Evening Edition is an Open Thread

Now with 45 Top Stories.

1 Kadhafi says NATO bombs won’t get him

by W.G. Dunlop, AFP

1 hr 47 mins ago

I’m rooting for the guy you don’t see in the Tigers cap (not the one with the mustache in the Ferrari).

Some of you might get the impression that I’m a big fan of Formula One racing.  Nothing could be further from the truth.  My dad, Richard, is hugely into all motor sports, even the Turn Left red neck bumper car travesty of twisted chunks of flaming metal.  By comparison Formula One has dignity.

But not much.

Ecclestone is a corporate whore who hired the son of a Nazi that likes his sex with 5 or 6 workers dressed in jackboots.  He’s probably just as responsible for the repression of the Bahrain Democracy movement as the Emir so he wouldn’t have nasty icky protesters spoiling his circus.  Under his direction driving is pay to play, a seat goes for over a million in sponsorships and without it you watch from the stands no matter how good you are.

In short an example of Galtian Greed that makes selfish George Steinbrenner seem all warm and fuzzy by comparison.  At least George wanted to win.

Which is why it’s no surprise to read stories like this-

Texas Taxpayers Finance Formula One Auto Races as Schools Dismiss Teachers

By Darrell Preston and Aaron Kuriloff, Bloomberg News

May 11, 2011 12:43 PM ET

As many as 100,000 teachers in Texas may be fired because of spending cuts to cope with the state’s budget crisis, according to Moak Casey & Associates, an Austin-based education consultant. For $25 million a year, the state could pay more than 500 teachers an average salary of $48,000.

…

If the financing works as projected, the decision will use $250 million in state tax revenue for the races over 10 years.

“With places struggling, spending that much money on an essentially one-off event is tough to do,” said Michael Cramer, a former president of baseball’s Texas Rangers and hockey’s Dallas Stars who runs the sports and media program at the University of Texas at Austin. “It’s a very high cost of entry.”

Texas, like other states cutting budgets for schools, nursing homes and basic services, uses economic-development spending to bring in jobs and seed growth. That often involves giving up tax revenue generated by a project to pay part of the cost. New Jersey is providing $200 million of tax-increment financing to help develop the American Dream in the Meadowlands, which will be the biggest mall in the U.S. when it opens.

“I’m not sure of the wisdom of using tax dollars to fund a racetrack,” said Siwak, the Austin teacher. “They’re giving so much tax dollars away I don’t think they could make it up with the racetrack.”

…

The state’s $25 million is being paid to London-based Formula One Management Ltd. to hold the race in Austin, Sexton said. Formula One, owned by London-based CVC Capital Partners Ltd., a private-equity firm, is run by Bernie Ecclestone, the chief executive officer of the series.

“It’s going to Mr. Ecclestone and Formula One to get them to bring the event here,” Sexton said.

Paying such a fee goes beyond the intended use of the state fund, which was set up to support bringing annual events to Texas by rebating increased taxes they generate to cover costs including security and traffic control, said Richard Viktorin, an accountant with Audits in the Public Interest. The Austin- based group opposes government support for the races.

…

“It’s off-balance-sheet financing for a rich man’s sport,” Viktorin said. Combs is “supposed to be a fiscal officer for the state. She’s not controlling that fund.”

…

Austin and the state are unlikely to recover their investment directly, Cipolloni said. However, the race will expose the city to a wide audience of tourists and executives that could help recruit companies and create jobs, he said.

“They won’t collect tax money equal to the $25 million” from the state, Cipolloni said. “It’s just a way to get exposure for the city.”

As State Faces Deep Cuts, Texas Commits $250 Million Of Taxpayer Money To Auto Racing

By Marie Diamond, Think Progress

May 12th, 2011 at 3:45 pm

The motorsport franchise left the U.S. four years ago because of low attendance, but the effort to bring it back – and base it in Texas – has been spearheaded by B.J. “Red” McCombs, the co-founder of conservative media conglomerate Clear Channel Communications. Despite being consistently ranked as one of Forbes 400 richest Americans – with a net worth last estimated at $1.4 billion – McCombs has gotten state Comptroller Susan Combs to agree to build a racing track in Austin at taxpayer expense. Austin’s city government may also invest an additional $4 million a year in tax revenue to facilitate the plan.

…

Corporate backers of the plan and their GOP allies insist that F-1 racing will pump money and jobs into the Texas economy. But sporting experts say the state is betting taxpayer money on an uncertain investment. Michael Cramer, a former president of the Texas Rangers and Dallas Stars, told Bloomberg, “With places struggling, spending that much money on an essentially one-off event is tough to do.”

F-1 races have tried and failed to gain traction in the U.S. in different cities since since the 1970s. Even Bernie Ecclestone, the CEO of the F-1 series admitted that, “No one wanted to hold it,” until the Austin promoters stepped in.

One of the few things I miss about working in a convenience store is that I used to be able to read 5 or 6 newspapers a day and even take them home after I cut out the masthead.  It’s like those paperback books with the cover ripped off, the publisher doesn’t charge you for the unsold stock and since it’s too damn expensive to handle the whole thing the cover will do for the refund.  Who wants to read a coverless book anyway?

Heh.

Now the Daily News is great for sports and has 3 pages of comics, but the one I really hoped wouldn’t sell out when I was addicted to dead trees was The New York Times.  Their paywall was anticipated with much trepidation and loathing but I’ve personally found it a great convenience.  I used to get nagged all the time to register, but now hardly ever because they don’t count views from blogs like this one or even aggregators like Google.

If you are having a problem I suggest you get a selective cookie deleter and search and destroy the ones containing “nyt”.  There’s also a tool called NYTClean that I’m told works except I’ve never had to use it.

All of which is an introduction to this roundup of the not so Gray Lady’s coverage of the Rajaratnam verdict that I actually did pick up from the front page of their International Herald Tribune subsidiary.

So if I start getting nasty messages I’m going to blame you, dear reader.  It’s one of the sacrifices I make for blogging.

Wall Street, Held Accountable

The New York Times

Published: May 11, 2011

It is sometimes said insider trading is a victimless crime. It is not. Was it good for Goldman Sachs’s reputation to have wiretaps played in court of a director leaking confidential information to Mr. Rajaratnam? Or for Intel, I.B.M., McKinsey or other companies to have illegal inside tips about them passed to him and his cronies?

More fundamentally, everyone affected by markets distorted by such illicit trading is a victim. The prosecution of Mr. Rajaratnam was a test of whether this kind of fraud is still offensive to an American jury.

…

The crimes he was tried for began in 2003 and ended in 2009, a period when markets were out of control. Had he been acquitted, Americans might have concluded that it was O.K. for an insider to play the markets as dishonestly as he did because they are basically rigged.

Galleon Chief’s Web of Friends Proved Crucial to Scheme

By PETER LATTMAN and AZAM AHMED, The New York Times

May 11, 2011, 7:28 pm

In many respects, Mr. Rajaratnam was no different from the thousands of Wall Street stock pickers who diligently network with corporate executives and industry experts to gain an investment edge. But Mr. Rajaratnam, a 53-year-old Sri Lankan native, sought out information that was confidential, beyond the reach of research, and illegally traded on it, a jury in Federal District Court in Manhattan found on Wednesday, convicting him on all 14 counts of securities fraud and conspiracy.

Next Up, a Crackdown on Outside-Expert Firms

By EVELYN M. RUSLI, The New York Times

May 11, 2011, 9:11 pm

Federal authorities have tried to quell the anxiety by drawing a distinction between the legitimate players and the bad actors. In March, Preet S. Bharara, the United States attorney in Manhattan, said that there was “nothing inherently wrong or bad about hedge funds or expert networking firms or aggressive market research, for that matter.”

Such statements have provided little reassurance. Many financial firms that are still using expert networks have moved their business to the largest outfits with the most established compliance practices

“If this little industry is to survive, it’s going to have to glow with virtue, which means a lot of self-regulation,” said Robert Weisberg, a professor of criminal law at Stanford.

Also there are these two handy charts-

• The Galleon Network
• The Verdict on Raj Rajaratnam

Happy nag free reading!

Evening Edition is an Open Thread

1 Three dead in NATO-led strike on Kadhafi compound

by W.G Dunlop, AFP

2 hrs 27 mins ago

Evening Edition is an Open Thread

Now with 45 Top Stories.

1 Libya rebels celebrate capture of Misrata airport

by Alberto Arce, AFP

2 hrs 26 mins ago

As read by Keith.

Galleon’s Rajaratnam Found Guilty

By PETER LATTMAN, The New York Times

May 11, 2011, 10:50

Raj Rajaratnam, the billionaire investor who once ran one of the world’s largest hedge funds, was found guilty of fraud and conspiracy on Wednesday by a federal jury in Manhattan. He is the most prominent figure convicted in the government’s crackdown on insider trading on Wall Street.

…

The government built its case against Mr. Rajaratnam with powerful wiretap evidence. Over a nine-month stretch in 2008, federal agents secretly recorded Mr. Rajaratnam’s telephone conversations. They listened in as Mr. Rajaratnam brazenly – and matter-of-factly – swapped inside stock tips with corporate insiders and fellow traders.

“I heard yesterday from somebody who’s on the board of Goldman Sachs that they are going to lose $2 per share,” Mr. Rajaratnam said to one of his employees in advance of the bank’s earnings announcement.

“One thing we know, this is very confidential, someone is going to put in a term sheet for Spansion,” he told a colleague, referring to a proposed acquisition of a technology company.

“So yesterday they agreed on, at least they’ve shaken hands,” a tipster told Mr. Rajaratnam about an upcoming deal involving another publicly traded business. “So I think, uh, you can now just buy.

…

Galleon brought Mr. Rajartnam great wealth. Forbes magazine pegged his net worth at $1.3 billion. He owns a second home in the wealthy suburb of Greenwich, Conn., and a condominium at the Setai Hotel in Miami Beach. During the trial, Mr. Rajaratnam’s former friends told the jury about lavish vacations including, for his 50th birthday, chartering a private jet to fly dozens of family and friends for a safari in Kenya.

Under Federal sentencing guidelines Rajaratnam is liable for at least 5 years per count (not that he’s likely to serve that).