Geithner Asks For Unprecedented Powers To Regulate & Even Take Over Non-bank Financial Institutions

Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke argued Tuesday for unprecedented powers to regulate and even take over financial goliaths whose collapse could imperil the entire economy. Obama, of course, agreed and said he hoped “it doesn’t take too long to convince Congress.”

Geithner Bernanke, said the messy federal intervention into American International Group demonstrated a need to regulate complex non-bank financial institutions.

Rep. Barney Frank, D-Mass., the committee chairman, said that “when non-bank major financial institutions need to be put out of their misery, we need to give somebody the authority to do what the FDIC can do with banks.”

Geithner made it clear he believes the treasury secretary should be granted broad powers – after consultation with Federal Reserve officials – to take control of a major financial institution and run it.

Dealings between Congress and Geithner have been tense.

Rep. Paul Kanjorski, D-Pa., warned Geithner about any requests by the Obama administration for more taxpayer money to support financial bailouts.

“I assume that you recognize there’s not an awful lot of sympathy up here to necessarily provide additional funds – not going on the merits of whether the funds are necessary,” he said.

Rep. Brad Sherman, D-Calif., told Geithner: “What I fear here is that we are doing a kabuki theater in three acts.

“The first act: Washington tells the American people, ‘We understand your anger at Wall Street.’ In the second act, we nitpick to death any proposal that actually adversely affects Wall Street. And then, in the third act, we bestow another trillion dollars on Wall Street under extremely favorable terms.”

Kris Holstrom Breaks The Law With The Fancifully Painted 55-Gallon Buckets Underneath The Gutters Of Her Farmhouse

One Man’s Thoughts Has Moved To

http://www.patriotthoughts.com

You can read this article at:

http://www.patriotthoughts.com/2009/03/25/kris-holstrom-breaks-the-law-with-the-fancifully-painted-55-gallon-buckets-underneath-the-gutters-of-her-farmhouse/

Thank You, Vytautas

Credit Crisis Was A Heist

It was no accident.

The folks in power in Washington and on Wall Street want to pretend that the current global financial crisis — you know, the one that reduced household net worth in the United States by $11.2 trillion in 2008, according to the Federal Reserve — was an accident caused by some unfortunate confluence of greed and asleep-at-the-switch regulators.

What we’re now living through, though, is the result of a conscious, planned looting of the world economy. Its roots stretch back decades. And it wouldn’t have been possible without the contrivances of the bought-and-paid-for folks who sit in Congress.

Of course, just because the plan blew up on the looters, taking off a financial finger here and a portfolio hand there, you shouldn’t have any illusion that they’ve retired. In fact, in the “solutions” now being proposed — by Congress — to fix the global and U.S. financial systems, you can see the looters at work as hard as ever.

Blaming the regulators

The smoke screen — the official explanation of the global crash — was on full display at a March 5 hearing led by Sens. Chris Dodd, D-Conn., and Richard Shelby, R-Ala., respectively the chairman and ranking minority member of the Senate Banking Committee, into the $170 billion morass that is American International Group (AIG, news, msgs). Served up on the grill were Eric Dinallo, the supervisor of insurance for New York state, and Scott Polakoff, the acting director of the federal Office of Thrift Supervision.

To read the rest of this great article by Jim Jubak, please go to: http://articles.moneycentral.msn.com/Investing/JubaksJournal/fluke-credit-crisis-was-a-heist.aspx

Rural Mexican Villages Dig Moats To Repel Gangsters

Ditches Don’t Always Deter Raids,

But Federal Troops Can’t Be Spared

Since right before Christmas, armed raiders repeatedly have swept into villages a long day’s drive south of the Rio Grande to carry away local men. Government help arrived too late, or not at all.

Terrified villagers – at the urging of army officers who couldn’t be there around the clock – have clawed moats across every access road but one into their communities, hoping to repel the raids.

“This was a means of preservation,” said Ruben Solis, 47, a farmers’ leader in Cuauhtemoc, a collection of adobe and concrete houses called home by 3,700 people. “It’s better to struggle this way than to face the consequences.”

But shortly after midnight last Sunday, villagers said, as many as 15 SUVs loaded with pistoleros attacked nearby San Angel, population 250, and kidnapped five people.

After the earthworks were dug in both villages, volunteers manned checkpoints at the remaining open entrances. Those sentinels, however, were removed when it was decided they couldn’t stop a serious attack, anyhow.

“We aren’t able to confront this sort of thing,” Solis said. “We have a few shotguns, some .22 rifles, a few pistols – nothing compared to what they have.”

Mexico, of course, has strong gun control laws which prohibit law abiding farmers from acquiring the weapons needed to combat the attackers. The attackers are heavily armed because they do not obey the law.

President Felipe Calderon’s federal forces have been unable to extinguish the bloodshed or the crime. Kidnappings, extortions and bank robberies are on the rise in many cities and even in rural flyspecks like Cuauhtemoc and San Angel.

Though still far less serious, the troubles faintly echo those of a century ago when Cuencame township, which includes Cuauhtemoc and San Angel, suffered massacres and guerrilla attacks in the lead-up to the Mexican Revolution.

Government forces frequently find themselves without adequate manpower to be everywhere at once.

“This is really the job of the federal government,” Solis said of his town’s efforts at self-defense. “But they don’t have enough men to keep up.“

Government officials blame much of Mexico’s violence on wars between gangs like the Zetas, whose founders were army deserters, for control of smuggling corridors, local drug sales and other rackets.

Gangsters have staged platoon-strength raids on towns in Chihuahua and other nearby states. Kidnappings have increased, as well as cold-call extortion attempts to even poor residents of the area.

A number of merchants, as well as two members of the city council, have been kidnapped in Guadalupe Victoria since late December, residents said. Ransoms, they said, have reached several hundred thousand dollars.

Soldiers and federal police took up the defense of Cuauhtemoc and San Angel last week after the towns’ plight played on the front page of a Mexico City newspaper. But the patrols evaporated after a few days, leaving nothing but the ditches in the villagers’ defense.

“That’s the way it is,” said a sun-weathered Roberto Fuentes. “If the government doesn’t do it, we have to.

“Here, the people are defending the town.”

GOP Sen. Judd Gregg Warned Sunday That The Country Might Be Headed For A Fiscal Crash If Spending Isn’t Controlled.

Even though he was almost a member of the new Obama administration, New Hampshire Republican Judd Gregg Sunday slammed Obama’s approach to handling the country’s fiscal outlook.

“The practical implications of this is bankruptcy for the United States,” Gregg said of the Obama’s administration’s recently released budget blueprint. “There’s no other way around it. If we maintain the proposals that are in this budget over the ten-year period that this budget covers, this country will go bankrupt. People will not buy our debt, our dollar will become devalued. It is a very severe situation.”

Gregg, known as one of the keenest fiscal minds on Capitol Hill, also told CNN Chief National Correspondent John King that he thought it was “almost unconscionable” for the White House to continue with its planned course on fiscal matters with unprecedented actual and projected budget deficits in the coming years.

“It is as if you were flying an airplane and the gas light came on and it said ‘you 15 minutes of gas left’ and the pilot said ‘we’re not going to worry about that, we’re going to fly for another two hours.’ Well, the plane crashes and our country will crash and we’ll pass on to our kids a country that’s not affordable.”

The Republican senator was appointed to be Obama’s Commerce Secretary but then bowed out unexpectedly, citing policy differences with the Democratic administration.

Defaulting Commercial Properties Hit Banks on Vacancy-Rate Rise

U.S. banks, battered by record losses from the worst housing slump since the Great Depression, now must weather increasing loan delinquencies from owners of skyscrapers and shopping malls.

The country’s 10 biggest banks have $327.6 billion in commercial mortgages, which face a wave of defaults as office vacancies grow and retailers and casinos go bankrupt. A projected tripling in the default rate would result in losses of about 7 percent of total unpaid balances, according to estimates from analysts at research firm Reis Inc.

Commercial property prices are down almost 20 percent in the past year, and with the global recession worsening, there’s “significant stress” in the market, said William Schwartz, a credit analyst at DBRS Inc. in New York.

With U.S. unemployment at 8.1 percent, the highest in a quarter-century, and more than 100,000 people and companies filing for bankruptcy in February, commercial property defaults are poised to rise. That may lift the vacancy rate at office buildings to 16.7 percent this year from 14.5 percent at the end of 2008, analysts at New York-based Reis estimate.

While the housing boom of the past decade drove banks to issue tens of thousands of subprime and option adjustable-rate residential loans, lenders also made cheap credit available to builders and buyers of high-rise office buildings, strip malls and apartment complexes.

The number of retail properties seized by banks or in some state of default rose to 464 this month, more than triple the number on Dec. 18, with a total value of $7 billion, according to Jessica Ruderman, a research analyst at Real Capital Analytics Inc. in New York. That means banks aren’t being repaid and are stuck owning properties that have plunged in value.

Most troubled commercial properties have loans that are either syndicated or packaged into securities and sold to investors, and aren’t owned by a single lender. One Riverwalk Place, an 18-story office building in San Antonio, defaulted this year, as did Riviera Holdings Corp., a Las Vegas-based casino owner. Neither loan is owned by a single lender.

While the highest delinquency rates may be in the areas that got most overheated, such as parts of Florida and California, the increase in job cuts will lead to vacancies in areas once thought safe, said Walter Mix, managing director of the Secura Group of LECG, a consulting firm in Los Angeles.

Unemployment in California

This link will take you to an interactive map that shows the month to month changes in California’s unemployment rate by county.

Just on year ago, half of California’s counties had unemployment rates below 8 percent, a distinction only four can claim today.

http://www.sacbee.com/1232/rich_media/1698037.html

Americans Angered By Fresh Revelations About AIG’s Bonuses

American insurance giant AIG, has paid out far more than previously thought to its executives, it was revealed yesterday.

In shelling out a reported $165m in bonuses to its top staff, AIG has rocked Obama’s administration and prompted new laws in a bid to try to claw back the money.

But now documents obtained by Richard Blumenthal, the attorney general of Connecticut, where AIG has offices, show the firm has, in fact, paid out $218m in bonuses, 32% more than previously thought. The shocking news is certain to further inflame popular emotions against AIG and embattled Treasury Secretary Tim Geithner.

AIG has become the unacceptable public face of the economic crisis. Many AIG executives have also faced death threats in the wake of bonus revelations as ordinary Americans, struggling in the face of the deepest economic crisis since the Depression, have wondered why financiers who helped cause the disaster should profit so much from it.

Lawmakers in Washington are trying to force Geithner to resign. They have demanded to know when Geithner knew about the bonuses and why legislation that could have prevented them was removed at the apparent request of Treasury officials.

“The administration has really had to scramble on this. It shows how angry and how politically dangerous the mood of the American public is right now,” said Steve Mitchell, a political pollster and founder of Mitchell Research and Communications.

The last week has seen a steady erosion of support for Obama. One study showed his approval rating dropping from 64% to 59%. Another revealed that the number of Americans who disapprove of Obama’s performance had risen from 17% to 26%. “He is slipping in the polls,” said Mitchell.

13 Companies Getting Bailout Money Owe Back Taxes

At least 13 companies receiving billions of dollars in bailout money owe a total of more than $220 million in unpaid federal taxes, a key lawmaker said Thursday.

Rep. John Lewis, D-Ga., chairman of a House subcommittee overseeing the federal bailout, said two companies owe more than $100 million apiece.

“This is shameful. It is a disgrace,” said Lewis. “We are going to get to the bottom of what is going on here.”

The House Ways and Means subcommittee on oversight discovered the unpaid taxes in a review of tax records from 23 companies receiving the most money, Lewis said as he opened a hearing on the issue.

The committee said it could not legally release the names of the companies owing taxes. It said one recipient of bailout money had almost $113 million in unpaid federal income taxes from 2005 and 2006. A second recipient owed almost $102 million dating to before 2004. Another was behind $1.1 million in federal income taxes and $223,000 in federal employment taxes.

Banks and other companies receiving federal money were required to sign contracts stating they had no unpaid taxes, Lewis said. But he said the Treasury Department did not ask them to turn over their tax records.

Treasury Secretary Timothy Geithner is already under fire on Capitol Hill for not preventing $165 million in bonuses from being paid to employees at troubled insurance giant AIG.

People will ask, said Rep. Artur Davis, D-Ala., why there are “large companies getting taxpayer dollars, making false representations, and we can’t even name them, much less make them pay the money back, much less prosecute them.”

To date, the Troubled Asset Relief Program, or TARP, has paid out more than $300 billion to private companies, with billions more on the way.

3 Police Officers Killed & 1 Brain Dead in Oakland California

Three officers were killed Saturday during separate confrontations with a 26-year-old parolee. A fourth officer was on life support.

Police said all four officers were shot Saturday by Lovelle Mixon, 26, of Oakland, a parolee who fled after shooting the first two officers following a traffic stop, then shot two more after a SWAT team entered an apartment in which he was hiding. Mixon was killed by officers, police said.

Mixon had previously served six years in state prison for felony assault with a firearm during an armed robbery in San Francisco. Mixon was paroled. He was wanted on a no-bail warrant for violating his parole when Sgt. Mark Dunakin, 40, and Officer John Hege, 41, both on motorcycles, stopped a 1995 Buick sedan in east Oakland just after 1 p.m., police said.

The driver opened fire, killing Dunakin and gravely wounding Hege, Oakland police spokesman Jeff Thomason said.

After shooting Hege and Dunakin, the felon on parole gunman fled on foot, police said, leading to an intense manhunt. Two hours later, officers found the felon on parole gunman inside a nearby apartment building.

When a SWAT team entered, the felon on parole gunman opened fire, police said. Sgt. Ervin Romans, 43, and Sgt. Daniel Sakai, 35, were killed and a third officer was grazed by a bullet, police said. Officers returned fire, killing Mixon, police said.

Dunakin is survived by his wife of 16 years and their three children, two boys ages 15 and 8, and a 13-year-old daughter, said Maxine Schwab, Dunakin’s mother-in-law. “He was smart, and he was so good with people, very warm and affectionate,” said Schwab. “If you met him, you’d be charmed by him.”

Friends who knew Sakai from his days at the University of California at Berkeley and his continued involvement in his college fraternity said he was married to a campus police officer and was the father of a young daughter. He and his family lived in Castro Valley. Oren Levy, a fraternity brother of Sakai, said his friend grew up in Big Bear and was an accomplished mountain biker and outdoorsman who majored in forestry and graduated in 1995. As an undergraduate at Berkeley, Sakai worked for the campus police department as a student volunteer. After graduation, Sakai spent a year in Japan teaching English. “His honor was extremely important to him. Whenever there was a situation where someone could take the path that was less honorable, he always advocated doing the right thing,” Levy said. “Being a police officer was really perfect for him.”

Hege’s father said his son, who lived in Concord, loved being a policeman. He worked well with people and was an Eagle Scout. He played high school football and wrestled. He umpired and coached even as a youth, and joined the Oakland Police Department reserves. He taught high school physical education for a few years in Hayward before joining the police department a decade ago. He recently became a motorcycle traffic patrol officer, Hege said, adding, “He liked excitement.”