Halloween aftermath

Sunday November 1st, 2009

. . . .Just a couple of quick items here on a Sunday morning, in my continued pursuit of exposing the bastards behind the biggest economic collapse since the Great Depression, and these assholes are intent on continuing it and profiting from it, bottomfeeders that they are.

. . . .Well, that and the fact that I'm sick as hell and have a blown-out back.

. . . .All, I'm gonna say about the following is "I told you so", from McClatchy this morning.

In 2006 and 2007, Goldman Sachs Group peddled more than $40 billion in securities backed by at least 200,000 risky home mortgages, but never told the buyers it was secretly betting that a sharp drop in U.S. housing prices would send the value of those securities plummeting.

Goldman's sales and its clandestine wagers, completed at the brink of the housing market meltdown, enabled the nation's premier investment bank to pass most of its potential losses to others before a flood of mortgage defaults staggered the U.S. and global economies.

Only later did investors discover that what Goldman had promoted as triple-A rated investments were closer to junk.

Now, pension funds, insurance companies, labor unions and foreign financial institutions that bought those dicey mortgage securities are facing large losses, and a five-month McClatchy investigation has found that Goldman's failure to disclose that it made secret, exotic bets on an imminent housing crash may have violated securities laws.

"The Securities and Exchange Commission should be very interested in any financial company that secretly decides a financial product is a loser and then goes out and actively markets that product or very similar products to unsuspecting customers without disclosing its true opinion," said Laurence Kotlikoff, a Boston University economics professor who's proposed a massive overhaul of the nation's banks. "This is fraud and should be prosecuted."

John Coffee, a Columbia University law professor who served on an advisory committee to the New York Stock Exchange, said that investment banks have wide latitude to manage their assets, and so the legality of Goldman's maneuvers depends on what its executives knew at the time.

"It would look much more damaging," Coffee said, "if it appeared that the firm was dumping these investments because it saw them as toxic waste and virtually worthless."

Lloyd Blankfein, Goldman's chairman and chief executive, declined to be interviewed for this article.

A Goldman spokesman, Michael DuVally, said that the firm decided in December 2006 to reduce its mortgage risks and did so by selling off subprime-related securities and making myriad insurance-like bets, called credit-default swaps, to "hedge" against a housing downturn.

DuVally told McClatchy that Goldman "had no obligation to disclose how it was managing its risk, nor would investors have expected us to do so ... other market participants had access to the same information we did."

For the past year, Goldman has been on the defensive over its Washington connections and the billions in federal bailout funds it received. Scant attention has been paid, however, to how it became the only major Wall Street player to extricate itself from the subprime securities market before the housing bubble burst.

Goldman remains, along with Morgan Stanley, one of two venerable Wall Street investment banks still standing. Their grievously wounded peers Bear Stearns and Merrill Lynch fell into the arms of retail banks, while another, Lehman Brothers, folded.

To piece together Goldman's role in the subprime meltdown, McClatchy reviewed hundreds of documents, SEC filings, copies of secret investment circulars, lawsuits and interviewed numerous people familiar with the firm's activities.

McClatchy's inquiry found that Goldman Sachs:

• Bought and converted into high-yield bonds tens of thousands of mortgages from subprime lenders that became the subjects of FBI investigations into whether they'd misled borrowers or exaggerated applicants' incomes to justify making hefty loans.
• Used offshore tax havens to shuffle its mortgage-backed securities to institutions worldwide, including European and Asian banks, often in secret deals run through the Cayman Islands, a British territory in the Caribbean that companies use to bypass U.S. disclosure requirements.
• Has dispatched lawyers across the country to repossess homes from bankrupt or financially struggling individuals, many of whom lacked sufficient credit or income but got subprime mortgages anyway because Wall Street made it easy for them to qualify.
• Was buoyed last fall by key federal bailout decisions, at least two of which involved then-Treasury Secretary Henry Paulson, a former Goldman chief executive whose staff at Treasury included several other Goldman alumni.

The firm benefited when Paulson elected not to save rival Lehman Brothers from collapse, and when he organized a massive rescue of tottering global insurer American International Group while in constant telephone contact with Goldman chief Blankfein. With the Federal Reserve Board's blessing, AIG later used $12.9 billion in taxpayers' dollars to pay off every penny it owed Goldman.

These decisions preserved billions of dollars in value for Goldman's executives and shareholders. For example, Blankfein held 1.6 million shares in the company in September 2008, and he could have lost more than $150 million if his firm had gone bankrupt.

With the help of more than $23 billion in direct and indirect federal aid, Goldman appears to have emerged intact from the economic implosion, limiting its subprime losses to $1.5 billion. By repaying $10 billion in direct federal bailout money — a 23 percent taxpayer return that exceeded federal officials' demand — the firm has escaped tough federal limits on 2009 bonuses to executives of firms that received bailout money.

Goldman announced record earnings in July, and the firm is on course to surpass $50 billion in revenue in 2009 and to pay its employees more than $20 billion in year-end bonuses.

. . . . . .Read the entire article here.

. . . . . .And I'll put the bottom tag line of the article here.

COMING TOMORROW

Since the economic collapse that swept millions of Americans out of their jobs and homes, Goldman Sachs has moved aggressively to recover its losses. The firm is pursuing marginally qualified borrowers into state courts federal and bankruptcy across the country and seeking to seize their homes. McClatchy examines one couple's multi-year attempt to get Goldman to admit that it had purchased their mortgage.

. . . . .And this from the New York Times on Citibank, this morning:

OVER the past 80 years, the United States government has engineered not one, not two, not three, but at least four rescues of the institution now known as Citigroup. In previous instances, the bank came back from the crisis and prospered.

Will Citigroup rise again from its recent near-death experience?

The answer to that question concerns not only the 276,000 employees who work at what was once the world’s largest bank, but the nation’s taxpayers as well. Even as Citigroup’s stock has soared from a low of $1.02 to its current $4.09 — and the company has eked out a $101 million profit in the third quarter along the way — it’s still unclear whether it can climb out of the hole that its former leaders dug before and during the mortgage mania. If Citigroup remains stuck, taxpayers will be on the hook for outsize losses.

Citigroup remains a sprawling, complex enterprise, with 200 million customer accounts and operations in more than 100 countries. And when people talk about institutions that have grown so large and entwined in the economy that regulators have deemed them too big to be allowed to fail, Citigroup is the premier example.

As a result, the government has handed Citigroup $45 billion under the Troubled Asset Relief Program over the last year. Through the Federal Deposit Insurance Corporation, a major bank regulator, the government has also agreed to back roughly $300 billion in soured assets that sit on Citigroup’s books. Even as other troubled institutions recently curtailed their use of another F.D.I.C. program that backs new debt issued by banks, Citigroup has continued to tap the arrangement.

Citigroup is also one of only two TARP recipients so desperate for capital that they’ve swapped government-issued shares into common stock, diluting existing shareholders. (GMAC, the troubled auto lender that may receive another government infusion, is the other.)

While Citigroup has written down tens of billions of dollars’ worth of mortgages on its books, there are looming problems in its huge credit card portfolio. Of the company’s $1.2 trillion in credit commitments outstanding in the second quarter, $873 billion were credit card lines. A measure of the bank’s efforts to wrestle that problem to the ground is the interest it charges customers: in October, Citigroup raised interest rates on some credit card holders to 29.99 percent.

. . . .Read the entire piece here.

. . . .We are so far beyond capitalism and free-market enterprise, there isn't even a word to describe this economic and political shell game. We truly have become a corporatist society, in which the personal, economic well-being of the singular entity known as the "corporation" comes first and foremost. And most of you spent your summer calling him a "socialist", or a "communist", or a "fascist". This guy is the ultimate corporate, capitalist tool.

. . . .I'm re-running the one from Larry Flynt from earlier in the summer:

The American government -- which we once called our government -- has been taken over by Wall Street, the mega-corporations and the super-rich. They are the ones who decide our fate. It is this group of powerful elites, the people President Franklin D. Roosevelt called "economic royalists," who choose our elected officials -- indeed, our very form of government. Both Democrats and Republicans dance to the tune of their corporate masters. In America, corporations do not control the government. In America, corporations are the government.

This was never more obvious than with the Wall Street bailout, whereby the very corporations that caused the collapse of our economy were rewarded with taxpayer dollars. So arrogant, so smug were they that, without a moment's hesitation, they took our money -- yours and mine -- to pay their executives multimillion-dollar bonuses, something they continue doing to this very day. They have no shame. They don't care what you and I think about them. Henry Kissinger refers to us as "useless eaters."

But, you say, we have elected a candidate of change. To which I respond: Do these words of President Obama sound like change?

"A culture of irresponsibility took root, from Wall Street to Washington to Main Street."
There it is. Right there. We are Main Street. We must, according to our president, share the blame. He went on to say: "And a regulatory regime basically crafted in the wake of a 20th-century economic crisis -- the Great Depression -- was overwhelmed by the speed, scope and sophistication of a 21st-century global economy."

This is nonsense.

The reason Wall Street was able to game the system the way it did -- knowing that they would become rich at the expense of the American people (oh, yes, they most certainly knew that) -- was because the financial elite had bribed our legislators to roll back the protections enacted after the Stock Market Crash of 1929.

Congress gutted the Glass-Steagall Act, which separated commercial lending banks from investment banks, and passed the Commodity Futures Modernization Act, which allowed for self-regulation with no oversight. The Securities and Exchange Commission subsequently revised its rules to allow for even less oversight -- and we've all seen how well that worked out. To date, no serious legislation has been offered by the Obama administration to correct these problems.

Instead, Obama wants to increase the oversight power of the Federal Reserve. Never mind that it already had significant oversight power before our most recent economic meltdown, yet failed to take action. Never mind that the Fed is not a government agency but a cartel of private bankers that cannot be held accountable by Washington. Whatever the Fed does with these supposed new oversight powers will be behind closed doors.

Obama's failure to act sends one message loud and clear: He cannot stand up to the powerful Wall Street interests that supplied the bulk of his campaign money for the 2008 election. Nor, for that matter, can Congress, for much the same reason.

Consider what multibillionaire banker David Rockefeller wrote in his 2002 memoirs:

"Some even believe we are part of a secret cabal working against the best interests of the United States, characterizing my family and me as 'internationalists' and of conspiring with others around the world to build a more integrated global political and economic structure -- one world, if you will. If that's the charge, I stand guilty, and I am proud of it."

Read Rockefeller's words again. He actually admits to working against the "best interests of the United States."

Need more? Here's what Rockefeller said in 1994 at a U.N. dinner: "We are on the verge of a global transformation. All we need is the right major crisis, and the nations will accept the New World Order." They're gaming us. Our country has been stolen from us.

Journalist Matt Taibbi, writing in Rolling Stone, notes that esteemed economist John Kenneth Galbraith laid the 1929 crash at the feet of banking giant Goldman Sachs. Taibbi goes on to say that Goldman Sachs has been behind every other economic downturn as well, including the most recent one. As if that wasn't enough, Goldman Sachs even had a hand in pushing gas prices up to $4 a gallon.

The problem with bankers is longstanding. Here's what one of our Founding Fathers, Thomas Jefferson, had to say about them:

"If the American people ever allow private banks to control the issuance of their currency, first by inflation, and then by deflation, the banks and the corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their father's conquered."

We all know that the first American Revolution officially began in 1776, with the Declaration of Independence. Less well known is that the single strongest motivating factor for revolution was the colonists' attempt to free themselves from the Bank of England. But how many of you know about the second revolution, referred to by historians as Shays' Rebellion? It took place in 1786-87, and once again the banks were the cause. This time they were putting the screws to America's farmers.

Daniel Shays was a farmer in western Massachusetts. Like many other farmers of the day, he was being driven into bankruptcy by the banks' predatory lending practices. (Sound familiar?) Rallying other farmers to his side, Shays led his rebels in an attack on the courts and the local armory. The rebellion itself failed, but a message had been sent: The bankers (and the politicians who supported them) ultimately backed off. As Thomas Jefferson famously quipped in regard to the insurrection: "A little rebellion now and then is a good thing. The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants."

Perhaps it's time to consider that option once again.

I'm calling for a national strike, one designed to close the country down for a day. The intent? Real campaign-finance reform and strong restrictions on lobbying. Because nothing will change until we take corporate money out of politics. Nothing will improve until our politicians are once again answerable to their constituents, not the rich and powerful.

Let's set a date. No one goes to work. No one buys anything. And if that isn't effective -- if the politicians ignore us -- we do it again. And again. And again.

The real war is not between the left and the right. It is between the average American and the ruling class. If we come together on this single issue, everything else will resolve itself. It's time we took back our government from those who would make us their slaves.

. . . .Catch up on the last 10 postings, where I've been writing about, and putting contributions about this same thing up, day after day after day. It's the most important issue we face, and it's meaningless, at least apparently, based on the level of apathy most people are exhibiting about, to most folks.

. . . .Outta here, I may update later today.

. . . .. . . .And that's the way it is:

. . . . .. . . .We can salvage this shipwreck of a Nation. It will take all of us working together. It will take all of us understanding the concepts of the Great American Experiment, the political process of the Republic. It's amazing, I don't see eye-to-eye on every issue with my friends, but we respect one another's opinion, share information, share facts, and we don't talk over one another or at one another, we talk with one another. It's amazing what happens when a group of people who share the common goal of leaving a better country for their children and grandchildren can do when they sit down with one another as human beings, and realize that we each have power, and together, we are unstoppable.

. . . .I'm going to ask this of you for the next 30 days. Turn your TV off, turn your radio off. Start to use that beautiful mind that your Creator gave you, that your underpaid, underappreciated High School teachers tried to develop. If you hear something, if you read something, if someone sends you an e-mail that says "this bill will do this", or "this politician says this", I'm asking you to check it out. Check it out this way, use some of the following fact-based sites, who exist solely for the purpose of data and fact-checking.
- If whatever you've heard or read concerns a bill in Congress, use the following -
- Open Congress, it's non-partisan and devoted to a complete tracking of every bill in Congress, both houses. How a bill is developed, who is sponsoring it, what the riders are, what the discussion around it is.
- GovTrack, again non-partisan, non-commercial and open source; devoted to the same things, tracking Congress.
- Open Secrets, one of the most important ones, it tracks the lobbying money and campaign contributions flowing to your congressperson, and most of the time is a pretty good predictor of how they'll vote.
- Political Party Time, non-partisan, devoted to solely tracking political fundraisers, and letting you know exactly what parties your Representative and Senators are throwing for fundraisers and who is attending and how much money they're throwing at them to gain influence.

. . . .If someone sends something to you saying "this is so" or "that is so" or "the President/Senator/Representative said this" use the following:
- Fact Check, non-partisan, designed to separate fact from bullshit and fiction
- Snopes, devoted to the same thing.
- Politifact, devoted to getting to the truth, and separating out the lies that are spread.


. . . .I keep doing this not because I don't have faith, but because I do have faith. I have faith in the ultimate triumph of the spirit, intellect and heart of the American people. I have faith that the people I know want to leave something better for future generations, and know that something is terribly wrong, and want to do something about it. I do it because Paine and Jefferson were brilliant, unique singularities and were right.

. . . .I keep doing this because I don't believe in big imaginary friends for adults, I don't believe in alien conspiracies running the Government, I don't believe the Roswell bodies are at Wright-Patterson, I don't believe that a big portal will open up on Dec. 21, 2012, I don't believe that the spaceships will show up.

. . . I do believe that the people who have fucked everything up are greedy, avaricious human beings who have been able to steal from the American people, to harm them, who have run unchecked because no one calls it out for what it is. I believe that if we shine the light of day on it, if the people of this country have had enough, we can change it, and change it for the better.

. . . . I keep doing this because I do believe that people, human beings, unchecked will continue to do what they've done throughout history, and throughout the history of this country. Together, they will find the solutions and provide better for their children and grandchildren.

. . . .I believe in us, I believe in people. I believe in the beauty, power and grace of the individual.

. . . .I do this for everyone who's ever walked that lonely road of knowing what they do, what they believe, what they know is right. I do it for everyone who's ever walked that lonely road of faith, hope, love, hate, justice, war and peace.

. . . .I do it because I believe in justice, in all it's forms.

. . . .I do this everyday for the people and kids who are tattoed, pierced and inked and keep getting told to get "into the mainstream". I do this everyday for those guys who wear black that you don't understand, you just know there's something about them, and that when the chips are down, when you have to walk down a dark alley somewhere, and you know what's waiting for you at the end of it, and you can only take one person with you, that's who you want walking with you, because you know you'll come back out alive, and that guy doesn't care what it costs him.

. . . .I do this everyday for the outcasts, the misfits, the ones who don't fit and who will turn their back on you and walk away when you try to make them fit into a mold. I do it everyday for everyone who does it their way, knows that they're paying a high price for it, but the freedom is worth the cost.

. . . . I do this everyday for outlaws, cowboys, renegades, pirates and fallen angels. I do it everyday for the people who understand that rock and roll can save their soul, that redemption can be found in a 3-chord lick from a vintage Les Paul. I do it for the men and women who aren't afraid to turn it all the way up, who keep looking for an 11 setting on a volume knob that only goes to 10, who know that rock and roll's got nothing to do with age.


. . . .If right now, you're doing something you don't want to do, stop it. If you've surrounded yourself with people who want you to do or be something other than who you are, walk away. If you've got people around you who actually let it slip out that they think you "should be doing (fill in the blank here)" and it involves your life, your future, your existence as an individual, walk away, right now, and don't look back. You don't owe anyone anything. Live fearlessly. If the people around you can't accept it, can't accept you as you are, really are, they aren't and weren't friends anyhow.

. . . .Don't march to anyone else's drumbeat, don't drink the Kool-Aid, anyone's. Right, Left, conservative, liberal, Democrat, Republican, Christian, Buddhist, Pagan. Use your own mind, that's why you were given one. Examine, question, do what's right for you first, everything else will fall in place from there, quit looking for the path, you're already on it.

. . . .Come out of the gate each morning with both barrels blazing, pedal-to-metal, full-tilt boogie, all-in and balls-out, what's stopping you? Do you want to live forever? That'd be boring.

. . . .Got your back. somewhere out there in the night

. . . .Kiss your kids, tell the ones you love out loud that you do. Seize the precious moments before they're ripped away from you. This rodeo is a one-way ticket and no one, absolutely no one gets out alive. There aren't a lot of second chances, and we don't get to dictate terms and circumstances of how the ticket gets punched. This ain't no dress rehearsal, and the curtain's gone up, it's real and right now. It's not about yesterday or tomorrow. It's about right fucking here, right fucking now. This, what you're reading, what you're hearing, is the proof, the words, the sounds and the sights of someone changing his own life and his own world and not being afraid to put it out there. What have you done for yourself lately and why are you waiting? Do it now.

The Desolation Angel
from somewhere halfway to Heaven, and just a mile out of Hell

You know someone like me, there's still a few of us left. If we have to, we'll stand at the gates of Hell and hold the last train home for you.. . . . . .

[where: Gregory, MI 48137]