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Should
People Trust Obama, with So Much of Their Money?
President Obama appeared on a popular TV chat show, Jay Leno,
to promote moves
to resolve the economic crisis. His answers show he is trying
to fool us about
some very important financial topics. Does Obama really understand
the profound
sense of betrayal by Wall Street that so many Americans feel.
Bonuses
on Wall Street encourage reckless, get-the-money-and-run risk-taking.
That is why there was a
BUUBLE. CEOs had every incentive to make extra short-term
profits and use maximum
leverage, no matter the risk of safety and prudence.
Example from Yahoo message Board: "...(T)he supposed
wizards of finance,
the Masters of
the Universe who shower themselves with unimaginable wealth, were
safeguarding our
economic well-being with the diligence and sobriety of a drunken
high-roller at a
craps table in Vegas at 4 a.m.? Does he understand that the crisis
is not just an
economic watershed but a cultural one as well, and that what once was
deemed perfectly
acceptable behavior on Wall Street is now seen as reprehensible?"
(Source: Eugene
Robinson)
Obama Paved The Way
for AIG Bonues.
What A Show of Outrage Obama Puts on for Public Display.
His Opposition To Wall Street Bonuses Is A Public Charade
Obama
said he was "stunned" by the huge bonuses that
bailed-out
insurance firm AIG was paying its employees. The bonuses
-
totalling $165m in a company now 80% government-owned - have caused
outrage in the US.
TRUTH - Obama
knew in advance of the AIG bonuses. He only
expressed outrage after the bonuses became public.
More important
his Treasury Secretary had cleared the way legally for the
bonuses,
by secretly striking a provision in his Stimulus
legislation several weeks
ago that would have forbad such bonuses!
TRUTH -
According to Julie
Hirschfield Davis and six other AP reporters who assisted her,'
The Obama administration has known "for months"
that insurance giant AIG was
getting ready to pay huge bonuses while living off
government bailouts. Source.
Obama
Defends Geithner, The Pro-Banker Treasury Secretary.
Obama:
"This guy has not just a banking crisis. He's got the worst recession
since the Great Depression," he said, adding: "I think Geithner is doing an outstanding job."
TRUTH -
Geithner played a major role in causing the financial meltdown that
resulted from vastly excessive use of leverage by Wall
Street banks by not even
trying to police them when he was CHairman of the NY
Federal Reserve. Geithner
was deeply involved on everything that went wrong and
caused the financial
meltdown.
TRUTH - Geithner willingly participated in TARP-1 in a most
industry compliant
and submissive way. He did not insist on transparency
or accountability.
Bonuses were fine with him. There is no record of him
objecting to
Paulson's unfettered giveaway to banks of $300 billion in
TARP-1.
TRUTH - Geihtner's has stubbornly fought those who say that
the bad banks,
who made terrible loans and recklessly used leverage,
should be allowed to fail
rather than be propped up as Zombie banks, and given
billions and billions,
with no guarantee that they would ever make loans to Main
Street!
TRUTH -
Geithner certainly knew in advance of the AIG bonuses. He happily
took AIG management's position that the bonuses were
necessary to retain
the very people who destroyed AIG's solvency and refused to
seek ways to
deny them thse obscene bonuses. More important,
Geithner intervened
in the dead of the night, thinking no one would find out,
and cleared the way
legally for the bonuses, by secretly striking a provision
that both the Senate
and The House of Representatives had agreed in the Stimulus
legislation several weeks
ago that would have forbade such bonuses!
TRUTH - Geithner is not to be trusted. Geithner
failed to pay $34,000 in federal taxes
between 2001 and 2004. Surely, we have a right to
expect the secretary of the Treasury to
faithfully pay his own taxes fully. He blamed Turbo
Tax.
Obama Denies
That Extensive Economic Crimes
and Fraud Lay behind The Financial Collapse of 2008.
MR. LENO: I just read today about Merrill Lynch. They
handed out $3.6 billion --
it's not even million anymore, it's billions in bonuses. I know it
would make me feel good --
shouldn't somebody go to
jail? (Laughter and applause.) I say that because
I watch those people in New York, even people who had lost everything
--
when Bernard Madoff went to jail, at least they felt they got
something.
MR. OBAMA: Right. They got some satisfaction. Here's the dirty little secret,
though. Most of the stuff that got us into trouble was perfectly legal.
And that is a sign of how much we've got to change our laws -- right? We were
talking earlier
about credit cards, and it's legal to charge somebody 30 percent on their
credit card,
and charge fees and so forth that people don't always know what they're
getting into.
So the answer is to deal with those laws in a way that gives the average
consumer a break.
When you buy a toaster, if it explodes in your face there's a law that says
your toasters
need to be safe. But when you get a credit card, or you get a mortgage,
there's
no law on the books that says if that explodes in your face
financially,
somehow you're going to be protected.
So this is -- the need for getting back to some common sense
regulations --
there's nothing wrong with innovation in the financial markets. We want
people
to be successful; we want people to be able to make a profit. Banks are
critical
to our economy and we want credit to flow again. But we just want to
make sure
that there's enough regulatory common sense in place that ordinary
Americans
aren't taken advantage of, and taxpayers, after the fact, aren't taken
advantage of.
(Source: http://freedomeden.blogspot.com/2009/03/obama-and-leno-march-19-transcript.html
)
THROWING MORE GOOD TAXPAYER MONEY DOWN A ZOMBIE
BANKS' RAT-HOLE!
Obama Admitted The
Banks That Have Gotten
the $300 Billion TARP Bailout have not used the
money to make loans to Main Street. But now
he is planning for the US Government to give them
even more money by buying their toxic assets
at inflated prices.
Mr LENO: Well, when will the money -- this money was given out to the
banks.
I would have thought by this time it would have sort of trickled down to Main Street,
to people wanting to get loans -- I mean, it all went out there months and months ago.
Where is it?
OBAMA: Well, what's happening is a lot of these banks are keeping
it in the bank because their balance sheets had gotten so bad that they decided, you know
what, for us to stay solvent we need to maintain certain capital ratios; we've got to have
a certain amount of capital in the bank -- and they haven't started lending it yet.
And that's why what we've got to do -- right now what we're doing is essentially
doing a diagnostic test -- trying to use some auto language here so you -- (laughter) --
we're doing a diagnostic on each of the banks, figuring out what are their capital levels?
Can they sustain lending? And then I think we're going to separate out -- those banks that
are in good shape, we're going to say to them, all right, you're on your own; go start
lending again. Those banks that still have problems, we'll
do a little more intervention to try to clean some of those toxic assets off their
books."
(In other words, we'll keep propping up the bloated
and inefficient banks with bad management!
"So let me get this straight. We have here
broad acknowledgment that the first bank intervention didn't work because the banks used
the money to bolster their capital ratios instead of lending the money out, which was the
whole point of the intervention in the first place. Additionally, we have Obama talking
about the need to "set up a securitized market... outside of the banking system"
in order to "get credit flowing again," and establish the very lending that the
bank intervention was supposed to have achieved. Isn't this an indictment, plain and
simple, of TARP? And yet, after these "diagnostic tests," we may yet end up
doing "a little more" TARP-style "intervention?"
Saturday - 3/22/2009 OBAMA REQUESTS 2ND $350 BILLION FOR BANKS FROM CONGRESS. Late last week, congressional watchdog Elizabeth Warren
said the Treasury Department has done nothing to make sure $700 billion in
taxpayer-provided bailout money is used to buttress the weak U.S. mortgage market, which
has been the key catalyst for the growing global financial crisis. Warren, who heads the Congressional Oversight Panel for the bailout
program, told ABC News on Friday that there was no evidence the Treasury had used
TARP bailout money to put a floor under the falling U.S. housing market by avoiding
preventable foreclosures.
“There’s just no money that’s gone in that
direction,”Warren said. “This one’s not even arguable. The TARP funds
themselves have not been used in this way despite congressional statutes requiring them to
do so.” The congressional investigation is just the latest in a series of
revelations demonstrating the possible misallocation of the taxpayer-provided bailout
money. An ongoing
investigation by Money Morning has detailed how banks have used the first $350
billion: They’ve used the capital to finance investments in other banks - including an investment in
China - and to pay bonuses to executives. Then they audaciously
refused to say where the money went, or how it was used, Money Morning has shown."
( http://www.moneymorning.com/2009/01/13/obama-tarp/
)
Not surprisingly, Obama is
requesting the bailout money comes just
as banks have started lobbying the federal government to go back to its original TARP
proposal, under which the Treasury Department would actually buy back troubled
mortgage assets.
OBAMA'S ADMINISTRATION'S EXCUSE FOR ALLOWING
BAILOUT - SANCTITY OF CONTRACTS
Obama White House economist, Larry Summers, on whose watch as Treasury Secretary in the
Clinton administration financial deregulation got out of control, invoked the "sanctity
of contracts" in defense of the AIG bonuses. So did Obama, saying the US
Government might end up having to pay treble damages.
Buy I have read that the Courts rarely overturn taxation laws. Is the issue of
contracts more pro-bank excuse-mongering? Interestingly, Obama does not regard other
contracts to be "sacred". Labor unions had to agree to give-backs in order
for the auto companies to obtain federal help; CNN reports that "Veterans Affairs Secretary Eric Shinseki
confirmed Tuesday [March
10] that the Obama
administration is considering a controversial plan to make veterans pay for treatment of
service-related injuries with private insurance" the Washington Post reports
that the Obama team has
set its sights on downsizing Social Security and Medicare. According to the Post , Obama said that "it
is impossible to separate the country's financial ills from the long-term need to rein in
health-care costs, stabilize Social Security and prevent the Medicare program from
bankrupting the government." After Washington's
trillion dollar bank bailouts and trillion dollar gratuitous wars for the sake of the
military industry's profits and Israeli territorial expansion, there is no money for
Social Security and Medicare.
The US government breaks its contracts with US citizens on a daily basis, but AIG's
bonus contracts are sacrosanct. The Social Security contract was broken when the
government decided to tax 85% of the benefits. It was broken again when the Clinton
administration rigged the inflation measure in order to beat retirees out of their
cost-of-living adjustments. To have any real Medicare coverage, a person has to give
up part of his Social Security check to pay Medicare Part B premium and then take out a
private supplemental policy. The true cost of Medicare to beneficiaries is about
$6,000 annually in premiums, plus deductibles and the Medicare tax if the person is still
earning. ( Source. )
(Sources: http://www.huffingtonpost.com/2009/03/20/what-obama-said-last-nigh_n_177401.html
Wall Street Firms
Looking to Circumvent TARP Bonus Caps Via Salary Increases (naked capitalism, 3/16/09)
He Makes Bush
Look Smart (Financial Armageddon, 1/9/09)
David Sirota:
"Obama's Team of Zombies" (Updated: Frank Rich on Geithner) (naked capitalism,) 2/7/09)
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Wall
Street Culpabaility in The Financial Melt-Down of 2008
More coming soon. For now Google those words.
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