Apologies to readers for being a day late to this.

Whitney notes that “core fundamentals” inside the banks are terrible, that they’re still very much on “life support,” and that they’re “kicking the can down the road.”

Besides house prices, she also sees the stock market falling back from here.

There’s much more in the clip.

Two weeks ago, Judge Jed Rakoff refused to approve the $33 million settlement between Bank of America and the SEC. He said he wanted more facts and ordered the parties to file briefs to that effect by today.

BofA published its brief earlier this afternoon. I’m reserving my opinion until I’ve had a chance to wade through the whole thing. In the meantime, I thought some readers might want to see it (click “more” below).

There are three docs: The final submission along with two affidavits, one from Stanford law professor Joseph Grundfest, the other from Dewey and LeBoeuf’s Morton Pierce (who got paid the tidy sum of $1,090 per hour for his work).

St. John’s Professor Anthony Sabino offers the following initial comments:

1. The Joe Grundfest Affidavit signifies that BofA is not fooling around.

Getting Joe Grundfest to give an affidavit is like sending up Derek Jeter to hit in the World Series—he’s “clutch.”  Grundfest is one of the greatest scholars of his generation in the securities law field….His name alone lends a gravitas to what he has to say.  Judge Rakoff will respect that.

2. The Grundfest Affidavit, particularly Para. 36.

Grundfest takes the critical step of pointing out the very powerful defenses available to BofA, essentially arguing that the gov’t could never win, and the Bank is settling this matter early rather than spend resources to litigate to a foregone conclusion, i.e., they would win anyway, but it’s cheaper to settle.  That is often the gravamen of any settlement, so it’s important that a scholar as notable as Grundfest spells it out, apparently something that was lacking the first time out.

3. Substantial likelihood Judge Rakoff will now be satisfied, and settlement will be approved, BUT there is a slim chance the Judge may still hesitate, because it was reported that at the hearings the Judge wanted disclosure about individuals and their individual actions.   From what I see of the BofA side, not much of that, so unless the SEC addresses that, the Judge may still ask questions.

But overall, I see this going through now.  I would not bet against the side with a Grundfest affidavit.

The SEC hasn’t filed its brief yet; I will share that one when it hits.

At the moment, there isn’t another public hearing on the schedule.  According to Rakoff’s office, if the judge decides to schedule another one, it will come after response briefs are filed on September 9th.

(more…)

A gap in the output gap (Alphaville)  Tracy Alloway notes a key problem of basing monetary/fiscal policy on the idea that there’s “slack” in the economy.  Just because GDP reached a certain high thanks to credit-fueled over-consumption doesn’t mean that we can spend and print with impunity until we get back to that level.

usdebtclock.org Brilliant.

Ford posts $2.3 billion profit (WSJ)  One-time items helped a lot.  “Ford Motor Co. returned to profitability in its second-quarter and slowed its cash burn amid speculation that it may issue more equity to reduce its debt.”

Wall St. jacks up pay after bailouts (WaPo)  Banker bonuses are on track to beat those received during the height of the bubble.

Mayors, Rabbis arrested in NJ corruption probe (Reuters)

Existing Home Sales Anaylzed, Part 1 and Part 2 (CalculatedRisk)  Nobody in the blogosphere analyzes home sales data better than CR.  Don’t think the slight fall in inventories is necessarily positive.  Lots of bank-owned properties are being kept off the market.  And plenty of folks who want to sell are waiting for a better market.  Inventories are going to remain elevated for some time.

Icahn on retention bonuses (Icahn report)  Retention bonuses are “another word for extortion” and Icahn knows all about extortion!

Naked girls plow fields for rain (Reuters)  “Farmers in an eastern Indian state have asked their unmarried daughters to plow parched fields naked in a bid to embarrass the weather gods to bring some badly needed monsoon rain, officials said on Thursday.”

CIT rejected GE financing (Bloomberg)  Wondering why so many lenders fell all over themselves to provide CIT’s stopgap funding late last week?  First of all because the terms were usurious.  Because it gives them a leg up on providing debtor-in-possession financing when the company finally does file for bankruptcy.  DIP financing is incredibly lucrative.  The interest rates are high and  you jump to the front of the line to be paid back.  Low risk, high reward.

LAX parking lot is home away from home for many airline workers (LA Times)  “Buffeted by their industry’s turbulence, airline employees save money by living part time in a motor home colony at LAX.”

GE Capital “positions” self to “exit” TLGP (GE press release)  Be careful not to step in the bullsh*t here.  GE’s plan to “exit” TLGP is to stop issuing short-term paper, so the $17 million they’ve issued thus far will roll off over the next 9 months.   But they’ve already issued $51 billion of long-term debt.  And they have $14 billion left of capacity to issue more long-term debt, which they clearly intend to use.  Bottom line:  GE will continue to be the largest recipient of bailout funding via FDIC’s debt guarantee program.

A city without a grocery store chain (CNN Money)  Not too hard to guess which one…

The Fed’s currency swaps (Jesse)  In past weekly posts regarding the Fed’s balance sheet, I’ve noted the fluctuations in currency swap lines the Fed has with foreign central banks.  This post explains what these are.

Morgan Stanley sets aside 72% of revenue for bonuses (Bloomberg)  That’s a higher percentage of revenue than Goldman….

Amid protests, Cal State Trustees OK 20% fee hike (CBS5)  Students protesting don’t realize they’ve enjoyed a discounted ride for a long time (see last post on Harvard…).  There’s just no money to subsidize their education.  This reminds me of protests that hit Ireland a few months ago (that have continued) when it became clear their national government had to make draconian cuts in order to balance its budget.  We’ll be forced to make similar draconian cuts in the U.S. before too long.  When those cuts come, Americans are likely to behave as naively as the Irish did, pretending that protests will somehow turn up cash to pay unpayable bills.

Actor Stephen Baldwin files bankruptcy (Reuters)

Funny signs (funnyjunk.com)

Ron Paul confronts Bernanke with some of his toughest, and most cogent, rhetoric to date…

CIT buys time, but fate rests with regulators (WSJ)  As I noted yesterday in my column, the ploy for CIT is to finagle a backdoor bailout.  It can’t get explicit government backing for its debt, so it wants to sell more brokered deposits (which are FDIC insured of course) in order to fund its business.  BTW, the stock was down big in early trading today as investors realized yesterday’s “rescue” is just a stopgap.

VIDEO:  The Ascent of Money (PBS, ht JW)  A fascinating documentary series.  Long but worth it (so far!).  Watch it online at this PBS website.  “Economist and historian Niall Ferguson traces the evolution of money and demonstrates that financial history is the essential back-story behind all history.”

Stores go dark where buyers once roamed (NYT)  …as New Yorkers have drastically cut back, the shops that line the streets, from chain outlets to family-run shops, have started to disappear….

Gay marriage and the constitution (WSJ)  A brilliant op-ed by one of the country’s top lawyers.  This man knows how to make an argument.

StockLemon goes after VistaPrint (Citron Research)  These guys are typically right when it comes to questioning business models.  But their ability to predict stock declines is mixed.  Frequently they write up companies that are too small to be able to short and/or the short interest is so high it makes no sense to take a position.  Neverthless, if you’re searching for short ideas, these guys are a decent source.

USDA: 750k pounds of ham for $1.2 million (TheHill)  This made news yesterday b/c Drudge linked to an invoice on recovery.org showing the government paid up for ham (about 2x what similar products cost at supermarkets).  The big problem here is overpaying in order to, as the administration puts is, “provide a modest economic benefit” to suppliers.  Ugh.  Instead of leveraging the volume of its purchases in order to secure better pricing, the government is finding excuses to shovel money out the door.  All financed with debt that will have to be paid back.  On the bright side, it’s great to see some transparency here.  I like all the nitty gritty detail being provided by contract so that purchases can be criticized.

Three myths about the Consumer Financial Product Agency (Elizabeth Warren)  Writing at Baseline Scenario, Warren argues why we need a CFPA:  “The key principle behind the new agency is that disclosure that runs on for pages is not real disclosure—it’s just a way to hide more tricks.” Indeed.

How the media would cover a moon-landing today….

(Send link, pics, vids to optionarmageddon at gmail)

Financial innovation vs. consumer protection (Robert Shiller)  Ugh.  This is a pretty terrible op-ed from an economist who thinks he understands banking.  He doesn’t.  The thesis that financial innovation benefits society can be dispatched with two deep thoughts.  One from Martin Mayer, who has said that financial innovation just means finding new ways to do what the old rules prohibit.  And one from James Grant, who argues that while innovation in science is cumulative, innovation in finance is cyclical.  The bottom line is that financial innovation primarily benefits financiers.  The bottom line is that a consumer protection agency is quite sensible.  No, I don’t like subjecting the free market to unnecessary rules and regulations.  But if this credit debacle has taught us anything it’s that the free market is broken.  Sensible rules will help fix it.

Cocksure: banks, battles and the psychology of overconfidence (New Yorker)  Malcolm Gladwell’s latest.  Always a fun read.

Is GLD a good deal (Hard Asset Investor)  A must-read for gold investors, particularly the last section.

Fiscal Ruin of the western world beckons (Evans-Pritchard) He argues that we need to cut spending, and offset the deflationary effects with monetary stimulus.

California’s budget gap won’t stay closed for long (Reuters)  The moral of the story is it’s better to make cuts sooner rather than later…

Governors fear Medicaid costs in health plan (NYT)  Governors, regardless of party, are opposed to Obama’s health care plans.  It would stick them with much higher costs at a time when they’re already facing yawning budget deficits.

The real price of Goldman’s giganto profits (True Slant, ht Geoffrey V.)  Matt Taibbi keeps up the heat on Goldman.

Moody’s: CRE prices down 16% in two months (CalculatedRisk)  16% in two months?  That’s a CRAZY rate of decline.  House prices are down 32% from the peak, but that’s over three years.  I’m going to look into this….

As boom times sour in Vegas, upward mobility goes bust (WSJ)

CIT’s Peek may be paid ahead of Treasury in case of bankruptcy (Bloomberg)  TARP money came in the form of preferred stock, which is junior in the capital structure to both employees and creditors.  Those folks get paid out before others when bankruptcy divides up the pie of assets.  Peek is owed $14.7 million if terminated or there’s a change in control.  He’s likely to get that money before taxpayers get a dime of their $2.3 billion of TARP preferred, which is now effectively worthless.  Not bad pay for having driven a company into the groun

What went wrong with economics (Economist)  and On the Unwillingness of Economists to recant (Naked Capitalism)  I’m linking to the Economist piece b/c it’s a decent take-down of the economics profession.  The glaring omission is that Austrians, especially those who focus on Minsky’s Financial Instability Hypothesis instead of Keynesianism and/or efficient market theory, most certainly got it right.  What this article should say is that the crisis demonstrates not only the bankruptcy of neo-classical economics, but the superiority of the Austrian school.  The Naked Capitalism link has a good anecdote that demonstrates how far up their own behinds most economists’ heads remain.

Foreigners still buy U.S. assets, but only the most liquid ones (CFR)  Lots of great data.

Satyajit Das weighs in on derivatives regulation (Naked Capitalism)  Another great one from Yves, she analyzes and links to this piece.  The takeaway is that the Obama administration isn’t coming down nearly hard enough on the OTC derivatives market, not if it wants to eliminate systemic risk.

Security Savings Bank: not so solid ground (Bank-Implode)  More evidence that OTS is totally feckless.

Another Goldman appointment in the Obama administration (WSJ)

New pictures of moon landing site (Discover Mag)  Pretty cool.

Why does anyone still listen to this guy?

More secret than sensible (WashTimes)  Walker Todd and Bill Ford argue that the Fed’s balance sheet is terrifically overlevered relative to underlying capital.  Once upon a time, when assets were held entirely in Treasuries, this wouldn’t have been so alarming.  Today, a good chunk of the Fed’s assets are in toxic securities.  And because the Fed doesn’t keep its books according to GAAP, it doesn’t take loan loss reserves against these assets.

The AEI vs. the real world (Baseline Scenario)  James Kwak calls out Peter Wallison, who is among the Republican appointees to the new panel charged with investigating the financial crisis, for his rigidly ideological defense of financial innovation.  The one big point in Wallison’s defense is that he’s complained about Fannie and Freddie dating back to the 80s.

57% tax looms for NYC’s top earners (NY Post)

Brooksley Born is back! (speaker.house.gov)  The former chairwoman of the CFTC, who got railroaded by Summers/Greenspan/Rubin when she tried to regulated OTC derivatives, was appointed to the newly formed Financial Crisis Inquiry Commission.  This is the committee that Wallison was also appointed to.  My guess is it won’t amount to much, partisan bickering is more likely on this commission than, say, the 9/11 commission.

Rein in insane health costs (David Walker)  The former Controller General at GAO, and the guy featured in IOUSA, pens this op-ed about the potentially ruinous growth in health care costs.  He’s a non-partisan guy and he’s very worried about plans to expand health care coverage before we address the more fundamental problem of the cost of delivering services.

Why are cheap airlines so cheap? (Flowing data, ht NG)  An interesting chart.

Lessons for the future (VoxEU)  Economist Guido Tabellini has some ideas for the world’s financial future.

Twitter vitals leaked (TechCrunch)  The revenue estimates appear to be placeholders.  The company has no revenue model yet so even they can’t gauge the cash that will come to the top line when they start selling stuff.  More interesting is the data about cash in the bank and expenses.  That gives us an idea of Twitter’s burn rate and when they’ll have to do their next capital raise.

7 personal financial miracles (Intuit)  Maybe this could be you.

Once-trendy crocs could be on their last legs (WaPo)

A lot of penguins (pic)

Wells Fargo sells $600 million of distressed assets at 35 cents on dollar (Edward Harrison)  Imagine if they tried to sell their book of home equity loans and option ARMs…

The sound of recession, Salvation Army bells in July (True Slant)  Leaving my office yesterday in Times Square I noticed a bell ringer on the corner of 42nd street and 7th Ave, which I thought was pretty odd.

Coalition to attack plan for Fed powers (FT)  The Fed has proved to be a terrible regulator, probably because its quasi-private status makes it an arm of the financial sector more than an arm of the government.  This isn’t necessarily bad.  Do we really want Congress in charge of the money supply?  Can you imagine how much worse they’d handle it?  But if the government is going to root out systemic risks, it needs a body totally independent of the banking system to do that.

Mortgages are now a bank’s best friend (NYT)  Banks are taking the Fed’s cue to reflate the bubble.

Online bartering grows (Inc)

Shining results aren’t solid gold (WSJ)  Goldman is making lots of money, but taking lots of risk to do so.  And why shouldn’t they?  They’re too big to fail!

Republican chart of Democratic health care plan (docs.house.gov)  To be fair, the biggest health care boondoggle of the last 20 years may have been the Medicare drug plan, which Bush signed into law.  At the same time, it’s important to question the wisdom of creating a gigantic new federal bureaucracy to operate our health care system.

Lenny Dykstra’s financial career….

The Billyburg Bust (NY Mag)  A fascinating and detailed look at the real estate bust in my old neighborhood of Williamsburg, Brooklyn.

Springtime for German dollar borrowing (Barron’s)  Germany holds billions worth of dollar-denominated reserves and is therefore unhappy with U.S. plans to debase its currency.  If the dollar is going to lose value, might as well issue dollar-denominated debt too.  If you can’t beat ‘em, join ‘em.

As foreclosures surge, Obama considers rental option (CR)  Does this mean folks could stop paying their mortgage and then negotiate a lease with the bank?

Morning madness, economic fundamentals (Denninger)  Karl explains why the math behind stimulus doesn’t add up.

NYPD wastes $1m on typewriters (NY Post)

Bridal bouquet brings down plane (BBC)  Oops.

Texas school district collects $100k in fines ($15 at a time) for errant cell phone use (ABC News)

Microsoft to step up Google battle (FT)  Interesting.  What kind of computing power will MSFT be willing to support off the desktop?  And how much will that undercut its traditional biz model?  I wonder why MSFT even feels pressure from Google to do cloud computing.  The spreadsheet and word processing software that Google offers for free over the internet is quite terrible.  It’s slow, kluge, and has a fraction of the capability of MSFT’s Office software.

To control bubbles, the fed must control itself (David Merkel)  “The present Fed holding action inflates assets not goods.  By offering financing to asset markets that are in disarray, it supports asset prices.  For now, none of that balance sheet expansion leaks out to the general public, and thus, little goods inflation.  But also, little true stimulus….the Fed should limit its powers to reliquify the economy, because sloppy efforts in the past 25 years produced the popped bubbles that we are now dealing with.  Better to leave policy tight longer, and not loosen so much in troubles.  Don’t worry, we might have to wait longer for recovery, but the recoveries will be sounder when they come.”

Why negative nominal interest rates miss the point (Scott Fullwiller, ht Yves)  A great take-down of Mankiw’s idea to tax people for holding currency.

Bank of America said to balk at paying backstop fee (Bloomberg)  “Bank of America, ranked first by assets and deposits in the U.S., ‘got a moral commitment for insurance without tendering a check, so it appears they got something for nothing,’ said Representative Brad Sherman, a California Democrat on the House Financial Services Committee. ‘If the government takes the risk, the government needs to be paid.’” A great point Rep. Sherman!

How to win friends and influence people (Baseline Scenario, ht CB)  Advice from James Kwak on how to build cred in the blogosphere.

Bloods street gang targets N.J. banks in high-tech $654k check scam (NJ.com, ht Rej)

China’s detention of executives rattles investors (NYT)  The high cost of doing business in China.

Unreliable Range Rover covered in warnings and dumped outside dealer (Telegraph)

Daniel Radcliffe aces interview with terrifed 11 year-old reporter (NY Mag)

(Send links/pics/vids to optionarmageddon at gmail.com)

Must-read—The Invisible Hand, trupmed by Darwin? (NYT)  Fascinating.  “By calling our attention to the conflict between individual and group interest, Darwin has identified the rationale for much of the regulation we observe in modern societies — including steroid bans in sports, safety and hours regulation in the workplace, product safety standards and the myriad restrictions typically imposed on the financial sector.” Interesting to read in conjunction with the next link….

IKEA is as bad as Walmart (Salon)  “A bricklayer or carpenter or teacher, a musician or salesperson, a writer of computer code — any and all can be craftsmen. Craftsmanship cements a relationship between buyer and seller, worker and employer, and expects something of both. It is about caring about the work and its application. It is what distinguishes the work of humans from the work of machines, and it is everything that IKEA and other discounters are not.”

Wells Fargo sues itself (Fox Business)  “In this particular case, Wells Fargo holds the first and second mortgages on a condominium, according to Sarasota, Fla., attorney Dan McKillop, who represents the condo owner.  As holder of the first, Wells Fargo is suing all other lien holders, including the holder of the second, which is itself.”

NYT to charge for content (Telegraph)  But it’s not clear how just yet.

To save newspapers, ban links to copyrighted material (Becker-Posner Blog)  I’m late to this, but it’s certainly interesting.  “Expanding copyright law to bar online access to copyrighted materials without the copyright holder’s consent, or to bar linking to or paraphrasing copyrighted materials without the copyright holder’s consent, might be necessary to keep free riding on content financed by online newspapers from so impairing the incentive to create costly news-gathering operations that news services like Reuters and the Associated Press would become the only professional, nongovernmental sources of news and opinion.” Ironic that Posner is creating his content on a blog, where readership depends on….links. 

Gibraltar Airport (SlightlyWarped.com)

Premier fighter jet has major shortcomings (WaPo)  The F-22 is vulnerable to rain.

Girl, texting, falls into open manhole cover.  And she wants to sue…

(Send links, pics, vids to optionarmageddon at gmail.com)

With sale of good assets, GM tries for fresh start (NYT)  GM made it through bankruptcy in 40 days.  Remember when everyone was saying that if GM filed for bankruptcy the world would end?  It didn’t.  Yeah they got lots of government help, but they were still able to divest billions of old liabilities.  So why don’t we remove the bailout facilities benefiting banks and busted homeowners and force them through the bankruptcy process?

AIG seeks clearance on bonuses (WSJ)  Are they kidding?  The fact that these guys still get a paycheck should be bonus enough.  If they want to leave, fine.  Let the company implode.  We need more creative destruction.

10 most broke states (ABC News)  This article notes that police overtime for the Michael Jackson memorial was estimated at $4 million.  That hits L.A.’s budget, not the state’s.  Still: Not helpful.

Whip Inflation Now (David Brooks)  “Health care inflation is not some optional side issue that can be left out of reform. It is the core problem that undermines the viability of the health care system, the federal budget and the economy as a whole. Maybe the administration will provide some last-minute solution in conference or somewhere else. But right now the prospects don’t look good.”

FDIC said to be unwilling to back CIT on risk (Bloomberg)  Kudos to Sheila Bair for saying no to someone (assuming she sticks to it).  If only other arms of the government would do this more often, we might actually clean up the financial mess rather than sweep it under the rug.

Lending industry attacks homeowner’s rights to legal help (PR Web)

Biff! Wham! Pow!  Times Sq. cops vs. superheroes (NY Post)  “Mommy, it’s Superman!”

If Swine Flu weren’t enough, now there’s Swine Ebola (Scientific American)  Actually, this isn’t a new virus.  Apparently pigs have always carried a strain of ebola that doesn’t infect humans.  Not yet anyway…

Of mice and monkeys: how to extend your life by a decade or two (Economist)

60 million stung by social networking ripoff (Independent)  I definitely got half a dozen e-mails from Tagged.  I don’t remember if I clicked on any.  Hope not.

Why didn’t I think of this?

(Send links, pics, vids to optionarmageddon at gmail.com)

Bailouts let banks carry loans at values that are too high (NYT)  This is a very important to understand.  A big way banks avoid writedowns is by expressing “intent and ability” to hold toxic loans to maturity.  They don’t want to sell at market prices, so they have intent.  And they have an implicit government guarantee against failure, so they have ability.

Lenny Dykstra files for bankruptcy (Inquirer)  Another Schadenfreude alert.  Dykstra reminds one of Donald Trump: great at self-promotion, not so great at substance.  Yeah, he was a good ballplayer.  But a lot of his “talent” was likely due to steroid abuse.  I remember Jim Cramer being interviewed for HBO profile of Dykstra called him one of the smartest guys he knew.

Sorry, not everything can be hedged (David Merkel)  “…often the amount of CDS created exceeds the amount of debt covered….I call this a gambling market, because there are parties where the transaction takes place where neither has a relationship to the underlying assets.  There is no risk transfer, but only a bet.  My view is such gambling should be illegal…”

Buffett backs second stimulus (ABC News)  We’re not going to clean up our mess of debt folks; we’re just going to blow another credit bubble.  Count on it.

Historical unemployment data (Northern Trust)  An interesting report from Paul Kasriel, but I wonder: How have the ways we measure unemployment changed?  Is it fair to compare today’s data with data from 80 years ago?  Maybe it is.  I don’t know.

Breaking down June retail sales (Real Time Econ)  A helpful interactive table.  The box of text to the right makes the presentation a little kluge, but the text is helpful for those interested in detail.

Slump visists summer hideaway for the rich (NYT)  The top of the market is also buckling substantially.

Treasury announces first PPIP investments (Reuters)  The numbers are far smaller than initially anticipated, thank goodness.  Every dollar spent as part of this program is a dollar wasted to bail out bank creditors.

Swiss workers want 2 more weeks vacation (Swiss Info)  Four weeks isn’t enough.

Real-life Captcha….

(Send links, pics, vids to optionarmageddon at gmail.com)

Who’s in charge of global health spending (Aid Watch)  One third of the money spent by the U.S. government on health-related development aid has vanished without a trace.  Perhaps it was spent on something useful, but who knows?

Lo-Fi (Nick Gogerty)  Methinks Nick would be a big fan of narrow banking…

Hybrid securities doomed six IL banks (WSJ)  Details about the IL banks that collapsed last week.  Agnes has some thoughtful comments.  BTW, narrow banking would also solve this problem.

In search of dignity (David Brooks)  George Washington lived by a code of dignified living that was lost long ago.  Brooks thinks Obama might resurrect it.

Tell Americans what they’re really paying for their food (Atlantic)  Food subsidies waste money.  That’s not a new argument.  But as long as we keep flushing money down that toilet, it’s not old either…

Is job retraining a waste of money? (NYT)  An interesting Labor Dept. study says yes.

An overview of the housing crisis and why there is more pain to come (T2 Partners)  An updated slide presentation.  I particularly like slide #20, Tilson’s “immutable laws of the universe.” (ht M. Winks)

Amenity: Giant Lizards (HeraldTribune)   “If you’re looking for a silver lining to the home-foreclosure story — and who isn’t? — the good news is that 8-foot-long Nile monitor lizards are taking over our abandoned properties.”

Cartesian personal ad (Craigslist)  Brilliant.

The best insults in Cricket (Independent)  #11: Ian Botham could always give as good as he got. When he came to the crease Aussie ‘keeper Rod Marsh said cheerfully: ‘How’s your wife and my kids?’ Botham is said to have replied: “The wife’s fine. The kids are retarded.”