The Incentive Bubble
) - "The fraying of the compact of American capitalism by rising income inequality and repeated governance crises is disturbing. But misallocations of financial, real, and human capital arising from the financial-incentive bubble are much more worrisome to those concerned with the competitiveness of the American economy." [more inside]
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If you watch late-night TV, you've heard it all before. But what's the story behind these slick pitchmen and their dubious schemes? Enter The Salty Droid
, your ornery metal guide to the corrupt underworld of scam-marketing scum. This charmingly acerbic bot
(owned and operated by mild-mannered Chicago dog-lover Jason Michael Jones [inter-view, long talk + transcript]
) is a valiant crusader against the vile con-men who bankrupt the elderly and the desperate with beautiful lies
. Exposed so far:
A shadowy "Syndicate"
of frauduct-pushing personality cults
polluting the media with blogspam
and woo-woo talking points
. Boiler rooms
in the Utah desert where telemarketers farm credit from easy targets
with cunning, probing scripts [PDF]
. Powerful politicians bought wholesale
. Believers left to die in fraudulent new-age vision quests
. It's a soul-crushing beat, enough to make one feel like a regular catcher-bot in the digital rye
. But somebody's got to do it -- preferably someone with plasma nunchucks and titanium skin
How two American kids became big-time weapons traders
- "Working with nothing but an Internet connection, a couple of cellphones and a steady supply of weed, the two friends — one with a few college credits, the other a high school dropout — had beaten out Fortune 500 giants like General Dynamics to score the huge arms contract. With a single deal, two stoners from Miami Beach had turned themselves into the least likely merchants of death in history." (via
; previously on arms contractors
Ken Lay & Enron. Bernie Madoff. Bernie Ebbers & WorldCom. What is it about CEOs that makes them uniquely capable of pulling off the most audacious & expensive kind of white collar crime? Control Fraud Theory
has the answer. Via the ever-enlightening Bruce Schneier
"To weaken the cartels, some argue the U.S. should legalize marijuana
, let cocaine pass through the Caribbean and take the profit motive out of the drug trade."
FTC imposes $10M fine against ChoicePoint for data breach
The U.S. Federal Trade Commission has fined ChoicePoint $10 million for a data breach that allowed identity thieves posing as legitimate businesses to steal social security numbers, credit reports, and other data from nearly 140,000 people. This is the largest fine ever levied by the FTC. ChoicePoint also has to set up a 'trust fund' for people victimized by identity thieves. From the article: 'As part of its agreement with the FTC, ChoicePoint will also have to submit to comprehensive security audits every two years for the next 20 years.'" BusinessWeek has additional info.
Perhaps there might be hope for individual privacy after all. Let's all keep our fingers crossed.
Enron 'Crooked E' For Sale
"The ultimate symbol of the bankrupt power trader -- one of the ubiquitous chrome signs dubbed "the Crooked E" for its distinctive slant and commentary on the company's questionable dealings -- is on the auction block." The sign is only one of thousands of items up for sale September 25th and 26th, at the Houston Radisson Astrodome
"To compile The Top 100 Corporate Criminals of the 1990s,
we used the most narrow and conservative of definitions -- corporations that have pled guilty or no contest to crimes and have been criminally fined." Just brimming with fascinating business lore, including "The FBI estimates that 19,000 Americans are murdered every year. Compare this to the 56,000 Americans who die every year on the job or from occupational diseases such as black lung and asbestosis and the tens of thousands of other Americans who fall victim to the silent violence of pollution, contaminated foods, hazardous consumer
Enron's historical precidents.
This L.A. Times article discusses the historical precidents to the Enron debacle. My favorite (among lots of good stuff):
"Like Enron, ITT was a big campaign contributor. But Geneen's idea of how to use political influence made Lay and associates look like choir boys. In 1970, the company offered Republicans $1 million and consulted heavily with the Nixon White House and the CIA when Chile's new socialist president, Salvador Allende, threatened to seize the ITT-owned Chilean Telephone Co. Allende was overthrown with U.S. aid."