March 15, 2012

Beware the Ides of March…  Did anyone whisper this phrase into Mitt’s ear recently?  The Ides crept up upon Caesar and, lo and behold, he lost two key states in his quest to become the most powerful person in the world.  Instead his world came crashing down as a Senator stabbed him in the heart.  Et tu Rick?

Last evening state dinner for the British Prime Minister was attended by several Pennsylvanians.  Mr. and Mrs. Mark Alderman, John Block (Pittsburgh Post-Gazette) and his wife, Bradford Collins of Langhorne, Benjamin and Amy Deardorf of Lancaster, Dr. Amy Gutmann (University of Pennsylvania) and Dr. Michael Gutmann.  Also invited were George Clooney, Warren Buffet, Teresa Heinz Kerry, Gwen Ifill and Irish golfer Rory McIlroy accompanied by Mr. Conor Ridge.

Pennsylvania landowners who have leased land for shale drilling are discovering they aren’t being informed of violations and safety issues on their own land.  This is the sort of thing which can be expected when one makes a deal with the devil.

Drilling, is, of course, a 24/7 operation and shale extraction in North Dakota is lighting up the night sky there.  Imagine what Pennsylvania will look like in ten years?

The Turnpike Commission is planning on dunning non EZ Pass users a 76% surcharge for choosing to maintain their privacy rights.  Just because the state wants to get rid of toll collectors doesn’t mean we must relinquish our rights.  The right to privacy is the entire purpose of our constitution.  We should be able to travel freely without the state following our every move.  This establishes two, separate classes of motorists on the Turnpike, something which I believe is unconstitutional.  Tolls are, essentially, a tax and having separate rates violates the state document.

Matt Cartwright has his first ad up in his primary race for Tim Holden’s seat.

Mayor Nutter wants to ban outdoor feeding of the homeless.  I suppose he wants to “let them eat cake.”

Keystone Progress has organized an effort to get Rush off of 24 Pennsylvania radio stations.  Join the effort here.

The ultrasound bill has now lost 32 sponsors.  The rats are fleeing this ship.  Patrick Murphy wants Gov. Gasbag to retract his offensive statements about the bill:

“It’s bad enough that Governor Corbett wants to force women to get an unnecessary and invasive procedure as a means of getting a government permission slip to undergo legal medical care. It’s worse yet that he wants to shame them by shoving an ultrasound screen in their face. But it’s unthinkable that he would so casually dismiss this by advising women to just close their eyes. Governor Corbett’s comments are disturbingly offensive, insensitive, and out of touch. He should apologize immediately.” Murphy said. “As I have said before, this legislation is an outrageous assault on women’s rights in Pennsylvania and an unprecedented intrusion into decisions that should be made exclusively between a woman and her doctor. The proposal is demeaning, mean spirited and wrong. There is no legal justification for forcing a woman to undergo an invasive ultrasound, and after careful analysis, I believe that no reasonable arguments can be made to support the Constitutionality of this bill. As Attorney General, I could not defend it against a Constitutional challenge.”

New White House interns include Kathryn Baxter of Glenside, Karen Blyton of Malvern, Evan Cohen from Penn State, Kathleen Dorian of Johnstown, Blake Harden from Penn, Stefan Johnson of Philadelphia, Anne Kauth from Bryn Mawr College, Lindsay Matthews of Birdsboro, Queen Muse of Philadelphia, Nickolas Reck of Douglassville, Dana Rosenzweig of Wyomissing, Brendan Saller from Penn State and Stephanie Yoon of Philadelphia.  Congratulations!

Greg Smith’s Goldman Sachs resignation letter is all the rage.  As if it says anything we didn’t already know, its shocking coming from an insider.  Firms which stop being responsive and responsible to their clients soon cease being businesses.

To put the problem in the simplest terms, the interests of the client continue to be sidelined in the way the firm operates and thinks about making money…It makes me ill how callously people talk about ripping their clients off. Over the last 12 months I have seen five different managing directors refer to their own clients as “muppets,” sometimes over internal e-mail….These days, the most common question I get from junior analysts about derivatives is, “How much money did we make off the client?”

The State Government Committee pulled Daryl Metcalfe’s hate filled “marriage protection” amendment Tuesday.  Perhaps the extreme lunatics in charge in Harrisburg are feeling some heat?

That didn’t stop Gov. gasbag from quickly signing into law legislation requiring all voters to show their papers at the polls.  All this from a Governor too stupid to keep his lies straight.

 

News & Notes September 28, 2011

I got moved to the new house over the weekend but am still ferrying carloads of small things so my schedule is kind of busy right now.  The desktop system isn’t set up yet so I’m dependent on my laptop and the dining room table.  Hopefully by next week I’ll be somewhat back to normal.  It doesn’t appear there’s a way to disassemble the old desk/hutch so I’m shopping for something new.

Michelle Bachmann says she’d eliminate all taxes as president.  That means she’d eliminate all government.

Rick Santorum is moving ahead of Bachmann and some of the other dwarfs in the Snow White GOP field.  Have people forgotten he wants to establish a Big Government to intrude into your sex life and tell you what you can and cannot do with your partner in bed?  Santorum believes every sex act must be vaginal intercourse without contraception so we can continue overpopulating the planet.  Remember he’s a member of the Roman Catholic cult Opus Dei.  He would report to the Pope.

Could next year’s election be stolen?  It turns out Diebold electronic voting machines can be hacked with $10 worth of materials.  A majority of Pennsylvanians will vote on machines which can be hacked to rig an election.  No wonder half of us no longer even vote.  The system is becoming more and more corrupt.

New census data out shows 130,000 same sex married couples and 514,000 living in long term relationships but unable to wed.

It also shows the poorest city in America is our own Reading, PA.  It surprises no one here that Reading now has the highest percentage of residents living in poverty.  One need only drive through the City to see the condition of its residents.  Crime is skyrocketing and anyone who has been able to flee Reading has already.

In the “tell me something I don’t already know” department a BBC interview is getting attention for the blunt words said about the economy:

I’ve been saying for a while that anyone with money in the market is a fool because the game is rigged by Wall Street insiders.  It is obvious to me a collapse of global proportions is coming because Washington has failed to regulate bankers.  They have failed to do that because Goldman Sachs runs our government.

Lawrence O’Donnell is covering the occupation of Wall Street and the police brutality against protesters:

The baseball season ends today and the Phillies are the best team of the year and enter the playoffs the favorite to win the World Series.  Unfortunately for Pirates fans they’ve endured their 20th consecutive losing season.  The Phils sleepwalked through an eight game losing streak where it appears they allowed St. Louis to sweep a four game series to screw the Braves.  If so those of us who attended those games deserve our money back.

The Eagles, coronated as the “Dream Team” all summer are also sleep walking through their schedule.  I don’t think this is what was meant by “dream team.”  They won’t win until they get an offensive line.

Have you seen the Taco Bell commercial where they brag about using “select grade” beef?  Select is the lowest grade of beef you can buy.

The new season of “Survivor” is on and my readers know I’m a long time Survivor fanatic.  There’s another interesting cast this season and I’ve yet to choose a favorite.  I do like Jim, the marajuana dealer from California.  The Hantz kid is riding his uncle’s coattails but he’s no Russell.  He screwed Coach last week so he’s history.

Gov. Corbett continues to hide from Pennsylvanians, not making public appearances or conducting press briefings.  We all know what he’s trying to hide and this simply makes it obvious.

While in New Mexico last month I did a bit of research into hydrofracking in The Land of Enchantment.  They’ve had it for thrity years with far fewer problems than we’ve had in a short time period.  I went to the office of the State Land Commissioner, a state wide elected office there to make an appointment to talk to some experts.  They not only accommodated me they had me wait a few minutes until two gentlemen came out of a conference room in front of me, answered a few questions and then escorted me up a flight of stairs.  there they introduced me to New Mexico’s state geologist who gave me half an hour on the spot.  Would that happen in Harrisburg?  Never in a million years.

By the way the geologist said if any officials from Pennsylvania want to come to Santa Fe and see how it’s done (effective regulation and taxation) they’re welcome.

Feds Sue 17 Major Banks for Mortgage Fraud

The government regulator in charge of overseeing Fannie Mae and Freddie MAC sued 17 major banks today for mortgage fraud.  The federal agencies purchase mortgages from banks to guarantee them against losses and taxpayers have taken an almost $200 billion hit.  The feds say material representations made were fraudulent and serious omissions of fact occurred.  Among the banks sued were Ally Financial (GMAC Mortgage), Countrywide, JP Morgan Chase, CitiGroup, Goldman Sachs, and DeutscheBank.  To date no criminal prosecutions have begun.  If the government acknowledges, as they do with this suit, that massive fraud happened in the mortgage markets why are they not prosecuting criminally?  Did Barack Obama take so much campaign money from these bankers they got immunity?

Obama Bypasses Warren For CFPB

In yet another indication the White House is a wholly owned subsidiary of Goldman Sachs President Obama today announced his appointment for the CFPB.  It isn’t Elizabeth Warren.  The Consumer Finance Protection Bureau was her creation and her solid credentials looking out for us instead of Wall Street doomed her with Treasury Secretary Timothy Geithner who is about to enter the revolving door between Treasury and Goldman.  Instead former Ohio Attorney General Richard Cordray will be sent to the Senate for confirmation.  He is currently in charge of enforcement at CFPB.

This nomination is a test of the President’s resolve to fight for us.  It is yet another sign that nothing much has changed in Washington under his leadership.  The person chosen to head the CFPB is critical to its effectiveness fighting the corruption which resulted in a catastrophic economic recession and massive fraud operated from Wall Street and which has gone wholly unprosecuted by the Obama Administration.

A local Party leader tried explaining this away to me yesterday claiming that Warren couldn’t have been approved by the Senate so Cordray was a good choice.  Since when do we surrender without even putting up a fight?  Since when do we completely abandon our principles and our commitments to working Americans because it might be tough?  Since when do Democratic Party leaders go around defending the indefensible and expect me to buy their load of crap?

Afternoon Update

Its been a busy week with lots happening.  I had two White House calls yesterday about Obama’s fiscal irresponsibility and another today with Mayor Nutter.  I hung up after listening to Charlotte Mayor Anthony Foxx state that “we can’t spend our way out of this recession.”  Obviously he isn’t an economist.  The White House is using morons like these to support their misguided policy?  No wonder we’re in a mess and sinking deeper.

Sen. Casey announced he has $2.1 million cash on hand after raising $1.1 million the first quarter.  He’s had full time fund raisers working since last fall raising money for 2012.  No wonder the GOP is looking at potted plants for a challenger.

Our own fringe whack job Rep. Daryl Metcalfe introduced a Birther Bill yesterday.  It would require any candidate for president or VP to provide proof of their birth in the U.S.  I say we amend it to say anyone running for the state legislature prove their sanity.  That may be the best method for ridding ourselves of Mr. Metcalfe.

For some reason the major media have been ignoring the biggest story in the country which is the huge wealth gap dividing the 1% top tier from the rest of us.  Meanwhile even networks like NPR are perpetuating myths being spread by lying conservatives.  I was listening to a show this morning (about 8:45 AM) when Congressman Camp repeated the lie that 50% of all the top 2% are small business owners.  His pants should be on fire because it is patently false.  The NPR person failed to call him out on the lie.  Maybe we should defund them since they’re failing to provide real news any longer.

The differences between the top 1% and the rest of the country is a recipe for revolution and no one is talking about this issue.   Nothing else should even be on the agenda until it is addressed and reformed.  The only place you’ll hear about it is on blogs and places like AlterNet and Truthout.  Here’s a piece about how a hedge fund manager can earn more in an hour as middle class households in 47 years.  This is the stuff we should be discussing on TV.

Here’s a snippet from the article:

Just take a look at the latest reports on what the top hedge fund managers haul in. In 2010 John Paulson led the list with a record $4.9 billion in personal earnings. That’s a whopping $2.4 million an HOUR. Here’s a factoid to make you wretch: It would take the median US household over 47 years to earn as much as Paulson pocketed in just 60 minutes. And, every hedge fund manager pays a lower tax rate than the average family.

Rick Santorum’s campaign slogan was borrowed from a poem by Langston Hughes.  The African-American union, civil rights and gay rights supporter coined the term “let America be America again.”  Oops.  I guess Santorum doesn’t use the Google.  Of course considering the results it brings on his own name we cannot blame the guy.

The Yes Men and US Uncut combined to sting GE over its failure to pay any federal taxes.  In fact the huge corporation has earned $27 billion the last five years and paid $0.  The group issued a fake press release saying GE would “do the right thing” and voluntarily pay.  Of course they’ll do no such thing.

Goldman Sachs Cashed in As They Crashed the Economy

Newly released emails show that executives at Goldman Sachs celebrated the tremendous profits they made selling worthless securities and then cashed in by turning around and selling them short to cash in again.  Selling short means guessing (or knowing in this case) that a security is going to drop in value and betting on that scenario.  Of course if you created the securities and know they’re worthless selling short isn’t much of a gamble.  Ordinarily it is, it can be a huge gamble.

At the time the housing market was beginning to collapse so Goldman Sachs became Goldman Sex and screwed millions of Americans by destroying the economy with these unregulated securities and trades.  I wonder how many times I wrote over several years of the danger posed by these unregulated hedge funds and derivative securities.  I do know it was often and yet no one in Washington or New York saw the danger?  I’m no financial expert but I saw it and wrote about here on the blog.  Goldman’s management certainly knew it too, they knew these bundled mortgages were toxic and so they bet they would fall in value.  The amazing thing is they then boasted about the profits being created by their treachery.  This is the culture of Wall Street where greed is good and making money, billions of dollars a year, is the Holy Grail.  There are no morals or ethics on Wall Street and no one there has shed a tear for any of the millions who lost their jobs, their homes, their retirements or their security to the greed of these financial predators.  This is why we must have tough, meaningful and effective regulation.

The Stupidity of the Tea Partiers

I’ve been wondering why Canadians are so much smarter than Americans.  Our neighbors north of the border share the same heritage with us:  settled by Western Europeans, tied to the British and French nations, pioneers who crossed a dangerous ocean in search of opportunity.  Our nation’s paths diverged quickly; Canada never adopted slavery as its climate was unfit for cotton, the crop which seemed to corrupt American morals, and it remained part of the British Empire far longer.  Canadians have universal health care and love it, they are a far more peaceful people than Americans, never having started a war of empire or imperialism and didn’t engage in the genocide of natives as happened in the lower 48.

There are great similarities and great differences between the U.S. and Canada but the level of knowledge and intelligence is what strikes me most.  Canadians know their facts, Americans do not.  It isn’t necessarily that Americans are stupid but that they choose not to learn basic things.  Things such as initiating wars under false pretenses for imperialistic reasons is bad, that genocide is bad, that dropping atomic bombs on people is bad, that lying about reality is bad and on and on.  We can blame the ignorance and misinformation on Rush, Hannity, O’Reilly, Faux News and others but the fact is Americans choose to get their misinformation from these sources rather than reality based programming.  That makes them stupid in my book.  The internet brings all sorts of information to our fingertips but many choose not to access reliable sources.  Canadians do.

We witnessed much of this ignorance last year during the health care debacle and will observe it once again on Wall Street reform.  The Tea baggers were out in force last week protesting taxes and government.  I say if you don’t like our form of government you are free to relocate to Somalia.  Go live where there is no government.  While carrying signs protesting President Obama and his taxes few of these folks accepted the actual fact that he cut taxes for 95% of working Americans.  With the nation, and world, on the brink of an economic catastrophe which could have made the Great Depression seem like a summer picnic he pulled us back from the brink of a deep abyss and turned things around.  They give him no credit for that but, instead blame him for massive budget deficits.  The reality is that those deficits are from failed right wing policies they support.  Why are Americans so stupid?

Here’s a graph which makes it so simple even a Tea bagger can comprehend it:

As you can see most of the deficit has resulted from a failed economy.  Add in the unpaid wars in Iraq and Afghanistan, the unpaid for Bush tax cuts and Bush’s TARP and Fannie and Freddie bailouts and most of our deficit is the fault of Republicans.  Tea baggers blame Barack Obama however.

Democrats don’t support massive tax cuts for the richest 1%, that’s a right wing philosophy, as are imperialistic wars based on lies to the people and policies of deregulation big business.  It was Republicans like George Bush (both), Dick Cheney, Phil Gramm, Mitch McConnell, Bill Frist, Dick Armey and so on who chose to allow Wall Street to manufacture fraud on such a massive scale it collapsed the global economy.  Unfortunately our friends in Canada and everywhere else suffered along with Americans who lost $7 trillion in personal wealth, seven millions homes and eight million jobs.  These nitwit Americans blame Democrats however.

Now I’ll concede there are lots of corporate Democrats who remain part of the problem.  The Wall Street tycoons who thought up these toxic mortgage securities then peddled them to new homeowners using fraudulent tactics then bet against them failing (as they knew they must) are the principle criminals in what happened.  Simply going after Goldman Sachs won’t assuage the guilt of the millions of traders, managers and sales agents who perpetrated this massive fraud.  Though bankers created 80% of the fraud many greedy Americans also saw the chance to strike it rich and attempted to cash in by flipping houses, taking interest only mortgages and bought homes they knew they couldn’t afford.  

How many of us drove past those developments of McMansions and wondered how people were affording them?  I bet most of us did.  They couldn’t and today they stand vacant, cancers on the economic health of the country.  Our financial system is as broken as our health care system and if what we just witnessed in the attempt to reform that is any indication stupid Americans will, once again, allow themselves to be brainwashed by the media into thinking white is black, black is white and up is down.  The corporate media didn’t want real health care reform and it doesn’t want economic reform.  They will continue to finance groups such as the Tea Party and convince these stupid, gullible souls into acting against their own interests.

I’m sorry but these idiots got exactly what they deserved with the financial, economic meltdown because they allowed the corporate media to brainwash them into thinking gay marriage would destroy this country.  Wall Street and the Republican Party for which they voted did.  When one votes repeatedly against one’s own economic interests don’t then turn around and blame me.  I told you so.  The supreme irony is that these same forces are financing the Tea Party.

Now people criticize me for calling Tea baggers stupid.  The evidence is overwhelming, I see it every time I see them.  The most aggravating part of it is that these people choose to be stupid, choose to access bad sources, choose to listen to Rush and watch Faux News, choose to be stupid.  Canadians don’t and I wonder why.  Better schools?

Understanding the Financial Crisis

Rolling Stone has published the most thorough analysis of the economic meltdown, what it is, how it happened and who caused our economic ruin.  Matt Taibbi is unafraid to point fingers to individuals like Sen. Phil Gramm, the Bush Administration, AIG executives and Goldman Sachs executives who engineered this debacle.  It is an amazingly good article which, a bit long for the average reader, is must reading for every citizen.

Reading this article will provide an excellent overview of how deregulation, refusal of BushCo to regulate anyone, and Hank Paulson’s moves to sink $3 trillion into financial black holes happened.  The more I find out about AIG the more I feel we need the company to simply disappear into bankruptcy.  No amount of taxpayer money can or will save this corporation.  It is dead and its time to bury the carcass before we all catch its fatal disease.

The same goes for the major “too big to fail” banks.  In our market economy I have no doubt others will move into these markets and do the normal, sane business which we need.  AIG isn’t the only insurance company and capital will flow into insurance to form new firms as AIG disappears.  That is the hallmark of a capitalist system.

Meanwhile, as yet, not one single new regulation has been enacted to prevent another meltdown.  The Phil and Wendy Gramm engineered repeal of Glass-Steagall which precipitated the meltdown remains the law of the land.  Why Congress has yet to enact legislation is amazing to me.  This must be the highest priority.

AIG was the world’s biggest casino.  Unfortunately the huge bets they made on everything from whether you’d default on your mortgage to sports events to whether someone might die, were made with no financial reserves whatsoever.  They were completely unregulated.  I wrote frequently the past several years about these unregulated markets and I’m no financial expert so those who should have known what was going on simply turned blind eyes.  In return for huge campaign contributions mind you…

Some excerpts from the article:

He (AIG Chairman Liddy) conveniently forgot to mention that AIG had spent more than a decade systematically scheming to evade U.S. and international regulators, or that one of the causes of its “pneumonia” was making colossal, world-sinking $500 billion bets with money it didn’t have, in a toxic and completely unregulated derivatives market.

Nor did anyone mention that when AIG finally got up from its seat at the Wall Street casino, broke and busted in the afterdawn light, it owed money all over town – and that a huge chunk of your taxpayer dollars in this particular bailout scam will be going to pay off the other high rollers at its table. Or that this was a casino unique among all casinos, one where middle-class taxpayers cover the bets of billionaires.

More…

The mess (Joe)Cassano created had its roots in an investment boom fueled in part by a relatively new type of financial instrument called a collateralized-debt obligation. A CDO is like a box full of diced-up assets. They can be anything: mortgages, corporate loans, aircraft loans, credit-card loans, even other CDOs. So as X mortgage holder pays his bill, and Y corporate debtor pays his bill, and Z credit-card debtor pays his bill, money flows into the box.

The problem was, none of this was based on reality. “The banks knew they were selling crap,” says a London-based trader from one of the bailed-out companies. To get AAA ratings, the CDOs relied not on their actual underlying assets but on crazy mathematical formulas that the banks cooked up to make the investments look safer than they really were. “They had some back room somewhere where a bunch of Indian guys who’d been doing nothing but math for God knows how many years would come up with some kind of model saying that this or that combination of debtors would only default once every 10,000 years,” says one young trader who sold CDOs for a major investment bank. “It was nuts.”

In its simplest form, a CDS is just a bet on an outcome. Say Bank A writes a million-dollar mortgage to the Pope for a town house in the West Village. Bank A wants to hedge its mortgage risk in case the Pope can’t make his monthly payments, so it buys CDS protection from Bank B, wherein it agrees to pay Bank B a premium of $1,000 a month for five years. In return, Bank B agrees to pay Bank A the full million-dollar value of the Pope’s mortgage if he defaults. In theory, Bank A is covered if the Pope goes on a meth binge and loses his job.

When Morgan presented their plans for credit swaps to regulators in the late Nineties, they argued that if they bought CDS protection for enough of the investments in their portfolio, they had effectively moved the risk off their books. Therefore, they argued, they should be allowed to lend more, without keeping more cash in reserve. A whole host of regulators – from the Federal Reserve to the Office of the Comptroller of the Currency – accepted the argument, and Morgan was allowed to put more money on the street.

But in the late Nineties, a few years before Cassano took over AIGFP, all that changed. The Democrats, tired of getting slaughtered in the fundraising arena by Republicans, decided to throw off their old reliance on unions and interest groups and become more “business-friendly.” Wall Street responded by flooding Washington with money, buying allies in both parties. In the 10-year period beginning in 1998, financial companies spent $1.7 billion on federal campaign contributions and another $3.4 billion on lobbyists. They quickly got what they paid for. In 1999, Gramm co-sponsored a bill that repealed key aspects of the Glass-Steagall Act, smoothing the way for the creation of financial megafirms like Citigroup. The move did away with the built-in protections afforded by smaller banks. In the old days, a local banker knew the people whose loans were on his balance sheet: He wasn’t going to give a million-dollar mortgage to a homeless meth addict, since he would have to keep that loan on his books. But a giant merged bank might write that loan and then sell it off to some fool in China, and who cared?

Read the entire article to understand what happened after AIG collapsed and the Bush Administration poured $3 trillion into trying to save Wall Street, actions with no oversight or openness.  This is very scary business and I wonder why the American masses haven’t descended on Wall Street and burned it to the ground.  Now, perhaps, you understand why Osama Bin laden targeted our financial center for his attack.  He was trying to destroy the cancer this country was hiding from the world.  I am not defending what this madman did, simply trying to educate you on his motivations.  Most Americans still have no real comprehension of why people hate us enough to launch mass attacks on our financial institutions.  How do we prevent future attacks if we don’t know why the fist ones were initiated?