September 29, 2008 archive

“If you want an answer RIGHT NOW, the answer’s ‘No.'”

That was the sign that used to hang behind the building permit counter at one of our local municipalities.

I didn’t much like it then, because I thought it represented the worst of an ossified bureaucratic outlook toward public service.

But after the vote in the the House today on the bailout bill, I completely understand the sentiment.

Four at Four

    1. The NY Times reports Treasury would emerge with vast new power.

      The draft legislation, which will be put to a House vote on Monday, gives Treasury Secretary Henry M. Paulson Jr. and his successor extraordinary power to decide how the $700 billion bailout fund is spent…

      Mr. Paulson can choose to buy from any financial institution that does business in the United States, or from pension funds, with wide discretion over what he will buy and how much he will pay. Under most circumstances, banks owned by foreign governments are not eligible for the money, but under some conditions, the secretary can choose to bail out foreign central banks.

      Under the bill, the Treasury is to buy the securities at prices he deems appropriate. Mr. Paulson may set prices through auctions but is not required to do so.

      Rarely if ever has one man had such broad authority to spend government money as he sees fit, with no rules requiring him to seek out the lowest possible price for assets being purchased.

      The LA Times reports Paulson will have no peer.

      Buried beneath the 100-plus pages of detail that Paulson’s financial rescue plan has picked up during its 10-day journey from a Bush administration wish list to a bipartisan congressional compromise is the striking fact that the Treasury secretary got almost everything he sought — an eventual $700 billion and the authority to spend it largely as he sees fit…

      Whether that turns out to be a big problem remains to be seen, however, and for the rest, Paulson’s new powers will be almost breathtaking in their scope.

      He and his successor will have the right to buy not just mortgage-related securities at the heart of the crisis, according to the language of the bill, but under some conditions could buy any financial instrument “the purchase of which is necessary to promote financial market stability.” …

      It even gives him the politically explosive power to cut deals with foreign, not just U.S., banks in some cases.

      AlterNet has lots of pictures as Bailout Protesters Send a Strong Message from Wall Street. In the first round of voting, the House defeated, by a 205-228 vote, the Economic Enabling Act of 2008. A new vote is planned, likely timed for after another stunt by McCain. Meanwhile, stocks are cratering and oil prices have dropped sharply.

    Four at Four continues with Mukasey appointing a special prosecutor, high-ranking former CIA official pleads guilty to fraud, and labor unions work to counter members’ racism against Obama.

Bailout Defeated: Chalk one up for democracy

The Wall Street bailout plan has been defeated in the House.

WASHINGTON – In a moment of historic drama in the Capitol and on Wall Street, the House of Representatives voted on Monday to reject a $700 billion rescue of the financial industry.

The vote against the measure was 228 to 205. Supporters vowed to try to bring the rescue package up for consideration again as soon as possible.

House leaders pushing for the package kept the voting period open for some 40 minutes past the allotted time, trying to convert “no” votes to “yes” votes by pointing to damage being done to the markets, but to no avail.

Whatever the relative merits of the economic legislation, this is still a very good day for our Republic.

It is far past time the Congressional Leadership realized that they are Representatives of the People – not of Wall Street bankers, corporate moguls, and foreign money lenders.  With public opinion so dead set against this bill, Pelosi and the others had no business trying to ram it through the House without adequate discussion and debate.

Hopefully, the defeat of Paulson’s Folly today will be a harbinger of a new era of greater accountability and responsibility by our elected representatives to the wishes of those whom they purport to represent.

But whatever the future may hold, at least on this day our Constitutional Republic has shown that it still has some life left in it.

Update: More on the vote from KagroX here.

Wow! NYT: Special Prosecutor Named in Attorney Firings Case

Sure to get lost in the financial news, but pretty damn shocking all things considered!

WASHINGTON– Attorney General Michael B. Mukasey appointed a special prosecutor on Monday to investigate whether criminal charges should be brought against former Attorney General Alberto R. Gonzales and other officials in connection with the firings of nine of United States attorneys in 2006.

The move came as the Justice Department released a report by its inspector general severely criticizing the process that led to the firings.


“The report makes plain that, at a minimum, the process by which nine U.S. attorneys were removed in 2006 was haphazard, arbitrary and unprofessional, and the way in which the Justice Department handled those removals and the resulting public controversy was profoundly lacking,” Mr. Mukasey said in a statement. The report called for further investigation to determine whether prosecutable offenses were committed either in the firings or in subsequent testimony about them.

Class War: Stupidity or Evil?

Our ‘elite’ is broken. Nobody really knows what the fuck they are doing. Nobody really knows the results of what they are doing. And to a certain extent is has to be said, they just don’t care either. They don’t care about us. All they care about is covering their own ass. At our expense. This is out and out Class War, they know, we know it, and the rest of The People seem to waking up to it.

Our financial elites don’t know and don’t care, they are in strict CYA mode, taking breaks only to figure out how to game and leverage the bailout so that they can transfer even more wealth from the taxpayers into their pocket. If things don’t turn out well, they open their Golden Parachutes and go live on a beach in the Caymans and sip rum drinks.

Stupid or evil? Conclusion: it doesn’t matter. We The People get screwed either way.

Our political ‘elite’ are even worse, they have NO clue as to what is going on. They are running around with their hair on fire in super-duper CYA mode, taking breaks only to figure out how this crisis can be maneuvered for political advantage and trying not to piss off their corporate masters, while keeping The People calm enough to not riot after assault piled on assault and insult piled on insult tax even the incredibly resilient somnabulance of Mr. and Mrs. America. As kos points out, they continue to think we are buying this crap. The party is over??? Gimme a fucking break Nancy. You are about to serve the fucking canapes, the party is just getting started. Just because you are buying their bullshit doesn’t mean we buy yours.

Stupid or evil? Conclusion: it doesn’t matter. We The People get screwed either way.

The only people who seem to have, well to be getting, a clue are The People, who are finally waking up from their slumber of post 9/11 fear and are looking around and seeing what has been going on and wondering why their ass hurts. It hurts because our ‘elite’ have been screwing them. And each time we get screwed, the ‘elites’ just tell us we have no choice but to trust them. Are they right? Are we at their mercy, no matter how badly they screw up? ARE we just sheep to be shorn by the ‘elite?”


Or will things be different this time?


On Responsibility

I’ve been sitting back, taking in as much of the facts about this economy meltdown as I could stand.  I’ve also sat reading conservatives who, after voting election after election for candidates who gave Big Business whatever they wanted, now lament how it must have been some racial thing that brought our country to collapse.  It would probably take a legion of psychologists decades to deduce the reasons for this denial in conservatives.

Your Money or Your Life – Bushco’s Last Grab


$700 Billion–Not Enough To Rescue Iceland’s Third Largest Bank

Apologies for posting twice in short order, but I really think this needs getting around. I regret that I’ve already used my Daily Kos slot for the day. Thank heavens for Docudharma’s somewhat mellower approach.

Since Congress is scheduled to debate and probably vote on the Henry Paulson “rescue plan” for the financial markets today, I want to highlight a bit of news hot off the presses (or the servers, anyhow).

To introduce it, let me say that in my view this plan will do almost nothing to stop the ongoing economic meltdown, and a lot to save various Wall Street firms and advance the concentration of capital. I expect the worthy Ilargi at the indispensable economics blog, The Automated Earth, is right that the storm of desperation and outrage currently directed at Congress will not stop this legislation from going through, since it is all about politics and not economics.

On the one hand, $700 billion seems like a lot of money. It’s supposed to. A Treasury Department spokeswoman told the online last week, “It’s not based on any particular data point. We just wanted to choose a really large number.”

On the other hand, this morning brings the news that the Glitnir Bank has just been taken over by the Icelandic government to prevent its collapse. Iceland now owns 75% of Glitnir.

The price tag was $868 billion.  Eight hundred and sixty eight billion dollars.

Think about it. That’s to rescue the third largest bank in freaking Iceland. (Admittedly Reykevik-based banks have become European and even global players by heavy risk-taking in derivative markets, but still…Iceland?)

If you feel like hollering at your Senators and Congresscritters this morning, you might want to ask them how much stability they think Paulson’s measly $700 billion is really going to buy?

This Week the Economies of the World Will be Destroyed


Where are you now?

This week the stock market is scheduled to collapse. Wachovia and National City banks are due to collapse. Over 100 banks are expected to collapse in the next few months.

Your money is probably very unsafe, your pensions, your social security and yet no one really seems to realize that it’s all about to come crumbling down…

From Paul Krugman to Kramer and Kudlow…that’s what they are saying. It’s not what I’m saying. It’s what they are saying.

There may be as few a 5 banks left. Citigroup, Bank of America, Chase are three of those. They will buy the smaller banks in league with the government. That will undoubtedly fail. They have been chosen by the government to be treated preferentially.

PUT YOUR MONEY IN THOSE BANKS…for your own good. All other banks may fail.

Yet the news, especially the “progressive” news is largely focused on an election that will become more and more meaningless as these events begin to unfold in the very immediate future.

It will be an election of symbolic value only. It’s far too late now, and it’s been far too late for several years.

That election might have to be put off.

It amazes me how so many people are focused on anything else but the giant wave of economic destruction that is about to engulf YOU.

It doesn’t matter whether you have any money or no money. The effect will be overwhelming for everybody.

5 banks have been chosen by the government to buy failing banks. JP Morgan Chase, Citigroup and Bank of America are three of those. The government will use the bail out money to give to these 5 banks to use to buy failing banks in the hopes that it will stop the flight of capital.

I don’t see how it could work. But what do I know? Probably a lot more than I want to admit to myself.

Open Thread


Git along little threads.  Yippie-yo-ki-yay!

Black NJ: Bail Out Homeowners, Not Bankers

Saturday was a day for summing up Presidential Debate number one. It was also the day that members of New Jersey’s People’s Organization for Progress (POP) delivered a summation of their own. They had watched two presidential candidates stand in front of a huge national television audience, hemming and hawing about bailing the US financial system out of economic catastrophe and not saying a whole lot about how the country got in this mess.

So Saturday at one, two dozen POP members wearing their trademark yellow t-shirts rolled out at Broad & Market, the historic and commercial center of Newark, to say “Save Our Houses, Don’t Bail Out Billionaires.”

Docudharma Times Monday September 29

I’m Sure Giving Henry Paulson All That Power

Just Warms The Heart As You Look Forward To

Another Heck Of A Job Brownie Moment

Monday’s Headlines:

More Americans on food stamps but say it’s not enough

Israel supplied with long-range radar, but US to get missile warning first

Syrian bombing: A jihadi attack?

Congo’s child soldiers re-enlisted

Sudan says six kidnappers killed in shootout  

Anti-foreigner campaign boosts Austrian far-right

Belarus opposition fails in polls  

Unions in China still feeble, but gaining foothold

Is Pakistan’s new president up to the job?

Voters in Ecuador Approve Constitution

Bailout Plan in Hand, House Braces for Tough Vote  



Published: September 28, 2008    

WASHINGTON – The House braced for a difficult vote set for Monday on a $700 billion rescue of the financial industry after a weekend of tense negotiations produced a plan that Congressional leaders portrayed as greatly strengthened by new taxpayer safeguards.

The 110-page bill, intended to ease a growing credit crisis, came after a frenzied week of political twists and turns that culminated in an agreement between the Bush administration and Congress early Sunday morning.

The measure still faced stiff resistance from Republican and Democratic lawmakers who portrayed it as a rush to economic judgment and an undeserved aid package for high-flying financiers who chased big profits through reckless investments.

European governments swoop to save troubled lenders



By Matthew Saltmarsh and Landon Thomas Jr.

Published: September 29, 2008

PARIS: Just days after the United States government brokered the sale of the largest U.S. savings and loan, Washington Mutual, regulators in Britain and Belgium swooped to engineer emergency rescues of two leading banks with heavy exposure to soured mortgages.

In the latest sign of trouble to hit Europe from the global credit crisis, the Belgian, Dutch and Luxembourg governments announced a partial nationalization of the troubled Belgian-Dutch financial conglomerate Fortis, involving a combined injection of €11.2 billion from the three governments, which take a 49 percent stake.

Prime Minister Yves Leterme of Belgium, who was joined Sunday by the European Central Bank president Jean-Claude Trichet in an unprecedented appearance, unveiled the accord after a weekend of emergency talks in which the governments had tried to broker a whole or partial sale of the bank to private bidders



Paulson will have no peer

The Treasury chief will gain sweeping, even unparalleled power under Congress’ compromise plan.

By Peter G. Gosselin, Los Angeles Times Staff Writer  

WASHINGTON — Despite all the constraints Congress supposedly wrapped around him, Treasury Secretary Henry M. Paulson is about to become the most powerful mortgage financier of the modern era — most likely of any era.

Buried beneath the 100-plus pages of detail that Paulson’s financial rescue plan has picked up during its 10-day journey from a Bush administration wish list to a bipartisan congressional compromise is the striking fact that the Treasury secretary got almost everything he sought — an eventual $700 billion and the authority to spend it largely as he sees fit.

To be sure, congressional bargainers did make one huge change.

And in the process, they created a potential stumbling block as the Treasury tries to stabilize the deeply damaged financial system by acquiring toxic mortgage-backed securities.

Under terms of the compromise announced Sunday, any firm selling troubled assets to the government would have to give Washington the right to take an ownership stake in the firm — a more sweeping requirement than had been expected.

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