Nov 29 2011
Our regular featured content-
These featured articles-
This is an Open Thread
Nov 29 2011
Crossposted from The Stars Hollow Gazette
Hank Paulson’s inside jobs
Felix Salmon, Reuters
Nov 29, 2011 09:55 EST
(I)n secret meetings, Paulson was hanging out with his old Goldman Sachs buddies, giving them invaluable information about what he was thinking in his new job.
…
Paulson had met with the entire board of Goldman Sachs in a Moscow hotel suite for an hour at the end of June 2008. He told them his views of the US and global economies, he previewed a market-moving speech he was about to give, and he even talked about the possibility that Lehman Brothers might blow up. Maybe it’s not so surprising that Goldman Sachs turned out to be so well positioned when Lehman did indeed do just that a few months later.Today we learn that the Goldman meeting in Moscow was not some kind of aberration. A few weeks later, on July 28 2008, Paulson met with a who’s who of the hedge-fund world in the headquarters of Eton Park Capital Management – a fund founded by former Goldman superstar Eric Mindich.
…
(W)e have no idea how many of these meetings there were, or how long they went on for – the only way that we ever find out about them is when reporters like Sorkin or Bloomberg’s Richard Teitelbaum manage to find a source who was in the meeting and is willing to talk about what happened.Given that it’s taken two years since the release of Sorkin’s book for the Eton Park meeting to be made public, it’s fair to assume that there were other meetings, too – possibly many others. Paulson was giving inside tips to Wall Street in general, and to Goldman types in particular: exactly the kind of behavior that “Government Sachs” conspiracy theorists have been speculating about for years. Turns out, they were right.
Paulson, says Teitelbaum, “is now a distinguished senior fellow at the University of Chicago, where he’s starting the Paulson Institute, a think tank focused on U.S.-Chinese relations”. I’d take issue with the “distinguished” bit. Unless it means “distinguished by an astonishing black hole where his ethics ought to be”.
So when is the indictment Mr. Holder?
Nov 29 2011
Cross posted from The Stars Hollow Gazette
This is your morning Open Thread. Pour your favorite beverage and review the past and comment on the future.
Find the past “On This Day in History” here.
November 29 is the 333rd day of the year (334th in leap years) in the Gregorian calendar. There are 32 days remaining until the end of the year.
On this day in 1963, one week after President John F. Kennedy was fatally shot while riding in a motorcade in Dallas, Texas, President Lyndon Johnson establishes a special commission, headed by Supreme Court Chief Justice Earl Warren, to investigate the assassination.
After 10 months of gathering evidence and questioning witnesses in public hearings, the Warren Commission report was released, concluding that there was no conspiracy, either domestic or international, in the assassination and that Lee Harvey Oswald, the alleged assassin, acted alone. The presidential commission also found that Jack Ruby, the nightclub owner who murdered Oswald on live national television, had no prior contact with Oswald.
According to the report, the bullets that killed President Kennedy and injured Texas Governor John Connally were fired by Oswald in three shots from a rifle pointed out of a sixth-floor window in the Texas School Book Depository. Oswald’s life, including his visit to the Soviet Union, was described in detail, but the report made no attempt to analyze his motives.
Nov 29 2011
Crossposted from The Stars Hollow Gazette
Report highlights Obama’s broken environmental promises
Posted by Suzanne Goldenberg, US environment correspondent, The Guardian
Monday 28 November 2011 17.37 EST
The steady stream of oil and coal industry lobbyists to Oira did not end when Bush left office – arguably it turned into a flood. Environmental regulations made up only 10% of Oira business in Bush’s time, but 36% of the office’s business was meeting with outside lobbyists.
Under Obama, Oira has dedicated more than half of its meetings, 51%, to discussing pending environmental regulations with industry lobbyists, the report says.
And for industry the meetings paid off – about as much under Obama as under Bush. Following those meetings with outsiders, Oira changed 84% of EPA rules during the Bush era. Depending on how you calculate it, the change rate was even higher under Obama. Oira changed 81% of environmental rules after meetings with lobbyists. But the change rate rises to 85% once all Oira decisions on environmental regulations are factored in.
…
Is there any chance that Obama is unaware of what Oira is up to? Rena Steinzor, the law professor at the University of Maryland who wrote the report, doesn’t think so. She notes that Sunstein is a longtime friend of Obama, who has for years advocated against government regulations.Obama will have to own those decisions – and the failure to live up to his election promises of 2008 to run a government that made decisions based on science and expertise, not political calculus.
“To us this is a sharp departure from what we were promised when this president was elected,” Steinzor said. “From sound practice what we really want is for the experts to be making decisions at government agencies – the toxicologists, the pediatricians, the geologists. That’s what modern government is supposed to be about, not having the decisions made by an office that is not accountable for what it does.”
But it’s not just Cass Sunstein, It’s Aust(eri)an Goolsbee as well.
Goolsbee Says U.S. Opponents of TransCanada’s Keystone Pipeline Are Naive
By Sean B. Pasternak, Bloomberg News
Nov 28, 2011 2:12 PM ET
“It’s a bit naïve to think the tar sands would not be developed if they don’t build that pipeline,” said Goolsbee (former chairman of the White House Council of Economic Advisers), speaking today in Toronto at the Economic Club of Canada. “Eventually, it’s going to be built. It may go to the Pacific, it may go through Nebraska, but it’s going to be built somewhere.”
Oh, who’s being naive Kate?
The stranded oil sands: A worst-case scenario
Claudia Cattaneo, Financial Post
Oct 31, 2011 9:39 AM ET
“Everybody in the industry is thinking about this,” said Bob Dunbar, president of Strategy West Inc., an oil sands consultancy based in Calgary. “Keystone XL is not the only solution, but it is a very elegant solution and it really would have an impact on the industry if it doesn’t proceed in a timely way.”
…
Industry growth plans would also be in doubt. Aggressive expansions may be revisited if there is no way to sell the oil. According to a new study by international petroleum consultancy Purvin & Gertz Inc., existing pipelines to U.S. markets could run out of space by 2013 to 2016, depending on how quickly oil sands production grows. In fact, after looking at all pipeline options, the consultancy concluded that additional capacity would be needed to accommodate oil sands growth by 2017 to 2019, even if Keystone XL is in operation.
Keystone XL: Game over?
raypierre, RealClimate
2 November 2011
(O)il-in-place is not the same as economically recoverable oil. That’s a moving target, as oil prices, production prices and technology evolve. At present, it is generally figured that only 10% of the oil-in-place is economically recoverable.
…
Currently, most of the energy used in production comes from natural gas (hence the push for a pipeline to pump Alaskan gas to Canada).
…
A knock-on effect of oil sands development is that it drives up demand for natural gas, displacing its use in electricity generation and making it more likely coal will be burned for such purposes.
The evil twin of the Keystone XL oil pipeline
By Michael Byers, Salon
Saturday, Oct 15, 2011 11:59 AM
The U.S. State Department has accepted assertions that the production of heavy oil will increase regardless of whether Keystone XL is built, because the Northern Gateway pipeline would bring oil for shipment to China.
…
Canadians know better. Although the Canadian government supports Northern Gateway, and the government-appointed National Energy Board can be expected to approve, the same cannot be said of the First Nations (i.e. indigenous peoples) living along its path.
…
The Northern Gateway pipeline faces decades of litigation over indigenous rights before construction could begin. As former Canadian environment minister Jim Prentice told an Enbridge shareholder meeting in May 2011: “The reality on the ground is that the constitutional and legal position of the First Nations is very strong.”In the 1970s, opposition from First Nations postponed a proposed natural gas pipeline in the Northwest Territories, initially for 10 years. Four decades later, the line still has not been built. In November 2010, Murray Edwards, the vice-chairman of Canadian Natural Resources Ltd., said securing the necessary consensus on the Northern Gateway project would be “just as challenging.” He described the proposal as “very, very difficult.”
…
Fully 80 percent of British Columbians oppose Northern Gateway, and that public opinion has translated into political opposition. All four opposition parties in the Canadian Parliament – who together won 60 percent of the vote in the last federal election – are opposed to Northern Gateway and support an oil tanker ban.Another proposal, to expand the capacity of a 50-year-old conventional oil pipeline from Alberta to Vancouver and use it for tar sands oil, is likewise dead.
The current pipeline, named “Trans Mountain” and owned by Kinder Morgan, ends at a terminal in Vancouver’s upper harbor. The oil must be offloaded onto tankers there, then shipped through the “Second Narrows,” a shallow strait that is subject to strong tidal currents, and confined by the piers of a railway bridge. The Canadian Coast Guard has assigned the highest possible navigational hazard rating to the bridge.
(h/t Think Progress)
Nov 29 2011
Cross posted from The Stars Hollow Gazette
While Iowa Attorney General Tom Miller and his merry band of AG sell outs push for an agreement to settle the mortgage fraud, it looks like California Attorney General, Kamala Harris, is sticking to her plan to hold the worst of the abusers feet to the fire.
The Miller agreement, which is also being backed by US Attorney General Eric Holder, could result in an even smaller settlement than the $25 million and would still leave the banks open to legal claims in the states that do not sign on to the agreement. While California is the state with the largest number of foreclosures, not signing onto the agreement would mean that homeowners would have to wait longer for relief but, as AG Harris has stated, it “would allow too few California homeowners to stay in their homes…. After much consideration, I have concluded that this is not the deal California homeowners have been looking for.”
Ms. Harris has been under considerable pressure from the Obama administration, who has considered her a replacement for Eric Holder should Obama be reelected. However. many community organizations, unions and liberal groups have urged to her not to sign on to the Miller agreement unless there is a larger monetary settlement or, that failing, the states are allowed to prosecute the banks for crimes they may have committed. Neither of those two stipulations appears to have happened, nor are they likely.
Along with New York’s Eric Schneiderman, Delaware’s Beau Biden, Nevada’s Catherine Cortez Masto and a couple of other state attorney generals, Ms. Harris’s position is good policy for the state, as well as, good politics for her. She has stood by the people who put her in office, the people she will need to support her should she run for governor or the US Senate. We could use a few like her in that body.
Nov 29 2011
 Muse in the Morning |
Time for a break from poetry…in order to create some art.
| We are taught you must blame your father, your sisters, your brothers, the school, the teachers – but never blame yourself. It’s never your fault. But it’s always your fault, because if you wanted to change you’re the one who has got to change.
–Katharine Hepburn |
 Focus 2 |
Nov 29 2011
I’m substituting for TheMomCat today.
Our regular featured content-
These featured articles-
Nov 28 2011
Crossposted from The Stars Hollow Gazette
$7.7 Trillion in unsecured loans to the Too Big To Fail Accounting Fraud Banks on which they generated $13 Billion profit from the float between their .01% (free) interest borrowing costs and the usurious amounts they charged their customers.
Which they promptly paid out in bonuses and dividends and didn’t use to deleverage the toxic waste they are still carrying on their books as assets at full fictional value instead of marking to market at the 50% discount it deserves.
Umm, this is not news. It’s been blog reported for months now but perhaps this piece from Bloomberg with it’s fancy interactive graph will finally get it the attention it deserves. I’ll note their headline is designed to minimize the amounts involved and point out the total-
The amount of money the central bank parceled out was surprising even to Gary H. Stern, president of the Federal Reserve Bank of Minneapolis from 1985 to 2009, who says he “wasn’t aware of the magnitude.” It dwarfed the Treasury Department’s better-known $700 billion Troubled Asset Relief Program, or TARP. Add up guarantees and lending limits, and the Fed had committed $7.77 trillion as of March 2009 to rescuing the financial system, more than half the value of everything produced in the U.S. that year.
Some reports from around the web-
Employees at the six biggest banks made twice the average for all U.S. workers in 2010, based on Bureau of Labor Statistics hourly compensation cost data. The banks spent $146.3 billion on compensation in 2010, or an average of $126,342 per worker, according to data compiled by Bloomberg. That’s up almost 20 percent from five years earlier compared with less than 15 percent for the average worker. Average pay at the banks in 2010 was about the same as in 2007, before the bailouts.
Lobbying expenditures by the six banks that would have been affected by the legislation rose to $29.4 million in 2010 compared with $22.1 million in 2006, the last full year before credit markets seized up — a gain of 33 percent, according to OpenSecrets.org, a research group that tracks money in U.S. politics. Lobbying by the American Bankers Association, a trade organization, increased at about the same rate, OpenSecrets.org reported.
“Banks don’t give lines of credit to corporations for free,” he says. “Why should all these government guarantees and liquidity facilities be for free?”
In the September 2008 meeting at which Paulson and Bernanke briefed lawmakers on the need for TARP, Bernanke said that if nothing was done, “unemployment would rise — to 8 or 9 percent from the prevailing 6.1 percent,” Paulson wrote in “On the Brink” (Business Plus, 2010).
The U.S. jobless rate hasn’t dipped below 8.8 percent since March 2009, 3.6 million homes have been foreclosed since August 2007, according to data provider RealtyTrac Inc., and police have clashed with Occupy Wall Street protesters, who say government policies favor the wealthiest citizens, in New York, Boston, Seattle and Oakland, California.
Nov 28 2011
Crossposted from The Stars Hollow Gazette
The Tax Mess Deepens
By LAURA SAUNDERS, The Wall Street Journal
NOVEMBER 26, 2011
The tax code is wondrous for investors. Not only is the top rate on long-term capital gains 15%, but investors also can time gains and losses to minimize tax. Also, up to $3,000 of long-term losses can be deducted against ordinary income from wages or other sources, which are taxed at up to a 35% rate. Unused losses carry over to future years.
…
The current top rate of 15% on long-term gains and dividends is a historic low, and a new 3.8% tax on net investment income is set to take effect in 2013 for many joint filers.That tax will affect taxpayers with adjusted gross incomes of $250,000 or more (or $200,000 for single filers), and the levy applies to taxable interest, dividends, rents, some annuities, royalties and capital gains, including the sale of a house, after a $500,000 exclusion ($250,000 for single filers).
…
Sole proprietors and other businesses reporting on Schedule C of a personal return should check expanded write-offs that become less generous at the end of 2011.One provision allows an immediate deduction for up to $500,000 of qualified costs, which can be for a car, truck, computer, desk, chairs or other equipment, as long as it is purchased and placed in service before the end of the year. Small retailers may deduct up to $250,000 in leasehold improvements under this provision.
Another provision, “bonus” depreciation, is also changing. A favorite use is to take a full write-off of SUVs over 6,000 pounds in the first year.
…
Despite rampant rumors, this area (Estate and Gift Taxes) is expected to remain stable through the end of 2012. At that point, the estate tax is slated to snap back to its 2001 version, with a $1 million exemption per individual and a top rate of 55%.That is far worse for taxpayers than current law, which has a gift- and estate-tax exemption of $5 million per individual and a top rate of 35%.
…
Separate from the $5 million gift-tax exemption, any taxpayer may give anyone up to $13,000 of cash or property a year, free of gift tax. So if Ed and Edna have three married children and six grandchildren, they could give away up to $312,000 per year free of tax. If the property isn’t cash, the giver’s cost basis carries over to the recipient.In one twist, some taxpayers use this provision to forgive up to $13,000 of intrafamily loans a year. In another, a taxpayer may bunch up to five years of such annual gifts-$65,000 per donor-in one contribution to a “529 plan” that will be used for qualified education costs. The giver may withdraw principal free of penalty if needed.
