Coyote Blog

It is never dull here in AZ.  It appears that Michael Marin, upon being convicted of arson in court yesterday, may have committed suicide right there in court.

"Burning Man" Michael Marin reportedly died after his "medical emergency" in the courtroom yesterday, which came after a jury handed down a guilty verdict in Marin's arson case.

Fox 10 had its camera on Marin's face as the verdict came in, and it sure looks like he put something in his mouth before he started having an apparent seizure and fell unconscious in the courtroom.

Video at the link if you are morbidly inclined.

I just read JD Tuccille's High Desert Barbeque, also about arson in AZ as it turns out, and enjoyed it thoroughly.  But authors like Tuccille who are writing satire have to work hard to stay more outrageous than the news here in AZ.  Seriously, a guy starts a fire in his own house, escapes from the second floor in a scuba mask and tanks, and then crunches a cyanide tablet in court as the verdict is read?  Come on, who is writing this stuff?

PS-  I may be missing the legal definition on this, but Marin was convicted of arson on an occupied structure when he was the only occupant.  I find it odd that the arsonist himself "counts" as an occupant towards this charge which, I presume, carries worse penalties than arson on an unoccupied structure.  Upping the charge this way reminds me of the NYC police asking people on the street to show them their weed and then busting them on the charge of public display of said weed.

You have to watch politicians' commercials

The Dish Network, in its continuing effort to attract new viewers, introduced a new DVR called the Hopper earlier this year. The Hopper's main appeal is that it allows you to skip past commercials entirely, and unsurprisingly, TV networks aren't very happy about this. But guess who else is unhappy?

At a Wednesday hearing on video distribution held by the Communications and Technology Subcommittee of the Energy and Commerce Committee, [Rep. John Dingell, D–Clueless] complained that the service will allow potential voters to skip past important commercial messages.

"I've got an election coming up, like all my colleagues," Dingell said, during his questioning of Dish Network Chairman Charlie Ergen. "We all put political ads on the local stations to reach our constituents. The Hopper potentially limits the ability of every member of this subcommittee to reach constituents to help them make up their minds on Election Day.

"Do you understand and appreciate the concerns that the politicians up here on the dais and other politicians everywhere will feel about that, yes or no?" Dingell asked.

These women's weight gain ads seem funny because they are so out of step with most women's concerns today.  But what changed?  My guess is that the whole weight-gain thing really was about larger breasts.  If you wanted more cleavage, you had to gain weight.  But breast implants changed that.  Now one can have an improbable rack while still starving.  So while breast implants are a positive in terms of empowering women to have control over their body, they have eliminated an important counter-balance to this crazy pressure on skinny-ness.

Disclosure:  On a scale from 1=Kate Moss to 10=Rubens paintings, my preferences definitely are in the higher numbers, so I am not without bias.  I also have a daughter who wastes way too much of her life worrying whether her body properly meets societal expectations for fat content.

My column is up at Forbes.com, and has a few quick thoughts on the decision.  A brief excerpt:

Second, though, I am really confused how financial penalties on states can be read as an effective mandate, and therefore un-Constitutional, but financial penalties on individuals do not constitute an effective mandate (if they did, this very ruling says that such a mandate would be illegal).   Using financial penalties to coerce action is either the equivalent of a mandate or it is not, but the decision seems to take two opposite stances on this question.

I will disagree with most commenters -- there is no support for the commerce clause implying any kind of regulatory limitations in this decision.  Any discussion of the commerce clause and what the Supreme said about it is irrelevant.   By this decision, Congress can essentially mandate any activity it pleases as long as it imposes a financial penalty for an individual who ignores the mandate.  SCOTUS upheld that the commerce clause has limits, and then made these limits irrelevant.

So this is how I read the PPACA/Obamacare decision today

• The mandate is not allowed under the commerce clause powers
• However, Congress is allowed to use its taxing power to issue financial threats to coerce individual activity it can't mandate
• However, Congress is not allowed to use financial threats to coerce state government activity that it can't mandate

Rolling Stone Magazine has an good story on the conviction of a number of banks and brokers on charges of bid-rigging, specifically on contracts for short-to-medium term management of municipal bond cash accounts.  Apparently brokers were paid by certain banks to be given a look at all the other bids before they made their final bid.  The article focuses mainly on the ability of winning bidders not to bid any higher than necessary, though I would suppose there were also times when, given this peek, the winning bidder actually raised its bid higher than it might have to ace out other bidders.

This is classic government contracting fraud and it's great to see this being rooted out.  I am not wildly confident it is going to go away, but any prosecutorial attention is welcome.

But I am left with a few questions:

• It seems that government contracting is more susceptible to this kind of manipulation.  Similar stories have existed for years in state highway contracting, and the municipal bond world has had accusations of kick-backs for years.  Is this a correct perception, or is the rate of fraud between public and private contracting the same but we just notice more with the government because the numbers are larger, the press coverage is greater, and the prosecutorial resources are more robust?
• If government contracting of this sort is more susceptible to fraud, why, and how do we fix it?

The latter is not an academic question for me.  I run a company that privately operates public recreation areas.  I bid on and manage government contracts.  Frequently, a major argument used against the expansion of such privatization initiatives is that past government outsourcing and contracting efforts have been characterized by fraud and mismanagement.  The argument boils down to "the government has so many management problems that it can't be trusted with contracting for certain services so it needs to operate those services itself."

The only way to reconcile this view is to assume that private actors are more likely to act fraudulently and be dishonest than public employees.  If this were true, then the public would be safer if a public management process of questionable ability were applied towards public employees rather than outside private contractors, because those who were being managed would be less likely to take advantage.  And certainly there are plenty of folks with deep skepticism of private enterprise that believe this.

However, I would offer that only by adopting an asymmetric view of what constitutes fraud would we get to this conclusion.  Clearly, banks colluding to shave a few basis points off municipal asset returns is fraud.     As the author of the Rolling Stone piece puts it several times, the crime here is that the public did not get the best market rate.  So why is, say, elected officials colluding with public employees unions to artificially raise wages, benefits, and staffing levels above market rates not fraud as well?  In both cases insiders are manipulating the government's procurement and political processes to pay more than the market rates for certain services.

This is Bastiat's "seen and unseen" of the privatization debate.   Yes, the world is unfortunately littered with examples of government procurement fraud.  This is often cited as a reason for maintaining the status quo of continued government management of a diverse range of services.  But what we miss, what is unseen, is that these government services are often run with staffing levels, work rules, productivity expectations, and pay rates that would constitute a scandal if uncovered in a division of a corporation, particularly if the workers were spending a lot of money to make sure the manager handing them this largess was able to keep his job.

Yes, the public lost several basis points on its investments when it did not get the market rate of return from cheating bankers.  But it loses as much as 50% of every tax dollar sent to many state agencies because it does not get market rates (and practices) for state labor.

No matter what the SCOTUS decision on health care, the Internet is going to go apeshit tomorrow.

This is true for me, ymmv.

Time seems to pass much more quickly as one is experiencing it when one is busy.

However, looking backwards, time periods that were chock-full of activities tend to lengthen.  A point in time a year ago seems further in the past in a busy year than a sparse year.  Almost as if your mind assumes some average activity density, then applies this to remembered activities to estimate time passage.

The absolute randomness of this observation should give readers an idea of my state of mind today.

Apparently the co-owner of the Miami Heat Ranaan Katz does not like to be criticized by the plebes.  So like many rich guys nowadays, he sued a blogger who he felt was saying hurtful things about him, because as we all know the First Amendment has a built in exception for college students and billionaires who have a right not to be offended by other peoples' speech.  So far, this is just the usual SLAPP nuttiness, up to and including a rallying of support by attorneys willing to help out pro bono.  This latter can usually solve the problem, as these suits gain their strength not from any legal merit but from the ability to intimidate ordinary people unfamiliar with the legal system and without the resources to hire top attorneys to defend themselves.

But, as with the case of serial moron Charles Carreon, Katz and his attorneys then proceeded to drive right over the cliff.  Because they then sued the attorney's representing the blogger on the brilliant theory that by providing legal advice to the blogger, the attorneys made themselves parties to the bloggers "crimes."  Seriously.   By which theory Jerry Sandusky's attorneys will soon be serving time for child abuse.

On UVA from Walter Russel Mead via Glenn Reynolds

As the NYT article points out, universities all over the country are facing a world of rapid change. This is going to be hard to face. Universities are structured to adapt slowly—if at all. Typically, university presidents have only limited controls, while faculties have a lot of power to resist. Management is usually decentralized, with different schools and departments governed under different rules and accountable to different constituencies. The fiscal arrangements of most universities are both byzantine and opaque; it can be very hard for administrators to understand or properly and fairly value the true cost and contributions of different parts of the institution.

The structural problem our universities face is this: confronted with the need for sweeping, rapid changes, administrators and boards have two options — and they are both bad. One option is to press ahead to make rapid changes. This risks — and in many (perhaps most) cases will cause — enormous upheavals; star professors will flounce off. Alumni will be offended. Waves of horrible publicity will besmirch the university’s name.

Option two: you can try to make your reforms consensual — watering down, delaying, carefully respecting existing interests and pecking orders. If you do this, you will have a peaceful, happy campus . . . until the money runs out.

This kind of organizational change issue is NOT unique to public institutions.  I think if one were a fly on the wall at Sears, or RIM/Blackberry, or AOL, one could describe exactly the same dynamic: insider constituencies were and are successful under the old model, so consensus processes involving these same constituencies seldom lead to change since these changes are inherently threatening to these same constituencies.  A simpler way of saying this is that it is really hard to obsolete oneself.  Just go ask Blockbuster Video.

But there is one difference in the world of public institutions.  In the private world, new success models in the worlds of Sears and AOL and Blackberry are already out there and growing really fast, run by outsiders who have absolutely no stake in the success of the old model (in fact by folks who have a strong economic stake in killing the old models).  But there is no parallel to capital markets and entrepreneurship in the public space.  There is no venue for new-model proponents to get capital and support outside of the old-model institutions.  In fact, if anything, public institutions will rally their political clout, up to and including sponsoring new legislation, to make sure new models are strangled in the crib.

If I were in the VA legislature and really cared about education innovation in the future, I would give up on UVA driving it and instead take 20% of its funding and hand it off to a brand new parallel entity, say UVA 2.0, run by an entirely new team.

Via Radley Balko.  He is quoting Tim Carney in turn

People think money drives politics. It doesn’t. Money is merely the vehicle. Power drives Washington. As Carney points out, Hatch has spent a good deal of his time on the Judiciary Committee targeting Microsoft. So he wasn’t mad that the company wasn’t giving him money—they weren’t giving to his opponents, either. Hatch was angry that the company wasn’t acknowledging that it needs Washington, that it needs people like him. He finds that offensive. So people like Hatch make companies like Google need people like Hatch.

More:

 . . . it grated on Hatch and other senators that Gates didn’t want to want to play the Washington game. Former Microsoft employee Michael Kinsley, a liberal, wrote of Gates: “He didn’t want anything special from the government, except the freedom to build and sell software. If the government would leave him alone, he would leave the government alone.”

This was a mistake. One lobbyist fumed about Gates to author Gary Rivlin: “You look at a guy like Gates, who’s been arrogant and cheap and incredibly naive about politics. He genuinely believed that because he was creating jobs or whatever, that’d be enough.”

Gates was “cheap” because Microsoft spent only $2 million on lobbying in 1997, and its PAC contributed less than $50,000 during the 1996 election cycle.

“You can’t say, ‘We’re better than that,’ ” a Microsoft lobbyist told me on Friday. “At some point, you get too big, and you can’t just ignore Washington.”

You know what happens next . . .

After the Hatch hearings, Microsoft complied. Its PAC increased spending fivefold in each of the next two elections. In the 2010 elections, Microsoft’s PAC contributed $2.3 million to House and Senate candidates. The PAC has contributed the maximum $10,000 to each of Hatch’s last two campaigns.

Back before the antitrust case, Microsoft’s tiny lobbying contingent sat in the company’s local sales office in Chevy Chase. Since the Hatch hearings, Gates’ company has poured more than $100 million into K Street’s economy, hiring up members of congress and Capitol Hill staff, many of whom then became top fundraisers — such as Republican Jack Abramoff and Democrat Steve Elmendorf.

And of course now that Microsoft has a strong Washington presence, it uses its influence to lobby the government to harass its competitors. Like Google, which must then open its own Washington lobbying outfit in response. And the cycle starts all over again. (If you’re really on your game, you then hire the government regulators you’ve lobbied to investigate your rival to come work for you.)

Money is not the problem in politics, and is not the root of the corporate state.  Power is.  Money in politics will never go away as long as the government has the power to micromanage winners and losers.  Take the power away, and the money would disappear.

I have written before of my believe that climate has become the first post-modern science.  This time, I will yield the floor to Garth Paltridge to make the same point:

But the real worry with climate research is that it is on the very edge of what is called postmodern science. This is a counterpart of the relativist world of postmodern art and design. It is a much more dangerous beast, whose results are valid only in the context of society’s beliefs and where the very existence of scientific truth can be denied. Postmodern science envisages a sort of political nirvana in which scientific theory and results can be consciously and legitimately manipulated to suit either the dictates of political correctness or the policies of the government of the day.

There is little doubt that some players in the climate game – not a lot, but enough to have severely damaged the reputation of climate scientists in general – have stepped across the boundary into postmodern science. The Climategate scandal of 2009, wherein thousands of emails were leaked from the Climate Research Unit of the University of East Anglia in England, showed that certain senior members of the research community were, and presumably still are, quite capable of deliberately selecting data in order to overstate the evidence for dangerous climate change. The emails showed as well that these senior members were quite happy to discuss ways and means of controlling the research journals so as to deny publication of any material that goes against the orthodox dogma. The ways and means included the sacking of recalcitrant editors.

Whatever the reason, it is indeed vastly more difficult to publish results in climate research journals if they run against the tide of politically correct opinion. Which is why most of the sceptic literature on the subject has been forced onto the web, and particularly onto web-logs devoted to the sceptic view of things. Which, in turn, is why the more fanatical of the believers in anthropogenic global warming insist that only peer-reviewed literature should be accepted as an indication of the real state of affairs. They argue that the sceptic web-logs should never be taken seriously by “real” scientists, and certainly should never be quoted. Which is a great pity. Some of the sceptics are extremely productive as far as critical analysis of climate science is concerned. Names like Judith Curry (chair of the School of Earth and Atmospheric Sciences at the Georgia Institute of Technology in Atlanta), Steve McIntyre (a Canadian geologist-statistician) and blogger Willis Eschenbach come to mind. These three in particular provide a balance and maturity in public discussion that puts many players in the global warming movement to shame, and as a consequence their outreach to the scientifically inclined general public is highly effective. Their output, together with that of other sceptics on the web, is fast becoming a practical and stringent substitute for peer review.

Update:  The IPCC does not seem to be on a path to building the credibility of climate science.  In their last report, the IPCC was rightly criticized for using "grey" literature as a source for their findings, against their own rules.  Grey literature encompasses about anything that is not published peer-reviewed literature, including, from the last report, sources that were essentially press releases from advocacy groups like the IPCC.  They even use a travel brochure as a source.

This time, to avoid this criticism, the IPCC is ... changing their rules to allow such grey literature citations.    I am pretty sure that this was NOT passed in order to get more material from Steve McIntyre's blog.  In related news, the IPCC also changed the makeup of its scientific panel, putting geographical and gender diversity over scientific qualifications as a criteria.  The quota for African climate scientists will, for example, be higher than that of North America.  See the whole story here.

Though this was all presented with pious words, my guess is that it was felt by the political leaders of the IPCC in the UN that the last report was not socialist or totalitarian enough and that more of such content was necessary.  We'll see.

The Wall Street Journal editorial page had a piece on the "smearing" of small business.  Apparently, in the political battle over Obamacare, the NFIB has become the new target of the left.

I have not seen these attacks on the NFIB, but after the bizarre joint attacks on ALEC, I certainly believe they exist.  The WSJ summarizes these attacks this way:

According to the smear campaign against the National Federation of Independent Business, or NFIB, small businesses are thrilled with the Affordable Care Act and the trade group betrayed the 300,000 companies it represents. Among the dozens of media outlets publishing anti-NFIB op-eds disguised as reporting, Reuters recently asked in a headline, "Who truly speaks for small businesses?" The question mark was superfluous.

The chairmen of the House Progressive Caucus, Democrats Raul Grijalva and Keith Ellison, chimed in with a letter accusing the NFIB of acting against "the best interest of small business owners" and "the popular opinion of the American small business community." They suggest Karl Rove is behind the suit, as he is everything else.

As a member of the NFIB  (I joined several years ago specifically due to their work on health care) I believe the NFIB addresses issues that really concern our company better than any other group I have found.  Certainly they are far better than the Chamber of Commerce, which tends to be a group of large companies more interested in crony handouts than free competition.  Members get polled constantly to see what issues we care about and to see what positions we would like the NFIB to take.

This latter process makes the NFIB among the most virtuous of the organizations to which I have belonged.  Certainly the Sierra Club, way back when I was a member, never polled me on whether I preferred them to focus their efforts, say, on political activism or true conservation efforts.

I am exhausted by journalists and politicians on the Left who have barely even worked in a profit-making venture, much less run one, who speak with great authority on what small business owners should or should not want.  Our company is in the business of making long-term operations bids.  For the last three years, we have had to bid two numbers for our expenses, one with Obamacare and (a much lower one) without.  Never in 25 years of our history has any external factor, government-drive or not, made this much contingent difference to our bids.  So it is simply insulting to be told that it should not make any difference to me, or that its effects will be universally cost-reducing.

Further, it is really, really hard for a small business to parse the impact of Obamacare because it is #$&*#$ hard to figure out just what its provisions are.  McDonalds can afford to hire a team of experts to figure it out, and to start gaming it by using its political clout to seek special exemptions and treatment from the Obama Administration.  We cannot.  The NFIB is the only organization, public or private, in the country that has actually helped us understand the law's requirements.  For several years running, they have sent an expert, at their expense, to our industry gatherings to help educate companies on the law.

I suppose it is time again to remind folks about my comment moderation policy, which is:  I don't moderate.  I certainly strongly request that commenters remain civil, reasonable, and respectful.  But, the combination of being lazy and not easily offended cause me to almost never moderate on content, except to eliminate obvious spam.

Readers should remember that the existence of comments from morons does not mean that I in any way endorse them - I simply have no desire, paraphrasing Napoleon, to interrupt a moron when he is proving himself to be such.  I have never fully understood folks deleting comments of foul-mouthed idiots who disagree with them in spectacularly stupid ways -- aren't you just helping your opposition?  The only folks I am ever tempted to moderate are those who agree with me, and do it poorly.  Back in college, I used to much prefer a group argument when I was the only person on my side, as I always found that people who leaped to my defense did more rhetorical harm than good.

European economic problems must be due to the "austerity" (which means, in popular Leftist use, not growing government spending faster than the rate of inflation).  I am sure this kind of thing has nothing to do with high unemployment rates.  I would certainly be really excited to hire more employees under these conditions:

For most Europeans, almost nothing is more prized than their four to six weeks of guaranteed annual vacation leave. But it was not clear just how sacrosanct that time off was until Thursday, when Europe’s highest court ruled that workers who happened to get sick on vacation were legally entitled to take another [paid] vacation.

“The purpose of entitlement to paid annual leave is to enable the worker to rest and enjoy a period of relaxation and leisure,” the Court of Justice of the European Union, based in Luxembourg, ruled in a case involving department store workers in Spain. “The purpose of entitlement to sick leave is different, since it enables a worker to recover from an illness that has caused him to be unfit for work.

This advertisement from the 1970's is a fail on so many levels that it is just hilarious.  Using the Shah of Iran as you source of moral authority?  Cheer-leading the Iranian nuclear program?  Awesome.  Via How to be a Retronaut

Interesting if slightly odd story today:

About 5 to 10 percent of U.S. high-school boys say they've been "physically forced" to have sexual intercourse against their will, according to survey results reported by the Centers for Disease Control and Prevention.

Those surprising numbers come from the Youth Risk Behavior Surveillance report published by the CDC on June 8, and are based on student-reported answers to 2011 national and state surveys.

Click here to see the report. The results concerning high-school students and forced sex can be seen on pages 66-68....

The survey results show girls reporting an even higher percentages of rapes -- 11.8 percent nationally.

So, what is your guess?  Is their an epidemic of boy rape (homosexual I assume but apparently the survey is not taken in a way that one can tell) or are the CDC numbers that women's groups so often like to trumpet basically garbage?

For a while I have advocated for the idea that we eliminate the corporate income tax and simply tax capital gains and dividends as regular individual income.  Corporate profits eventually flow to one or the other.  Out would go a whole expensive class of taxation that has all kinds of distorting effects (and really does not raise that much money).  Out would go the tax preferences for corporate debt over equity financing.  Out would go double taxation of investment income.  Out would go the disincentive to repatriate corporate profits and relocate headquarters to foreign countries.  And out would go the perceived need for the goofy "Buffett Rule."

At least some on the Left might be open to the idea.

I have been emailing the Florida Secretary of State today, trying to get information on an article I am writing on corporate minutes scams (something I have blogged about in the past).  The folks in Florida have been helpful, no complaint there, which is why I took the individual's name off the email below.

It is the footer in this email that bothers me, specifically the chart on the bottom left.   My guess is that this footer is appended to all emails from government employees, at least of the Secretary of State's office.  It strikes me the attached chart crosses the line from public information into the majority political party making a campaign point.  Here is an enlargement of the chart:

My guess is that many Democrats in the state would not necessarily agree this is "the right direction".  Certainly President Obama went on the record last week as saying that he thought that the decline in public sector workers was bad, not good.

I think readers know that I likely agree with the sentiments of the people who made this chart.  I think increasing private employment and decreasing public employment is the right direction.  But just as it is important to support free speech of people we disagree with or find objectionable, it is important to oppose government excesses even when we are in favor of its goals.

This is a great campaign chart.  It is not an appropriate attachment to official government business mail.

A quick information graphic for you:

This count does not include his Wikipedia page, where about half the content now is about the Funnyjunk/Oatmeal brouhaha.  Hilariously, before this happened, Mr. Carreon's page was nominated for deletion for his being too much of a non-entity.  Using a great new phrase I just learned from Ken at Popehat, "on information and belief" the original page was probably put up on Wikipedia by him or one of his paid help.  Apparently

"On information and belief" is lawyer-speak for "I have no evidence whatsoever, but I kind of like to imagine that it's true, and who knows what I'll find in discovery."

Useful term, that.  By the way, Ken has lots of updates at that link.

After years of apparently being OK with California's absurd restrictions on development and crazy environmental laws that tied most everything new up in the courts for years, Kevin Drum suddenly thinks they may be flawed now that they are slowing development he likes (wind, solar, high density housing around transit stations).  Drum is a classic technocrat, who is OK with absolute state authority as long as the state is doing what he wants it to do.  I am reminded of what I wrote technocrats 7(!) years ago:

Technocratic idealists ALWAYS lose control of the game.  It may feel good at first when the trains start running on time, but the technocrats are soon swept away by the thugs, and the patina of idealism is swept away, and only fascism is left.  Interestingly, the technocrats always cry “our only mistake was letting those other guys take control”.  No, the mistake was accepting the right to use force on another man.  Everything after that was inevitable.

I am reminded of all this because the technocrats that built our regulatory state are starting to see the danger of what they created.  A public school system was great as long as it was teaching the right things and its indoctrinational excesses were in a leftish direction.  Now, however, we can see the panic.  The left is freaked that some red state school districts may start teaching creationism or intelligent design.  And you can hear the lament – how did we let Bush and these conservative idiots take control of the beautiful machine we built?  My answer is that you shouldn’t have built the machine in the first place – it always falls into the wrong hands.  Maybe its time for me to again invite the left to reconsider school choice.

Today, via Instapundit, comes this story about the GAO audit of the decision by the FDA to not allow the plan B morning after pill to be sold over the counter.  And, knock me over with a feather, it appears that the decision was political, based on a conservative administration’s opposition to abortion.  And again the technocrats on the left are freaked.  Well, what did you expect?  You applauded the Clinton FDA’s politically motivated ban on breast implants as a sop to NOW and the trial lawyers.  In establishing the FDA, it was you on the left that established the principal, contradictory to the left’s own stand on abortion, that the government does indeed trump the individual on decision making for their own body  (other thoughts here).  Again we hear the lament that the game was great until these conservative yahoos took over.  No, it wasn’t.  It was unjust to scheme to control other people’s lives, and just plain stupid to expect that the machinery of control you created would never fall into your political enemy’s hands.

I find these photos surprisingly compelling

Breaking news via Zero Hedge

EU LAWMAKERS APPROVE AMENDMENT TO END USE OF CREDIT RATINGS

It is always amazing to me that so many people view the government as a reasonable fix for perceived failures in private accountability systems.  Government officials are the worst about avoiding accountability.

Update:  The point that Basel II/III has big discrete jumps in capital requirements for small shifts in bond ratings is a reasonable observations.  Smoothing this out makes sense, but there is more than this that needs to be fixed in the Basel requirements (particularly the now largely dated idea that any assets are "risk-free"), which played a huge but largely unsung role in inflating the demand in the last decade for AAA rated mortgage bonds.

Most folks, by now, know to be suspicious of this kind of thing.  My wife is looking at buying a high-end sewing machine (e.g. a Bernina).  Apparently, these machines along with high-end bikes are a hotbed for scam artists.  The story is almost always the same - I had to leave the country suddenly, and am selling my machine which I left with an escrow company in the US.

Example 1, person supposedly in Italy

Example 2, person supposedly in Spain

Both suggested escrow companies, but in both cases the escrow companies smelled bad.  Here was one example link the "seller" sent us.  This is unbelievably sketchy, merely a forum web post rather than an actual web site.  Google searches quickly demolished the credibility of the escrow suggestions, and when we suggested an escrow company we knew to be legit, emails from the sellers ended.