SCAM confirmation: "Paulson Debt Plan May Benefit Mostly Goldman, Morgan"

[jordi_fanclub]

Source: Bloomberg

Sept. 22 (Bloomberg) -- Goldman Sachs Group Inc. and Morgan Stanley may be among the biggest beneficiaries of the $700 billion U.S. plan to buy assets from financial companies while many banks see limited aid, according to Bank of America Corp.

``Its benefits, in its current form, will be largely limited to investment banks and other banks that have aggressively written down the value of their holdings and have already recognized the attendant capital impairment,'' Jeffrey Rosenberg, Bank of America's head of credit strategy research, wrote in a report dated yesterday, without identifying particular banks.

Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=aUj_9.k13q7s&refer=home

---

Surprise, surprise!
Just add this to the SCAM...
$521,000: The average pay of Goldman Sachs employees and that includes secretaries
Not a typo, it's $521,000 as of 2006, today probably is much more... http://www.independent.co.uk/news/business/news/521000-the-average-pay-of-goldman-sachs-employees-173-and-that-includes-secretaries-466273.html

[curious one]

1. Did you expect anything else?

[Mr_Jefferson_24]

67. No, I didn't.

[BrklynLiberal]

2. Holy Moly..Ex CEO of Goldman sets up a plan that lays golden eggs for Goldman....

What a shock.

[indepat]

92. And Paulson's the guy I heard (on TV) say there was no speculation in oil prices, that the price of

oil was strictly a supply-demand issue. Me thinks Paulson is so eaten up with RW ideology and a hankering to bail out Goldman and Morgan Stanley that not a word he speaks can be believed in absence of verification from several sources known to be reliable. :P

[Pete2069]

132. Three previous CEOs of Goldman Sachs in charge of our government

Paulson's three immediate predecessors as CEO of Goldman Sachs
— Jon Corzine, Stephen Friedman, and Robert Rubin — 
each left the company to serve in government: 
Corzine as a U.S. Senator (later Governor of New Jersey), 
Friedman as chairman of the National Economic Council (later
chairman of the President's Foreign Intelligence Advisory
Board), and 
Rubin as both chairman of the NEC and later Treasury Secretary
under President Bill Clinton.
Looks like Goldman Sachs in were embedded into our government
to control our policies...
This bailout stinks to high heaven and then some...

[Just-plain-Kathy]

133. Wow, the pieces are really starting to fall together.

I have been stuck on the fact that Goldman Sachs is an investor to Papa Bush's Carlyle Group. Goldman Sachs received a $3b bailout in August of 2007. I guess that was just a trail run to see how far they could go; or how much they could get away with.

http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=389&topic_id=4021566

[rucognizant]

135. Bilderberg

Jon Corzine attended the Bilderbeg several years ago! I have heard that that is an indicator of possible Presidential run. Clinton, attended before 1992. ( Hillary too?) Edwards as well, although he successfully squelched that.
Corzine went from Senator to Governor...........I guess his near fatal auto accident delayed his ambitions for this year...........

[daggahead]

146. And McCain talks about ...

Obama "gaming the system!"

If Paulson isn't gaming the system, I'll eat my hat ... not because I want to, but because that may be the only thing I have left to eat.:hurts:

[ptolle]

101. shock indeed.

It would have been more shocking if it hadn't been set up this way. Not that anyone needed any more confirmation that this is anything but another setup to hand the keys to the treasury over to another bunch of bushevik cronies there's this over at DKos:http://www.dailykos.com/storyonly/2008/9/23/124453/470/612/607556
If our military were truly committed to its oath to defend the country and the constitution they'd pull a brigade or two out of the mess-o-potamia, surround the White House and deadeye dickless Cheney's residence and cart the whole bunch away in shackles.

[Amonester]

106. Plus... seize all their assets (everything), not forgetting all those...

they've been so dedicated to hide away in so called Tax Havens all around the world for decades.

Yes, "return" every single penny they stole from the American People to the American People, and throw 'em Republicans in jail where they belong.

And don't forget to give them tea bags! (Symbolism is important.)

[Joe Chi Minh]

136. Shades of Dick "Turpin" Cheney and Halliburton.

[HCE SuiGeneris]

3. JFC!

And now we are to aid these poor foot soldiers, huh?

NO!

[ClayZ]

4. WTF K and R

[lurky]

5. BTW, what's the median pay at Goldman?

I'm guessing it's a lot lower. Meaning the guys at the top make so much that it screws up the average. Kind of like if Bill Gates and I were in the same room, our average net worth would be $30 billion dollars.

[Lucky Luciano]

20. True, it is heavily skewed.

They have about 26,000 employees. 1,000 are managing partners who get roughly $10MM of bonus per year. The newer ones - ie kids out of college get six figure bonuses though as long as they are not fuckups (Usually they are not fuckups). I-Banking is the one business where emplyees really share in the spoils even if it is still heavily skewed. In the business for 10 years at Goldman means that it is pretty hard not to earn a seven figure bonus - you would likely have been fired first as they only want to keep the cream of the crop, so it is a bit stressful.

[BearSquirrel2]

24. They're all gamblers ...

Fuck em' all. Let Goldman Sachs go down, shuffle their assets off to responsible companies and give these companies heavy financial backing. These crooks have got to go.

I'm not to sympathetic about "out of college kids" making $100,000 bonuses for making predatory loans. They should feel lucky to not be in jail at this point.

[WriteDown]

58. GS does not make loans to consumers.

Who are you thinking of?

[BearSquirrel2]

119. Mortage backed bonds ...

They made all those predatory loans because companies like Goldman Sacks were buying the bonds. I don't care if these people lose their comfy jobs.

[WriteDown]

143. Huh?

You do realize that GS's MBS stake was small compared to the rest of their holdings. Also, demand for Ipods and Iphones(which I own) causes more people to work in poor conditions and create pollution in China. Do we all deserve to suffer for that? People buying foreign cars displace American union workers. I suppose the car buyers deserve to suffer too.

[Lucky Luciano]

123. ugggg

:eyes:

I am a trader at a big I-Bank and thoroughly unapologetic about it, but I still sympathize with many people here in spite of their hate.

[BRLIB]

57. Creme of the crop- that means the best swindlers and con men

who create and understand crooked new ways to grow paper, but never create real wealth backed by tangible assets.

[alcibiades_mystery]

54. My brother works for Goldman

$521,000

:rofl:

He fuckin' wishes!

By the way, he's a strong Dem, as are many in the NY/NJ area who work in the financial industry. I'd venture to say he's more a lefty than many many people on this board, in fact.

[Pete2069]

83. Don't democrats realize , if you are not a right-wing republican

then the news media and others call you either a lefty or the
extreme left.   This is to use their scare tactic on other
Americans to say if its' democrats then it is off the chart
and we are against it.

Republicans use words to define groups of people or policies
they wish to be attacked.

[alcibiades_mystery]

84. Since I consider myself a leftist

I don't really give a shit.

Cheers.

[Pete2069]

82. Did you read how many countries they are in????

Data from 2005 , now who knows what the increase is.

If Goldman Sachs employs people in  at least 26 other
countries , why don't they bail them out by handing over their
money to them.   No they are not idiots like we are.
 
Goldman Sachs in 2006 employed 22,425 employees and 1 in 7
were in London alone. 
So what percent do they employ in our country ,, less then a
fifth ,, if we are lucky....   
Here are some of the countries in which Goldman Sachs have
their businesses:   France Germany Ireland Israel Italy Russia
South Africa Spain Sweden Switzerland United Arab Emirates
United Kingdom Argentina Brazil Canada Mexico United States
Australia & New Zealand China India Japan Korea Hong Kong
Singapore Taiwan Thailand ,,,  if not more. 

Deutsche Bank disclose to its staff the bonus cheques they
will soon be taking home. Some top executives will receive
bonuses 75 per cent higher than last year.

Looks as if they Global Giants should be bailing our country
out of debt to China.....

This is now the problem with U.S. controlling these Giant
Corporations which have moved out of our country.   They are
monopolies and they are using the word GLOBAL in place of
MONOPOLY as a means to disguise it..

[magellan]

6. The other shoe drops

I knew there had to be a good reason these two wanted to become banks and why it was done with such unprecedented alacrity. They wanted a better position at the money trough!

Wonder how much Paulson gets out of this neat deal?

[depakid]

7. Calm down Jordi

It's clear that you don't have a clue- and are behaving just like Republicans do (on about on the same level).

[w4rma]

14. You calm down depakid. It's clear that you are pretending that you don't have a clue.

And are supporting bills that the Republicans do.

[depakid]

15. Just having a go with reality

and hoping that others do, too.

We need to pass a bill- and do it right.

I'm sorry, but I'm losing tolerance for dumbshits- on either side.

[ixion]

27. to do it 'right', these companies need to fail

because they screwed up.

a) We don't have a couple trillion extra to cough up and bail them out, and;

b) If we do bail them out, we do so at the risk of our own livelihood and the value of the dollar, and;

c) they don't really deserve to be bailed out in the first place, since they were committing fraud.

[WriteDown]

59. How was GS committing fraud?

? :shrug:

[depakid]

65. Proving my point

Yet another poster showing that he or she doesn't understand the situation- and basically acting like a simple minded Republican,

[ixion]

68. I see...

so what part, exactly, don't I understand?

The part where we're already 9 trillion in debt and this will make it worse, or the part where we're borrowing 2 bln a day just to cover debt service? Or perhaps it's the part where the Fed stopped publishing the M3 because they didn't want anyone to know how much money they were creating out of thin air?

I get a big kick out of you attacking me without refuting a single point that I very clearly delineated.

[depakid]

74. Exactly which parts of a credit freeze and the ramifications to every sector of the economy

do you not understand?

It's been noted by several people on the boards that some seem to want another 1929. You seem to be one of them.

[mbperrin]

102. This bailout will create a credit freeze.

All of the money will have to be borrowed by the government, which will crowd out all other borrowers, since they're not constrained by a rate-of-return ceiling on borrowing costs.

If their assets were any good, the "market" would price them and buy them. The complete absence of any buyers (including cash-rich China, for instance) is all the proof we need that these are completely worthless.

Business people who accumulate worthless assets don't need to be given new ones to ruin. They deserve to find an occupation they can understand and contribute in. Business failure is the "creative destruction" that the economists love to blab on about. It's a great place to find bargains if you have some money.

Otherwise, the same fools will continue to do what they have already done.

[depakid]

103. That's one of the better rationalizations I've heard

for driving off a cliff.

[mbperrin]

105. Any analysis? Or is a metaphor all you got?

nt

[depakid]

107. Actually, there's another DU poster who explains it better than I can

Have a look:

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=4059821&mesg_id=4059821

[dixiegrrrrl]

70. Hear hear !

Verily, you speak the truth. :applause:

[PassingFair]

34. What do we need a bill for?

The last time I read one of your posts, you
were assuring all of us "dumbshits" that the
only thing in trouble was OUR attitudes.

[dhpgetsit]

55. We need a bill to protect homeowners from predation.

People are losing their jobs overseas and becoming unemployed or underemployed and having trouble making ends meet. The price of gas, food and everything else is going up, and people are trying to get by with credit cards while they search for better work as the rate on the credit card suddenly goes through the roof.

Right now I'm feeling the pressure myself as my wife is trying to find work and we can't afford to stock up on firewood for the winter. Everything is so much more expensive than last year. So far we have not missed the mortgage payment but one serious illness or injury would completely wipe us out.

[PassingFair]

117. Hey, I get it.

The poster I was replying to has castigated
people for crying foul over this theftocracy
we are living in.

He believes that we should all just pretend
that the country and its banks are solvent.

Now he wants a bail-out to protect his "investments".

[ooglymoogly]

99. Pugs have admitted to making their own reality no matter how outrageous.

Something to which you apparently ascribe.

[joeglow3]

96. We have to pass this

Believe me, I HATE saying this. My wife and I were responsible and bought a house 8 years with a 30 year fixed loan and have no desire to move, even though MANY of our peers are now in houses worth over twice ours. I hate thinking that I am subsidizing stupid people and stupid companies. People do ass tons of research before buying a TV or a vacuum, so they damn well should have done a ton of research before buying a 6 figure house. OTOH, the companies have ZERO excuse for not knowing exactly what they were getting themselves into.

That said, if we let nature take its course, lending will freeze up. Companies that want to expand will need to pay higher interest rates, forcing them to cut costs elsewhere (read: JOBS). This will lead to massive layoffs, increased assisstance costs, decreased purchasing and more layoffs. If we do nothing, the ramifications to the working class will BE HUGE.

If it were simply a matter of punishing the stupid companies and people who did not do their research or got caught up trying to make a quick buck in a bubble, I would say hell yes. However, I don't want to see the innocent working class get slaughtered.

We need to do this fast. However, I expect Congress to be putting in 18 hour days, 7 days a week, to make sure it is done RIGHT. All of us have to work those kind of hours when something needs to be done on a deadline. There is no reason why Congress cannot do this to make sure it is done in a quick, but correct manner.

Additionally, people need to realize this will not COST $700 billion dollars. We are buying assets that have SOME value. Hopefully, the government is able to buy them at a cost that will allow us to recoup all the cost in 5-10 years. However, even if it does not, we will not lose the entire amount. THIS is where we need the Democrats in Congress to be vigilant.

[ooglymoogly]

100. There are far better ways to do it that will actually work

Paulson should be fired immediately and an honest broker put in his place. He is looking an awfully lot like Cheney and is using the same m.o.

[mbperrin]

104. Corporations who need to raise money can issue more stock.

That's the purpose of the market, to raise capital. It never was intended to be a casino or a piggy bank for incompetent cronies of CEOs.

Any well run company which wants to expand will find eager buyers for their shares. Borrowing doesn't make sense with its concomitant interest expense and the need to repay the principal in time.

And bad companies don't need money to expand.

The whole business needs credit to expand is purely myth and simply ignores the function of the stock market.

[IronLionZion]

120. Who the hell is going to buy the stock of a failing company about to collapse?

That is who other than the US Federal Reserve Bank? I wouldn't buy it. Would you? Somebody has to buy their stock and that's exactly what the fed is doing. US taxpayers are getting shareholder's equity in these companies, like 80% of AIG and something similar for Freddie Mac and Fannie Mae. Hopefully that can be returned after they get back on their feet.

Those responsible for these companies are not benefiting, in fact most have lost like hell when the share prices collapsed and will forever be branded as miserable failures for the rest of their lives, as they should be. They fucked up and everyone knows it, let's not throw the baby out with the bathwater. Secretary Paulson seems to think this might be the end of America as we know it unless this is sorted out.

[Grinchie]

109. Then Don't Say It

Because you are falling prey to the Chicken Little myth that Paulson and Benanke are foisting upon your shallow little mind.

The world will not end as they predict, in fact, it may snap the medicated American public into waking up before they walk up the conveyer belt into the slaughterhouse.

This is a manufactured economic Pearl Harbor. This is the October Surprise, and this is the last chance the Administration has to tie up the dysfunctional system before they are shown the door.

If I were Congress, I'd ask for the heads of Gonzales, Rove, Myers, Addington, Cheney and Bush before working on any bailout.

Paulson is asking for the world, asking for no oversight, knowing that it would never get passed, but this is only a ploy to set the negotiation bar too high in the first place so the Congress won't ask for heads. He hopes that Congress will feel like a winner if they get oversight, so they won't look like the spinelees blobs of Jello that they are.

I am afraid that Paulson's brazen request tactic may have workerd, since the Congress never bargains for our interests.

[truthisfreedom]

8. So where did Paulson used to work, anyway?

[RUMMYisFROSTED]

47. I heard he was a community organizer.

[Indenturedebtor]

9. Yep sounds like a Bushco plan to me

Can we hang them for treason yet?

[Dover]

10. uh huh

The announcement paves the way for the two New York-based firms, both of which will now be regulated by the Fed, to build their deposit base, potentially through acquisitions. That will allow them to rely more heavily on deposits from retail customers instead of using borrowed money -- the leverage that led to the undoing of Bear Stearns and Lehman.

..snip..

Wachovia,'' Plath said. ``Morgan Stanley is going to try to go it alone, and I expect it will try to buy a bank with a market-to-book ratio that is next to nothing. It means they are walking away from Wachovia.''

Morgan Stanley, the second-biggest securities firm until this week, had $36 billion of deposits and three million retail accounts at the end of August. The company plans to convert its Utah-based industrial bank into a national bank.

``This new bank holding structure will ensure that Morgan Stanley is in the strongest possible position,'' Chairman and Chief Executive Officer John Mack, 63, said in a statement last night. ``It also offers the marketplace certainty about the strength of our financial position and our access to funding.''

Goldman, the largest and most profitable of the U.S. securities firms, will become the fourth-largest bank holding company. The firm already has more than $20 billion in customer deposits in two subsidiaries and is creating a new one, GS Bank USA, that will have more than $150 billion of assets, making it one of the 10 largest banks in the U.S., the firm said in a statement last night. The firm will increase its deposit base ``through acquisitions and organically,'' Goldman said.

[jpak]

11. K&R

Fucking crooks

[AzDar]

12. Jeebus.

:wow:

[Revlon10]

13. Hell NO

Lets make some noise

http://www.senate.gov/general/contact_information/senators_cfm.cfm

[ChiciB1]

33. You Also Need To List Representatives! I KNOW Mine... Vern Buchanan, Who Currently Has

8 lawsuits pending against him AND over 150 PAST lawsuits and is presently LEADING in the polls in my District.

THE ONLY DISTRICT to lose over 18,000 votes in 2006 in an election won by him by 369 votes! And we NEVER got any solution as to WHERE those votes went!!!

PEOPLE need to call Representatives too!!

Treasury CAN NOT have ALMIGHTY POWER that from what I hear will never be able to be challenged by ANYONE in ANYWAY!! How can the PEOPLE let this go down??

I've called for REVOLUTION for many years... THE TIME IS NOW!!!!!!!!!!!!!!!!!!

[dana_b]

61. have done it everyday BUT

I believe that they are so busy taking our calls, that they don't have time to respond. I called Boxer's office yesterday and I was cut off - the staff member was overwhelmed.

[dixiegrrrrl]

71. Overwhelming them is the point...

Inundating the offices with calls is actually very important

In past occasions, I have had office staff tell me how strongly the message was getting thru.

Remember that these guys want to adjourn so they can go home and campaign.
They got this election on their mind.

[ChiciB1]

81. Thank You... I Will Call... Nelson, Martinez AND Verneey, YUK!! n/t

[Grinchie]

16. Article Suggests that Lehman part of J.P Morgan Self Dealing

Lehman’s Demise Was Most Assuredly All-About J.P. Morgan

First off, I found it perversely odd that there were allegedly serious suitors who got to take a peak at the state of Lehman’s finances. Institutions rumored to be involved were Korea Exchange Bank, Barclays and B of A. What stuck in my craw was the widely publicized revelation that,

The Lehman rescue failed because the US government was unwilling to issue guarantees to the potential purchasers.

Ladies and gentlemen, are we to believe that the U.S. Fed and Treasury preferred to shoulder, as it turns out, the bailout of the whole global financial system rather than provide some comfort for a would-be purchaser of Lehman?

This makes absolutely zero sense. But the following does:

Late last week, I wrote about a very strange occurrence – the reporting of J.P. Morgan “transferring” 138 billion dollars to Lehman, after Lehman had already filed for Chapter 11 bankruptcy early last Monday morning.

This bears repeating.

The advance was reportedly “to allow” Lehman to settle securities trades with clients. J.P. Morgan was then immediately reimbursed by the Federal Reserve for the same 138 billion.

What was not originally reported, or likely not understood at the time due to the types of securities that Lehman did most of their business in , it is a virtual certainty that J.P. Morgan was the “client” .

The critical piece of information that completes the daisy-chain: The world only learned about J.P. Morgan’s 138 billion advance from a bankruptcy court document, where Lehman was asking the court for the authority to give the settlement of claims of J.P. Morgan “special status.”

More Here http://www.financialsense.com/Market/wrapup.htm">And The Band Played On

[Roland99]

37. And how the dollar isn't in free-fall I cannot fathom

[lelgt60]

38. It is going down. 1.48 euros from 1.39 euros 12 days ago. Pretty big move

.

[crickets]

53. Wait a minute... So J.P. Morgan takes 138 billion dollars

and gives it to Lehman, then Uncle Sam turns around and gives J.P. Morgan 138 billion minty fresh dollars in reimbursement. Did they just launder money right in front of everybody?

[Nihil]

78. "Written laws are like spider's webs ..."

... "They will catch, it is true, the weak and the poor,
but would be torn in pieces by the rich and powerful."

You are right Crickets but expected to be ignored or vilified
by those who benefit from such money laundering and the willing
fools who trust them.

[Grinchie]

110. If you were to be caught seal dealing in Bankruptcy Court...

You'd go to Jail...

Now does anyone wonder why Paulson inserted the "May not review by court of law" clause in the bailout plan?

[barbtries]

17. paulson needs to step down

preferably into a cell. this is criminal.

[nichomachus]

56. No -- Paulson needs to step up -- and then fall through a trap door

[OakCliffDem]

18. The Republicans want the rich to maintain their current lifestyle

[EndElectoral]

19. Paulsen has a huge conflict of interest. I'm afraid Dems are gonna buy into this mess just like Iraq

[ProgressiveEconomist]

40. No wonder Paulson opposes caps on executive pay as a condition for bailout--

he'll likely to be looking for a joba at one of those firms in six weeks!

There could not be a bigger conflict of interest.

[Enthusiast]

90. The Democrats have disappointed me

at every turn. Why do they act like weak pussies when Republicans make demands? The American people, both Democrats and Republicans, do not want this bailout in it's present form.

[Grinchie]

111. Because they pray at the Alter of money

Either that or they are just plain ignorant of Historical fact due to being too busy milking lobbyists for more money.

[Enthusiast]

125. If Obama is elected

we must have sweeping reform. This is why they are fighting so hard to keep him out of office. The free ride is what they are protecting. That and investigations into the wrong doing. The wrong doing winked at by the good old boy's club must be corrected. These criminals will stop at nothing to keep a Republican in office.

[Lucky Luciano]

21. ummmm....

``Its benefits, in its current form, will be largely limited to investment banks and other banks that have aggressively written down the value of their holdings and have already recognized the attendant capital impairment''

Yes, this is true, but those who have not written their investments down have been less than honest by definition with their shareholders.

[JuniorPlankton]

43. For some reason people don't pay attention to this fact.

One of the reasons a lot banks can't benefit from this is the accounting fakery they engaged in.
If an asset is worth 30 cents (and you still can't sell it) but you are carrying it at 80 cents.. well, this bailout will only force you to recognize the losses.

[dana_b]

62. wow - so we're not the only ones shaking in our boots. n/t

[EndElectoral]

22. This will destroy so many good federal programs as we add this debt for decades.

I am just sick at this.

[Monk06]

23. No wonder Paulson is in such a hurry to push this through six weeks before an election.

The Repugs are going for broke. They realize this
is the last scam the are going to be able to pull
because they cheated the world this time not just
the US taxpayer.

GS and MS know that they have to cash in because
nobody will do business with them after Nov 6

[Grinchie]

112. Exactly, this is the Kobyashi Maru Scenario.

If the prospect is an unwinnable Scenario -- Cheat and make Trillions of dollars out of thin air.

[Ganja Ninja]

25. We need to start impeachment proceedings on Nov 5th.

Just get rid of these morons like overnight and seize every scrap of paper and every e-mail and recored conversation in one fell swoop. The corruption is too much for the country to take any more. They need to be escorted out under armed guard and the investigations should start at the same time.

[ProgressiveEconomist]

26. Direct KEATING 5 link: Goldman and Morgan are the last 2 left of 5 who in 2004 received special SEC ...

special SEC exemptions from regulations on "leverage"--the dollars in assets that each dollar of reserves stood behind.

What I'd like to know is--WHO were the lobbyists who won those exemptions for the five firms, and how many of them now are associated with John McCain's campaign?

Remember, this was the same issue that got McCain into the Keating 5 two decades ago--intercession with regulators on behalf of an individual firm (Lincoln Savings and Loan) that later was bailed out at great public expense. IMO, if Democrats can find an effective way to frame this, McCain is TOAST.

From http://www.rgemonitor.com/us-monitor/253651/how_sec_regulatory_exemptions_helped_lead_to_collapse :

"How SEC Regulatory Exemptions Helped Lead to Collapse

Barry Ritholtz--Sep 18, 2008

Is Financial Innovation just another word for excessive and reckless leverage? Apparently so. As we learn this morning via Julie Satow of the NY Sun, special exemptions from the SEC are in large part responsible for the huge build up in financial sector leverage over the past 4 years -- as well as the massive current unwind Satow interviews the above quoted former SEC director, and he spits out the blunt truth: The current excess leverage now unwinding was the result of a purposeful SEC exemption given to five firms. You read that right -- the events of the past year are not a mere accident, but are the results of a conscious and willful SEC decision to allow these firms to legally violate existing net capital rules that, in the past 30 years, had limited broker dealers debt-to-net capital ratio to 12-to-1.

Instead, the 2004 exemption -- given only to 5 firms -- allowed them to lever up 30 and even 40 to 1.

Who were the five that received this special exemption? You won't be surprised to learn that they were Goldman, Merrill, Lehman, Bear Stearns, and Morgan Stanley. As Mr. Pickard points out that "The proof is in the pudding--three of the five broker-dealers have blown up.""

[KittyWampus]

44. Pointing Large Arrow To Above Post. READ THAT POST DU'ERS!

[ProgressiveEconomist]

48. Thanks for noticing. I've turned it into its own GDP thread, at LINK

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=132x7151098 .

There's a research strategy outlined there (in post #3) that could bring us to very close to the list of McCain staff likely most responsible for the current crisis.

[fasttense]

28. We couldn't have a worse person at the helm during this crisis than Paulson.

Paulson just a few years ago was the CEO of Goldman Sachs and it is because of the risks he took then as the CEO, that the firm is suffering now. He has to bail them out so he has a job when he leaves with the bushes. He needs to make Goldmans Sachs look good so he doesn't look like the idiot he was as CEO. Just like dick when he started a war to bailout Halliburton and K&R.

Paulson is just trying to cover his a**.

[lelgt60]

36. Paulson should be a "consultant", though

He's a made man. He knows how the mob works. In any criminal investigation, you need informants.

[Joe Chi Minh]

138. What angers me - and I'm not even American - is the height of his audacity.

It's as if he's mocking the tax-payers, almost putting them in the stocks and throwing stuff at them. Asking for absolute powers!

"At a very high level, I've assisted in bankrupting the country. Now give me total authority without oversight or appeal to finish the job...." That's what sticks in my craw: the arrant presumption!

[Nihil]

139. Why not?

Let's face it, history is supporting his chances of success
far more than the taxpayers' ...

[Joe Chi Minh]

141. True. And I'm sure that's how he reasons. Even so, until recently, there were limits.

[RoccoR5955]

29. We were expecting no less from this POS...

...Yeah, tell them to stick it where the sun doesn't shine!
These shysters screwed up, let them suffer!

[Solly Mack]

30. oooh...roomy pockets

please dig deeper mister government man.....leave me the crumbs and I'll eat'em from your hands

[bronxiteforever]

31. "I have had it with these MF Snakes in my MF Country" apologies to Samuel L Jackson

k & r

[Roland99]

32. I am Jack's complete lack of surprise

And he was unanimously approved to the position, eh?

:eyes:

[lelgt60]

35. Suggestion: into the lions den

Posting here is all fine and good. But I think you can do some good by letting others who do not necessarily share your view know what you think and why.

CNBC is clearly the leading cable news financial site. Before the market opens at 9:30am ET, they are always interviewing the top Wall St/Washington guys. People like Paulson, Barney Frank, Schumer, Bernanke, etc. The interviewers need to hear your opinions to help them shape their questions. I know you may think they'll ignore you, but given an appropriate number and intensity, I'm not so sure.

Go to cnbc.com. Register. Go to their blogs section. Pick an appropriate blog and give your opinion. Email their hosts: Joe Kernan, etc.

[KoKo]

60. Good Point....I've noticed they talking about "viewer comments" more and more.

They are one of the GE Beasts...they will listen because viewers drive their jobs...and Fox Financial is now their competitor.

Thanks!

[dixiegrrrrl]

76. A good idea, and welcome to DU.

:hi:

[Porschenut1066]

39. Wall St Bailout explained

Look at this video I think it says it all;

http://www.youtube.com/watch?v=nsQTXx_bXSc

[Mark D.]

41. MORGAN

Please watch 'The Money Masters' on Google Video (it's too broken up on You Tube). It explains it all. The Morgan family is of British elite lineage. The original Morgan to set foot in America founded AETNA, the first then, and the biggest now, of health insurers. A model for the for-profit system that kills us. A leader in the fight against single-payer, not-for-profit health insurance. They also administer Medicare, their filthy hands are everywhere.

His son was the first to get into Banking. His grandson, JP Morgan, was the most powerful, and his work in the early 1900's created the small crash, that ushered in the 'need' for a Federal Reserve, that allowed him and other elites (ie. Rothschild's people in America and the Rockefeller's) to use that new establishment to affect the money supply and cause the Great Depression, only after a 'Roaring 20s' period that made it look like it was the victim's (the people's) fault.

Yes, Morgan was the biggest player in the Great Depression. Hedge Funds are the biggest factor in the housing crash. MORGAN is the biggest Hedge Fund. Energy speculation is the biggest factor in the rise in gas prices, MORGAN is the biggest energy speculator. Now that we are 'saving' the huge globalist investment companies that looted so much already thanks to the right wing libertarian style 'deregulation' they just write down the bad debt their antics create, get a big tax write off so they can continue to pay almost no Federal taxes, and then get the biggest hand-out in this 'emergency fund'.

They probably made a trillion dollars in this Republican era 'boom' of the last decade that vastly helped the top .01% triple its income, while us 95% at the bottom saw our income fall on average. They're making another trillion now. We have no oversight or control of the Federal Reserve that has dumped a lot of money into these bankers/investors already. Now Bush rams through 'Disaster Capitalism/Shock Doctrine' 'help' for these poor rich bastards 'losing money' so WE won't be hurt.

Let me get this straight. We are getting saddled with so much more debt, that even if Obama wins, he'll be struggling to restore a merely viable economy, they'll keep all our money, and WE will have to pay back the loan given to them. THEM, the rich/corporate/globalist bastards who've rejoiced at our jobs being exported, told us we are whiners, and didn't fail to whine how bad they had it when their massive profits took a small dip they manufactured intentionally for this kind of bail-out.

I don't expect Obama to address monetary-policy. The last president to really do that on a big scale, fighting the central bank concept, was JFK, the last before him was Garfield, the last before him, Lincoln. You see what happened to them. Andrew Jackson successfully beat the bankers back, and retired happily. Why? THE ASSASSIN'S BULLET MISSED HIM. But like the one who killed Lincoln, he too was connected to European bankers (who Morgan is well connected to). But at least Obama can make a dent, or if he is just re-arranging chairs on the Titanic, he'll at least make them more comfortable for us, while McSame will Nuke the whole deck with us on it. So I'll go with Obama's ideas in this case.

[Grinchie]

113. The Money Masters needs to be seen by Everyone.

This is a well researched, thoughtful production that brings together all the dealings of the Moneychangers into one place.

If you have Attention Defecit Disorder, due to Aspartame and other medications, you may find http://video.google.com/videoplay?docid=-9050474362583451279&ei=TUjZSKb-M5n-qAOXg7WyAg&q=money+as+debt+by+paul+grignon&hl=en">Money As Debt a little more palatable as a starter course on why education sucks when it comes to the money system.

http://video.google.com/videoplay?docid=-9050474362583451279&ei=TUjZSKb-M5n-qAOXg7WyAg&q=money+as+debt+by+paul+grignon&hl=en">Money As Debt is also a must see.

If you follow the Money As Debt film, you will see that the collapse of the Housing Market has basically destroyed Trillions of dollars of the money supply, since the "Promise to Pay" is now worthless.

Add to this the 30 to 1 leverage of Lehman in the Derivative market, that is another huge chunk of money that has been destroyed.

The bailout is nothing more than a shift of these debts to YOU, which is the Promise to Pay by every one of you, your kids, and the US Government. No Healthcare for you, I need to pay the interest on the National Debt.

Our industrial base has been dismembered, our natural resources are depleted, and there will be great difficulty in producing products for places like China, Russia or India. They have the labor, the resources and the Political will, while we have Enron Economic policies.

[Raksha]

115. Thanks, Mark - very informative post. n/t

[Mark D.]

129. Grinchie / Raksha

Thanks for picking up what I'm getting at. I too have seen Money as Debt. It gives a more condensed view of what the Money Masters explains. Thanks for mentioning Aspartame too. Few understand how well knit into the globalist scheme companies like Monsanto are. Their Codex Alamentarius is ready to drop in a year or so. It will make things like vitamins, natural herbal remedies, etc., either RX only or illegal 'drugs'. It will force ALL growers worldwide to use growth hormones and GMOs to 'meet the needs of a growing population' that through those means, will be eugenicised. The third world first, then the less affluent in the industrial world. Organics will be made illegal.

I'm not making this up, it's written in the UN policy that Monsanto mainly, and others like Dow, and Bayer want. These companies make chemicals that are carcinogenic, but also make chemicals big pharma uses in chemo, but the side affect of a lot of that chemo is 'cancer'. Talk to some oncologists. It's a business, and we are the source of profit, even if it means infecting us and 'treating us' and it's why AIDS will never be cured, only treated long, long term with incredibly expensive regimens that are paid for by affluent or well insured Americans (the others lose) or in the third world where we are too quick to 'thank' Bush for his active participation in the scheme.

His push to have taxpayers subsidize this treatment for their manufactured disease that is decimating Africa and poor areas of southeast Asia. If one of the Bush Nazis, Rockefeller, or a Rothschild/Morgan high ranking family member got AIDS, you bet your ass they'd cure it fast. Though I doubt we'd ever hear about it. If some independent scientific group cures AIDS or Cancer, they better make the announcement from a secretive, well guarded bunker, because they will go after them. I digress, not many know that Donald Rumsfeld was the CEO of Searle who actively pushed to get Aspartame on the market, THE most toxic food additive of the last 50 years, period.

That is a sub company of the Monsanto empire. The hormones that make fatter cows that make more milk that THEY make are giving little girls periods and tits way before they should have them, and speeding up the move to make 90% of Americans not only poor, but obese, diabetic (insulin dependent, another disease they have no plans on curing, just 'treating') and easier to control and more likely to sit on that couch and be hypnotized by FAUX Snooze than get up, get out, and protest. Morbidly obese, diseased but getting 'treatment', 80 hrs a week working to barely survive out of poverty, microchiped and locked into the Matrix. OUR ignorance is THEIR bliss. America must wake up.

[Rosa Luxemburg]

42. see I told you!

[nolabels]

45. Looks like us people who said NO DEAL are starting to look smarter

Knowing a scam when you see one often comes from having been the victim of one before. Of course with * in office that would include all of us being suckered a couple of times

[pleah]

46. Just a scam to keep the very rich, very rich. n/t

[greyghost]

75. EXACTLY

[wowimthere]

49. Figures! Humph... Working on behalf of Republicans

[whistle]

50. Was there ever any doubt? Paulsom is part of the Wall Street swindler crowd

[dhpgetsit]

51. Paulson will be back in Goldman Sachs

after he's done looting the taxpayers.

[paparush]

52. According to this article, Paulson owns 3 MILLION shares of Goldman Sachs

http://www.bloomberg.com/apps/news?pid=20601087&sid=a4ukqrA3RFyc&refer


"Conflict Of Interest? Goldman Sachs ‘Among Biggest Beneficiaries’ Of Paulson’s Bailout"
By Satyam, Think Progress

"In making his push to administer the largest federal bailout of Wall Street in history, Treasury Secretary Henry Paulson is seeking unfettered authority. McClatchy poses the question today, “can you trust a Wall Street veteran with a Wall Street bailout?,” referring to Paulson, the former CEO of Goldman Sachs:

But the conflicts are also visible. Paulson has surrounded himself with former Goldman executives as he tries to navigate the domino-like collapse of several parts of the global financial market. And others have gone off to lead companies that could be among those that receive a bailout.

In late July, Paulson tapped Ken Wilson, one of Goldman’s most senior executives, to join him as an adviser on what to about problems in the U.S. and global banking sector. Paulson’s former assistant secretary, Robert Steel, left in July to become head of Wachovia, the Charlotte-based bank that has hundreds of millions of troubled mortgage loans on its books.

Goldman Sachs cashed in under Paulson, with earnings in 2005 of $5.6 billion; Paulson made more than $38 million that year. A 2005 annual report shows that “Goldman was still a significant player” in issuing mortgage bonds. The conflict of interest is increasingly clear today, as Bloomberg reports that “Goldman Sachs Group Inc. and Morgan Stanley may be among the biggest beneficiaries” of Paulson’s bailout plan:

Goldman Sachs Group Inc. and Morgan Stanley may be among the biggest beneficiaries of the $700 billion U.S. plan to buy assets from financial companies while many banks see limited aid, according to Bank of America Corp.

“Its benefits, in its current form, will be largely limited to investment banks and other banks that have aggressively written down the value of their holdings and have already recognized the attendant capital impairment,” Jeffrey Rosenberg, Bank of America’s head of credit strategy research, wrote in a report today, without identifying particular investment banks.”

McClatchy adds that the administration’s draft law “also would preclude court review of steps Paulson might take.” Joshua Rosner of Graham Fisher & Co. remarked that Treasury’s ability to “without oversight, determine a financial institution an agent of the government” could be used to mask previous illegal activities at Goldman. The Wonk Room notes six months ago, Paulson claimed, “our banks and investment banks, are strong.”"

The full article is at:
http://thinkprogress.org/2008/09/22/paulson-goldman-bailout/

[mcg]

72. "to mask previous illegal activities at Goldman"

Illegal activities at Goldman would not surprise me in the least.

[greyghost]

77. I read an article that said Paulson had 5 mil in GS stock...

No conflict of interest there...:sarcasm:

[MadrasT]

108. WTF??? 3 million shares???

How many ways can you say, "Conflict of interest!!!"

[paparush]

122. These are not the crooks you are looking for..move along. (jedi mind trick on voodoo economics)

[LSK]

63. I dont see how it benefits them specifically

Except by keeping the Banking system as a whole alive and that benefits every single person in this country. So by that link, yes it benefits them.

:shrug:

[Grinchie]

114. The Fractional Reserve Banking System is a Cancer on the Earth

It needs to be removed before we all live on a polluted, dying world.

[defendandprotect]

64. WE will own them -- and they have to be broken up -- ALL of them --

including the oil industry -- ExxonMobil crime family --

[ShortnFiery]

145. WE will OWN NOTHING. Do NOT pass *any bail out* for Wall Street. eom

[defendandprotect]

147. No... I'm against any bail out -- this is merely criminal activity ,,, HOWEVER --

if any bail-out again goes forward it has to be based on BUY-OUT ...

NOT bail-out

Capitalism is a stinking pile of manure -- Again --

[chill_wind]

66. Heh heh. "Simply no equal to Hank!"

How long did that confirmation process take again?

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x4058688#top

[Booster]

69. I have never been so fearful about what's going to happen to our

country, and never felt so helpless as there is nothing we can do about it. This administration has found a way to steal everything we have all worked so hard for to make our country strong and in just 8 short years they have torn this entire country down. The neo-cons have won, folks.

[Supersedeas]

73. Paulson: still in the bidness of picking Winners and Losers

[99 Percent Sure]

79. CALL THE US SENATE BANKING COMMITTEE NOW! 202.224.7391!

I posted a diary on Daily Kos about this but because I haven't enough comments on DU, I am unable to start a thread here - Daily Kos link: http://www.dailykos.com/story/2008/9/23/11457/6053/698/607478.

Please call 202.224.7391 and let them know that you do not want a bailout, and certainly not one of a trillion dollars.

This is a huge, huge scam that our congressional leaders need to thoroughly review; they also need to listen to us since it will directly affect us. Crooks Row does not need a bailout of this magnitude!

Call now and keep calling until you get through! 202.224.7391!

[Politicalboi]

80. Let Them Die

And hold all these thugs for fraud


http://uk.youtube.com/watch?v=Kvv_5Q4EfNI&feature=email

[mcg]

85. Paulson wants to override the free market, have the Fed pay more than market value

for the securities at Goldman Sachs.

There are some interesting comments at

Avoiding fire-sale price is key to Paulson plan: Bernanke
http://www.marketwatch.com/news/story/avoiding-fire-sale-price-key-paulson/story.aspx?guid={BE116D8A-C118-48FE-938C-2D43070424BC}&dist=msr_4#comments

What Paulson wants:

Goldman Sucks the Treasury dry.
Goldman Sacks the Treasury.

[Faygo Kid]

86. I'm shocked! Shocked, I tell you! Round up the usual suspects!

[mcg]

87. "The Wrong Emergency"

The Wrong Emergency by Roger Lowenstein
http://www.tnr.com/politics/story.html?id=0a253ad4-7e1a-4d8e-b50a-ecb61ec70855

... Paulson, the former Goldman Sachs banker, whose stock when he cashed out in 2006 was worth half billion dollars, is sure to argue that the appropriations are necessary because the market is illiquid. Yet a market for mortgage paper still exists. "Sellers just don't like the bids," a hedge fund manager told me. A manager with a big money management company confirmed that if Citigroup, Goldman, and the rest want to unload their securities, his firm has money to spend. "We just can't spend as much as Paulson," he noted.

The only conceivable purpose of Treasury intervention is to buoy the market (using taxpayer funds) by paying higher-than-market prices. After all, if the government merely intended to match the market, what would be the point? ...

What is so special about Goldman Sachs? Why is keeping Goldman Sachs afloat so important?

[katty]

88. it will exponentially benefit: Goldigger Sachs More Gain Stanley

[GinaMaria]

89. sign here

http://www.democrats.com/stop-paulsons-plunder

it's a petition. Show them they are going against every American.

[lelgt60]

91. Every conservative/ repub acquaintance I have also thinks this is a rip-off

This has got to be one the few truly bi-partisan issues of our time.

How come our people in Washington aren't coming down harder????

[GinaMaria]

94. they are actively against it

http://capwiz.com/sicminc/issues/alert/?alertid=11954501&type=ML

this is from RightMarch Conservative Alerts

Elected officials are getting pressure from all sides. It's starting to look like who ever signs off on this will be signing away his/her career. Keep writing and calling. There's still time. It is not a done deal.

[lonestarnot]

93. Of course it is a damn scam!

:eyes:

[TBF]

95. I'm shocked. *sarcasm tag*

[tooeyeten]

97. Stop the fast passage

:wtf:

[backscatter712]

98. The worst part - it's the classic Rovian Bitchslap.

We all know what this bailout's engineered to accomplish...

Aside from a dictatorial powergrab and a robbery of 700 billion bucks from the taxpayers...

It's designed to force the Democrats in Congress to do a 1...2...3...CAVE!!! maneuver just like FISA and Kyl-Lieberman, just in time for the election.

In other words, it's designed to make the Democrats look like the Alan Colmes party - draw contempt from the electorate by making them think the Democrats will let themselves be bitchslapped by Bush, and won't hit back.

http://talkingpointsmemo.com/archives/209645.php

Stuff like the Swift Boat attacks on John Kerry and McCain's Celeb/P Diddy assault on Obama aren't really about the attacks themselves. In themselves, they're often too cartoonish to be believed in any literal sense. What they're about is smacking the other guy around and making him take it. There's no better way to demonstrate someone's lack of toughness or strength than to attack them and show they are either unwilling or unable to defend themselves -- thus the rough slang I used above. That not only makes the other guy look weak. It also transforms him into an object of contempt, which together are politically fatal. It's this meta-message of weakness that resonates far beyond the literal claims. And it's this that Democrats so often seem to miss -- explaining the factual inaccuracies of the claims, demanding that the attacks stop, all the while reinforcing the intended message of the attacks in the first place.

[greyghost]

116. Damn straight, this is their Oct. Surprise, f*ck im!

[EmilyAnne]

118. Wow. Scam, indeed. Thanks for posting.

[IronLionZion]

121. Henry Paulson should surrender all of his shares to the US taxpayers immediately

as a token of good faith. That means shares in every company that gets bailout money. Kudos to Bernanke for not owning shares (other than Altria). For that simple fact, I trust Bernanke more than any other Bush official, not that I have much trust for any of them.

[Mark D.]

130. Good points...however...

Bernake is not a Bush official. Oh sure, he did the ceremonious appointment of Bernake. But the Federal Reserve and banker elite / military-industrial complex run America. It just looks like it is the other way around.

[crossroads]

124. Paulson owns $700 Million in Goldman S. stock

Paulson owns $700 Million in Goldman S. stock! Is it any wonder?

http://www.slate.com/id/2143018 /

This is outragious!

CR

[Riverman]

126. Wall Street Mafia Shakedown!

How is different from the old fashioned neighborhood thugs from the :family" going door to door or local small shops and saying hey Mr. Cohen, you have a very nice deli here and we want to be your business partner. You agree right - you pay us $1,000 a week and we make sure nothing bad happens to your nice business that you have worked so long to make a small profit and we know you would hate to see anything happen to your business or your beautiful wife and children. God forbid there be a fire or an accident.

Berneke said the same thing today to the Congress - give us $700 billion or bad things will happen to your constituents - the people and businesses that elected you and you care about. No, Mr. Schumer, we can't take a partial payment today, we have to have the full $700 billion now, or else! You know, some pretty bad stuff could happen, Mr Schumer, and you wouldn't want anything to happen on your watch. Wouldn't you agree, Mr. Schumer?

Congress - tell the Wall Street Thugs to GO FUCK YOURSELVES

[McCamy Taylor]

127. The money involved is way more than any of these companies need.

This is twice the U.S. debt which China holds. Think about it. This is more money than the U.S. has spent in Iraq. Where the hell did they get this sum? Did they pull it out of Dick Cheney's ass? They planned this for months and they have plans for this money, and they could buy more than Goldman Sachs with this sum.

We should be asking What illegal plan does Cheney have for this money in the last three months of his administration? And I will guarantee it is not a cash giveaway to a couple of banks. Not just that anyway.

[DireStrike]

128. Lol, "may benefit" his old bank.

This guy is about to become King.

Section 8 of the proposed legislation says it all:

“Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.”

[Mark D.]

131. Incredible

Just incredible. That last line needs to be seen everywhere in America. I cannot believe they are near passing a law with that written in it. For God's sake, it doesn't even allow a court, from local to the supreme court (not that they'd do anything about it) to have oversight on what this guy does with a trillion dollars? This billionaire Pulson and his hier to that throne if McSame wins, Gramm, who pushed through the legislation that made all of this possible? Just unbelievable!

[Vickers]

134. Holy shit.

Start a thread with that as the subject line (or as much as you can squeeze in).

:wow:

[OakCliffDem]

137. SCAM confirmation: Debt Plan will benefit mostly republicans

[ShortnFiery]

144. Tell that to the shameless dems: Chuck Schumer, Barney Franks and Chris Dodd.

These corporate cronies in sheeps' (democratic) clothing are going to RAM THIS BILL down the taxpayer throats. It's not urgent that this SCAM be passed during this session. :grr:

[thecrow]

140. kick. this is a must see thread

[GinaMaria]

142. over the last couple days

we've seen movement and Resistance increase. We cannot let up now. Keep the pressure on. We need our Congress Peeps to slam on the brakes. No new * legislation, plans or ideas. This can wait for the next president to determine the correct course of action.

[defendandprotect]

148. Swutchboards to Congess are jammed --

Hope everyone is calling --