Pat Toomey: The Wall Street Years

[marmar]

from Mother Jones:




You've probably heard a lot about wacky, radical candidates like Carl Paladino, Christine O'Donnell, Paul LePage, Sharron Angle, and Rand Paul. But lost in all the media finger-pointing is the fact that Pat Toomey, who in any other year would be among the most conservative candidates in the country, is on a glide path to take Arlen Specter's old Senate seat. The former congressman and Wall Street banker has led in the Pennsylvania polls for months. And despite some apparent tightening in recent weeks, polling guru Nate Silver gives Toomey a 92 percent chance of beating his Democratic opponent, Rep. Joe Sestak.

In an attempt to close the gap, Dems have latched onto Toomey's Wall Street past, hammering the Republican for opposing financial regulatory reform and supporting deregulation. Toomey's an easy target for economic-centered attacks. As a Wall Street banker, Toomey helped pioneer the use of some of the same financial products that have caused fiscal chaos for American towns, cities, and states. He spent years as a derivatives trader for Chemical Bank and at Morgan Grenfell, a British financial firm. While at Morgan Grenfell, Toomey focused on things like interest rate swaps—complicated debt instruments that poisoned many a municipality's portfolio. Shortly after he was elected to Congress in 1998, a trade magazine rejoiced that "now the derivatives industry can claim representation by one of its own." Toomey parlayed his trading experience into a spot on the House banking committee, where he crusaded against regulation of financial markets—especially derivatives. And unless Sestak can stage an epic comeback, Toomey will soon be back in Congress, with a vote on banking regulation, if not a seat on the upper chamber's powerful banking panel.

(Toomey's campaign requested questions for this story via email, but did not respond to those questions or to follow-up requests.)

Here's a glimpse of Toomey's background trading derivatives and pushing the market deregulation that some blame for playing a leading role in the financial meltdown. Until the mid-1980s, derivatives—financial products whose value is derived from the value of a different, underlying asset, like a house or a bushel of wheat—were only legally in force if one of the two parties owned or had promised to buy the underlying asset. In order for the government to enforce the deal, one party effectively had to be insuring something—"hedging" against economic risk. You could still trade derivatives if neither party owned the asset, but you couldn't use the court system to adjudicate these purely speculative wagers. At the time, the vast majority of derivatives trading took place on exchanges like the Chicago Mercantile futures exchange. The exchanges functioned as private trading clubs—and they had various internal rules designed to ensure traders could pay off their bets. ..........(more)

The complete piece is at: http://motherjones.com/politics/2010/10/pat-toomey-derivatives-wall-street

[ProudToBeBlueInRhody]

1. This asshole has been getting a free ride

He's more dangerous than the others because he's almost a shoo-in at this point and he's been prepared for it for awhile.

[blue neen]

2. Pennsylvania school districts were hurt badly by Toomey's shenanigans.

"In Pennsylvania alone, 107 school districts reportedly entered into swap deals—"gambling with the public's money," according to the state's auditor general. Some have since paid millions of dollars to Wall Street banks to get out from under the deals. Chicago, Denver, Kansas City, Missouri, Philadelphia, Massachusetts, New Jersey, New York, and Oregon all recently lost money on similar swap deals, according to the Wall Street Journal."

http://motherjones.com/transition/inter.php?dest=http://motherjones.com/politics/2010/10/pat-toomey-derivatives-wall-street

Who paid? The taxpayers, of course. Pat Toomey made money on the backs of Pennsylvania (and nationwide) taxpayers.

Joe Sestak, you need to start hammering on this!

:dem:

[truedelphi]

3. Good to know. If anyone in PA needs a Phone Banking person

With phone sales experience to pitch Sestak to voters, I am willing and able.

And I have unlimited long distance phone coverage.

just PM me with details of who to call, and I will call whatever office you suggest and get signed up to help.

[blue neen]

4. Thank you.

I will check tomorrow and get back to you!

:toast:

[truedelphi]

5. Am looking forward to that. Thanks Blueneen. n/t