Is Cheney Betting On Economic Collapse? (Curious Investment Portfolio)

[norml]

Is Cheney Betting On Economic Collapse?

Written by Richard Kastelein
Thursday, 06 July 2006

The Veep's Curious Investment Portfolio
By MIKE WHITNEY

Wouldn't you like to know where Dick Cheney puts his money? Then you'd know whether his "deficits don't matter" claim is just baloney or not.

Well, as it turns out, Kiplinger Magazine ran an article based on Cheney's financial disclosure statement and, sure enough, found out that the VP is lying to the American people for the umpteenth time. Deficits do matter and Cheney has invested his money accordingly.

The article is called "Cheney's betting on bad news" and provides an account of where Cheney has socked away more than $25 million. While the figures may be estimates, the investments are not. According to Tom Blackburn of the Palm Beach Post, Cheney has invested heavily in "a fund that specializes in short-term municipal bonds, a tax-exempt money market fund and an inflation protected securities fund. The first two hold up if interest rates rise with inflation. The third is protected against inflation."

Cheney has dumped another (estimated) $10 to $25 million in a European bond fund which tells us that he is counting on a steadily weakening dollar. So, while working class Americans are loosing ground to inflation and rising energy costs, Darth Cheney will be enhancing his wealth in "Old Europe". As Blackburn sagely notes, "Not all bad news' is bad for everybody."

This should put to rest once and for all the foolish notion that the "Bush Economic Plan" is anything more than a scam aimed at looting the public till. The whole deal is intended to shift the nation's wealth from one class to another. It's also clear that Bush-Cheney couldn't have carried this off without the tacit approval of the thieves at the Federal Reserve who engineered the low-interest rate boondoggle to put the American people to sleep while they picked their pockets.


snip


http://www.chris-floyd.com/index.php?option=com_content&task=view&id=728

[WCGreen]

1. First of all...

Aren't his investments suppose to be in a blind trust...

Also, the investment move out of stocks and into safer bonds is pretty predictable for a man his age...

And since his portfolio is rather large, he can afford the luxoury of diverse invesment products...

[larrysh]

5. I have little or no control over what investments....

Are in my trust. My trust officer at the bank sat me down
not long after my dad died and more or less said, "Our bank has a long and successful track record managing people's money. Your portfolio will consist of 1/3 tax-free municiple bonds, 1/3 in a fixed income tax-free municiple bond fund, 20% in short term CD's and money market accounts, and the rest in cash in case you have a health related emergency." Then, he stared down at me over his glasses, while drumming his fat little fingers on the desk (to indicate, I suppose,
the meeting was over), and that was that! I suppose Cheney's blind trust works much the same way, except he gets more respect from the
assholes in charge.

[quiet.american]

7. Believe me, Cheney is not being intimidated by bank managers.

Holding secret energy task force meetings, squeezing the CIA, having the "friend" he shot in the face apologize to him -- I would venture to say Cheney's meetings with his bankers go a whole lot differently than yours did! :)

[quiet.american]

8. Dupe.

[WCGreen]

16. You should look over the trust and see if you have any control..

If you are young, that is a pretty conservative approach to investments....

[norml]

11. Here's the original Kiplinger's article with more of the details.

Cheneys betting on bad news?

A look at the president and vice president's financial disclosure forms.


By Kiplinger's Personal Finance Magazine

Vice President Dick Cheney's financial advisers are apparently betting on a rise in inflation and interest rates and on a decline in the value of the dollar against foreign currencies. That's the conclusion we draw after scouring the financial disclosure form released by Cheney recently.

As of the end of last year, Cheney and his wife, Lynne, held between $10 million and $25 million in Vanguard Short-Term Tax-Exempt fund (VWSTX, news, msgs) (it's impossible to be more precise because the disclosure form lists holdings within ranges). The fund's holdings of tax-free municipal bonds mature, on average, in a little more than a year -- meaning that the fund should hold up well if rates rise.

The Cheneys held another $1 million to $5 million in Vanguard Tax-Exempt Money Market fund (VMSXX, news, msgs), which is practically risk-free and could benefit from continued increases in short-term interest rates. And the couple had between $2 million and $10 million in Vanguard Inflation-Protected Securities fund (VIPSX, news, msgs). The principal and interest payments of inflation-protected bonds rise along with consumer prices, making them good inflation hedges.


Expecting dollar drop?

The Cheneys also had between $10 million and $25 million in American Century International Bond (BEGBX, news, msgs). The fund buys mainly high-quality foreign bonds (predominantly in Europe) and rarely hedges against possible increases in the value of the dollar. Indeed, its prospectus limits dollar exposure to 25% of assets and the fund currently has only 6% of assets in dollars, according to an American Century spokesman.


snip


http://articles.moneycentral.msn.com/Investing/Extra/CheneysBettingonBadNews.aspx?GT1=8283

[WCGreen]

15. Still, Kiplinger makes money from speculating....

Of course they are going to look at anything in order to show they have their eyes on everything...

All I am saying, and I could be wrong, is Cheney should have no control over his trust and that his invesments are not out of the ordinary....

[sandnsea]

2. That's what they do

While the experts we're telling all the little people to "invest for the long haul", they were all moving their money into gold and foreign money. They've known for a while higher interest rates were coming, so that doesn't surprise me. The rich never lose because they've been playing the investment merry-go-round for hundreds of years. The only ones who lose, again and again and again, are US. But when we lose it isn't because the rich cheat us out of our money, it's always because we're stupid or lazy.

[SensibleAmerican]

3. Short-term bonds drop in value with higher interest rates

Mr. Floyd does not seem to understand simple finance.

Secondly, most blind trusts invest in a wide variety of bonds with an emphasis on tax exempt municipal bonds for the rich.

Whilst I would not doubt that the Vice President is trading with inside information, this information in itself does not even cause me to have reasonable suspicion. If the Fed chairman wanted to get rich off of insider trading, there would be much easier ways for it to do so rather than supposedly conspiring with the VP.

[unblock]

6. but short-term debt allows for quick reinvestment at higher rates

this is a very defensive place to park your money if you fear inflation. mostly immune to inflation due to short maturities. a fund would typically hold these instruments to maturity, so default risk and reinvestment is all that matter. high inflation mostly means that the fund is quickly matured and reinvested at higher rates.

it protects, rather than profits, from inflation.

although, "short-term bonds" is a choice of words an expert would avoid, as it's a contradiction in terms. bonds are by definition long term. for short-term one would use the term "bill", for medium-term one would use the term "note".

"short-term bonds" is only correct, technically, for a debt instrument with a maturity of say, 11 years. long enough to qualify as a "bond" but shorter that most other bonds.

[varkam]

4. Conflicts of interest...

are nothing new to Mr. Cheney.

[ClassWarrior]

9. Of course he is. That's what this is all about... Profits for the few...

...at the expense of the many. It's the conservative philosophy.

NGU.

[norml]

10. They expect us to flee in terror, when they cry "class warfare"

Yet they wage it every day.


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[norml]

12. Class warfare wrapped in flag

Class warfare wrapped in flag

By PAUL KRUGMAN
Columnist



In case you haven’t noticed, modern American politics is marked by vicious partisanship, with the great bulk of the viciousness coming from the right. It’s clear that the Republican plan for the 2006 election is, once again, to question Democrats’ patriotism.

But do Republican leaders truly believe that they are serious about fighting terrorism, while Democrats aren’t? When the speaker of the House declares that “we in this Congress must show the same steely resolve as those men and women on United Flight 93,” is that really the way he sees himself? (Dennis Hastert, Man of Steel!) Of course not.

So what’s our bitter partisan divide really about? In two words: class warfare. That’s the lesson of a new book, Polarized America: The Dance of Ideology and Unequal Riches, by Nolan McCarty of Princeton University; Keith Poole of the University of California-San Diego; and Howard Rosenthal of New York University.

snip

What the book shows, using a sophisticated analysis of congressional votes and other data, is that for the past century, political polarization and economic inequality have moved hand in hand. Politics during the Gilded Age, an era of huge income gaps, was a nasty business — as nasty as it is today. The era of bipartisanship, which lasted for roughly a generation after World War II, corresponded to the high tide of America’s middle class. That high tide began receding in the late 1970s, as middle-class incomes grew slowly at best while incomes at the top soared; and as income gaps widened, a deep partisan divide re-emerged.

snip

Before the 1940s, the Republican Party relied financially on the support of a wealthy elite, and most Republican politicians firmly defended that elite’s privileges. But the rich became a lot poorer during and after World War II, while the middle class prospered. And many Republicans adapted to the new situation, accepting the legitimacy and desirability of institutions that helped limit economic inequality, such as a strongly progressive tax system. (The top rate during the Eisenhower years was 91 percent.)


snip


http://www.kansascity.com/mld/kansascity/business/14981892.htm

[TahitiNut]

14. "That high tide began receding in the late 1970s" ... as I've said often

In almost every way we look at it, economic justice and liberalism - after having gained hard-fought equities in the mid-1970s, has been in decline under the assault of the force of greed and elitism.

We see it measured in the Gini Index ....


We see it reflected in the federal minimum wage ...


We see reflected in the GDP ...


We see the result of the predations on the working class in excesses of corporatism ...


... which have not been as excessive since immeidately prior to the Great Depression ...

[lonestarnot]

19. Another wise DUer! Wooooooodamnwhoooo!

[goforit]

13. Trying to hide his mountain of dough.

But can he run and hide?

[Rosemary2205]

17. All the big money folk have left the US of A

Kiplinger said almost a year ago that the biggest of the big had pulled all their money out of American investments -- including real estate.

[lonestarnot]

18. I think they should be tracked with dogs!

[mistertrickster]

20. This is brilliant. If Darth Cheney thought the economy were strong,

he'd be investing in American stocks.

He clearly thinks inflation will rise (because of deficit spending-national debt) and that the dollar will weaken (trade deficit, etc).

Just heard on the radio, Johnny Cash singing "God Almighty's gonna cut you down!"

Perfect timing . . .