Juggling Dynamite

Volkswagen’s emissions crisis deepens today as the company admits as many as 11 million vehicles world-wide could be affected by the software they allegedly used to cheat emissions tests. VW stock is down 45% year to date and the company is setting aside billions for upcoming legal fees and fines.

CEO Martin Winterkorn says the company is cooperating with authorities and is very sorry. Thanks Martin, but if evidence supports intentional fraud, then executives must be disgorged of all executive bonuses in the offending years and those who knew about the crimes should do jail time. Fraud has become a very profitable way of doing business. The time of allowing criminal actors to hide behind corporate fines must end.

On the upside, this is all just a million more reasons for moving the world to electric cars.  The time is now.  See: VW emissions scandal leads to 11 million cars:

Further details of the issue emerged as German and French officials called for investigations into Volkswagen to be widened to include the entire auto industry, as regulators begin to ponder whether such deception is more widespread.

Concerns that the scandal could lead to broader damage for the industry hit the shares of car companies across Europe, with shares of Daimler AG, BMW and French car makers Renault SA and PSA Peugeot Citroën all suffering sharp falls.

The state of Lower Saxony, a major Volkswagen shareholder with 20% of the car maker’s voting stock, said Tuesday that the emissions allegations raised doubts about tailpipe data published by all car makers.

Thanks to the leadership of Elon Musk and Tesla, the smartest companies (and people) are finally embracing the future.  See: Apple speeds up electric-car work:

Apple Inc. is accelerating efforts to build an electric car, designating it internally as a “committed project” and setting a target ship date for 2019, according to people familiar with the matter.

The go-ahead came after the company spent more than a year investigating the feasibility of an Apple-branded car, including meetings with two groups of government officials in California. Leaders of the project, code-named Titan , have been given permission to triple the 600-person team, the people familiar with the matter said.

Nice to hear from sober thinkers.  There aren’t a lot of us left.  This was taped before the Fed chickened out again.

Universa Investments CIO Mark Spitznagel on the markets and the Federal Reserve.  Here is a direct video link.

“Great myths die hard. And I think what we’re witnessing today is the slow death of one of the great myths of human history: this idea that centrally planned command economies work, that they’re even feasible, and that they can be successful.

It’s one of these enigmatic mythologies of the last hundred years in particular that we’ve been grappling with, and here we are today yet again thinking about this…

There was this notion not long ago of the Bernanke put, the Greenspan put. It was sort of a dirty thing to admit that it was part of our investment strategy. But today, it’s everyone’s investment strategy.

…I think that another generation will look back and say ‘how could you have made that mistake all over again? How could you have failed to understand Hayek’s notion of the fatal conceit, that central planners can’t do better than the dispersed knowledge and signals of free market processes?'”