« Inside The Shiny Head Of A Financial Terrorist »
Writer Todd Purdum and Vanity Fair have published an extremely interesting piece on former Goldman Sachs CEO, Treasury Secretary and TARP terrorist Henry Paulson. Purdum had access to the Hammer for over 6 months and reveals it all to VF. The juicy revelation seems to be the admission from Hank that he knew early on that capital injections would be required instead of an asset buy.
This should not be surprising. The Hammer knew all along that an asset purchase program would be impossible to create and launch quickly. But it sounded more palatable than asking for $700 billion to lend directly to the banks. So he sold TARP under a false premise and then changed the wording of the final bill.
Except we knew this already. Anyone remember the language change in the final TARP legislation? I covered the story back in February but can't find it in the site archives. Phrasing was inserted into the bill which would grant the Treasury Secretary "the authority to make direct investments in troubled banks." No one noticed until a few weeks later when the policy shift toward direct investment was announced. So I think this defeats Denninger's argument for subpoeanas, as Hank can claim that it was an option he was considering, or that the changing nature of the crisis required a new approach.
Either Max Keiser or Rep. Marcy Kaptur deserves credit for calling Paulson a financial terrorist. I can't remember who used the phrase first.
Purdum appeared on CNBC yesterday to discuss his VF article.
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Wednesday, September 2, 2009 at 6:39AM
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http://dailybail.com/display/Search?searchQuery=paulson&moduleId=4521698&moduleFilter=&categoryFilter=&startAt=0
http://www.cnbc.com/id/32651797
The proposed framework, to be released Wednesday by the Mortgage Bankers Association, would give successor entities to Fannie and Freddie the authority to create securities backed by certain types of mortgages. The new companies would guarantee the securities against defaults on the underlying mortgages.
The new companies would also pay fees into a federal insurance fund, which would guarantee interest and principal payments to bondholders if the companies were ...
http://online.wsj.com/article/SB125186013970178403.html
Bill Gross | September 2009
On the “Course” to a New Normal
http://www.pimco.com/LeftNav/Featured+Market+Commentary/IO/2009/Gross+Sept+On+the+Course+to+a+New+Normal.htm
_Most_ of TARP seems to have been done with the idea of being paid back for our investments. The evil parts of it, a bazillion $ in gifts to reckless idiots through the AIG conduit and a ludicrous $300 billion guarantee for Citi, are what really frost me. I've seen somebody raise the point that if we wanted to prop up the investment bank counterparties to AIG, we should have TARP'ed them *directly*, lending them money rather than effectively giving it to them. I don't see why that wouldn't have worked.
To be sure, the bailouts overall still bother me, because they strengthen an already imposing banking oligarchy by rescuing big incompetents while letting small incompetents die. Industry consolidation will just cause the customer (i.e. the same taxpayer whose money is saving these giant clowns) to be reamed even more.
But I do look at TARP as stratified, and mentally break it down into "semi acceptable" money-making parts and "truly evil" money-losing parts. Likewise, I put much of TARP into a more preferential category than things like PPIP.
that includes *potentially* money-losing for the gigundo Citigroup guarantee.
It's like getting a bank to loan you money for a house, then at the last minute writing in "or whatever the fuck else I want to spend it on". Oh, and let's not forget why Paulson asked for $800 Billion (I just wanted a really big number). If this was not an orchestrated theft to save his buddies, this clown is one of the stupidest human being to ever walk the planet. Are we sure his thumbs are real? This guy has no business saying any member of congress asked idiotic questions.
http://www.youtube.com/watch?v=7nn8N0W903M
He called the bottom in housing, Q1 2007
Oh and Paulson didn't "inherit" the banking crisis, he created it by asking for 40 to one leverage:
"In addition, we and other global firms have, for many years, urged the SEC to reform its net capital rule to allow for more efficient use of capital. This is the single most important factor in driving significant parts of our business offshore, so that our firms can remain competitive with our foreign competitors risk-based capital standards must become the norm. The SEC has made it clear that risk-based capital rules can be implemented only when the Commission is confident that firms employing value-at-risk models have robust credit and risk management policies in place."
Risk management policy? Unless you count swindling taxpayers into bailing you out!
DB got it right in the headline "FINANCIAL TERRORIST", Hankenstein did more to destroy the fabric of America and Capitalism than Osama bin Laden could ever dream of. He should be hung for treason, or forced to wear a dunce cap the size of the Washington Monument. I will not stand by and let anybody spin him into anything else.
Paulson started his work as Treasury Secretary by circumventing payment of capital gains tax on a 500m sale of Goldman Sachs stock. He effectively dodged 200m in taxes. That of course pales in comparison to what he did while in power.
If we can overturn the powers that be in this country this turkey may just end up on trial for his laundry list of treasonous activity. I hope that during that trial we can give new meaning to the phrase "forced liquidation".
But as Mark pointed out, this is the main guy responsible for the SEC rule change on leverage....so it's hard for me to think of him positively in any way.
Without the leverage change, everything else would have been manageable...overnight the demand for securitized products tripled...
@Will
Though I hope like you that he is somehow forced to pay for his misdeeds, I'm afraid Paulson has gotten away free...so as retribution, we expose and ridicule him whenever possible...
DB--Your headline is WAY better.
Hey SNK.
The problem is that most financial reporters aren't skeptical enough by nature...when was the last time fraud has been discovered by a biz reporter...there are no investigative voices left in financial journalism...it's all about snagging the big interview, which skews objectivity...
Here is the link for that Paulson quote...it's all the way at the bottom...
http://banking.senate.gov/00_02hrg/022900/paulson.htm
http://itsnotrealmoney.com/reports/
The Fraud Of The Federal Reserve Bank / Companies / Banking Stocks
The Fraud Of The Federal Reserve Bank / Companies / Banking Stocks
By: Captain_Hook
Far too many look for easy ways to get rich quick these days, only to be disappointed or shocked when reality bites in the end. Because of this there are no shortage of Ponzi like schemes characterizing the financial landscape, one by one being found out to be frauds, with Bernie Madoff at the top of the list in history thus far. The public was shocked when they discovered the size of the Ponzi scheme he was able to put together and perpetuate for so long, as usually, operations like this fall apart much quicker.
http://www.marketoracle.co.uk/Article12972.html
http://www.pushhamburger.com/
AND BAMBOOZLED GENERATION ON MESSAGE BOARDS..COWARDS;NO BALLS TO REVOLT
LOL
CDC H1N1 forced quarantine docs leak
Zero Hedge
September 2, 2009
Although the current H1N1 virus does not have lethal genes yet, we have been implicitly promised by the national and global health authorities that novel H1N1 will soon return with such genetic ‘upgrades’, just as it did in 1918. Here at ZeroHedge, we are expecting a flock of economic black swans soon, and a pandemic — whether real or hyped — may be part of this flock. An economic collapse will be no doubt be triggered soon , and it will be convenient for the political elites to blame the collapse on an external factor, such as a pandemic or a war. Furthermore, the fall H1N1 pandemic may be a convenient pretext by which dangerous levels of expanding social control can be established by elites which have proven themselves utterly corrupt and morally bankrupt.
On to the documents.
http://www.zerohedge.com/article/cdc-h1n1-forced-quarantine-docs-leak