Control failures in terms of the housing market, reported in Reuters:

Critics of the system argue scores are full of errors and dangerous to use alone. They also are easy to manipulate. A cottage industry has thrived helping prospective borrowers raise their scores without changing their underlying ability to repay a mortgage.

“There are fundamental flaws in the system because people can manipulate characteristics to get the FICO score they would like to see,” said Kevin Jackson, a strategist who follows mortgages at RBC Capital Markets in New York. The system can be played “to come up with the kind of mortgage for people who really couldn’t afford a house.”

Point of trivia, I used to play in a band with one of the authors of the article.

Another point of trivia, I was recently talking with a seasoned computer security professional who said “I have no sympathy for those people who signed up for high risk mortgages. They knew the risks and now they must pay the price.”

If only it were true. The fact is actually that the “risk” is not only obscure, but seems to have been actively manipulated by those who intended to shift all liability to the less fortunate with little/no concern for macro stability/impact.

I don’t believe regulation in innately good, but I also don’t believe that babies should be taken from their mother, dropped on a street corner and left to fend for themselves to prove the benefits of a free-market. A certain amount of guidance and care to ensure a stable family, or even society, is not a bad thing.

Those who want an absence of regulation are often the same ones who (believe they) are the ones most likely to profit from it while avoiding the costs, so conflict-of-interest issues must always be minded.

Rhymes, eh?

Apparently the famous American movie star was unaware that his vials of muscle enhancing drugs are a controlled substance in Australia. He thus had an unpleasant surprise when he disembarked from his private jet and was found carrying 48 vials of Chinese GeneScience pharmaceuticals.

Nothing terribly surprising about a US movie star unfamiliar with a foreign country, I suppose, but the part of story that caught my attention was his lawyer’s defense:

Boulten said Stallone was taking both substances under medical supervision.

“This is not some back-alley body builder dealing covertly with some banned substance in some sort of secret way,” he said. “This was a legitimate medical condition being treated by doctors of the top ranking order in the west coast of the United States.”

Oh the irony. Not only was Stallone carrying a Chinese drug, but the US is hardly considered a pinnacle of scientific research or engineering in the world worthy of respect. Here is how Australian medical literature often refers to American practices:

The pharmaceutical industry reacted vigorously to the threat posed by the NIH advice to their $8 billion a year antacid market by making a swift deal with the U.S. Federal Drug Administration (FDA) to allow their antiulcer drugs to be sold without a prescription. With this master stroke the drug companies freed medical doctors from the ethical burden of prescribing ineffective, costly drugs while at the same time maintaining or perhaps even expanding their market among the broad segment of the population who had never heard of H. pylori much less the 1994 NIH advice. Not surprisingly, the drug company executive who negotiated the deal with the FDA was later named one of the 25 most successful business men in a 1995 survey by Business Week.

Success from freedom from ethics? Stallone has played the big dumb violent guy so well in the popular media that he is actually a caricature of America’s new place in the world — rich dumb violent guys who want things their way with little/no respect for laws. Shoot first (pun intended) ask questions later. It seems customs officials were not impressed:

“You have not been validly prescribed the goods by a medical practitioner for any medical condition suffered by you and for which the goods are recognised medical treatment,” Stallone was told in a customs document submitted to the court.

They seem to have a higher standard for prescriptions down under. Back to the lawyer’s comment, who in their right mind would demand Australians of all people must pay homage to pharmaceuticals prescribed in the US when Australians have uncovered so much of the corrupt underpinnings of US medicine?

Also, what does Stallone’s lawyer mean by “some sort of secret way”? The AP gives some key details:

Three days later, Stallone threw four vials of the male hormone testosterone from his Sydney hotel room when customs officials arrived to search it, prosecutor David Agius told the court. […] Agius said Stallone had demonstrated a “consciousness of guilt” by throwing the testosterone from the hotel.

I can just see Stallone’s reaction: “What, you don’t throw your trash off the balcony in Australia either? Who can live with all these rules?” At some point the ignorance stops being funny, usually when it starts to threaten the welfare of others, even if the perpetrator is making good money (or avoiding cleanup/maintenance costs) from their violations.

The so called “top ranking order” the lawyer tries to reference appears to be in grave danger as indignant fools who profit from folly and corruption threaten to become become America’s dominant image abroad.

Stallone’s stupidity will probably have less impact than Wolfowitz’s, but you never know:

Wolfowitz, who has the morals and dignity of a feral dog, finally put out a memo today taking “full responsibility� (he’s not quitting) for brazenly stealing money from the world’s poor to pay for his adulteress. The World Bank’s board will fire him later this week.