Text: Henry Paulson Testimony before House Financial Services Committee | November 18, 2008

(Source: U.S. Treasury Department)

Click this link for PDF of Sec. Paulson’s Testimony

Text: Ben Bernanke Testimony to House Financial Services Committee | November 18, 2008

Click this link for PDF of Chairman Bernanke’s testimony.

Text: Summary of Auto Industry Rescue Bill – U.S. House Financial Services Committee

(Source: U.S. House Financial Services Committee)

Summary of Draft Auto Rescue Bill

Adds Title IV to the Emergency Economic Stability Act (EESA):

Emergency Direct Loan Program – Directs Treasury to make no greater than $25 billion total in loans to eligible automobile manufacturers no earlier than December 1, 2008. These funds will be drawn from the third tranche of the $700 billion provided under EESA without triggering the reporting and procedural requirements. Treasury will designate a portion of these funds as needed to meet applicants’ short-term liquidity requirements while they develop the long-term restructuring plan due on 3/31/09, and reserve the balance for long-term needs and implementation of restructuring plan.

Eligible Applicants

• Domestic automobile manufacturers producing in the U.S. continuously for 25 years or more.
• Treasury, in consultation with the Oversight Board described below, must make a determination that the failure of the applicant would have “systemic adverse effect on the overall United States economy.”
• Applicant must provide financial and other information as Treasury may require.
• Applicant must submit a short-term operating plan that describes planned use of the loan proceeds, including commitment of resources to develop long-term restructuring plan and reasonable prospects for repayment.•

Long-Term Restructuring Plan – Not later than 3/31/09, loan recipients must submit to Treasury acceptable restructuring plan for long-term viability and international competitiveness, including fuel efficiency standards and advanced technology vehicle manufacturing, rationalization of costs, and proposals for restructuring existing debt.

Oversight Board

• The Financial Stability Oversight Board (Oversight Board) established under EESA will provide oversight of the loan program, and will have four additional members for purposes of the loan program (Secretaries of Energy, Labor and Transportation and the EPA Administrator) in addition to the five existing members (Fed Chairman, Treasury Secretary, FHFA Director, SEC Chairman, and HUD Secretary).

Oversight of the Loan Program – Existing oversight provisions of EESA apply to the loan program, including GAO, Special IG, and Congressional Oversight Panel.

Allocation of Funds – Treasury, in consultation with the Oversight Board, will prioritize applications based on the magnitude of the impact of the applicant’s U.S. manufacturing operations on the overall U.S. economy.

Terms of Loans

• Term: 7 years (or longer as may be determined by the Oversight Board), subject to immediate acceleration if the recipient fails to submit an acceptable long-term restructuring plan.
• Interest Rate: 5% for first 5 years and 9% thereafter.
• Super Seniority: All other obligations and liabilities of a recipient will be subordinate to the loan.
• No prepayment penalty.

Warrants – Treasury must obtain warrants from each loan recipient (or economic equivalent in the case of a privately held firm) equal to 20% of the loan or such greater percentage as may be determined by Treasury in consultation with the Oversight Board.

Executive Compensation and Corporate Governance – All executive compensation restrictions from EESA apply to loan recipients for the duration of the loan plus the following additional restrictions:

• No bonuses to employees making more than $200,000 (which Treasury will adjust for inflation).
• No golden parachutes under any circumstances.
• No compensation plan that could encourage manipulation of reported earnings to enhance compensation.

Ability to Prohibit Transactions, Oversight of Financial Condition – For duration of the loan, Treasury in consultation with the Oversight Board will have the authority to review and prohibit any asset sale, investment, contract, or commitment proposed to be entered into by the recipient valued in excess of $25 million.•

Dividends – Recipients may not pay any dividends for duration of the loan.•

Full Information Access – Recipients are required to provide Treasury and Oversight Board access to all information that may be relevant to the loan to monitor the interests of the government under this title.

Acceleration of Repayment for Failure to Comply – Treasury may require, in consultation with the Oversight Board, accelerated repayment if loan recipient fails to submit an acceptable long-term restructuring plan or fails comply with any other applicable condition or requirement of the loan program or CAFE

Big Three Automakers, UAW Go Begging on Capitol Hill

Other Than Lehman, Who’s Not Too Big to Fail?

• Automakers beg for aid as their bailout bill stalls - Associated Press
• Big Three try to jumpstart U.S. bailout - Agence France Presse
• GM’s Wagoner: Bailout needed to save U.S. economy from ‘catastrophic collapse’ - Reuters
• Support unravels for Detroit’s share of $700 BN - Detroit Free Press
• Mulally defends Ford’s decisions - Detroit Free Press
• Automakers ask for federal help - Washington Post
• Automakers make their case to Congress - New York Times

Text: George Soros Testimony to U.S. House Committee on Oversight and Government Reform, November 13, 2008

(Source: U.S. Congress, House Committee on Oversight and Government Reform)

Click Here for PDF of Soros’ Prepared Testimony

Treasury Bailing Out AIG Again

Will There Be Spa Trips and English Hunting Excursions This Time?

I sure hope the executive pigs at AIG get it this time.  After all, the last time our tax money was used to prop up their failing business, they spent hundreds of thousands on a West Coast spa and an English hunting trip.

This morning, the U.S. Dept. of Treasury announced the federal government was upping the AIG bailout ante by $40 billion — bringing the taxpayer funded tab to keep the company solvent to $150 billion.  Additionally, AIG is getting a better deal today on the interest it is paying the federal government for loans the public is backing.  As this once shining capitalist jewel becomes nationalized, that means the public accounts will reap less from the bad business decisions sown by AIG executives.

One must also remember that just weeks ago, New York Attorney General Andrew Cuomo told the insurance company that he was able and willing to ‘help’ them do away with golden parachutes, executive pleasure outings and huge bonuses.  Then, U.S. Rep. Henry Waxman found that former AIG exec Joseph Cassano, who ran the company’s financial products section into the ground and left AIG in February was being paid $1 million a month - for nothing - even as the company slurped up taxpayers’ money. Read more

Sunday Papers – November 9, 2008

New York Times Magazine

• After the Imperial Presidency– Jonathan Mahler
• Payday Lenders, Check Cashers – Redeemed?– Douglas McGray
• Deprogramming Jihadists– Katherine Zoepf

New York Times

• Obama team weighs what to take on first
• Harsh words about Obama? Never mind
• Citing workload public lawyers refuse new cases
• How Merrill fell
• Pelosi, Reid want aid for U.S. automakers
• Op-Ed, Frank Rich: It still felt good morning after
• Op-Ed, Al Gore: The climate for change
• Op-Ed, Thomas Friedman: Show me the money
• Op-Ed, Nicholas Kristof: Obama and the War on Brains
• Rice visits West Bank
• U.S. electricity project in Afghanistan
• Back home, Palin finds landscape changed
• After push for Obama, Unions seek new rules

Washington Post

• Preparing for the Obama era
• Reid, Pelosi urge Treasury to extend aid to automakers
• Self-sufficiency evades Iraqi security forces
• Obama positioned to reverse Bush actions
• Medvedev calls Obama; Kremlin describes call
• Congressional Democrats say economy first priority
• Op-Ed, Rich Lowry: The right needs to get centered
• Op-Ed, Joseph Stiglitz: More pain to come even if he’s perfect
• Op-Ed, Ron Suskind: U.S. has power – it could use authority
• Op-Ed, David Broder: Governors know best
• Op-Ed, George Will: Democratic ironies and Republican Afflictions

Los Angeles Times

• Democrats set sights on Texas
• Public works on the table once again
• Obama relies on a close-knit inner circle
• Op-Ed, Norman Ornstein: The GOP’s deep hole
• Op-Ed, James Rainey: Right-wing media feeds its post-election anger
• Political blogger be nimble, be quick
• Election leaves gay couple feeling isolated

Ohio Election Wrap: Day After Clips from Ohio’s Newspapers

Presidential Coverage

• Obama Sweeps to victory as first black president
  – Columbus Dispatch
  
• Obama, American voters make history
  – The Plain Dealer
  
• Win restores blacks’ faith
  – Columbus Dispatch
  
• Analysis: How Obama Won Ohio
  – Columbus Dispatch
  
• Impressive showing but no Ohio turnout record
  – The Plain Dealer
  
• Editorial: Obama presidency is break from the past
  – Canton Repository
  
• Editorial: President Obama is change to cheer
  – Dayton Daily News
  
• Editorial: Making History
  – Akron Beacon Journal
  
• Voters rejoice at Obama’s election – Cincinnati Enquirer
  

• Obama wins Ohio, Michigan – Presidency in Landslide
  – Toledo Blade
  
• ‘Joe the Plumber’ will take his politics online
  – Toledo Blade
  
• Editorial: The View Forward
  – Toledo Blade
  
• Editorial: Now time to unite behind message of hope
  – The Plain Dealer
  
• Editorial: Not the day to be cynical
  – Dayton Daily News
  
• Editorial: Election brings change to America
  – Cincinnati Enquirer
  
• Election Problems? Not in Ohio
  – Columbus Dispatch
  
• Day smoother than expected despite some glitches
  – Columbus Dispatch
  

Ohio Candidates and Issues

• Dems wrest back control of Ohio House
  – Columbus Dispatch
• Stivers, Kilroy winner likely not know for 10 days
  - Columbus Dispatch
• Boccieri to replace Regula
  – Canton Repository
• Driehaus ousts Chabot
  – Cincinnati Enquirer
• Democrats reclaim Ohio House
  – Associated Press
• Cordray rolls to big win
  – Columbus Dispatch
• Editorial:
  Payday Lenders Lose Big in Ohio – The Plain Dealer
• Montgomery County results still being counted – Dayton Daily News
• Boehner will seek return to House leadership
  – The Plain Dealer
• Dems expand majorities in Congress but Ohio races up for grabs
  – The Plain Dealer
• Husted winning State Senate seat
  – Dayton Daily News
• Dems close to regaining control of Ohio House
  – The Plain Dealer
• Fudge, LaTourette, Kucinich win – The Plain Dealer
• Casino, Payday Lenders denied
  – Columbus Dispatch
• Voters choose no on casino – The Plain Dealer
• Payday lenders defeated at polls
  – The Plain Dealer
• Ohio defeats gambling, keeps lending limits – Associated Press
• Paper ballots hold up counts in Ohio counties
  – Associated Press
• Editorial: Ohioans wisely say no to casino
  – Canton Repository

Ohio: Latest Election News Update - PM - November 3

From Ohio’s Major Newspapers

• Biden makes one last plea to Ohioans - Toledo Blade
• Coal becomes burning issue at end of campaign - Columbus Dispatch
• Final Ohio Poll puts Obama as likely winner - The Plain Dealer
• Hundreds endure long lines at Lucas County voting center - Toledo Blade
• Early voters nearly a third of expected total: Officials - Akron Beacon Journal
• Palin starts final day of campaigning in Lakewood - The Plain Dealer
• Long waits during final day of early voting - Dayton Daily News
• Officials confident we won’t see goofs like in ‘04 - Columbus Dispatch
• What local bloggers are saying about the election - The Plain Dealer
• Potential pitfalls on election day - Columbus Dispatch
• Dems feel good heading into Tuesday - Columbus Dispatch
• Final list of Ohio House targeted races - Columbus Dispatch

• Crowds flock to Obama - Columbus Dispatch
• McCain: Momentum “Here” - Columbus Dispatch

• New Voters: Blue Tint - Columbus Dispatch
• Late night for early voters - Columbus Dispatch
• Kilroy, Stivers still sprinting - Columbus Dispatch
• Joe the Plumber sign of the times - Toledo Blade

Text: Prof. Nouriel Roubini’s Congressional Testimony, October 30 | Dr. Doom Speaks

Prof. Nouriel Roubini testified today before the U.S. Congress Joint Economic Committee.

Click Here for Roubini’s Written Testimony (PDF)

A Commercial That Should Have Aired on the Real Tube - David Robinson for Congress

As you pop your corn and crack open your favorite cold beverage to sit back and watch Barack Obama tonight, don’t forget about the great Democratic candidates who are left behind this cycle.  Candidates like David Robinson running to unseat career politician Pat Tiberi from the seat which was handed down to him by John Kasich.

It’s astonishing really.  Barack Obama has so much money left in the tank six days out that he will be able to go out tonight and spend 30 unininterrupted minutes and several millions of dollars to seal his deal with America.  On the other hand, you have an accomplished businessman with ideas and an energy policy who can’t get the people who hold Democratic pursestrings to throw a little love his way. 

It’s true, Robinson is a neophyte in politics.  Rumor has it his campaign is a bit haphazard and he’s fairly set in his ways of wanting to do things differently.  Well friends, he won the fucking primary why hasn’t Labor or the DCCC ponied up.  Well, there’s also the argument that his district is solidly red.  The former Democratic candidate spent over a million dollars and lost against Tiberi who is really a backbenching, pathetic sack of internal organs.  They say, we have to marshall our resources — Ohio 12 isn’t on the list. 

Well, guess what.  Voter registration is up in OH-12.  Shamansky was past his prime.  Shamansky is no David Robinson.  A long time ago when I was peripherally involved with the DCCC, Robinson was a candidate party leaders would have died for … handsome, well-spoken, smart, full of ideas - and wait - the vice-president of a small manufacturing business?  Are you kidding?  Let’s put some money down on this guy.

Perhaps party leaders need to rethink how the wealth is spread in the Democratic Party.  Candidates should have to meet standards, but they should also be able to run the race they want to run.  We can fund the hell out of a cranky old candidate whose baggage has made her race more difficult than it should be, but we can’t help Robinson mount any sort of a media campaign?  If Tiberi weren’t so pathetic, I wouldn’t be so exercised.  All I’m saying is let’s expand the metrics we judge candidates on when we have a do-nothing, Bush clone incumbent and a dynamic Democrat to challenge. 

Well, when the earth moves next Tuesday and we pick up more seats in the U.S. House and hopefully get to 60 in the Senate, our party will have left David Robinson behind. 

If we’re on TV for 30 minutes tonight, it’s obvious the resources were there.

Ted Stevens Guilty on All Counts in Ethics Trial - News Coverage

6 p.m.

• Alaska Senator is Convicted of Ethics Laws Violations - New York Times
• Sen. Stevens Guilty on all Counts - Washington Post
• Stevens conviction enhances Dems’ chances - Washington Post
• U.S. Senator Stevens found guilty - BBC
• Stevens guilty in corruption case - Associated Press
• Stevens guilty of concealing $250,000 in gifts - Bloomberg
• Stevens found guilty on all seven corruption counts - CQ Politics

Text: Alan Greenspan Testimony | Congress | October 23

The following link is Alan Greenspan’s testimony before the House of Representatives Committee on Oversight and Government Reform in Washington today.

Click Here for Greenspan Testimony

The U.S. Government Lie: $700 Billion Bailout

When the U.S. government begins renaming terrible things like killing civilians with misplaced bombs “collateral damage,” we should all know we’re in trouble. When the media doesn’t challenge this government gobbledy-gook but rather adopts it, we’re in bigger trouble. The de-sensitizing has begun. Read more

The $50 Trillion Swindle the Investment Class Doesn’t Have Us on the Hook For - Yet

Credit Default Swaps and the Potential Cost of a Las Vegas Financial System

If you’ve been paying any attention to my posts and choice of content over the last two weeks, you know I’m not for the current $700 billion federal bailout of Wall Street which is underway thanks to the jackasses in Washington – and I’m talking all of them regardless of party.

Granted, I’m not a financial expert. But, I have tried to educate myself, and this bailout just seems to be rewarding bad behavior with worse public policy. One book I’m about done with is Kevin Phillips’ Bad Money. This book is currently ranked 63 on Amazon and I highly recommend it. At any rate, just when I was getting resigned to the fact the bailout is now a fact of life, and there’s nothing I can do about it, I got a little more education this weekend.

On Sunday morning, I heard the latest edition of This American Life. Part of the show dealt with the impending doom that is ‘credit default swaps.’ You should give this show a listen online. Ira Glass’s gang simply defines and exposes the scope of the risk out there with these ’swaps.’ Later in the day came this report by 60 Minutes. This is another great piece of journalism exposing the problem with these financial vehicles. So, what are they – and why should we care?

Let’s say I’m a hedge fund and I have $1 billion wrapped up in a collateralized debt obligation (CDO) – aka a bunch of mortgages bundled together, many of which are shit. Lehman Brothers or CitiGroup comes to me and says, “We will insure you against loss for 2% of what you paid for the CDO.” I’m a little worried about the underlying assets in the CDO, so I say, sure, and fork over $20 million. CitiGroup has now made $20 million for nothing. When banks, investment banks, and hedge funds were doing these deals, they were merely placing a bet that the CDOs they were “insuring” wouldn’t tank.

We know what’s been happening. There’s more junk in the CDOs than anyone realized or cared to admit. I believe part of the reason Lehman failed is that the folks they sold credit default swaps to began to come calling for their insurance payout. But wait, I’m talking about insurance, right? Why are they called ’swaps?’ Simply put, if they called it insurance, it would be regulated, ie. the Lehmans of the world would have to show capital, or a risk reserve fund, backing up their deals. That’s cash. They call them swaps so the whole transaction remains the unregulated, gambling pile of poo that it is.

So far, taxpayers, we’re on the hook for $700 billion. If you watch the 60 Minutes segment, you’ll find out that the estimated value of all the credit default swaps out there in the world’s markets is around $50 trillion. That’s a “T” and an “R” at the beginning of that “illion.” How many more of the “insured” are going to demand payment from the underwriters of these swaps? How many more banks, insurance companies, or investment houses are going under? Who is going to pay for that?

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