Tag: Financial crisis

The Looting of American Workers’ Pensions

Cross posted from The Stars Hollow Gazette

In his latest expose at Rolling Stone, contributing editor Matt Taibbi reports how Wall Street is making millions in profits looting the pension funds of American workers. He opens the piece with an outline of Rhode Island Treasure Gina Raimondo’s Rhode Island Retirement Security Act of 2011 and how state workers ended up funding their own “disenfranchisement”

What few people knew at the time was that Raimondo’s “tool kit” wasn’t just meant for local consumption. The dynamic young Rhodes scholar was go here allowing her state to be used as a test case for the rest of the country, at the behest of powerful out-of-state financiers with dreams of pushing pension reform down the throats of taxpayers and public workers from coast to coast. One of her key supporters was billionaire former Enron executive John Arnold – a dickishly ubiquitous young right-wing kingmaker with clear designs on becoming the next generation’s Koch brothers, and who for years had been funding a nationwide campaign to slash benefits for public workers.

Nor did anyone know that part of Raimondo’s follow link strategy for saving money involved handing more than $1 billion – 14 percent of the state fund – to hedge funds, including a trio of well-known New York-based funds: Dan Loeb’s Third Point Capital was given $66 million, Ken Garschina’s Mason Capital got $64 million and $70 million went to Paul Singer’s Elliott Management. The funds now stood collectively to be paid tens of millions in fees every single year by the already overburdened taxpayers of her ostensibly flat-broke state. Felicitously, Loeb, Garschina and Singer serve on the board of the Manhattan Institute, a prominent conservative think tank with a history of supporting benefit-slashing reforms. The institute named Raimondo its 2011 “Urban Innovator” of the year. [..]

Today, the same Wall Street crowd that caused the crash is not merely rolling in money again but aggressively counterattacking on the public-relations front. The battle increasingly centers around public funds like state and municipal pensions. This war isn’t just about money. Crucially, in ways invisible to most Americans, it’s also about blame. In state after state, politicians are following the Rhode Island playbook, using here scare tactics and lavishly funded PR campaigns to cast teachers, firefighters and cops – not bankers – as the budget-devouring boogeymen responsible for the mounting fiscal problems of America’s states and cities.

Not only did these middle-class workers already lose huge chunks of retirement money to huckster financiers in the crash, and not only are they now being asked to take the long-term hit for those years of greed and speculative excess, but in many cases order 50 mg lasix without prescription they’re also being forced to sit by and watch helplessly as Gordon Gekko wanna-be’s like Loeb or scorched-earth takeover artists like Bain Capital are put in charge of their retirement savings.

In a preview of the article, Matt outlines three reasons to follow this scandal:

1)     http://cinziamazzamakeup.com/?x=dove-comprare-vardenafil-online Many states and cities have been under-paying or non-paying their required contributions into public pension funds for years, causing massive shortfalls that are seldom reported upon by local outlets.

2)     As a solution to the fiscal crises, click here unions and voters are being told that a key solution is seeking higher yields or more diversity through “alternative investments,” whose high fees cost nearly as much as the cuts being demanded of workers, making this a pretty straightforward wealth transfer. A series of other middlemen are also in on this game, siphoning off millions in fees from states that are publicly claiming to be broke.

3)     Many of the “alternative investments” these funds end up putting their money in are hedge funds or PE funds run by men and women who have lobbied politically against traditional union pension plans in the past, meaning union members have been giving away millions of their own retirement money essentially to fund political movements against them.

(all emphasis is mine)

Last week, Matt joined Amy Goodman and Juan González on Democracy Now! to discuss how hedge funds are looting the pension funds of American workers



Transcript can be read here

“Essentially it is a wealth transfer from teachers, cops and firemen to billionaire hedge funders,” Taibbi says. “Pension funds are one of the last great, unguarded piles of money in this country and there are going to be all sort of operators that are trying to get their hands on that money.”

The Financial Crisis: The Ratings Agency Did It In The Back Room

Cross posted from The Stars Hollow Gazette

Earlier this year, the Justice Department brought a $5 billion fraud law suit against the ratings agency Standard and Poors for knowingly giving triple “A” ratings to financial products the agency’s analysts understood to be unworthy. The financial crisis that began in 2007 was mostly caused by those fraudulent ratings. Senators Al Franken (D-MN) and Roger Wicker (R-MI) worked together on an amendment that was included in  Dodd-Frank (pdf) to bring accountability and transparency to the ratings process. The amendment also required that the Securities and Exchange Commission conduct a study, that study has been completed (pdf). It found that there were “inherent” conflicts of interest in the system contributed to the 2008 crisis.

Contributing editor and investigative journalist for Rolling Stone Matt Taibbi published an in depth look at the ratings agencies and how ratings agencies like Moody’s and Standard & Poor’s helped trigger the meltdown with new documents. The documents surfaced from two lawsuits that files against S&P by  a diverse group of institutional plaintiffs with King County, Washington, and the Abu Dhabi Commercial Bank. The plaintiffs claimed that S&P, along with Morgan Stanley, fraudulently induced them to heavily invest in a pair of doomed-to-implode subprime-laden deals. Matt calls these new revelations the “Last Mystery of the Financial Crisis:

What about the ratings agencies?

That’s what “they” always say about the financial crisis and the teeming rat’s nest of corruption it left behind. Everybody else got plenty of blame: the greed-fattened banks, the sleeping regulators, the unscrupulous mortgage hucksters like spray-tanned Countrywide ex-CEO Angelo Mozilo.

But what about the ratings agencies? Isn’t it true that almost none of the fraud that’s swallowed Wall Street in the past decade could have taken place without companies like Moody’s and Standard & Poor’s rubber-stamping it? Aren’t they guilty, too?

Man, are they ever. And a lot more than even the least generous of us suspected.

Thanks to a mountain of evidence gathered for a pair of major lawsuits, documents that for the most part have never been seen by the general public, we now know that the nation’s two top ratings companies, Moody’s and S&P, have for many years been shameless tools for the banks, willing to give just about anything a high rating in exchange for cash.

In incriminating e-mail after incriminating e-mail, executives and analysts from these companies are caught admitting their entire business model is crooked.

Matt joined MSNBC’s All In host Chris Hayes to discuss how these newly-revealed documents are “the smoking gun of the financial crisis” revealing the corruption and dishonesty at the core the industry.

ROTFLMAO: Tax the Banks to Punish Obama

Cross posted from The Stars Hollow Gazette

Seriously, you can’t make this stuff up.

Dave Camp Bank Tax Bill Would Punish Obama-Friendly CEOs

by Zach Carter and Ryan Grim, The Huffington Poat

WASHINGTON — House Ways and Means Committee Chairman Dave Camp (R-Mich.) is considering legislation that would significantly increase taxes for the nation’s largest banks while providing tax breaks to struggling homeowners. [..]

The bill would significantly strengthen the Volcker Rule, which bans banks from speculating in securities markets with taxpayer money. The Volcker Rule’s implementation has been delayed as bank lobbyists have flooded regulatory agencies in Washington, pillorying the ban with loopholes. Hefty tax burdens for proprietary trading would reduce bank incentives to engage in the risky activity.

Camp’s legislation also would permanently establish a homeowner aid plan advocated by former Rep. Brad Miller (D-N.C.), who retired this month. When banks grant homeowners mortgage relief, the IRS considers the debt-reduction taxable income. As a result, struggling homeowners can face an unmanageable tax burden. A $50,000 debt reduction can spark an $18,000 tax bill — money that borrowers struggling to avoid foreclosure simply do not have. Miller successfully lobbied to include a one-year fix on the tax policy in the fiscal cliff deal. Camp’s legislation would permanently end the tax policy.

Steve Benen at The Maddow Blog aptly notes that “hell hath no fury like a House Ways and Means committee chairman scorned” but points out Camp’s “big deal” won’t impress the bank lobby:

Camp sent an angry letter to the Business Roundtable a month ago, and now Republicans are saying if there must be new revenue, it should be “on their backs.”

How big a deal is Camp’s bill? I think it’s safe to say the bank lobby won’t be impressed.

   Camp’s new bill would get link harvest government revenues from complex financial transactions involving derivatives, some of which figured prominently in the 2008 banking collapse. Although the 2010 financial reform legislation would curb some excesses in the derivatives market, the legislation isn’t yet fully implemented, and leaves much of the market unregulated. Financial reform advocates have urged new taxes on derivatives to deter excessive risk-taking by big banks. […]

   Camp’s bill would http://cinziamazzamakeup.com/?x=viagra-generico-100-mg-online-prezzo-piu-basso-a-Firenze establish a new tax regime for derivatives, requiring banks to declare the fair market value of the products at the end of each year. Any increase in value would be considered corporate income, subject to taxation. It’s a more aggressive tax treatment than Wall Street enjoys for either derivatives or for trading in more traditional securities. […]

   The bill would significantly source url strengthen the Volcker Rule, which bans banks from speculating in securities markets with taxpayer money. The Volcker Rule’s implementation has been delayed as bank lobbyists have flooded regulatory agencies in Washington, pillorying the ban with loopholes. Hefty tax burdens for proprietary trading would reduce bank incentives to engage in the risky activity.

How serious is Camp about this? It’s hard to say at this point, though I suspect it’s mostly about posturing and political chest-thumping. Camp wants to send a message that he’s displeased and see this as a vehicle. Even if the committee chair got serious about this, I imagine other Republicans would intervene to stop its progress.

Benen thinks that in the aftermath of Pres. Obama’s reelection the business community see him as “a leader who is going nowhere” but “is reaching out to them.” At the same time they view the Republicans as untrustworthy and increasingly reckless.

But seriously, folks, the Republicans are threatening to tax the banks and help stressed homeowners as a “payback” for supporting Pres. Obama. Oh, please, let them.

ROTFLMAO

Obama refuses to occupy William Black (or Why I hate Democrats).

William Black already has a teaching job, but what he really needs is an occupation at Justice where he can kick some fraudulent ass.  Here’s vid from Democracy Now with Amy Goodman that I doubt gets front-paged at any high-traffic liberal blogs:

The vid and transcript are here.

Goldman Sachs Gets Subpoenas From NYC DA

Cross Posted from The Stars Hollow Gazette

Leave it to the District Attorney of Manhattan to do what the Obama DOJ failed to do, investigate properly the fraud that led to the economic crisis.

Goldman Receives Subpoena Over Financial Crisis

By Andrew Ross Sorkin and Susanne Craig

Goldman Sachs has received a subpoena from the office of the Manhattan district attorney, which is investigating the investment bank’s role in the financial crisis, according to people with knowledge of the matter.

The inquiry stems from a 650-page Senate report from the Permanent Subcommittee on Investigations that indicated Goldman had misled clients and Congress about its practices related to mortgage-linked securities.

Senator Carl Levin, Democrat of Michigan, who headed up the Congressional inquiry, had sent his findings to the Justice Department to figure out whether executives broke the law. The agency said it was reviewing the report.

The subpoena come two weeks after lawyers for Goldman Sachs met with the attorney general of New York’s office for an “exploratory” meeting about the Senate report, the people said.

From Talking Points Memo:

Manhattan DA Subpoenas Goldman Sachs Over Financial Crisis

The subpoena is apparently based on information contained in a Senate Permanent Subcommittee on Investigations report on Wall Street’s role in the housing market collapse. The report was critical of Goldman Sachs, and accused the bank of misleading buyers of mortgage-linked investments.

Lending to the Banks: Any Adventurers Online

ProPublica just sent out the following, with some 886 Government Documents that were released by the Federal Reserve:

Search the Fed’s Documents Detailing Their Lending to Banks During the Crisis

Last week, the Federal Reserve released a cache of several thousand pages detailing its support of financial institutions during the financial crisis. The documents, released due to a Freedom of Information Act request, include the Fed’s lending through its so-called discount window, its oldest lending program of last resort. The documents also include some previously released information about the Fed’s lending during the crisis through specially-created programs. You can search through it all below. To the Documents

Have fun!

I may even dive into some but I’m sure it’ll read greek to me.

How do i delete an essay?

Oops..  That’s what I get for posting without reading first.  My apologies to gjohnsit.  How do I delete an essay?

It was an idea that started in France when it became clear that simple protest was not going to change government financial policies.  It’s now spreading around Europe like wildfire, and appears to be beginning to jump the puddle to this side of the Atlantique:

Banque Stop!

http://dailybail.com/home/eric…

You should be aware that there is a French-based European movement that is gaining considerable strength that calls for massive, coordinated bank withdrawals across the continent on December 7.  It’s an attempt at a modern, crowd-sourced bank run.

Here’s the US Facebook page:  http://www.facebook.com/event….

Pass it along.

Why is it “Deficits don’t matter” — whenever THEY are in Charge?

Let me jog your memory, about one of the more memorable things the Former VP said to a ‘fiscally responsible’ Treasury Secretary — right before he fired him

Former Treasury Secretary Paul O’Neill was told “deficits don’t matter” when he warned of a looming fiscal crisis.

OnTheIssues.org

[…]

O’Neill said he tried to warn Vice President Dick Cheney that growing budget deficits-expected to top $500 billion this fiscal year alone — posed a threat to the economy. source url Cheney cut him off. “You know, Paul, Reagan proved deficits don’t matter,” he said, according to excerpts. Cheney continued: “We won the midterms (congressional elections). This is our due.” A month later, Cheney told the Treasury secretary he was fired.

Source: Adam Entous, Reuters, on AOL News Jan 11, 2004

Maybe “deficits don’t really matter” — whenever the Gophers have the National “Credit Card” in THEIR Pockets — Then it’s Party time, for their friends and buddies in the corporate boardrooms?

Otherwise — it’s “evict the lazy bastards”.  

Cut the Funds for something — NOW!

The Week in Editorial Cartoons – The Perfect Oil Clean Up Crew

Crossposted at Daily Kos

THE WEEK IN EDITORIAL CARTOONS

This weekly diary takes a look at the past week’s important news stories from the perspective of our leading editorial cartoonists (including a few foreign ones) with analysis and commentary added in by me.

When evaluating a cartoon, ask yourself these questions:

1. Does a cartoon add to my existing knowledge base and help crystallize my thinking about the issue depicted?

2. Does the cartoonist have any obvious biases that distort reality?

3. Is the cartoonist reflecting prevailing public opinion or trying to shape it?

The answers will help determine the effectiveness of the cartoonist’s message.

:: ::



Clean Up Crew by Cam Cardow, Ottawa Citizen, Buy this cartoon

…..The Harder They Fall

(Cross-posted from The Free Speech Zone)


Government allegations that financial giant Goldman Sachs defrauded investors are creating a political storm, with some lawmakers hoping that the civil lawsuit filed Friday by the Securities and Exchange Commission is just the beginning.

As the heat increases on the investment bank, which has denied all wrongdoing, Politico reports that they have hired Greg Craig for legal help. Craig formerly worked as the top lawyer for President Barack Obama and left the White House earlier this year to join the law firm Skadden, Arps.

The executive order Obama signed the day after he was inaugurated bars high-level executive branch appointees who leave the administration, like Craig, from communicating with their former employers. That executive order also prohibits such officials from lobbying the federal government during the remainder of the Obama administration.

The Politico article notes that since the SEC is an independent government agency, it would not coordinate with the White House on enforcement matters, such as the pending lawsuit targeting Goldman Sachs.

The article goes on to quote a source familiar with Goldman Sachs as saying Craig was hired for his ability to give advice and his “deep understanding of the legal process and the world of Washington.”



The U.S. government is not the only authority interested in further probing Goldman Sachs.

The British and German government have also raised the possibility of investigations. And on Capitol Hill, Democrats in the House and Senate are calling for more answers.

http://www.opensecrets.org/new…

Of all the articles I read on this, this Capital Eye Blog article has to be the best one.

Well, the one that gave me the biggest fucking hard-on in my life that is…..

If you haven’t seen this? See it

If you haven’t yet seen Frontline’s documentary about Brooksley Born, the woman who warned about the dangers of the Derivatives markets during the Clinton Administration, and the resulting financial disasters that ensued from deliberately choosing to ignore her, you simply must see it.

http://www.pbs.org/wgbh/pages/…

Frontline is one of the few true journalistic documentary shows remaining in this country.  And in this case they do their usual superlative job in presenting the story of what happened when Wall Street took over Washington, and when an idiot named Alan Greenspan channeled tricked everybody into thinking he was a genius.  

And yes, Virginia, it was Clinton’s fault.  It happened on Clinton’s watch, when Robert Rubin, Larry Summers, and Alan Greenspan convinced everyone that NO REGULATION of the markets, of Wall Street, was a good idea.

Can you believe that?   Alan Greenspan actually came out and said that even going after blatant fraud on Wall Street was a bad idea, a mistake even, because “the markets would take care of it themselves”.   He gave fraudsters a GREEN LIGHT.  

This is like saying we shouldn’t fight gangs of street thugs because it will sort itself out.  Police?  Just stay home.  Rapists and murderers and thieves will somehow just take care of themselves and will magically eradicate themselves.

Indeed this was a classic example of Magical Thinking.

And Magical Thinkers ran this country’s economy, and almost destroyed it completely.  

And what is worse, is that the policies that led to this are still in place.  Nothing has changed, and I mean nothing.

And some of the people who LED this disaster are now back in power, with the Obama administration.  Larry Summers, for one, who was “the enforcer” for these fools, the tough guy who would really play hardball with people (and how that must have made his balls swell with manly pride when he would do that) is now Obama’s chief economic adviser!

This is just insulting as hell.

This is like putting Charles Manson in charge of security for the Oscars.

Obama is an idiot to have these guys anywhere near his big-ass ears.  These people should be too ashamed of themselves to ever step foot in Washington ever again, but here they are, in control.

What is astounding about this documentary is that what this woman warned about, regarding the derivatives market, happened.  

No, not in 2008.  It happened in 1998.  

In 1998, exactly as she predicted, a major, enormous hedge fund went under and almost took the economy of the United States down with it.   And what was the result?   Nothing.   Greenspan and the other fools managed to convince Congress that NOTHING was the thing to do, that NOTHING was the plan, that NOTHING could be done.   “I can’t conceive of any way we could regulate this!” was his refrain.   He didn’t want to.   He had a childlike fascination with Ayn Rand and thought that there simply should be no regulations of any kind, that government should have absolutely no ability or power to TOUCH industry, or banking.  And here we had a guy with this kind of MAGICAL THINKING in charge of the Federal Reserve!  For years.  And touted as a genius.  

It blows the mind.

And keep in mind this happened on a Democrat’s watch.  Bill Clinton, the best Republican President ever, as I’ve always said.  Indeed he was.

So what happened in 1998 happened ten years later, AGAIN, almost to the date.  Only this time it was a mega-meltdown, the mother of all meltdowns, and once again EXACTLY what this woman warned against.   This woman whose job as a regulator was destroyed by an Act of Congress, a woman who was deliberately neutered by these fools who didn’t even know what a derivative WAS.   And this time it nearly did take the economy of the world down with it and still very well might.  

And what do we have now?  This slimy old piece of dung FOOL, Alan Greenspan, saying “gosh, I guess I was wrong all my life”.    And his buddies Larry Summers and his mop-topped protoge Timmy Geithner back in the White House.

Obama, you’re an idiot.   Larry Summers, you should resign in shame at once.   Congress, you should figure out a way to impeach Geithner and get rid of him.  They all gotta go.  If they don’t clean house, this is all going to happen AGAIN.   And that’s not me saying that, that’s Brooksley Born saying that, and she’s saying that now, that if this isn’t dealt with, and it is STILL not being dealt with, that this will happen again.  And again.  And again.  Until we learn and finally get it right.

We have learned, and we are deliberately not getting it right?  Why?  Because Wall Street makes money off of it.  Yes, the banks.  And they will be bailed out, and they will have their billion dollar bonuses, and this country will see what is in effect NATIONALIZED GAMBLING taken hold, by the ultra-rich, in a game that they can never lose.

In fact, just today, it has come out that Geithner’s idea to “fix” things, this little fuck actually has the gall to come out and propose that the Big Banks have an unlimited line of credit from the Executive Branch of the country, that they should be able to do whatever the FUCK they want and be PERMANENTLY BAILED OUT.   With no limits as to the dollar amount behind the bailouts.  

What the FUCK is this shit?   This is throwing good money after bad taken to a literally insane level.  Here, check this shit you, you simply won’t believe it:


In my opinion, Geithner’s proposal is “TARP on steroids.” Section 1204 of the proposal [the proposal being the “Resolution Authority for Large, Interconnected Financial Companies Act of 2009”] allows the executive branch to use taxpayer money to make loans to, or invest in, the largest financial institutions to avoid a systemic risk to the economy.

Geithner’s proposal reminds me of the Troubled Asset Relief Program (TARP), the $700 billion Wall Street bailout adopted last year, but the TARP was limited to two years, and to a maximum of $700 billion. Section 1204 is unlimited in dollar amount and is a permanent grant of power to the executive branch. TARP contained some limits on executive compensation and an array of special oversight authorities. Section 1204 contains absolutely no limits on executive compensation and no special oversight.

When I asked Geithner whether he would accept a $1 trillion limit on the new bailout authority (if the executive branch wanted to spend more, it would have to come back to Congress), he rejected a $1 trillion limit, insisting that the executive branch be able to respond without coming back to Congress.

That’s Geithner’s idea of how to “fix” corruption on Wall Street — KEEP GIVING THE CROOKS MONEY.

Why the FUCK does this guy have a job again?  Why the FUCK isn’t he fired?   How DARE he propose something like this?

This documentary should be required viewing by everyone in this country.

And after watching it you will never want to see Larry Summer’s ugly face ever again.  But you will, because he’s Obama’s “guy”.  

With Dems like these, who needs Republicans?  

They’re all crooked.  Time to throw them all out.  All of them.   Every last one.

It’s just so appalling.  

http://www.pbs.org/wgbh/pages/…

This is just insulting UPDATED

Hey!  Did you know that the recession is over!?

Wow, I had no idea.   That’s good news, right?!

Right!   Hey, we can go out and spend again.  It’s oooooo-kay!   “They” say it is.

“They” being our masters who tell us if the sun is shining, if their shit stinks, and what our favorite color is!

I am just absolutely fucking insulted by this bullshit:

“The recession gripping the United States for nearly two years is over” chortles the first sentence of this bullshit article.

Yeah, right.  

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