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Saturday, November 22, 2008

PART OF THE PROBLEM NOW PART OF THE SOLUTION?

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OBAMA NAMES ANOTHER CLINTONIAN BUSHCO REAGANAUT TO HIS CABINET

NY FED CHAIRMAN OK'ED DERIVATIVE "EXPERIMENT" & LEHMAN BROS FAILURE THAT STARTED CRISIS

WALLstreetWHORE copyright 2008 Cosanostradamus blog me no blog

But Obama Thinks He's A "Kewl Guy," So . . .

People keep saying wait and see, give Obama a chance, he's not even inaugurated yet, give him a chance to govern, benefit of the doubt, didn't make this mess, needs time to fix it, be patient, yatta-yatta-yatta. But every day brings a new old guy into the Obama Cabinet, a "new" remnant of the right-wing Carter-Reagan-Bush-Clinton-Bush years. How are THEY going to effect CHANGE when they are the very people whose numb-nuts notions caused the problems that now urgently require change? Would you let the surgeon who cut off the wrong foot operate on the other foot? Yes? Then you should work for Obama, too.

Is this really the kind of "experience" we want in this crisis? Are the fears on Wall Street that they will be called to account all we care about? I say hang the motherf*ckers, don't hire them. With a few hundred economic "experts," bureaucrats, brokers and bankers swinging from the lamp-posts of Wall Street, maybe they might get the message: Our economy is not their f*cking playground. Our jobs and homes are not their piggybank. Our country does not belong to them.

What Obama is doing instead is giving these criminals and bumbling incompetents the green light to keep right on gambling, stealing and screwing up. He's telling them that not only will there be no punishments, there will be tax-payer funded rewards. In effect, there is absolutely no difference between the Obama Administration and the last forty-three Administrations, as far as economic policy goes: The rich will always get richer, and the poor will always get poorer. The rest of us just have to bust our asses to stay out of poverty, or steal our asses off to join the rich at the hog trough.

To them it is all a game, or an academic exercise. To us, our economy, our economic system, our way of doing business is our life, and our death. Suicides and murders are up; and as the economy gets so worse, so will the violence. Families will be destroyed, children abandoned, education and careers will end, businesses will close their doors forever, whole towns will be wiped out. But to our financial elite, those are all just statistics.

Maybe they should be forced to live among us, to experience first-hand the pain their little games have caused us. Maybe if a heartbroken mother breaks down in tears right in front of them, or a disillusioned child forces one of them to witness the depths of his or her bitterness at the destruction of all their dreams, hopes and plans, or an angry father kicks their ass, then they'll get it.

The first qualification of any candidate for Treasury Secretary, or Fed Chairman, head of the FDIC or the Council of Economic Advisers or the heads of Fannie Mae and Freddie Mac and the SEC should be that they spend a year working in a factory and living in a cheap apartment with some other workers. Let them live the consequences of their own actions, like any convicted sociopath. Otherwise, they will just never understand. And nothing will ever change.


NY TIMES
"For Treasury, Geithner Said to Be Choice "
He broke it. Now he'll fix it? Is the gene pool THIS shallow?
' But people close to Mr. Obama say that he clicked with Mr. Geithner during a recent private meeting. The two men are the same age, 47, and Mr. Obama is closer temperamentally to the low-key and almost boyish Mr. Geithner than to the more tightly wound Mr. Summers. Mr. Summers, who will be 54 on Nov. 30, is universally described as brilliant, but is also renowned for being arrogant, occasionally rude and sometimes difficult to work with. In choosing Mr. Geithner, Mr. Obama would signal both a change at the Treasury Department and continuity in its economic rescue efforts. With the current Treasury secretary, Henry M. Paulson Jr., and Mr. Bernanke, Mr. Geithner — who as head of the New York Fed is the central bank’s eyes and ears on Wall Street — has been part of a troika that has struggled this year to contain the credit crisis. Along with Mr. Paulson and Mr. Bernanke, Mr. Geithner has come under criticism for the original construction of the $700 billion bailout plan, which had to be overhauled and has so far failed to remedy the financial crisis. But his association with the current administration’s policies is balanced by his close connections to the centrist Democratic policies of President Bill Clinton and Mr. Clinton’s best-known Treasury secretary, Robert E. Rubin. Mr. Geithner served under Mr. Rubin as well as Mr. Summers at the Treasury Department in the 1990s, and rose to be under secretary for international affairs. Michael Froman, Mr. Rubin’s former Treasury chief of staff and Mr. Obama’s classmate at Harvard Law School, is heading the economics personnel search for the transition. Mr. Froman’s head-hunting deputy is Mr. Rubin’s son, James Rubin. The Rubin wing of the Democratic Party has long been disparaged by liberals and union leaders as being too concerned with balanced budgets and free trade. But much of the ideological tension in the party has dissipated as the economy has weakened, and Mr. Obama has signaled that he intends to spend what it takes to get the economy back on track. Mr. Geithner also seems to fit Mr. Obama’s emphasis on “post-partisanship.” Associates say Mr. Geithner is an independent, though he was a Republican when he first was a staff member at the Treasury Department in the late 1980s under Presidents Ronald Reagan and George Bush. After college, he worked in the New York-based international consulting firm headed by Henry A. Kissinger. After leaving the Treasury Department, Mr. Geithner worked at the International Monetary Fund until he was hired in 2003 as president of the New York Fed. As the bank’s president, Mr. Geithner has had a seat on the Federal Open Market Committee, which sets short-term interest rates. He spent two years studying the complexities of the new credit derivatives that spread financial risk, but also exacerbated the economic downturn when the credit squeeze set in. “The fact that the banks are stronger and risk is spread more broadly should make the system more stable,” Mr. Geithner said in an interview in early 2007. “We can’t know that with certainty, though. We’ll have a test of that when things next threaten to fall apart.” The test began later that year as the housing credit crisis took hold. Working closely with Mr. Bernanke, Mr. Geithner early this year engineered the $30 billion bailout of Bear Stearns. Since September, the two of them and Mr. Paulson together have steered the government takeover of the mortgage giants Fannie Mae and Freddie Mac, bailouts of American International Group and a number of financial institutions, and the design of the $700 billion bailout program. Mr. Geithner has also had a part in some high-profile missteps, including the government’s decision to allow Lehman Brothers to fail; some experts say that destabilized markets and helped to spread the financial contagion globally. '

WASHINGTON POST
"A Treasury Contender Schooled in Crisis"
He was for it before he was against it. Too late!
' For the Obama administration, Geithner's appointment would offer a sense of continuity at Treasury. He has, after all, worked closely with Paulson and Fed chairman Ben S. Bernanke. But with continuity comes baggage. As president of the New York Fed -- one of 12 regional outposts that regulate banks and help set the nation's monetary policy -- Geithner has been the central bank's chief emissary to Wall Street as it has disintegrated. In speeches during the years leading up to the crisis, Geithner repeatedly raised concerns about frailties in the financial system -- pointing out, for example, weaknesses in the settlement and clearing systems by which financial transactions occur and the absence of oversight in the market for obscure financial products known as derivatives. But many of those speeches ultimately concluded with Geithner suggesting the financial system was becoming more stable rather than less. He did not wage aggressive campaigns on Wall Street or Capitol Hill to step up regulation. "The changes in credit markets that have accompanied the latest wave of innovation in derivatives and the large role played by leveraged financial institutions in those markets may exacerbate some of the traditional sources of challenges in financial markets," Geithner said in a 2006 speech in Hong Kong. But, he continued, "On balance, we believe these changes in the financial environment are likely to come with substantial benefits in terms of overall market efficiency." In fact, derivatives and leveraged financial institutions have been major reasons for the financial crisis, which is the most severe since the Great Depression. '

BUSINESS WEEK
"Geithner: Obama's Likely Treasury Choice"
Oh, good: No business experience or education. Well, not NO experience. Just some very BAD experience.
' "As much as you want some fresh ideas in there, I think at this point in time, having some continuity in there is a good thing," said Frederick Cannon, chief equity strategist at the research firm Keefe Bruyette & Woods. "The main thing the markets need is confidence." Still, Geithner's key role in the government's response to the financial crisis in recent months has garnered him his share of criticism. Take, for example, this passage from the recent issue of Institutional Risk Analyst, an influential newsletter written by managing director Christopher Whalen of Institutional Risk Analytics: "We have only two things to say about Tim Geithner, who we do not know: AIG and Lehman Brothers. Throw in the Bear, Stearns…fiasco for good measure. All of these 'rescues' are a disaster for the taxpayer, for the financial markets, and also for the Federal Reserve System as an organization. Geithner, in our view, deserves retirement, not promotion." With a bachelor's degree in government and Asian studies from Dartmouth College and a master's in international economics from Johns Hopkins, Geithner may not be an academic economist or an ex-Wall Street banker or corporate executive, a break with the recent past. At the same time, he is no stranger to handling economic crises that are international in scope. Critics warned that the move could encourage greater risk-taking by financial firms newly confident of a government bailout should they falter. Joseph Mason, an associate finance professor at Drexel University, told American Banker in May that the deal "opened a Pandora's box" and Geithner's role suggested that he is prone to "ideas that are just not always completely articulated or thought out." Geithner, however, has been unapologetic about his actions last spring. He has said the distress sale was the "only feasible option." '

PORTFOLIO.COM
"The Man Who Saved (or Got Suckered by) Wall Street"
Ah! No WONDER Wall Street loves him! He's their bitch!
' Geithner was the central figure in that drama. It was Geithner’s Federal Reserve bank, not the Treasury, that came up with the $29 billion loan that made the deal possible or, more precisely, acceptable to J.P. Morgan. Geithner brought the parties together, hashed out the details, and demanded answers when things got shaky. It was a heady role for a noneconomist who has, to put it kindly, only on-the-job training in the financial markets and who relies on an A-list inner circle. Officially, his advisers include the board of the New York Fed, which counts several heads of financial institutions as members. Unofficially, he has built an impressive career with the help of a number of kingmakers, including some with a financial interest in the industry he oversees. Thus Geithner reports to a board that is composed of people who are not only under his purview but would also benefit from any potential bailouts. The structure of the New York Fed’s board bears more than a passing resemblance to that of the New York Stock Exchange in the bad old days, when member firms, regulated by the N.Y.S.E., were heavily represented on its board. '
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4 Comments:

Blogger Gloria said...

Terrific! I should haul my ass over here first to get your take on these events.

You are right about Geithner's background. I don't know what Obama is thinking; perhaps he believes he can lay out his plan and get these yahoos to execute them with no problem. However, I don't believe Obama is the left of center guy some people think he is. But in this system, some of us never get what we want.

On consideration, even though Geithner is neither a real banker or economist (his studied intl relations), a ringing bell should have told everyone that he certainly knows who to cultivate, starting with his first job--with Kissinger Associates. It was all gladhanding and obsequiousness from there on--straight up, no chaser.

His father, Peter Geithner, was 28 years with the Ford Foundation, and the family spent many years in India, SE Asia and Japan, spreading US style capitalism under its aegis.

12:21 AM, November 23, 2008  
Blogger Cosa Nostradamus said...

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Yeah. Still hoping Obama has a master plan that somehow involves using all these corporatistas to flush the corporations out of our government, but that's looking less likely with each new Clinton retread.

Well, we know how to change Presidents, when necessary. This time, we've gotta take over the Democratic Party starting at the local level. Bring ten friends down to the next meeting. Give 'em Hell.

Send the DINOs back to the Repukelickin's, where they belong. WE won this election. They lost. It ain't over, but we'll win. We're the majority. We just proved that. Don't forget it.
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2:31 AM, November 23, 2008  
Anonymous surrogate said...

I'm on board with the "give the guy a chance" crew. Every article you posted was really nothing more than speculation. I'm curious who you think would have been a better pick? I mean, Summers will still be in the information chain, I'm sure, so his expertise will be gleaned as needed. It seems kind of silly to think Obama could or would bring in someone without any ties to the past.

I hardly think that because someone worked in (or for) previous administrations, that their current opinions and ideas are tainted. I've worked for some real slime-balls in my day, but I don't think that automatically makes me a slime-ball too. -Or I sure hope it doesn't. -Plus, I even learned from a couple them; what to do AND what NOT to do.

7:20 AM, November 23, 2008  
Blogger Cosa Nostradamus said...

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Most of the "speculation" on Geithner has been so fawning that I just had to get a second opinion. The "speculation" I referenced here is based on the actual facts in cases where the nominee has taken actions that made things worse, economically, and/ or involved serious conflicts of interest. He's part of the problem, not part of the solution.

It is not "speculation" that Geithner is or was a registered Republican, originally appointed by Republicans. It is not speculation that he is a congenital and hereditary bureaucrat with no business experience or academic expertise in finance, his portfolio at Treasury. He is, according to all accounts, a master at going along to get along with the very people who got us into the current economic mess by supporting the relentless drift toward corporatism that Republicans and DINOs represent.

It's not just Geithner: Every one of Obama's picks so far has been a "centrist," i.e., a right-wing Clintonista or an outright Republican. This after an election that all objective observers agree represented a big swing to the Left, bringing us closer to the real center in world politics, democratic socialism, though we still have a long way to go. In any case, we voted first against Clinton and then against Bush/ McCain. And what do we get? Left-over Bushies and recycled Clintonians. No thanks.

If we don't speak out now, the Cabinet will be packed with "moderates," aka Democrats In Name Only. More of the same failed policies of the last forty years. The country just can't stand that.

If you think Obama can govern effectively while straining against a pack of closet-conservatives, you need to re-read your Presidential history. Presidents are only as good as their teams, especially their closest advisers.

If Obama doesn't start choosing a bunch of people from somewhere left-of-center, from academia, the labor movement, community organizations, business mavericks, then all we're going to get is eight more years of the Permanent Government. We have no time to waste in stopping that. The drift rightwards is already confirmed by the nomination of this Kissinger protege.

Enough, already! This ain't what we voted for.
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5:16 PM, November 23, 2008  

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