The Money Party (6): "A Cascade of Ruin"

[autorank]

How did this economic crisis happen? What are they really trying to hide with these bailouts? This is very serious but there are solutions that DO NOT include bailing out the people who caused the crisis.

The Money Party (6)
Meltdown Perpetrators Position Themselves

Meet the New Boss - Robin Hood in Reverse -
U.S. Secretary of the Treasury Paulson

"A Cascade of Ruin"

Michael Collins

(Wash. DC) Well, they finally did it. The Money Part exposed the nauseating underbelly of first world finance. It's a cross between a Ponzi scheme and a complex math puzzle, all geared to let those in charge rake off as much money as they can, whenever they can, while they leave us out in the cold. Unfortunately, this time their greed and lack of control has the world poised for a systemic economic meltdown. Snip

If this happens, they will have achieved their goal: overshadowing nearly all of the domestic resistance to their schemes of perpetual empire and plunder with a financial meltdown that places survival and subsistence as the highest value. Snip

This teetering derivative market can't be bailed out. There simply isn't enough money. But our rulers think that the banks, insurance companies and stock brokerages heavily indebted and riddled with derivatives can be saved. As Ellen Brown pointed out last Thursday, save them and you stop the full exposure of the derivatives market. You avoid the risk of people finding out that their money and investments are being held by institutions willing to invest in financial products that are, at the least, highly speculative and, at the worst, pure vaporware.


More: http://www.scoop.co.nz/stories/HL0809/S00274.htm

[Jeffersons Ghost]

1. hi old friend...

you can always depend on me

[autorank]

6. Hey, how are you?

We're all screwed but that's a shared trait.

What do we do about this, in your opinion?

[FogerRox]

14. Sup Jefferson, check this crap out

http://www.democraticunderground.com/discuss/duboard.php?az=show_topics&forum=132

[Me.]

2. I Think We Should Sell Them Short

and cut their futures capacity

[autorank]

5. Their futures should involve a rural retirement community with large walls and gates n/t

[Me.]

12. I Was Thinking Of A Tin Cup With Pencils

And a pile of apples on a crate box, a sign around their neck, 'lo & behold how the mighty have fallen' and their beat should be wall street

[truedelphi]

7. Hee hee. n/t

[seemslikeadream]

3. and his friends

CEO: Jimmy Cayne

Company: Bear Stearns

On his watch: After serving as CEO for 15 years, Jimmy Cayne was conspicuously absent in the firm's final months. When Bear first disclosed mortgage losses last year, Cayne was at a Nashville bridge tournament. Eight months later, as Bear's non-executive chairman and as the company began its final descent, Cayne was at the North American Bridge Championships, where he could not be reached. Bear was sold days later to JPMorgan Chase at the bargain-basement price of about $10 a share, down from about $170 a share in 2007. Cayne had been worth about $1 billion in 2007, before Bear's demise shaved his savings down to about $600 million.

Payout: $61.3 million. Cayne and his wife dumped their Bear stock during the JPMorgan takeover. He will also receive another $4.6 million in JPMorgan stock.


CEO: Charles Prince

Company: Citigroup

On his watch: Before he stepped down in November 2007, Citigroup, the world's largest bank, reported a 57 percent drop in quarterly earnings and lost nearly a quarter of its market value. "It is my judgment that -given the size of the recent losses in our mortgage-backed securities business, the only honorable course for me to take as chief executive officer is to step down, "he said.

Payout: $68 million


CEO: Stanley O'Neal

Company: Merrill Lynch

On his watch: Shortly before his ouster last October, Merrill reported $7.9 billion in write-downs related to O'Neal's blundering forays into risky subprime-mortgage territory. O'Neal had snatched up subprime lender First Financial in late 2006, a move Portfolio magazine had likened to having "all the strategic wisdom of a foray into Havana real estate in 1959." Merrill's write-downs have since climbed to $45 billion.

Payout: $161.5 million


CEO: Angelo Mozilo

Company: Country Financial

On his watch: The founder of the ill-fated mortgage giant, Angelo Mozilo, 69, was at the helm during the subprime fiasco that led to the broader credit crisis, Mozilo swore Countrywide would ride out the turmoil and emerge bigger than ever. Instead, he cashed out his stock options as Countrywide headed into a nosedive this year. To date, the company's worth has shrunk from about $25 billion to $2.5 billion.

Payout: $121.5 million. Mozilo gave up $36.4 million in severance pay, but is under SEC investigation for his $121.5 million stock gains.



CEO: Richard Fuld

Company: Lehman Brothers

On his watch: The firm declared bankruptcy on Sept. 15. In April he proclaimed to shareholders that "the worst is behind us," but for months he had dodged queries about the firm's exposure to toxic subprime debt.

Payout $22 million

CEOS Daniel Mudd and Richard Syron

Company: Fannie Mae (Mudd) and Freddie Mac (Syron)

On there watch: Earlier this year, Mudd predicted Fannie would "feast" on the reduced competition in the mortgage insurer suffered four consecutive quarters in the red amid the worst housing crisis since the Great Depression. Likewise, Syron reportedly rejected internal warnings that could have protected Freddie from the crises that ultimately brought it down. Fannie shareholders lost $52 billion as the stock plummeted 83 percent,while Freddie shareholders watched $36 billion go down the drain as its share price slumped 85 percent and its value sank to negative $5.6 billion. By the time the U.S. government extended a $2.25 billion credit line to each in July, Fannie's debts had reached $800 billion and Freddie's had reached $740 billion.

Payout: Zero. Regulators axed contract provisions that would have awarded both men hefty exit packages. Mudd was set to receive $9.3 million in exit pay, on top of his $12.4 million in salary, bonuses and stock profits. Syron's exit package could have amounted to at least $14.1 million. He has made $17.1 million in salary, bonuses and stock profits since becoming CEO in 2003.




CEO: Michael Perry

Company: IndyMac Bank

On his watch: The bank collapsed in July 2008, in what regulators called the second largest bank failure in U.S. history. Despite mouting losses from delinquent loans in 2007, Perry insisted in December that the bank would be profitable by the second half of 2008. A protege of former Countrywide CEO Angelo Mozilo, Perry was 45 when he was removed from his 15-year tenure as CEO during the FDIC's takeover.

Payout: Unknown. Forbes, however, listed Perry's five-year compensation total from IndyMac as $37.49 million.


CEO: Ken Thompson

Company: Wachovia

On his watch: Shareholders called for his ouster at their annual meeting in April 2008 following a first-quarter loss and a dividend cut of 41 percent. Thompson had earlier promised the dividend would not be cut. He also came under fire for his $25 billion purchase of home lender Golden West, a deal he made at the height of the housing boom. He is shown here (at left) arriving at the April meeting. He resigned the next month.

Payout: $8.7 million


CEOs: (From left) Robert Willumstad (July 2008-September 2008), Martin Sullivan (2005-2008), Maurice (Hank) Greenberg (1968-2005)

Company: American International Group (AIG). world's largest insurance firm

On their watch: In Willumstad's brief tenure, AIG stock plunged from around $27 a share
to $2 a share, and the ailing firm agreed to an $85 billion government bailout. Sullivan left
after two quarters of record losses and $20 billion in sub prime-mortgage-related losses.
Greenberg was credited with shaping AIG into the world's largest insurer but was forced
out in 2005 due to a fraud investigation. No charges were filed against him.

Payout: $7 million for Willumstad's three months of work, $47 million for Sullivan and for Greenberg, despite the investigation, a 12 percent stake in AIG. That stake, however, isn't worth what it was once was. After the government bailout, Greenberg's $3billion interest nearly disappeared, and he dropped off the Forbes list of the richest people in the

[autorank]

4. Rogues Gallery. That's about perfect. Here's a gem from India.

Is the US economy heading for a collapse?

M R Venkatesh | March 20, 2008 | 15:52 IST
(Chartered Accountant, India)

An open letter to Mr Ben Bernanke, chairman, US Federal Reserve:
http://inhome.rediff.com/money/2008/mar/20mrv.htm

Sir,

Decades back, one of your predecessors splendidly captured the post-gold standard and the consequent free float of the US dollar scenario rather succinctly when he termed the US dollar as 'our currency, others' responsibility.'

It is this responsibility cast on outsiders like me that compels me to write this open letter to you.

As I write this, I am fully conscious of the fact that we are living in exceptionally troubled times. I am equally conscious of the fact that being the chairman of the US Federal Reserve, you are in effect the central banker to the entire world. Surely, it is an unenviable position.

Your actions, sir, not only impact the United States economy, it does have the potency to impact the global economy. That explains, partly, if not wholly, the 'why' to this letter.

Yes, I am indeed aware of the sub-prime crisis that has engulfed the entire global financial sector. I am sure you are fully aware as to how your predecessor, Mr Alan Greenspan -- one of the most influential economists of our times -- described the sub-prime crisis in his book -- The Age of Turbulence. According to him the American economy was 'facing not a bubble but a froth -- lots of small, local bubbles that never grew to a scale that could threaten the health of the overall economy.'

Yet, as events turns out, I suspect, Alan Greenspan is wrong. But the point is not merely the judgemental capacity of Alan Greenspan. Rather, it reflects poorly on the American regulatory mechanism.

After all, wasn't he the product of a system that was repeatedly touted as fail-proof; at least in surveillance, supervision and regulation? And my worry is that you too are a product of the very same system that has compelled him to be wrong.

[truedelphi]

8. Did you see the article about the Indian workers who beat their CEO to DEATH!!

I think we should start globalizing our CEO's immediately!

One way ticket to New Delhi.

[autorank]

16. I knew politics were passionate in India

Good grief!

[truedelphi]

36. Well, politics by extension means whether or not you can afford

To conitinue farming.

Whether or not you can afford to feed your kids.

Jon Stewart asked John Oliver, "So what is it that Bush wants to have happen in our economy, then? I mean this: can it get any worse?"

And Oliver replies, "Do you still have a house to live in, John?"

Jon says yes.

Oliver then asks "And did your kids eat breakfast this morning after they woke up?"

Jon says yes.

Then Oliver says, "See. Bush won't be happy until the kids get their breakfast out on the street, eating up road kill."

JOn asks, "So then Bush will be happy?"

Oliver: "Especially once the kids are out there FIGHTING over the road kill."

And in places like India - it is not a joke. With any luck, just a smide more of bad luck, and that's what our society will be.

[FogerRox]

11. What a bunch of ugly pusses. Yuck.

[dixiegrrrrl]

15. Watching Angelo Mozilo at the hearings a couple months back

convinced me of the presence of aliens.
I kept expecting his face to start slipping off.

These guys all look weird to me.

[formercia]

26. The 12 horsemen of the financial apocalypse. n/t

[seemslikeadream]

28. The 12 TERRORIST horsemen of the financial apocalypse

[formercia]

29. Thank you for the correction.

That is quite appropriate. :hi:

I need another cuppa. I need to get my edge back.

[seemslikeadream]

30. I had too bit of an edge yesterday!

I lost it for a little while I can not tell you how pissed I am, more that ever in the last 7 years. This was planned I predicted it 2 years ago and told my best friends plan for it because it is coming

[formercia]

33. You bet.

These guys may be crooks, but they're not stupid.

All that loot came out of another crook's pocket that just wasn't quite as quick as they are. It also came out of the pockets of people who were suckered into believing that there was such a thing as the "American Dream."

[ihavenobias]

9. K & R

[FogerRox]

10. Consider all those at risk Mortgages paid in full, wipe the debt away

Good jobs and a good refi would do wonders, the mortgages would then be desirable by the banks, because the mortgages would then be a good revenue source.

But thats not is being done, this is just accelerating the trasnfer of wealth that the working and middles classes culminated thru the New Deal. 70 years of family assets being swiped, like the swipe of a credit card.

We should threaten these pukes with nationalization. And then negotiate from there. If they dont want to negotiate, then nationalize the fuckers.

SAME shit as 1929.

[autorank]

17. Any bailout is submitting to blackmail

You are in sync with the close of the article and a great blogger on economics, Numerian of The Agonist

==================
"There needs to be an accounting and a correction - and not by the usual suspects.

"Here's one way to start with derivatives crisis in major institutions:

If all the top 25 financial institutions were put into receivership, and (big if) if they all could be liquidated under an agreed legal framework, many of these risky contracts could be allowed to offset each other, and much of the risk eliminated.
Private correspondence, Numerian, The Agonist, Sept. 21, 2008

END

Permission granted to reproduce this article in whole or in part with attribution of authorship, a link to this article, and acknowledgment of any images.
http://www.scoop.co.nz/stories/HL0809/S00274.htm

[Hubert Flottz]

13. We left that place called hope and started across that bridge...

to the 21st century...but we were hijacked on 12/12/2000 and the detour that the SCOTUS sent us on led us to this bridge to nowhere.

As long as America remains unreconstructed we will never reach that place called hope. Abe Lincoln must really be sad, to know that the great divide is still alive and well in this shaky "house." 95% of America is on the brink of becoming officially de-emancipated due to our collective stupidity, greed, fear and bigotry.

[autorank]

18. The plan is almost complete

They invaded Iraq against our will and we were laregely silent.

They looted the Treasury at will and we were largely silent.

They stole two elections and we were largely silent.

They gave a trial run to total oppression in Denver, Minneapolis, and St. Paul and we were largely silent.

They're now going to pull off the greatest theft in the history of mankind.

How much longer will be be silent?

[Hubert Flottz]

24. "How much longer will be be silent?"

I'd say about the time little Trog...err...Trig Palin does his 8 years in the White House at the end of the GOP's 50 year plus "Palin Dynasty," the country may be just about ripe for a large asskicking focused on the GOP.

Poppy Bush bailed out in WWI...McCain bailed out in Viet Nam...AWOL Junior(Bunko Billy)is trying for the biggest bailout in history...And Sara wants to turn the White House into a home for unwed mothers!

It's hard for me to set back and watch my country being trashed the way the GOP has been trashing it...I don't think most Americans are any more thrilled about all this than I am. First they came for your first born to send to a war that will never end, then they came for your good paying job, then they came for your deed, then they came for your retirement and social security...it's just a matter of time before they come for your guns...then they'll be free to come for your ass.

[puebloknot]

37. *They* are now bringing the "Posse Comitatus NOT" brigade ...

... to American soil, under Northern Command, and we are silent, except for Amy Goodman. They're lean and hungry and have learned the art of killing in Iraq. What's a skill for, if not to be used?

Said brigade is going to be used for crowd control. The taser and tear gas are child's play in today's world. Draconian weapons which didn't exist during Vietnam are their toys now.

I remember, again, the bombed out buildings still sadly standing in post-war Germany, circa 1955, and the people wearing moth-eaten clothing and living in gardener's shacks. This, I got to observe as an American army brat, living a life of privilege on their soil I could not then appreciate.

I keep feeling that our only real hope is intervention from the rest of the world. But why would they risk their collective skins to save us (never mind about D-Day and all that)? The one reason is that they don't want to go down with our sinking fiscal ship. Our graft is hitting the whole world in the pocketbook. How much longer will *they* be silent?

It does seem that the pen is mightier than the bomb for yet a little while. Thanks for your splendid writing!

[bleever]

19. Given our pluralistic society, and egalitarian governance (as enshrined in the U.S. Constitution),

I'm still amazed that the flesh-eaters have such a powerful voice in our politics.

[stevedeshazer]

20. Recommended.

autorank has nailed it once again.

[flamingdem]

21. It's Colonel Klink!

Paulson needs a nap

[autorank]

31. I was wondering who he reminded me of;)

Ouch ...

[Karenina]

22. K&R!

[passy]

23. K&R

[formercia]

25. Paulson is driven by noblesse oblige and love for his fellow man

The fact that he holds $700 Million in Goldman Sachs stock doesn't color his perspective at all.

Chucky Shumer is holding a few shares of financials himself, as are many others in Congress.

[autorank]

32. You're first on the block

That's the question and I hope we get an answer, loud and clear, from one of the public integrity
groups. I hope we get an answer before the vote. That could change a lot of things.

[lonestarnot]

27. Wallstreet's enemanator!

K & R

[formercia]

34. I feel my zipper ripping already.

La chingada national.

[lonestarnot]

35. Y mierda de ratons!