Thanks Gregg!

Digg please

Hmmm.

“sources tell the Chicago Sun-Times“

Sure would be nice to have some further characterization of those “sources”. Are they Jackson associates, people in Blago’s office, people in Fitz’s office (not bloody likely) or just crackpots calling up the newspaper?

Let’s not incriminate anyone based on ‘he said’ by Blago. This guy has every reason to bring certain people down We need to do it right and get the certain people who stoop to these abuses of democracy.

Why on earth aren’t all these people identified in the public filing? This is an indictment, not a fucking FBI investigation or a grand jury proceeding. Are they gonna have hoods over their heads at the trial? Voice distortion, too? This is fucking bullshit.

Schakowsky not important enough to be asked.
http://thinkprogress.org/2008/…..agojevich/

Not an indictment. It’s a criminal complaint in an ongoing investigation. Probable cause for an arrest, but nothing else. Think Fitz has to go to a GJ to get an indictment, but IANAL, so don’t take my word on that.

Brian Ross (Mr. Upstanding Journalist of bentonite in the anthrax fame) is reporting that “federal law enforcement sources tell ABC News” that Jackson is #5.

msnbc clip–andrea and pete williams.
http://www.msnbc.msn.com/id/21…..5#28160175

says all possible wrong-doing is third hand–the governor said the emissary said, when they don’t know what the emissary said-yet, or if they were even speaking for jackson..

moving the liveblogging of the house financial services hearing with kashkari to this thread….

manzullo: you were asked by rep sherman if a $3 million bonus too much for someone who is responsible

kashkari: dances without an answer.

manzullo: the largest city in my district has over 11% unemployment. ave salary in my district is $41K. i want a yes or no answer.

kashkari; it’s too much for a failing organization.

manzullo: is tarp going to ask for the money back

kashkari: i’m going to have to look into it.

manzullo: not acceptable. maybe we need someone else to do your job. maybe an executive from one my district’s community bankers.

kashkari: i don’t know the details.

manzullo: you are not the person for the job. you don’t understand what is happening. on the basis of your answers i think you should step aside.

cleaver: i actually feel sorry for you. it’s is really paulson who should be sitting in that seat.

Recommencing liveblogging of Frank hearing:

Representative: What world do you live in? When you can’t figure out if a $3 million bonus for an executive at AIG is too much, you should step aside.

cleaver: a dramatic turn from what the plan was initially. my constituents are furious. they think i voted for the switch in approach for the TARP. people are confused and angry. i see my colleagues here who i have nothing in common with except life – and yet i find myself agreeing with them.

kashkari: we hear you. but we had to move quickly

cleaver: don’t you know that we would have all jumped on a plane to come back?

cleaver: i want my constituents to know we didn’t participate in a bait and switch. and i want you to hear what people are saying.

cleaver: talks about the difficulty in getting credit for buying cars and everything else.

Shorter Kash: We hear you. We are not listening to you but we are hearing you.

You have a massive undertaking and you have hired 48 people to do it.

didn’t catch the name of the rep: i didn’t expect to be an apologist for treasury. i want to say that things have been moving at a clip that no one could have anticipated.

cspan has interrupted coverage. don’t see it on either cspan-2 or cspan-3. going to try the congressional committee website feed.

Kash: If you count Treasury people, we have over 100.

Who wow, 100 people sort of kind of to administer a $350 billion program.

We hear you too, Kash.

cspan radio is continuing coverage: direct link for realplayer feed.

Point was made that GMAC and other auto company or former auto company credit companies are trying to be redesignated as bank holding companies to qualify for TARP funds.

Kash falls back on that’s a Fed decision (about bankholding companies) and then they would have to be screened by regulators and looked at by us and meet all the deadlines.

Again for AIG or Citi none of this was done, they just got the money.

Kash makes the vacuous point that banks are not making no loans. They are just not making as many. What an idiot! What does this have to do with easing the credit crunch?

It’s outrageous! GMAC also finances homes now, and has a real estate arm (presumably to sell their REOs!) Yet heaven forbid they should be looked on as anything but a blue collar extension of credit for cars.

if the number of loans being made is not zero, then that is evidence of TARP’s success.

one of the committee members made the point that the auto executives have agreed to get paid 1$ / year in salary. where is the equivalent commitment from the financial institutions?

foster: the claims that there is some kind of bait and switch or bamboozling is really unjustified. the members who have said this were not paying attention.

foster asks about common stocks vs preferred (w voting privileges).

kash: we can’t make our $ unattractive to the financial institutions because we want them to take our $.

me: wtf?

Sort of combining themes but Kash is a bigger and more ineffective dealmaker than Blago. He is doing a lousy job at the TARP. He doesn’t have a good explanation for the initial bait and switch of the TARP program. He can’t say why some banks are getting money. He can’t say how they are spending it. He can’t say how this will in fact not theory ease credit. And he can’t say how taxpayers will ever be reimbursed for the money he is slinging around.

Why, the “financial institution” people are “entitled” (there’s that term that Rethugs profess to hate again!) to $3M bonuses in addition to their ample salaries, dontcha know!

be back in minute. need to get some coffee. ugh.

Plenty of blame to go around but the TARP definitely was a bait and switch.

Yeah, that’s struck me as really incongruous before too! Gonna hafta cram that money down their throats whether they want it or not! And then they don’t want to know what the “financial institutions” have done with the money! Nice work if you can get it!

Kash just said he had a bunch of people on something. When you have only 48 permanent staff, there is no bunch.

Thanks Hugh & Selise, for the liveblogging !

Kash is a Yutz !

Finishing this panel on lame question: What would have happened if Congress had not passed the bailout?

This is the wrong question. It is not this vs nothing. It is this vs a real comprehensive plan that would have addressed the underlying problems of distressed homeowners, derivatives, bank insolvency, credit, and re-regulation.

I guess I won my bet on an earlier post.

Because Hensarling had to leave early, he made a quick statement and left. This means that the second panel is made up of Elizabeth Warren, a Harvard Law professor and member of the Congressional Oversight Board for the TARP. She has been critical of Paulson and Kash’s activities.

have coffee. have advil. and kashkari is gone. i predict my headache is soon to follow.

elizabeth warren up. some background on her – she was the one who did a bit of blogging at TPM a while ago. i think it was her research that showed before the current crisis that over half all bankruptcies were triggered by major illness. really like her work so far.

she say that their panel has been in existence just 2 weeks. their website is going live today. there will be a way for us citizens to provide comments and questions.

maloney: i notice that you [warren] have been here for the entire hearing.

maloney: interest rates for cars are at 14%. people can’t get home loans. what should we be doing?

warren: premature for me to see much about this, but see p 19 of our report. see uk (?) example. banks were recapitalized with an explicit promise that they would continue to lend.

Warren: In the UK the British made an explicit quid pro quo that money banks received had to be used to small lending. Something which could be done (i.e. has not been done) in this country.

Maloney on toxic assets.

Warren: Not possible to save banks without saving families.

warren: i would like to point out that banks can not be saved if we don’t save families and small businesses. the idea of looking at banks in isolation is not helpful. we must have a comprehensive plan.

me: wow. warren sounds like hugh. *g*

watt: asks about time commitment.

warren: we were told it was to be part time.

watt: how will you get answers from the treasury that we have not been able.

warren: statutorily we can hold hearings. we work for you (congress) and will have to come to you.

watt: warns that if the oversight board’s responsibility is to take public comment, it will just be a bunch of venting. don’t want you doing pr instead of serious analysis of what is being done with these funds.

Lott?: Is this a full time job.

Warren: We were told explicitly that it was part time.

Lott: So how can you be taken seriously?

Warren: We can hold hearings but no subpoena power if there is a problem we have to come to you. We work for you.

Lott: How is this any different than a popularity contest? (referring I suppose to the group’s website and taking in public comments)

Here’s a thought. If the Congress had wanted an oversight board with real teeth it could have created one. Where were you then, Lott?

Lott = Watt.

Here’s a thought. If the Congress had wanted an oversight board with real teeth it could have created one.

feature. not a bug.

Repeating question on AIG and counterparties, where is the money going?

Warren: We can ask AIG who the original signatories were.

Another repeat question on Citi about assets.

Warren will look into these. Do not know if AIG is currently writing naked swaps.

So why are they asking Warren about naked swaps. If they don’t like them and think they should not be paid, they can pass legislation to nullify them.

A lot of these questions are just re-addressing the points that Kash refused to answer or flimflammed on.

miller: do you know what the assets were and why were they troubled.

mahoney: when bernanke was here he said there are two types of swaps. one with assets and one is just gambling. imo the taxpayer should not be paying off the gambling debts [this isn’t exactly what she said will go back to the transcript later]

miller: reclaiming my time, do we know if aig is still writing credit default swaps?

warren: no, but we will be asking.

mahoney: what is the social utility of CDSs?

warren: i have difficulty understanding if there is one. i am anxious to be educated but i am skeptical.

What they should be asking Warren about is the TARP performance so far.

Last questioner: Is your staffing OK? Will you address unwinding CDOs? Need to look at further downturn in the real estate market.

Damn, why not ask her about the report?

foster: do you have enough staff? are you getting enough support?

warren: wonderful support from congress. our problem is just that we were trying to write the report at the same time as we were buying the fax machine. our panel is set to continue for a year and a half.

foster: there is a level of risk that people don’t like to talk about. possibility that home prices will fall another 2x. can you find out if treasury is looking at the possibility even if they are not talking to us about it?

mahoney: possibility of legislating the use of tarp funds along the lines of bair proposal.

warren: need to rewrite bankruptcy laws as well. want to make the point again that we need a comprehensive program we need to think in a comprehensive way. especially families.

mahoney: we are called to a vote. some members may have additional questions to submit in writing. hearing is adjourned.

Adjourned.

thanks hugh. that was a long one.

I think Manzullo’s comments on top of Sherman’s were the highlight of the hearing. If Kashkari can’t say that a $3 million bonus for an AIG exec is out of line his judgment is so poor, he doesn’t belong in his position.

agree. unfortunately i don’t have that bit of video – it would make for a nice youtube.

I wonder if David Addington gives lessons on how to stonewall Congress because that is what we saw with Kashkari. Most of what he said was uninformative, wrong, or missed the point entirely. Kashkari like Addington appears perfectly content to keep pushing until someone forces him to stop. So the take home here is that the crony capitalism of the TARP is going to continue and that it will be run with the same lack of transparency and fairness until Kash leaves or it runs out of money.

certainly i see no indication that congress has any desire to even attempt to force him to stop. although they might be happy if warren did it for them, as you pointed out, they have not given her the tools or resources for that job.

congress has capitulated all of it’s power… they seem unwilling to take responsibility for any kind of decision making let alone governance.

bbl time for a walk. strangely warm (57F!) and not raining….

Thank you, selise and Hugh, for keepimg the rest of us informed.

It is a sorry spectacle indeed, which we are witnessing. The abject failure of the ruling classes (America’s Own Ari$tocracy & the Polirical Class) to ‘manage’ the economy in such fashion as to sustain our society, is nothing short of crimminal.

In fact, the deliberate disdain which they evidence as regards the rest of us should inspire something akin to a new American Revolution.

Constitutional Convention, anyone?

What were those words?

Something to the effect of, “If we don’t hang together, then we shall certainly hang alone.”

So, again, thanks selise and Hugh for ‘hanging in there’ for all of us.

(I only wish that you both might be able to ask the questions which must be asked … and answered … or else … a ‘reckoning’ is due those who would destroy this nation for mere money … filthy lucre … and the obscene lust for absolute power and the corruption it inevitably brings)

DW

warren: premature for me to see much about this, but see p 19 of our report. see uk (?) example. banks were recapitalized with an explicit promise that they would continue to lend.

I don’t think anybody here had a clue the banks would take the money and still not lend.

Did the UK recapitalization occur AFTER the U.S. example? If so, they got a good lesson and knew to include the requirement for banks to continue lending.

mahoney: what is the social utility of CDSs?

warren: i have difficulty understanding if there is one. i am anxious to be educated but i am skeptical.

Isn’t it just another way to hedge investments? If you could buy an insurance policy to cover losses on any investments then you could make much bolder risky investments to try and make more money. That’s what it’s about…making more money.

Problem is somebody is supposed to be backing the CDSs and apparently they weren’t holding enough reserves because there wasn’t proper regulation.

Finally, I wonder, if there were sufficient regulation requiring adequate reserves on a CDS, then would they suddenly become unprofitable to offer and therefore just disappear. THAT would be interesting to know. After all, regular insurance continues to exist despite regs requiring reserves.

If Kashkari can’t say that a $3 million bonus for an AIG exec is out of line his judgment is so poor, he doesn’t belong in his position.

He’s supposed to manage the TARP funds and I don’t see how that relates to whether an exec gets a bonus. It just shows his Wall Street bias.

They should be asking Paulson if he can tie bigger strings to TARP money to require $1/year CEO pay (they can’t since the law covered CEO pay) or to require firms continue to lend (they might be able to require that, though it’s hard to quantify what would be ‘normal lending’ when these banks are simply saying their decision-making is normal.

Where I think banks should be kicked in the ass is where the Fed is backing bank loans and they still insist on not loaning. That shows something terribly wrong.