the reality is that once a toll road becomes managed by the private sector there is a very real loss of accountability on its operation. Additionally, once the government ceases to budget for improving that road, it is exceedingly difficult to work it back into already tight public budgets.

I will say that the rise of pension funds investing in these infrastructure assets, is less disturbing than private firms -- but then again, how will these pension funds respond if the project isn't allowing them to meet their target return rate?

The Convention is underway...

The Dems have kicked off the festivities in Denver...

Short reviews of what I've seen:

Nancy Pelosi - forced public speaker, never president.
Ted Kennedy - BAMF.
Craig Robinson - tall, looks like his sister. smooth.
Michelle Obama - articulate, kinda hot. uses hands too much.


Biden - nods a lot.

What is rich?

In today's NYT, Krugman asks the question of what is rich and what is middle class? Of course, the cynics answer is "rich = those who make more than me, middle class = what I make," but this is a serious question that doesn't seem to get much play. There are tons of factors that could be weighed in making a determination couched on a numerical cusp, but at the end of the day, it is more of a "feel" than a number. Krugman highlights just how each of the two candidates for president "feel" on this, by going back to the way each answered the question of "at what income do you move from middle class to rich?," posed by Rick Warren.

Mr. Obama answered the question seriously, defining middle class as meaning an income below $150,000. Mr. McCain, at first, made it into a joke, saying “how about $5 million?” Then he declared that it didn’t matter because he wouldn’t raise anyone’s taxes. That wasn’t just an evasion, it was a falsehood: Mr. McCain’s health care plan, by limiting the deductibility of employer-paid insurance premiums, would effectively raise taxes on a number of people.

I really do have to pick up the book "Richistan" by Robert Frank mentioned in this op-ed, as I've seen it cited quite often recently.

And down the backstretch we come...

The 2008 election is moving down the backstretch and into turn three, with Obama maintaining a 2-3 point average lead in the polls. This number, often quoted, seems a little silly to me, considering the fact that we award electoral votes on a state by state all or nothing (at least mostly) basis. The more significant number is 264, which according to pollster.com is the current electoral votes from states in which Obama has a quantifiable lead. This means that Obama would only need six additional e-votes to take the prize, which given the resource depth of the campaign should be doable. I personally think Colorado is going to be a bellwether state...

This portion of the campaign tends to really bore me, given the disproportionate amount of media coverage of the VP "race." The NYT offers an example of this type of coverage in a piece related to both candidates potential VP selections. I admit to some armchair punditry on the issue (I'm feeling Bayh and Pawlenty), but am amazed that the media covers claptrap from pundits on the issue, as if it were news...

Some Republicans said that Mr. McCain could still choose Mr. Ridge and get around the problem with social conservatives by assuring them that the vice-presidential candidate would support the position of the presidential candidate and the party, no matter his personal views.

Such a formulation would be unlikely to satisfy Rush Limbaugh, the conservative radio talk show host and longtime McCain nemesis, who on Tuesday sounded a siren for his listeners. “If he picks a pro-choice running mate, it’s not going to be pretty,” Mr. Limbaugh warned, adding that Mr. McCain would have “effectively destroyed the Republican Party and pushed the conservative movement into the bleachers.”

I have to question the intelligence (not the first time) of Mr. Limbaugh on this issue. Is it really possible to "destroy" the Republican Party by nominating a somewhat pro-choice candidate as VP? Or, is it more likely that the GOP could begin it's migration into the 21st century of acceptance of the rights of others not to be coerced into the action deemed appropriate by those in power.... Well, maybe that logic would destroy the GOP.

The 29th Olympiad...

I have admittedly watched more of the Olympics action than ever before, which is partially responsible for my lack of posting. For some interesting thoughts on the first half of the Olympics, I refer you to the incomparable Mel-Anon. Ken points out some of the same issues I have had with swimming coverage, especially with regard to the commentators extreme American bias. I also concur with Ken's assessment of the most pleasant story of the games thus far,

Usain Bolt: Best sprinting name in history, maybe the best sprinter in history. Bolt broke the world record in the 100-meter final Saturday night, and may have wholly shattered it had he not slowed up in the final 20 meters. And he has yet to run the 200, which is--gulp--his better race.

Bolt is just fun to watch.

I do have to break with Ken on giving an effective pass to the Chinese gymnasts age controversy, by claiming America has no basis for criticism given the Karolyi's dictatorial coaching style. I do believe that this story comes across like a whine, given it seems to be coming almost exclusively from American media sources and it really flared up after China edged out America in the team competition. I tend to believe these girls look significantly under 16, but hey in a country of 1.2 billion maybe you can find a lot of 75 pound athletic and strong girls... Of course, as long as the Olympic governing body chooses to use national passports for verification of age, this will likely be an issue. However, I believe there is a fairly clear distinction between extreme/hard training techniques and expectations and intentional disregard of established rules. To equate the two allows cheats to push off criticism through a relavistic out.


Additionally, race walking is not a sport.

August Recess...

In honor of our "DO NOTHING CONGRESS," who won't come back and pass some good ole reforms that would surely lower energy prices by 60%, I to am taking a summer recess. This partially to do with a current melancholic and apathetic view of the news cycle, and more so related to a very busy time in my professional life. I hope to be able to return to the April/May posting levels in September, but given the Cardinals failing, the end of the yummy food season and the beginning of the end of my mind turning to mush from McCain/Obama "energy" ads that may be a bit optimistic. While I'm gone, try to enjoy the summer and check out the Olympics, they are kind of awesome.