F. George McDuffee wrote:
On Wed, 16 Jul 2008 11:36:20 -0700, "John R. Carroll"
wrote:
snip
The situation was only viewed from the perspective of the investmant
community. No thought at all was given to the fundamental nature of
the changes being made in spite of the fact the the exact nature and
mechanics were very well understood.
snip
=========
A very clear and precise statement of the problem.

Where do we go from here (other than over the falls in a barrel)?



Think about this.
F&F are toast. They have tremendous value but they have forfieted the one
thing no institution can afford to toss - their credibility. They aren't
alone and couldn't be and therein lies the problem. American financial
institutions of nearly every stripe are pretty skunky right now.

No problem. The Treasury Department has stepped up to be full partners in
both enterprises. All they need is money!
That means Congress so what they can do is pass or prepare legistlation
capitalizing a fresh entity.
That initial capitalization is important because it will put the magnitude
of all of this right out where everyone can see it.
Any number that isnt realistic will be scoffed at and that will keep
Congress and the pols from pulling the wool over the public eye.America will
simultaneously get a real good look at - and in monetized terms - just how
bad they have been screwed. That is really important as well. I can hear the
collective gasp even now.

Part of that legistlation will also tamp mortgage backed securities right
down to nothing and reinstate a modernized Glass-Steagall. You know, we can
incorporate the lessons learned from the decades of observing the short
comings of the Glass-Steagall Act of 1933.

Ok, now the deal has to be funded. You don't use debt, at least not
initially. You use equity.
Where oh where can Congress lay it's hand on revenue without raising taxes?
Hmmmmm.
Well, one of the reasons that Bill Clinton was as unpopular as he was is
that the guy stole any idea he thought was a good one and if you look at the
financial legistlation passed during his two terms you will see that he
looks a lot like what used to be a Republican. At least he took the parts
that he liked. LOL

I say we take Goober Bush's Social Security Trust Fund privatization policy
and turn it right on it's head. What better investment could American's
possibly make than an investment in this new entity and listen, they are
going to pay for the clean up no matter what anyway so at least let them
into the market in this one, exclusive and single way.
The Trust fund has two things going for it. The first is the tremendous
wealth vested there. You have to believe that T-Bills are worth something to
agree with that statement but id doesn't matter wither way because you see,
SS is the worlds largest and fattest CASH COW. Just sell some of the cash
flow to a soveriegn wealth fund and be done with it. This also has the
unintended but laudatory benefit of denying SS money to finance American
public debt and deficit spending.
Now THAT"S a lock box.

Halt all trading in F&F equity immediately and announce that on date X the
new entity will open as the old F&F emerging from Chapter 11 with fresh
funds, new rules and will honor all debts. You probably wouldn't even need
the courts. Look at the Bear Stearns deal.
The old shareholders will get something. They'll have to, but the haircut
institutional investors or hedge funds get will really give them pause.
About like the Bear Stearns deal. No more than that mind you, but they won't
soon be up to their old tricks.

Finally, the announcement would further state that equity in the
reformulated agency would offered to the public in an open sealed bid
auction ( the way Google did it - look it up) beginning in 2012. I'd say ten
percent or so to start and spread the balance over two or more years as the
French did with the Bank of France IPO.

As I see it, I believe the interest of all Americans are properly served.
These hedge fund, PE and Soveriegn Wealth guys think they are the
swingin'est dick in the game do they.....
LOL
They are peckerwoods compared to the SS Trust fund they have been dying to
loot. Let them see how far the can be hoist on that petard.

Whatcha think of them apples Unka' George?
Does it tick like a watch or a bomb!

--

John R. Carroll
www.machiningsolution.com

On Wed, 16 Jul 2008 18:01:55 -0500, with neither quill nor qualm, F.
George McDuffee quickly quoth:

The fact that both McCain and Obama *WANT* to be president shows
they don't understand the situation.

That's got to be the best comment of the year so far, Unka G.
g

--
"Giving every man a vote has no more made men wise and free
than Christianity has made them good." --H. L. Mencken
---

On Wed, 16 Jul 2008 20:16:35 -0500, Jon Elson
wrote:
snip
OK, banks are required by law (state and federal) to keep some
amount of cash on hand, and a certain ratio of cash vs. debits
on their books.
snip
Indeed, and it was the circumvention of this most prudent
requirement that the current round of troubles seems to be
largely based.

Rigid and universal application of this and other accounting
rules [such as not counting the same money twice] would have
largely prevented the inflation of the several "bubbles" from the
S&Ls, through the dot coms [cons?] and real estate, and on into
the current commodity bubble.

Evasion of this requirement was the reason for the invention and
continued existence of "Special Investment Vehicles [SIVs],
Special Purpose Entities, [SPEs], conduits and a number of other
techniques.

I posted an article showing *ONE* bank [Citi] has over a trillion
dollars US worth of these phantom/invisible loans being forced
back onto their books by changes in the FASB accounting
standards. The banks and other institutions are also being
forced to "mark to market" rather than "mark to myth" the value
of many of their other "assets," which in machining terms is
scrap value only.

When these "off the books" loans come back on the books and many
of the existing "assets" are marked to current market value, the
banks are broke, and cannot meet the minimum capital
requirements. Unfortunately, this is not something new, but
seems to have existed for several years, even as the M&A and real
estate activity rose to a fever pitch. Then someone demanded
their $1.98 change in cash and the whole thing collapsed.....

The commodities bubble seems to be a similar construct, and thus
has the potential to bring down any financial institutions still
standing.

Look for the "ship to hit the sand" *BIGTIME* on Wednesday
November the 5th 2008...


Unka' George [George McDuffee]
-------------------------------------------
He that will not apply new remedies,
must expect new evils:
for Time is the greatest innovator: and
if Time, of course, alter things to the worse,
and wisdom and counsel shall not alter them to the better,
what shall be the end?

Francis Bacon (1561-1626), English philosopher, essayist, statesman.
Essays, "Of Innovations" (1597-1625).

On Wed, 16 Jul 2008 18:21:53 -0700, "John R. Carroll"
wrote:

F. George McDuffee wrote:
On Wed, 16 Jul 2008 11:36:20 -0700, "John R. Carroll"
wrote:
snip
The situation was only viewed from the perspective of the investmant
community. No thought at all was given to the fundamental nature of
the changes being made in spite of the fact the the exact nature and
mechanics were very well understood.
snip
=========
A very clear and precise statement of the problem.

Where do we go from here (other than over the falls in a barrel)?



Think about this.
F&F are toast. They have tremendous value but they have forfieted the one
thing no institution can afford to toss - their credibility. They aren't
alone and couldn't be and therein lies the problem. American financial
institutions of nearly every stripe are pretty skunky right now.

No problem. The Treasury Department has stepped up to be full partners in
both enterprises. All they need is money!
That means Congress so what they can do is pass or prepare legistlation
capitalizing a fresh entity.
That initial capitalization is important because it will put the magnitude
of all of this right out where everyone can see it.
Any number that isnt realistic will be scoffed at and that will keep
Congress and the pols from pulling the wool over the public eye.America will
simultaneously get a real good look at - and in monetized terms - just how
bad they have been screwed. That is really important as well. I can hear the
collective gasp even now.

Part of that legistlation will also tamp mortgage backed securities right
down to nothing and reinstate a modernized Glass-Steagall. You know, we can
incorporate the lessons learned from the decades of observing the short
comings of the Glass-Steagall Act of 1933.

Ok, now the deal has to be funded. You don't use debt, at least not
initially. You use equity.
Where oh where can Congress lay it's hand on revenue without raising taxes?
Hmmmmm.
Well, one of the reasons that Bill Clinton was as unpopular as he was is
that the guy stole any idea he thought was a good one and if you look at the
financial legistlation passed during his two terms you will see that he
looks a lot like what used to be a Republican. At least he took the parts
that he liked. LOL

I say we take Goober Bush's Social Security Trust Fund privatization policy
and turn it right on it's head. What better investment could American's
possibly make than an investment in this new entity and listen, they are
going to pay for the clean up no matter what anyway so at least let them
into the market in this one, exclusive and single way.
The Trust fund has two things going for it. The first is the tremendous
wealth vested there. You have to believe that T-Bills are worth something to
agree with that statement but id doesn't matter wither way because you see,
SS is the worlds largest and fattest CASH COW. Just sell some of the cash
flow to a soveriegn wealth fund and be done with it. This also has the
unintended but laudatory benefit of denying SS money to finance American
public debt and deficit spending.
Now THAT"S a lock box.

Halt all trading in F&F equity immediately and announce that on date X the
new entity will open as the old F&F emerging from Chapter 11 with fresh
funds, new rules and will honor all debts. You probably wouldn't even need
the courts. Look at the Bear Stearns deal.
The old shareholders will get something. They'll have to, but the haircut
institutional investors or hedge funds get will really give them pause.
About like the Bear Stearns deal. No more than that mind you, but they won't
soon be up to their old tricks.

Finally, the announcement would further state that equity in the
reformulated agency would offered to the public in an open sealed bid
auction ( the way Google did it - look it up) beginning in 2012. I'd say ten
percent or so to start and spread the balance over two or more years as the
French did with the Bank of France IPO.

As I see it, I believe the interest of all Americans are properly served.
These hedge fund, PE and Soveriegn Wealth guys think they are the
swingin'est dick in the game do they.....
LOL
They are peckerwoods compared to the SS Trust fund they have been dying to
loot. Let them see how far the can be hoist on that petard.

Whatcha think of them apples Unka' George?
Does it tick like a watch or a bomb!
=======
Both. This appears to be a classical "double bind" situation."

If we don't reorganize F&F, there is a substantial danger of
bringing the entire global economy down, and if we do pump in
enough capital, at best it will simply disappear down the tubes
like all the rest, with the only effect that we have gained a
little time at enormous expense. There is always the possibility
that F&F will go down anyhow (with all that this implies), even
with huge tax payer funded capital injections.

The single group of people most responsible is Congress, both for
removing the "fire walls" and "bulk heads" put in place as the
result of the 1929 depression, and for failing to deal with the
new unregulated and global economy in a timely and prudent
fashion. There was plenty of warning from the S&L debacle to
BCCI, through "Long Term Capital Management," all of which was
ignored.

Until there are fundamental changes made in the US laws and basic
financial/monitary structure these crisises will keep
reoccurring.

The "silver bullet" ammunition box is empty.


Unka' George [George McDuffee]
-------------------------------------------
He that will not apply new remedies,
must expect new evils:
for Time is the greatest innovator: and
if Time, of course, alter things to the worse,
and wisdom and counsel shall not alter them to the better,
what shall be the end?

Francis Bacon (1561-1626), English philosopher, essayist, statesman.
Essays, "Of Innovations" (1597-1625).

FDR as I recall wasn't a Republican infringed our rights by overriding
some of the bill of rights in the name of national defense. The FBI loved
it and kept it that way for many years. Finally it was set back to normal.

Somehow those in power at the time forget that only the All Mighty has the right
to change these and I don't think Congress is equal to or greater than the
Supreme Architect. They think they are. Ego's abound.

Martin

Martin H. Eastburn
@ home at Lions' Lair with our computer lionslair at consolidated dot net
TSRA, Endowed; NRA LOH & Patron Member, Golden Eagle, Patriot's Medal.
NRA Second Amendment Task Force Charter Founder
IHMSA and NRA Metallic Silhouette maker & member.
http://lufkinced.com/


David R.Birch wrote:
John R. Carroll wrote:

So you say.
I say the basis for any forward looking plan will be rooted in
restoring the
fundamental integrity of our system of Justice (Legal), Legistlative
(Congress) and Executive but most importantly, the seperation/ cjeck and
balance of the three.
This is what has made America great and it's why capital has flowed
inward.
That it's now outbound has everything to do with eight years of
disregarding
this truth.

8 years? How about 28? Republicans have no monopoly on dismantling the
Constitution and Bill of Rights.

David


----== Posted via Pronews.Com - Unlimited-Unrestricted-Secure Usenet News==----
http://www.pronews.com The #1 Newsgroup Service in the World! 100,000 Newsgroups
---= - Total Privacy via Encryption =---

"F. George McDuffee" wrote in message
...


The "silver bullet" ammunition box is empty.


Have the FED open up Fort Knox and start using some of the golden bullets
stored there ?
Back F&F with gold reserves if they are so important to the econemy.
Printing more funny money
wont solve the problem just delay it.

Something for taxpaying US voters to consider before they vote this
november.

Best Regards
Tom.

azotic wrote:
"F. George McDuffee" wrote in message
...



The "silver bullet" ammunition box is empty.



Have the FED open up Fort Knox and start using some of the golden bullets
stored there ?
Back F&F with gold reserves if they are so important to the econemy.
Printing more funny money
wont solve the problem just delay it.

Something for taxpaying US voters to consider before they vote this
november.

Best Regards
Tom.





Regan took us off of the gold standard back inthe 70's (1973?)
because the national debt was larger than the amount of gold
on hand.

That was in 1973 dollars.

By todays standards, those golden bullets are only golden BBs.

F. George McDuffee wrote:

Look for the "ship to hit the sand" *BIGTIME* on Wednesday
November the 5th 2008...



111 shopping days until...

--

Richard

(remove the X to email)

America has become thouroughly convinced that the lunatics
are running the assylum and good idea or no, it will take
more that George W Bush at a press conference to reclaim
the public trust this administration has wantonly destroyed.

John R. Corroll

"Ignoramus30183" wrote in message
...
On 2008-07-16, Hawke wrote:
Ya got that right, and it all stems from free trade and the global
economy.
What the free traders want is basically an unregulated market where all
goods, services, and capital can freely go anywhere in the world where
it is
most profitable.

Keep in mind that the two failing behemoths are "GOVERNMENT sponsored
enterprises". It is that designation that let them grow so big and
make so many risky guarantees.

It is hard to blame the "free market" for their failure.

The "free market" response to these loan guarantees was to write and
sell bogus loans that would be guaranteed by these GSAs.

I remember being astonished how I was given a "no-documentation"
mortgage where I did not even have to state or prove my income. (we
did not borrow as much as we could, our mortgage payments are
approximately 10% of our gross income, but the lender had no idea)

i


The one great thing about this whole mess is that there is just so much
blame to go around. But I put most of it on the attitude or atmosphere of
anything goes because with the republicans in charge of the government there
weren't going to be any rules, anything was okay as long as money was being
made. This covered the borrowers, the lenders, the secondary mortgage
market, and the entities buying the securitized mortgages. Everybody was
looking the other way as things experienced people knew were foolhardy were
done every day as if nothing could ever go wrong. Those of us old enough to
have seen real estate go down knew that the bottom was going to fall out
eventually, but the people and the institutions who were making money hand
over fist had blinders on. Now that the real estate market has come back
down to earth it's going to take years to bring things back in line with the
traditional guidelines for real estate. The long standing rules for lending
in mortgages were there for good reason as we can now see so clearly. The
unrestricted behavior of a free market in real estate is what caused this to
happen. The uncontrolled market came about because of the republican view
that market needs to be left alone to work it's magic. Well, the "magic" has
played it's trick on us. Now we can go back to sound financial principles
once again and try to forget the magic thinking of the republicans and their
free markets and it's "invisible hand". Of course that invisible hand is
evening things out again by pounding the crap out of the American people,
its businesses, and it's markets. Everything works out in the end. If
suffering doesn't matter then I guess the free market system has worked
again.

Hawke

"Gunner" wrote in message
...
On Wed, 16 Jul 2008 03:10:26 -0700, "John R. Carroll"
wrote:

David R.Birch wrote:
John R. Carroll wrote:

So you say.
I say the basis for any forward looking plan will be rooted in
restoring the fundamental integrity of our system of Justice
(Legal), Legistlative (Congress) and Executive but most importantly,
the seperation/ cjeck and balance of the three.
This is what has made America great and it's why capital has flowed
inward. That it's now outbound has everything to do with eight years
of disregarding this truth.

8 years? How about 28? Republicans have no monopoly on dismantling the
Constitution and Bill of Rights.

No, but the last eight or ten years have been especially bad in this
regard.


Your BDS and opinion are again noted


And your ability to ignore facts and see reality as you want it to be
instead of how it truly is has also been noted. More proof of you affliction
is that you can be counted in the 28% who think Bush is a good president
according to the latest AP-IPSOS poll. That low equals Bush's lowest ever.
It took time but except for a small percentage of nuts all other Americans
know that Bush sucks as president.

Hawke

"Ed Huntress" wrote in message
...

"Ignoramus30183" wrote in message
...
On 2008-07-16, John R. Carroll jcarroll@ubu wrote:
Ignoramus30183 wrote:
On 2008-07-16, Larry Jaques novalidaddress@di wrote:
On Tue, 15 Jul 2008 20:18:57 -0500, with neither quill nor qualm,
Ignoramus19502 quickly quoth:

On 2008-07-15, John R. Carroll jcarroll@ubu wrote:

You know reconditioning well Chudov but apparently not finance.

I have a Master of business administration degree in finance from
University of Chicago. Which is admittedly not that much, but at
least I studied it a little bit.

Well, at least you gave it up for something more real and honest:
hawking wares on eBay and doing new/used metalworking.


That's not my day job,

Well you are very good at it.



Thanks John. I respect your opinions, experience etc. But at the same
time I also think that these GSEs created an enormous market
distortion and should be phased out (at least as "government
sponsored" entities).

If the value of mortgages decliness further, and if the government
steps in and assumes guarantees given by Freddie and Fannie, this
could potentially expose it to very large liabilities.

Which brings us to the question that always arises when there is a
proposal
to privatize some large government entity, or quasi-government entity like
these two: Why were they created in the first place, and what would have
happened without them?

The role of government encouragement for home ownership in our society
often
is underestimated. In general (and I haven't studied Freddie and Fannie
for
decades, so I'm not being specific here) they're created because the
market
isn't producing some desired result. Home ownership has been a desired
result for a long time, and anyone who thinks the market would have
emerged
to deal with the relatively low rates of ownership doesn't know the
history
of it. In the "free" market, down payments and interest rates were too
high,
largely because risk exposure was too large. And the "free" market had
created a number of non-equity payment schemes, such as the infamous "land
contract," which destabilized the whole system when there was an economic
downturn. Freddie and Fannie made it possible for more people to buy
houses
and they stabilized the system, having enabled the general use of
mortgages
that accrued equity for the homeowners even as the loans were being paid
off.

The upshot is that these two entities maybe -- probably -- created more
wealth and more stability in our economy, not to mention the enormous
fallout of economic activity from home building, than any damage their
troubles are likely to cause. In other words, be careful what you wish
for.

--
Ed Huntress


Any government created agency or organization can and every now and then
does wind up failing. These two quasi governmental organizations; which were
created because of a need the free market failed to provide, have been
around a long time and are responsible for creating the secondary market in
mortgages. This has been a boon for the whole country. Now they are in
trouble. They can and will eventually be fixed or closed down and something
better will replace them. So there is a down side to this kind of
organization. But privatization has a much greater risk, namely, bankruptcy.
If these were private companies they would simply go bankrupt and cause huge
problems. That is the main difference between government and private.
Private can simply close the doors and stop doing business if they screw
things up. Everyone involved with the business pays the price. The job of
these GSEs is too important to leave in the hands of businesses who will
just close up if they make a mess of things. Some things are best done by
government. I think this is one of them.

Hawke

"cavelamb himself" wrote in message
m...
F. George McDuffee wrote:

Look for the "ship to hit the sand" *BIGTIME* on Wednesday
November the 5th 2008...



111 shopping days until...

--

Richard


Bank Holiday ?

Best Regards
Tom.

"cavelamb himself" wrote in message
...
azotic wrote:
"F. George McDuffee" wrote in message
...



The "silver bullet" ammunition box is empty.



Have the FED open up Fort Knox and start using some of the golden bullets
stored there ?
Back F&F with gold reserves if they are so important to the econemy.
Printing more funny money
wont solve the problem just delay it.

Something for taxpaying US voters to consider before they vote this
november.

Best Regards
Tom.





Regan took us off of the gold standard back inthe 70's (1973?)
because the national debt was larger than the amount of gold
on hand.

That was in 1973 dollars.

By todays standards, those golden bullets are only golden BBs.


It was Nixon.

"Under the gold standard, governments that print too much paper money risk
runs on their gold reserves. Runs occur as holders of the paper seek to
convert to gold before the vaults are empty. A run on the dollar is what
happened in the late 1960s, which culminated in President Richard Nixon
closing the gold window in 1971.

"Closing the gold window" is a euphemism for the U.S. defaulting on its
promise to other countries to redeem dollars for gold. As an alternative,
Nixon could have devalued the dollar and continued to redeem. In effect, he
chose a one hundred percent devaluation, a de facto default on the promise
to redeem.

In the 34 years before Nixon closed the gold window, the money supply in the
U.S. grew less than two fold. In the 34 years after Nixon's action, the
money supply expanded 13 fold. The Fed's massive inflation of the 1990s
resulted in the greatest advance in stock market history. Automobiles now
cost more than houses did only thirty years ago."

http://www.cmi-gold-silver.com/gold-...iat-money.html



It would be intresting to see if thier actually is any gold left in Fort
Knox.

Best Regards

Tom.

azotic wrote:
"cavelamb himself" wrote in message
...

azotic wrote:

"F. George McDuffee" wrote in message
...




The "silver bullet" ammunition box is empty.



Have the FED open up Fort Knox and start using some of the golden bullets
stored there ?
Back F&F with gold reserves if they are so important to the econemy.
Printing more funny money
wont solve the problem just delay it.

Something for taxpaying US voters to consider before they vote this
november.

Best Regards
Tom.





Regan took us off of the gold standard back inthe 70's (1973?)
because the national debt was larger than the amount of gold
on hand.

That was in 1973 dollars.

By todays standards, those golden bullets are only golden BBs.



It was Nixon.



I stand corrected!




--

Richard

(remove the X to email)

America has become thouroughly convinced that the lunatics
are running the assylum and good idea or no, it will take
more that George W Bush at a press conference to reclaim
the public trust this administration has wantonly destroyed.

John R. Corroll

F. George McDuffee wrote:
On Wed, 16 Jul 2008 18:21:53 -0700, "John R. Carroll"
wrote:

F. George McDuffee wrote:
On Wed, 16 Jul 2008 11:36:20 -0700, "John R. Carroll"
wrote:
snip

Whatcha think of them apples Unka' George?
Does it tick like a watch or a bomb!
=======
Both. This appears to be a classical "double bind" situation."

If we don't reorganize F&F, there is a substantial danger of
bringing the entire global economy down, and if we do pump in
enough capital, at best it will simply disappear down the tubes
like all the rest, with the only effect that we have gained a
little time at enormous expense. There is always the possibility
that F&F will go down anyhow (with all that this implies), even
with huge tax payer funded capital injections.

The single group of people most responsible is Congress, both for
removing the "fire walls" and "bulk heads" put in place as the
result of the 1929 depression, and for failing to deal with the
new unregulated and global economy in a timely and prudent
fashion. There was plenty of warning from the S&L debacle to
BCCI, through "Long Term Capital Management," all of which was
ignored.

Foreclosure Phil

Years before Phil Gramm was a McCain campaign adviser and a lobbyist for a
Swiss bank at the center of the housing credit crisis, he pulled a sly
maneuver in the Senate that helped create today's subprime meltdown."
Who's to blame for the biggest financial catastrophe of our time? There are
plenty of culprits, but one candidate for lead perp is former Sen. Phil
Gramm. Eight years ago, as part of a decades-long anti-regulatory crusade,
Gramm pulled a sly legislative maneuver that greased the way to the
multibillion-dollar subprime meltdown. Yet has Gramm been banished from the
corridors of power? Reviled as the villain who bankrupted Middle America?
Hardly. Now a well-paid executive at a Swiss bank, Gramm cochairs Sen. John
McCain's presidential campaign and advises the Republican candidate on
economic matters. He's been mentioned as a possible Treasury secretary
should McCain win. That's right: A guy who helped screw up the global
financial system could end up in charge of US economic policy. Talk about a
market failure.
Gramm's long been a handmaiden to Big Finance. In the 1990s, as chairman of
the Senate banking committee, he routinely turned down Securities and
Exchange Commission chairman Arthur Levitt's requests for more money to
police Wall Street; during this period, the sec's workload shot up 80
percent, but its staff grew only 20 percent. Gramm also opposed an sec rule
that would have prohibited accounting firms from getting too close to the
companies they audited-at one point, according to Levitt's memoir, he warned
the sec chairman that if the commission adopted the rule, its funding would
be cut. And in 1999, Gramm pushed through a historic banking deregulation
bill that decimated Depression-era firewalls between commercial banks,
investment banks, insurance companies, and securities firms-setting off a
wave of merger mania.
But Gramm's most cunning coup on behalf of his friends in the financial
services industry-friends who gave him millions over his 24-year
congressional career-came on December 15, 2000. It was an especially tense
time in Washington. Only two days earlier, the Supreme Court had issued its
decision on Bush v. Gore. President Bill Clinton and the
Republican-controlled Congress were locked in a budget showdown. It was the
perfect moment for a wily senator to game the system. As Congress and the
White House were hurriedly hammering out a $384-billion omnibus spending
bill, Gramm slipped in a 262-page measure called the Commodity Futures
Modernization Act. Written with the help of financial industry lobbyists and
cosponsored by Senator Richard Lugar (R-Ind.), the chairman of the
agriculture committee, the measure had been considered dead-even by Gramm.
Few lawmakers had either the opportunity or inclination to read the version
of the bill Gramm inserted. "Nobody in either chamber had any knowledge of
what was going on or what was in it," says a congressional aide familiar
with the bill's history.
It's not exactly like Gramm hid his handiwork-far from it. The balding and
bespectacled Texan strode onto the Senate floor to hail the act's inclusion
into the must-pass budget package. But only an expert, or a lobbyist, could
have followed what Gramm was saying. The act, he declared, would ensure that
neither the sec nor the Commodity Futures Trading Commission (cftc) got into
the business of regulating newfangled financial products called swaps-and
would thus "protect financial institutions from overregulation" and
"position our financial services industries to be world leaders into the new
century."
Subprime 1-2-3
Don't understand credit default swaps? Don't worry-neither does Congress.
Herewith, a step-by-step outline of the subprime risk betting game. -Casey
Miner
Subprime borrower: Has a few overdue credit card bills; goes to a storefront
lender owned by major bank; takes out a $100,000 home-equity loan at 11
percent interest
Lending bank: Assuming housing prices will only go up, and that investors
will want to buy mortgage loan packages, makes as many subprime loans as it
can
Investment bank: Packages subprime mortgages into bundles called
collateralized debt obligations, or cdos, then sells those cdos to eager
investors. Goes to insurer to get protection for those investors, thus
passing the default risk to the insurer through a "credit default swap."
Insurer: Thinking that default risk is low, agrees to cover more money than
it can pay out, in exchange for a premium
Rating agency: On basis of original quality of loans and insurance policy
they are "wrapped" in, issues a rating signaling certain slices of the cdo
are low risk (aaa), medium risk (bbb), or high risk (ccc)
Investor: Borrows more money from investment bank to load up on cdo slices;
makes money from interest payments made to the "pool" of loans. No one
loses-as long as no one tries to cash in on the insurance.It didn't quite
work out that way. For starters, the legislation contained a
provision-lobbied for by Enron, a generous contributor to Gramm-that
exempted energy trading from regulatory oversight, allowing Enron to run
rampant, wreck the California electricity market, and cost consumers
billions before it collapsed. (For Gramm, Enron was a family affair. Eight
years earlier, his wife, Wendy Gramm, as cftc chairwoman, had pushed through
a rule excluding Enron's energy futures contracts from government oversight.
Wendy later joined the Houston-based company's board, and in the following
years her Enron salary and stock income brought between $915,000 and $1.8
million into the Gramm household.)
But the Enron loophole was small potatoes compared to the devastation that
unregulated swaps would unleash. Credit default swaps are essentially
insurance policies covering the losses on securities in the event of a
default. Financial institutions buy them to protect themselves if an
investment they hold goes south. It's like bookies trading bets, with banks
and hedge funds gambling on whether an investment (say, a pile of subprime
mortgages bundled into a security) will succeed or fail. Because of the
swap-related provisions of Gramm's bill-which were supported by Fed chairman
Alan Greenspan and Treasury secretary Larry Summers-a $62 trillion market
(nearly four times the size of the entire US stock market) remained utterly
unregulated, meaning no one made sure the banks and hedge funds had the
assets to cover the losses they guaranteed.
In essence, Wall Street's biggest players (which, thanks to Gramm's earlier
banking deregulation efforts, now incorporated everything from your checking
account to your pension fund) ran a secret casino. "Tens of trillions of
dollars of transactions were done in the dark," says University of San Diego
law professor Frank Partnoy, an expert on financial markets and derivatives.
"No one had a picture of where the risks were flowing." Betting on the risk
of any given transaction became more important-and more lucrative-than the
transactions themselves, Partnoy notes: "So there was more betting on the
riskiest subprime mortgages than there were actual mortgages." Banks and
hedge funds, notes Michael Greenberger, who directed the cftc's division of
trading and markets in the late 1990s, "were betting the subprimes would pay
off and they would not need the capital to support their bets."
These unregulated swaps have been at "the heart of the subprime meltdown,"
says Greenberger. "I happen to think Gramm did not know what he was doing. I
don't think a member in Congress had read the 262-page bill or had thought
of the cataclysm it would cause." In 1998, Greenberger's division at the
cftc proposed applying regulations to the burgeoning derivatives market.
But, he says, "all hell broke loose. The lobbyists for major commercial
banks and investment banks and hedge funds went wild. They all wanted to be
trading without the government looking over their shoulder."
Now, belatedly, the feds are swooping in-but not to regulate the industry,
only to bail it out, as they did in engineering the March takeover of
investment banking giant Bear Stearns by JPMorgan Chase, fearing the firm's
collapse could trigger a dominoes-like crash of the entire credit
derivatives market.
No one in Washington apologizes for anything, so it's no surprise that Gramm
has failed to issue any mea culpa. Post-Enron, says Greenberger, the senator
even called him to say, "You're going around saying this was my fault-and
it's not my fault. I didn't intend this."
Whether or not Gramm had bothered to ponder the potential downsides of his
commodities legislation, having helped set off an industry free-for-all, he
reaped the rewards. In 2003, he left the Senate to take a highly lucrative
job at ubs, Switzerland's largest bank, which had been able to acquire
investment house PaineWebber due to his banking deregulation bill. He would
soon be lobbying Congress, the Fed, and the Treasury Department for ubs on
banking and mortgage matters. There was a moment of poetic justice when ubs
became one of the subprime crisis' top losers, writing down $37 billion as
of this spring-an amount equal to its previous four years of profits
combined. In a report explaining how it had managed to mess up so grandly,
ubs noted that two-thirds of its losses were the fault of collateralized
debt obligations-securities backed largely by subprime instruments-and that
credit default swaps had been "key to the growth" of its out-of-control cdo
business. (Gramm declined to comment for this article.)
Gramm's record as a reckless deregulator has not affected his rating as a
Republican economic expert. Sen. John McCain has relied on him for policy
advice, especially, according to the campaign, on housing matters. The two
have been buddies ever since they served together in the House in the 1980s;
in 1996, McCain chaired Gramm's flop of a presidential campaign. (Gramm
spent $21 million and earned only 10 delegates during the gop primaries.) In
2005, McCain told a Wall Street Journal columnist that Gramm was his
economic guru. Two years later, Gramm wrote a piece for the Journal
extolling McCain as a modern-day Abraham Lincoln, and he's hailed McCain's
love of tax cuts and free trade. Media accounts have identified Gramm as a
contender for the top slot at the Treasury Department if McCain reaches the
White House. "If McCain gets in," frets Lynn Turner, a former chief sec
accountant, "we'll have more of the same deregulatory mess. I like John
McCain, but given what I know about Phil Gramm, I wouldn't vote for McCain."
As a thriving bank exec and presidential adviser, Gramm has defied a prime
economic principle: Bad products are driven out of the market. In John
McCain, he has gained an important customer, so his stock has gone up in
value. And there's no telling when the Gramm bubble will burst.

http://www.motherjones.com/news/feat...sure-phil.html
David Corn is Mother Jones' Washington, D.C. bureau chief.



--

John R. Carroll
www.machiningsolution.com

On Thu, 17 Jul 2008 08:23:06 -0700, "John R. Carroll"
wrote:
snip
Years before Phil Gramm was a McCain campaign adviser and a lobbyist for a
Swiss bank at the center of the housing credit crisis, he pulled a sly
maneuver in the Senate that helped create today's subprime meltdown."
Who's to blame for the biggest financial catastrophe of our time? There are
plenty of culprits, but one candidate for lead perp is former Sen. Phil
Gramm.
snip
=========
Phil Gramm makes a good poster boy, but he was only 1 of 100
senators, and bills require at least 51 votes to pass.

A more basic cause is a legislative body that permits 12,000 page
bills to be considered, and consists of senators and
representatives that vote for these bills which they [or their
staff] could not possibly have review, as in many cases these
were available in final form only hours before the vote.

The standard argument is that this is "must pass" legislation. I
would suggest that it became "must pass" only because of the
failure to conduct business on a reasonable basis, i.e.
considering the most important issues *FIRST*, and such delay may
well have been a deliberate ploy by the "leadership" to ram their
entire package through.

In any event, even though failure to enact the budget bill would
have shut down the Federal government, the cost of such a
shut-down would be *MUCH* less that the damage inflicted on the
US national economy.

Until we elect enough legislators that will vote *NO* and keep
voting *NO* on these massive bills with no opportunity for review
and evaluation, that no one understands, we will have these
problems.

What did we get? Investigations into the use of "performance
enhancing drugs" by professional athletes. How about an
investigation into "performance enhancing accounting" by the
professional scam artists?


Unka' George [George McDuffee]
-------------------------------------------
He that will not apply new remedies,
must expect new evils:
for Time is the greatest innovator: and
if Time, of course, alter things to the worse,
and wisdom and counsel shall not alter them to the better,
what shall be the end?

Francis Bacon (1561-1626), English philosopher, essayist, statesman.
Essays, "Of Innovations" (1597-1625).

On 2008-07-16, John R. Carroll jcarroll@ubu wrote:

Ignoramus30183 wrote:

On 2008-07-16, Larry Jaques novalidaddress@di wrote:

On Tue, 15 Jul 2008 20:18:57 -0500, with neither quill nor qualm,
Ignoramus19502 quickly quoth:


On 2008-07-15, John R. Carroll jcarroll@ubu wrote:

You know reconditioning well Chudov but apparently not finance.

I have a Master of business administration degree in finance from
University of Chicago. Which is admittedly not that much, but at
least I studied it a little bit.

Well, at least you gave it up for something more real and honest:
hawking wares on eBay and doing new/used metalworking.


That's not my day job,

Well you are very good at it.



Thanks John. I respect your opinions, experience etc. But at the same
time I also think that these GSEs created an enormous market
distortion and should be phased out (at least as "government
sponsored" entities).

If the value of mortgages decliness further, and if the government
steps in and assumes guarantees given by Freddie and Fannie, this
could potentially expose it to very large liabilities.


Which brings us to the question that always arises when there is a
proposal to privatize some large government entity, or quasi-government
entity like these two: Why were they created in the first place, and
what
would have happened without them?

The role of government encouragement for home ownership in our society
often is underestimated. In general (and I haven't studied Freddie and
Fannie for decades, so I'm not being specific here) they're created
because the market isn't producing some desired result. Home ownership
has been a desired result for a long time, and anyone who thinks the
market would have emerged to deal with the relatively low rates of
ownership doesn't know the history of it. In the "free" market, down
payments and interest rates were too high, largely because risk
exposure
was too large. And the "free" market had created a number of non-equity
payment schemes, such as the infamous "land contract," which
destabilized
the whole system when there was an economic downturn. Freddie and
Fannie
made it possible for more people to buy houses and they stabilized the
system, having enabled the general use of mortgages that accrued equity
for the homeowners even as the loans were being paid off.

The upshot is that these two entities maybe -- probably -- created more
wealth and more stability in our economy, not to mention the enormous
fallout of economic activity from home building, than any damage their
troubles are likely to cause. In other words, be careful what you wish
for.

--
Ed Huntress




This on CBS this morning...

http://www.cbsnews.com/stories/2008/...n4264014.shtml


(CBS) It was during the Great Depression that Fannie Mae was founded -
in
1938 - with a simple purpose in mind: to give lower and middle income
Americans more access to the Great American Dream, owning your own home.

It did it by guaranteeing if a homeowner defaulted on a loan the bank
would get paid, CBS News chief investigative correspondent Armen
Keteyian
reports.

Today Fannie and its smaller sibling, Freddie Mac, hold a pivotal place
in
the home loan market - one that has grown to include special advantages,
such as:
# guaranteed lines of credits from the U.S. Treasury
# exemption from state and local taxes
# limited government oversight

Their privileged status is that of government-sponsored Fortune 500
companies, powered by a vast political machine.

"Fannie and Freddie have probably had more influence than any set of
institutions in modern times," said former Rep. James Leach.

As the former chairman of the House Financial Services Committee, Leach
tried for years to hold Fannie and Freddie to tougher financial
standards.

"You'd have people in Congress that would make it very clear that they
wanted nothing to touch Fannie and Freddie," Leach said.

CBS News has learned Fannie and Freddie now boast nearly 150 lobbyists -
spending more than $5 million this year alone.

In addition, the mortgage giants have doled out about $2 million more in
campaign donations in the last four years to key member of Congress.

"The view was always held that if they lost even a small battle, it
might
slide into something more meaningful," said former Rep. Richard H.
Baker,
R-La. "So every threat was taken seriously."

A few years ago, Fannie was fined nearly $400 million after overstating
earnings by $10 billion to maximize bonuses. In 2006, Freddie paid a
record $4 million fine for illegal fundraisers.

Both Fannie and Freddy say they've changed their ways. But, more and
more,
it appears two companies designed to help average Americans have, in
fact,
been helping themselves.


--

Richard

As always with financial institutions, the fallout from Reaganomics
deregulation has led to some serious screwing of the public. The choices
here are a lot fewer homeowners, on one hand, with an accompanying
multiplication of the financial divide in America, versus responsible
oversight and regulation. Congress has abdicated this responsibility along
with many others; the irony is that it is now Congress (Baker being one of
the more egregious examples) who complain about their own lack of action.

It's worth pointing out, however, comparing such quasi-governmental
entities
with private financial institutions, that the total campaign donations
that
the article complains about are somewhat less than the transportation,
housing, and greens fees (including large amounts of grease paid to
various
officials) that Jack Abramoff paid for a typical week of Congressional
golf
junkets in Scotland.

--
Ed Huntress


It just goes to show you what happens when you let a governmental agency be
run by businessmen like it's a private for profit business. All the abuses
are there, the over compensated top brass, the financial shenanigans, the
undue influence of lobbying firms, and the paramount interest in profit
making. As usual the people running these organizations have forgotten what
they were created for. It wasn't for making profits and high salaries. It
was to benefit the lower and middle class public by helping them buy homes.
It's high time they get back to fulfilling the function they were created
for and quit acting like for profit businesses.

Hawke

As always with financial institutions, the fallout from Reaganomics
deregulation has led to some serious screwing of the public.

That is why I thing the Federal gov't. ought to sieze both Freddie
and Fannie, kick out the equity as an example and recreate new
hardware that properly reflects the nations needs, the best
interests of it's citizens and
the realities of Americas role in the world as a financial power.

It's something the markets would validate in a big hurry.

Gee, if you wouldn't call that fallout, what *would* you call it? g

History repeating itself in a country lacking eithe cultural or
institutional memory space.


I hear what you're saying, John, but why wouldn't it function well if
it were regulated more like commercial banks, with higher capital
requirements and some other sensible regulations?

I'm only advocating the demise of the existing institutions Ed. What's
being
formulated is the equivalent of a million fingers to plug a million holes
that may not even exist. That's the problem. America needs F&F as
constituted and for all of the reasons you mentioned. Those institutions
need rock solid credibility and so does the process.

Mortgages were bought and sold long before Solomon Bros. created mortgage
bonds you know.
The process of bundling mortgages as securities removes a lot of the
scrutiny of the underlying value and you completely lose any
accountability.
You could once get a read on the integrity of the product based on the
source. That ended.
Also, there is plenty of money at hand to fund mortgages , but by bundling
them into bonds and passing them through a broker once or twice - or as
many
times as you have to to clean them up - you end up having to look more at
the markets demand for product rather than the long term return on the
underlying debt.

The fee then becomes the holy grail and since you really can't get in
trouble for passing worthless mortgages as part of your bundle you put 10
percent junk in with 90 percent quality. The entire process is tainted and
value is willingly traded for cash in hand.

I don't think you could regulate in proper transparency. Some smart guys
will always thread the needle around it.
The rewards of doing so for the few are as large as the risk to them is
small that the incentive to "missbehave" will never go away.


It sounds like a good time to return to the 93% tax bracket for some of
those boys. Knowing that you're going to kick back the majority of all that
money to Uncle Sam might be an effective disincentive to some of the
highrollers that want to engage in that game. It would be a boon to the tax
rolls too.

Hawke

"Larry Jaques" wrote in message
...
On Wed, 16 Jul 2008 18:01:55 -0500, with neither quill nor qualm, F.
George McDuffee quickly quoth:

The fact that both McCain and Obama *WANT* to be president shows
they don't understand the situation.

That's got to be the best comment of the year so far, Unka G.
g

I think they know what they are going for. Just look at how much fun George
Bush is having playing president even when things are going very badly. He's
proof that even in bad times it's a lot of fun being president of the United
States. No matter who wins next time it'll probably be better than the way
it is now so being president ought to be great fun. There is a reason why
they say it's the best job in the world.

Hawke

"John R. Carroll" wrote in message
...
F. George McDuffee wrote:
On Wed, 16 Jul 2008 18:21:53 -0700, "John R. Carroll"
wrote:

F. George McDuffee wrote:
On Wed, 16 Jul 2008 11:36:20 -0700, "John R. Carroll"
wrote:
snip

Whatcha think of them apples Unka' George?
Does it tick like a watch or a bomb!
=======
Both. This appears to be a classical "double bind" situation."

If we don't reorganize F&F, there is a substantial danger of
bringing the entire global economy down, and if we do pump in
enough capital, at best it will simply disappear down the tubes
like all the rest, with the only effect that we have gained a
little time at enormous expense. There is always the possibility
that F&F will go down anyhow (with all that this implies), even
with huge tax payer funded capital injections.

The single group of people most responsible is Congress, both for
removing the "fire walls" and "bulk heads" put in place as the
result of the 1929 depression, and for failing to deal with the
new unregulated and global economy in a timely and prudent
fashion. There was plenty of warning from the S&L debacle to
BCCI, through "Long Term Capital Management," all of which was
ignored.

Foreclosure Phil

Years before Phil Gramm was a McCain campaign adviser and a lobbyist for a
Swiss bank at the center of the housing credit crisis, he pulled a sly
maneuver in the Senate that helped create today's subprime meltdown."
Who's to blame for the biggest financial catastrophe of our time? There
are
plenty of culprits, but one candidate for lead perp is former Sen. Phil
Gramm. Eight years ago, as part of a decades-long anti-regulatory crusade,
Gramm pulled a sly legislative maneuver that greased the way to the
multibillion-dollar subprime meltdown. Yet has Gramm been banished from
the
corridors of power? Reviled as the villain who bankrupted Middle America?
Hardly. Now a well-paid executive at a Swiss bank, Gramm cochairs Sen.
John
McCain's presidential campaign and advises the Republican candidate on
economic matters. He's been mentioned as a possible Treasury secretary
should McCain win. That's right: A guy who helped screw up the global
financial system could end up in charge of US economic policy. Talk about
a
market failure.
Gramm's long been a handmaiden to Big Finance. In the 1990s, as chairman
of
the Senate banking committee, he routinely turned down Securities and
Exchange Commission chairman Arthur Levitt's requests for more money to
police Wall Street; during this period, the sec's workload shot up 80
percent, but its staff grew only 20 percent. Gramm also opposed an sec
rule
that would have prohibited accounting firms from getting too close to the
companies they audited-at one point, according to Levitt's memoir, he
warned
the sec chairman that if the commission adopted the rule, its funding
would
be cut. And in 1999, Gramm pushed through a historic banking deregulation
bill that decimated Depression-era firewalls between commercial banks,
investment banks, insurance companies, and securities firms-setting off a
wave of merger mania.
But Gramm's most cunning coup on behalf of his friends in the financial
services industry-friends who gave him millions over his 24-year
congressional career-came on December 15, 2000. It was an especially tense
time in Washington. Only two days earlier, the Supreme Court had issued
its
decision on Bush v. Gore. President Bill Clinton and the
Republican-controlled Congress were locked in a budget showdown. It was
the
perfect moment for a wily senator to game the system. As Congress and the
White House were hurriedly hammering out a $384-billion omnibus spending
bill, Gramm slipped in a 262-page measure called the Commodity Futures
Modernization Act. Written with the help of financial industry lobbyists
and
cosponsored by Senator Richard Lugar (R-Ind.), the chairman of the
agriculture committee, the measure had been considered dead-even by Gramm.
Few lawmakers had either the opportunity or inclination to read the
version
of the bill Gramm inserted. "Nobody in either chamber had any knowledge of
what was going on or what was in it," says a congressional aide familiar
with the bill's history.
It's not exactly like Gramm hid his handiwork-far from it. The balding and
bespectacled Texan strode onto the Senate floor to hail the act's
inclusion
into the must-pass budget package. But only an expert, or a lobbyist,
could
have followed what Gramm was saying. The act, he declared, would ensure
that
neither the sec nor the Commodity Futures Trading Commission (cftc) got
into
the business of regulating newfangled financial products called swaps-and
would thus "protect financial institutions from overregulation" and
"position our financial services industries to be world leaders into the
new
century."
Subprime 1-2-3
Don't understand credit default swaps? Don't worry-neither does Congress.
Herewith, a step-by-step outline of the subprime risk betting game. -Casey
Miner
Subprime borrower: Has a few overdue credit card bills; goes to a
storefront
lender owned by major bank; takes out a $100,000 home-equity loan at 11
percent interest
Lending bank: Assuming housing prices will only go up, and that investors
will want to buy mortgage loan packages, makes as many subprime loans as
it
can
Investment bank: Packages subprime mortgages into bundles called
collateralized debt obligations, or cdos, then sells those cdos to eager
investors. Goes to insurer to get protection for those investors, thus
passing the default risk to the insurer through a "credit default swap."
Insurer: Thinking that default risk is low, agrees to cover more money
than
it can pay out, in exchange for a premium
Rating agency: On basis of original quality of loans and insurance policy
they are "wrapped" in, issues a rating signaling certain slices of the cdo
are low risk (aaa), medium risk (bbb), or high risk (ccc)
Investor: Borrows more money from investment bank to load up on cdo
slices;
makes money from interest payments made to the "pool" of loans. No one
loses-as long as no one tries to cash in on the insurance.It didn't quite
work out that way. For starters, the legislation contained a
provision-lobbied for by Enron, a generous contributor to Gramm-that
exempted energy trading from regulatory oversight, allowing Enron to run
rampant, wreck the California electricity market, and cost consumers
billions before it collapsed. (For Gramm, Enron was a family affair. Eight
years earlier, his wife, Wendy Gramm, as cftc chairwoman, had pushed
through
a rule excluding Enron's energy futures contracts from government
oversight.
Wendy later joined the Houston-based company's board, and in the following
years her Enron salary and stock income brought between $915,000 and $1.8
million into the Gramm household.)
But the Enron loophole was small potatoes compared to the devastation that
unregulated swaps would unleash. Credit default swaps are essentially
insurance policies covering the losses on securities in the event of a
default. Financial institutions buy them to protect themselves if an
investment they hold goes south. It's like bookies trading bets, with
banks
and hedge funds gambling on whether an investment (say, a pile of subprime
mortgages bundled into a security) will succeed or fail. Because of the
swap-related provisions of Gramm's bill-which were supported by Fed
chairman
Alan Greenspan and Treasury secretary Larry Summers-a $62 trillion market
(nearly four times the size of the entire US stock market) remained
utterly
unregulated, meaning no one made sure the banks and hedge funds had the
assets to cover the losses they guaranteed.
In essence, Wall Street's biggest players (which, thanks to Gramm's
earlier
banking deregulation efforts, now incorporated everything from your
checking
account to your pension fund) ran a secret casino. "Tens of trillions of
dollars of transactions were done in the dark," says University of San
Diego
law professor Frank Partnoy, an expert on financial markets and
derivatives.
"No one had a picture of where the risks were flowing." Betting on the
risk
of any given transaction became more important-and more lucrative-than the
transactions themselves, Partnoy notes: "So there was more betting on the
riskiest subprime mortgages than there were actual mortgages." Banks and
hedge funds, notes Michael Greenberger, who directed the cftc's division
of
trading and markets in the late 1990s, "were betting the subprimes would
pay
off and they would not need the capital to support their bets."
These unregulated swaps have been at "the heart of the subprime meltdown,"
says Greenberger. "I happen to think Gramm did not know what he was doing.
I
don't think a member in Congress had read the 262-page bill or had thought
of the cataclysm it would cause." In 1998, Greenberger's division at the
cftc proposed applying regulations to the burgeoning derivatives market.
But, he says, "all hell broke loose. The lobbyists for major commercial
banks and investment banks and hedge funds went wild. They all wanted to
be
trading without the government looking over their shoulder."
Now, belatedly, the feds are swooping in-but not to regulate the industry,
only to bail it out, as they did in engineering the March takeover of
investment banking giant Bear Stearns by JPMorgan Chase, fearing the
firm's
collapse could trigger a dominoes-like crash of the entire credit
derivatives market.
No one in Washington apologizes for anything, so it's no surprise that
Gramm
has failed to issue any mea culpa. Post-Enron, says Greenberger, the
senator
even called him to say, "You're going around saying this was my fault-and
it's not my fault. I didn't intend this."
Whether or not Gramm had bothered to ponder the potential downsides of his
commodities legislation, having helped set off an industry free-for-all,
he
reaped the rewards. In 2003, he left the Senate to take a highly lucrative
job at ubs, Switzerland's largest bank, which had been able to acquire
investment house PaineWebber due to his banking deregulation bill. He
would
soon be lobbying Congress, the Fed, and the Treasury Department for ubs on
banking and mortgage matters. There was a moment of poetic justice when
ubs
became one of the subprime crisis' top losers, writing down $37 billion as
of this spring-an amount equal to its previous four years of profits
combined. In a report explaining how it had managed to mess up so grandly,
ubs noted that two-thirds of its losses were the fault of collateralized
debt obligations-securities backed largely by subprime instruments-and
that
credit default swaps had been "key to the growth" of its out-of-control
cdo
business. (Gramm declined to comment for this article.)
Gramm's record as a reckless deregulator has not affected his rating as a
Republican economic expert. Sen. John McCain has relied on him for policy
advice, especially, according to the campaign, on housing matters. The two
have been buddies ever since they served together in the House in the
1980s;
in 1996, McCain chaired Gramm's flop of a presidential campaign. (Gramm
spent $21 million and earned only 10 delegates during the gop primaries.)
In
2005, McCain told a Wall Street Journal columnist that Gramm was his
economic guru. Two years later, Gramm wrote a piece for the Journal
extolling McCain as a modern-day Abraham Lincoln, and he's hailed McCain's
love of tax cuts and free trade. Media accounts have identified Gramm as a
contender for the top slot at the Treasury Department if McCain reaches
the
White House. "If McCain gets in," frets Lynn Turner, a former chief sec
accountant, "we'll have more of the same deregulatory mess. I like John
McCain, but given what I know about Phil Gramm, I wouldn't vote for
McCain."
As a thriving bank exec and presidential adviser, Gramm has defied a prime
economic principle: Bad products are driven out of the market. In John
McCain, he has gained an important customer, so his stock has gone up in
value. And there's no telling when the Gramm bubble will burst.

http://www.motherjones.com/news/feat...sure-phil.html
David Corn is Mother Jones' Washington, D.C. bureau chief.



--

John R. Carroll
www.machiningsolution.com

This should be a lesson to everyone. When you keep reelecting the same
people and allowing them to stay in office for decades you wind up getting
all of their crooked friends and cronies along with them. When Bush was
elected we got all the dregs from earlier republican administrations, most
of them crooked *******s out to make themselves wealthy. I could name some
of the very familiar names but the list would be too long. This is why you
have to clean house regularly. If McCain gets the White House all the same
bunch of criminals are going to get access to power once again. If Obama is
elected there is no guarantee that he won't wind up with a different group
that is just the same. But if you don't make the change you will certainly
get more of the corruption we have now. Allowing the same people to get
entrenched into the center of power and to have control of the levers of
power brings us the kind of problems we are now facing. Frequent changes of
personnel in Washington is the best medicine for what ails the country.

Hawke

On Tue, 15 Jul 2008 17:24:54 -0700, "John R. Carroll"
wrote:
snip
I say the basis for any forward looking plan will be rooted in restoring the
fundamental integrity of our system of Justice (Legal), Legistlative
(Congress) and Executive but most importantly, the seperation/ cjeck and
balance of the three.
This is what has made America great and it's why capital has flowed inward.
That it's now outbound has everything to do with eight years of disregarding
this truth.
snip
===========
Integrity/credability are indeed foundational. That is why I am
posting this gem of corporate responsibility.

-----------
Shell-shocked GM retirees react: 'This is a knife stab in the
back'

BY MEGH

After years of getting generous coverage, retirees from salaried
jobs at General Motors Corp. reacted angrily Tuesday to the
announcement that GM was ending their health benefits.

"I'm disappointed in the lifetime promise GM made to us," said
John Fleming, 67, of Rochester Hills, a retired information
system auditor. "We've been wiped off the books completely."

Fleming was among the shell-shocked GM retirees wondering about
what they'd do next for health care, following the surprise
announcement that is part of GM's latest cost-cutting plan.

Effective Jan. 1, GM will end health benefits for 97,400 salaried
retirees 65 or older, their spouses and dependents. Retirees will
receive an extra $300 a month in their pension checks that could
be used to buy health care.

snip
for complete article see
http://www.freep.com/apps/pbcs.dll/a...SS01/807160357
----------

Import of this is that by abrogating their long standing retiree
medical care deal GM is transferring about 250k$ of debt from
their books onto the retirees and taxpayers through medicare and
other social services for each retiree.

If you don't have a pencil handy, this is a 97,400 X 250k$
(24,350,000,000$US) weeny they just slipped their white collar
retirees and the general taxpayers. Note that this medical
coverage was not a gift or corporate largess, but deferred
compensation for work done over the 20 - 30 or more years
required to vest. General Motors already shifted most of their
retiree medical costs onto the taxpayers by shifting th majority
of coverage onto MediCare, with reduced benefits and higher
copays.

Q: As this is debt abrogation, and thus a "profit," does GM have
to pay taxes on it?

Look for the General to go chapter 11 after the election to dump
*ALL* their pension liabilities onto the taxpayers and retirees.

====================
"It's the first year Fidelity has conducted the study, which
supplements a survey the company completed in March estimating a
couple retiring this year would need $225,000 in savings to cover
medical costs in retirement. That estimate covers expenses
associated with Medicare premium payments, as well as co-payments
and deductibles, plus out-of-pocket prescription drug costs."
http://www.wtop.com/?nid=111&sid=1429074
-----------
This is the same corporation that was taking money *OUT* of their
pension funds during the boom years. [called "recapture" not
looting...]









Unka' George [George McDuffee]
-------------------------------------------
He that will not apply new remedies,
must expect new evils:
for Time is the greatest innovator: and
if Time, of course, alter things to the worse,
and wisdom and counsel shall not alter them to the better,
what shall be the end?

Francis Bacon (1561-1626), English philosopher, essayist, statesman.
Essays, "Of Innovations" (1597-1625).

F. George McDuffee wrote:
On Tue, 15 Jul 2008 17:24:54 -0700, "John R. Carroll"
wrote:
snip
I say the basis for any forward looking plan will be rooted in
restoring the fundamental integrity of our system of Justice
(Legal), Legistlative (Congress) and Executive but most importantly,
the seperation/ cjeck and balance of the three.
This is what has made America great and it's why capital has flowed
inward. That it's now outbound has everything to do with eight years
of disregarding this truth.
snip
===========
Integrity/credability are indeed foundational. That is why I am
posting this gem of corporate responsibility.

-----------

Look for the General to go chapter 11 after the election to dump
*ALL* their pension liabilities onto the taxpayers and retirees.

Well not all of them.
I've had more than one conversation with my Mother about this and her pre
ERISA plan isn't subject to the latest action. I don't think it is anyway.
In any event, her three sons will get together and make things work with or
without GM, taxpayer money or anything else if necessary.

If Rick Wagoner wanted to freak out an old woman he can rest assured that he
did.
Sheesh.

--

John R. Carroll
www.machiningsolution.com

On Tue, 15 Jul 2008 17:24:54 -0700, "John R. Carroll"
wrote:
snip
I say the basis for any forward looking plan will be rooted in restoring the
fundamental integrity of our system of Justice (Legal), Legistlative
(Congress) and Executive but most importantly, the seperation/ cjeck and
balance of the three.
This is what has made America great and it's why capital has flowed inward.
That it's now outbound has everything to do with eight years of disregarding
this truth.
snip
===========
Integrity/credability are indeed foundational. That is why I am
posting this gem of corporate responsibility.

snip
-----------
This is the same corporation that was taking money *OUT* of their
pension funds during the boom years. [called "recapture" not
looting...]

Just got some emails asking for more details of the pension fund
"recapture." Rationale for this is that the corporation
contributs stock rather than money to the pension fund, and when
the stock gains in value, for example during a bubble to the
point that more "money" is in the stock fund that the actuaries
say is necessary to fully fund, the company can take a little
out. Of course the company is paying the actuaries.

It was a little know or appreciated fact at that time (in the
boardroom), but stocks, including GM, do on occassion go down as
well as up...

===============
snip
This year, to make up its cash shortage, G.M. sold about $4
billion worth of common stock. But in 1989, G.M.'s last
profitable year, the auto maker began diverting pension-fund
money to pay for operations and capital projects.

Using cash from a pension fund to pay for daily operations is a
legitimate cash-management technique, employed by many
corporations. But a pension fund is a financial cushion as well
as a safety net for retirees, so regulators and investors worry
when a company with an underfunded pension fund consistently
loses money. 'Will the Cash Be There?'

"G.M.'s pension fund, with about $50 billion in assets, will be
about 25 percent underfunded by the end of the year," said Jerry
Paul, automotive analyst for Sanford C. Bernstein & Company in
New York. (Chrysler's pension fund is proportionately in worse
shape, with $4.4 billion or about 35 percent to 40 percent
underfunding.)
snip
for entire article click on
http://query.nytimes.com/gst/fullpag...C1A9649582 60
============

===========
for an entire book on this click on
http://www.amazon.com/While-America-.../dp/1594201676

While America Aged: How Pension Debts Ruined General Motors,
Stopped the NYC Subways, Bankrupted San Diego, and Loom as the
Next Financial Crisis (Hardcover)
by Roger Lowenstein (Author)

Review excerpt follows --
snip
"Lowenstein's account of how pension debt undid General Motors is
particularly telling. In 1949, management and the United Auto
Workers were battling over the terms of their next contract.
Times were flush as Americans flocked to buy autos in the postwar
boom, so GM management was eager to avoid a strike. Meanwhile,
autoworkers lacked pensions and feared correctly that the country
was still far away from adopting universal health care. These
circumstances created an opportunity for a seemingly perfect
bargain that came to be known as the "Treaty of Detroit."

GM jumped at a UAW proposal that, in lieu of large wage
increases, would set up a pension plan and offer half-price
health insurance. The short-term costs would be minimal because,
as the UAW pointed out, the average GM worker then had only seven
years of experience and a mere fifth were over 50. Left
unconsidered was the inevitability that these workers would age,
and that if GM did not put aside sufficient funds to pay for
their future benefits, the next generation of GM managers and
workers would be saddled with an impossible encumbrance.

And that's what happened. Time and again, management and labor
struck deals for more generous future benefits without taking
into account the resulting liability. As actuaries warned of a
long-term buildup of pension debt, GM made the debt disappear on
paper by using sunny assumptions about the company's growth
prospects -- assumptions that ignored the competition GM would
face from foreign automakers that did not have to build huge
pension and retiree health care costs into the prices of their
cars. By the mid-1990s, GM was compelled to pour so much into its
pension fund to make up its deficit that, with the same money, it
could have acquired half of Toyota or funded the development of
market-dominating, high-efficiency cars to better compete.

snip

The federal government's pension bailout agency, the Pension
Benefits Guarantee Corporation, itself faces a liability of more
than $14 billion as it pays off the benefits of more than 1.3
million people whose plans have failed. Many other businesses,
from Sears to IBM, have frozen their pension funds and shifted
workers into defined contribution, or 401(k) plans, which require
workers to bear the full risk if their investments lose value. As
Teresa Ghilarducci points out in When I'm Sixty-Four, another new
book on America's crumbling pension system, these trends leave
the next generation of retirees in sorry shape. According to
Ghilarducci, the average balance in the 401(k) plans of people
approaching retirement age is just $59,000. At today's interest
rates, that buys an annuity yielding less than $500 a month, with
no adjustment for inflation. A report released last Thursday by
the McKinsey Global Institute finds that 69 percent of Americans
approaching retirement age lack sufficient funds to avoid a
significant decline in their standard of living.
snip
========================
also see [long and detailed]
http://www.oecd.org/dataoecd/38/52/34030924.pdf

Smart Debt Bolsters GM Pension Fund

Walter Borst, MBA '87
Walter Borst,
MBA '87

General Motors and its treasurer, Walter Borst, MBA '87, recently
completed a $17.9 billion debt offering, the largest ever by a
corporation. Intended to provide the country's second-largest
company with flexibility, the June 2003 offering involved 11
separate transactions and 41 banks.

The deal was triggered by the pension fund shortfall affecting
many companies that had banked on higher stock market prices and
interest rates to cover their pension costs. While those
liabilities will shrink again if the markets change, GM's $19.3
billion pension shortfall had prompted Standard & Poor's to lower
its credit rating in October 2002.

"We felt that GM was becoming a little bit of a poster child for
this issue," Borst said in Treasury & Risk Management, a trade
journal that detailed the offering. While the bond market's
record-low rates were part of the reason for pension fund
shortfalls, the GM finance team recognized that the rates also
made GM's cost of issuing debt attractive. Prices spiked shortly
after the offering, making Borst's finance team look especially
prescient, the journal noted.
http://www.gsb.stanford.edu/news/bma...wsmakers.shtml

http://money.cnn.com/magazines/fortu...9189/index.htm

===========










Unka' George [George McDuffee]
-------------------------------------------
He that will not apply new remedies,
must expect new evils:
for Time is the greatest innovator: and
if Time, of course, alter things to the worse,
and wisdom and counsel shall not alter them to the better,
what shall be the end?

Francis Bacon (1561-1626), English philosopher, essayist, statesman.
Essays, "Of Innovations" (1597-1625).

On Tue, 15 Jul 2008 17:24:54 -0700, "John R. Carroll"
wrote:
snip
I say the basis for any forward looking plan will be rooted in restoring the
fundamental integrity of our system of Justice (Legal), Legistlative
(Congress) and Executive but most importantly, the seperation/ cjeck and
balance of the three.
This is what has made America great and it's why capital has flowed inward.
That it's now outbound has everything to do with eight years of disregarding
this truth.
snip
===========
Integrity/credability are indeed foundational. That is why I am
posting this gem of corporate responsibility.

snip
-----------
This is the same corporation that was taking money *OUT* of their
pension funds during the boom years. [called "recapture" not
looting...]
snip
===========
Just got some emails asking for more details of the pension fund
"recapture." Rationale for this is that the corporation
contributs stock rather than money to the pension fund, and when
the stock gains in value, for example during a bubble to the
point that more "money" is in the stock fund that the actuaries
say is necessary to fully fund, the company can take a little
out. Of course the company is paying the actuaries.

It was a little know or appreciated fact at that time (in the
boardroom), but stocks, including GM, do on occassion go down as
well as up...

===============
snip
This year, to make up its cash shortage, G.M. sold about $4
billion worth of common stock. But in 1989, G.M.'s last
profitable year, the auto maker began diverting pension-fund
money to pay for operations and capital projects.

Using cash from a pension fund to pay for daily operations is a
legitimate cash-management technique, employed by many
corporations. But a pension fund is a financial cushion as well
as a safety net for retirees, so regulators and investors worry
when a company with an underfunded pension fund consistently
loses money. 'Will the Cash Be There?'

"G.M.'s pension fund, with about $50 billion in assets, will be
about 25 percent underfunded by the end of the year," said Jerry
Paul, automotive analyst for Sanford C. Bernstein & Company in
New York. (Chrysler's pension fund is proportionately in worse
shape, with $4.4 billion or about 35 percent to 40 percent
underfunding.)
snip
for entire article click on
http://query.nytimes.com/gst/fullpag...C1A9649582 60
============

===========
for an entire book on this click on
http://www.amazon.com/While-America-.../dp/1594201676

While America Aged: How Pension Debts Ruined General Motors,
Stopped the NYC Subways, Bankrupted San Diego, and Loom as the
Next Financial Crisis (Hardcover)
by Roger Lowenstein (Author)

Review excerpt follows --
snip
"Lowenstein's account of how pension debt undid General Motors is
particularly telling. In 1949, management and the United Auto
Workers were battling over the terms of their next contract.
Times were flush as Americans flocked to buy autos in the postwar
boom, so GM management was eager to avoid a strike. Meanwhile,
autoworkers lacked pensions and feared correctly that the country
was still far away from adopting universal health care. These
circumstances created an opportunity for a seemingly perfect
bargain that came to be known as the "Treaty of Detroit."

GM jumped at a UAW proposal that, in lieu of large wage
increases, would set up a pension plan and offer half-price
health insurance. The short-term costs would be minimal because,
as the UAW pointed out, the average GM worker then had only seven
years of experience and a mere fifth were over 50. Left
unconsidered was the inevitability that these workers would age,
and that if GM did not put aside sufficient funds to pay for
their future benefits, the next generation of GM managers and
workers would be saddled with an impossible encumbrance.

And that's what happened. Time and again, management and labor
struck deals for more generous future benefits without taking
into account the resulting liability. As actuaries warned of a
long-term buildup of pension debt, GM made the debt disappear on
paper by using sunny assumptions about the company's growth
prospects -- assumptions that ignored the competition GM would
face from foreign automakers that did not have to build huge
pension and retiree health care costs into the prices of their
cars. By the mid-1990s, GM was compelled to pour so much into its
pension fund to make up its deficit that, with the same money, it
could have acquired half of Toyota or funded the development of
market-dominating, high-efficiency cars to better compete.

snip

The federal government's pension bailout agency, the Pension
Benefits Guarantee Corporation, itself faces a liability of more
than $14 billion as it pays off the benefits of more than 1.3
million people whose plans have failed. Many other businesses,
from Sears to IBM, have frozen their pension funds and shifted
workers into defined contribution, or 401(k) plans, which require
workers to bear the full risk if their investments lose value. As
Teresa Ghilarducci points out in When I'm Sixty-Four, another new
book on America's crumbling pension system, these trends leave
the next generation of retirees in sorry shape. According to
Ghilarducci, the average balance in the 401(k) plans of people
approaching retirement age is just $59,000. At today's interest
rates, that buys an annuity yielding less than $500 a month, with
no adjustment for inflation. A report released last Thursday by
the McKinsey Global Institute finds that 69 percent of Americans
approaching retirement age lack sufficient funds to avoid a
significant decline in their standard of living.
snip
========================
also see [long and detailed]
http://www.oecd.org/dataoecd/38/52/34030924.pdf

Smart Debt Bolsters GM Pension Fund

Walter Borst, MBA '87
Walter Borst,
MBA '87

General Motors and its treasurer, Walter Borst, MBA '87, recently
completed a $17.9 billion debt offering, the largest ever by a
corporation. Intended to provide the country's second-largest
company with flexibility, the June 2003 offering involved 11
separate transactions and 41 banks.

The deal was triggered by the pension fund shortfall affecting
many companies that had banked on higher stock market prices and
interest rates to cover their pension costs. While those
liabilities will shrink again if the markets change, GM's $19.3
billion pension shortfall had prompted Standard & Poor's to lower
its credit rating in October 2002.

"We felt that GM was becoming a little bit of a poster child for
this issue," Borst said in Treasury & Risk Management, a trade
journal that detailed the offering. While the bond market's
record-low rates were part of the reason for pension fund
shortfalls, the GM finance team recognized that the rates also
made GM's cost of issuing debt attractive. Prices spiked shortly
after the offering, making Borst's finance team look especially
prescient, the journal noted.
http://www.gsb.stanford.edu/news/bma...wsmakers.shtml

http://money.cnn.com/magazines/fortu...9189/index.htm

===========
snip
The Early Warning Program's greatest success involved
negotiations over the huge General Motors Corp. pension plan,
which was underfunded by $20 billion. Slate made it his business
to call GM executives during his first days on the job because he
knew the company's already-mammoth funding shortfall could be
aggravated by GM's plans to sell its Electronic Data Systems
(EDS) subsidiary. The relatively healthy EDS should not be
allowed to walk away without contributing to the pension plan,
PBGC leaders believed.

In October 1993, GM executives offered to add $6 billion of EDS
stock to the pension fund, an amount PBGC officials deemed
insufficient. After arduous negotiations ended almost a year
later, GM agreed to add $4 billion in cash and $6 billion of EDS
stock to the pension, while continuing to contribute $2 billion
to the fund annually. In return, PBGC allowed GM to release EDS.
snip
http://www.govexec.com/features/1195s1.htm
================


Unka' George [George McDuffee]
-------------------------------------------
He that will not apply new remedies,
must expect new evils:
for Time is the greatest innovator: and
if Time, of course, alter things to the worse,
and wisdom and counsel shall not alter them to the better,
what shall be the end?

Francis Bacon (1561-1626), English philosopher, essayist, statesman.
Essays, "Of Innovations" (1597-1625).

On Thu, 17 Jul 2008 16:38:13 -0700, "John R. Carroll"
wrote:

F. George McDuffee wrote:
On Tue, 15 Jul 2008 17:24:54 -0700, "John R. Carroll"
wrote:
snip
I say the basis for any forward looking plan will be rooted in
restoring the fundamental integrity of our system of Justice
(Legal), Legistlative (Congress) and Executive but most importantly,
the seperation/ cjeck and balance of the three.
This is what has made America great and it's why capital has flowed
inward. That it's now outbound has everything to do with eight years
of disregarding this truth.
snip
===========
Integrity/credability are indeed foundational. That is why I am
posting this gem of corporate responsibility.

-----------

Look for the General to go chapter 11 after the election to dump
*ALL* their pension liabilities onto the taxpayers and retirees.

Well not all of them.
I've had more than one conversation with my Mother about this and her pre
ERISA plan isn't subject to the latest action. I don't think it is anyway.
In any event, her three sons will get together and make things work with or
without GM, taxpayer money or anything else if necessary.

If Rick Wagoner wanted to freak out an old woman he can rest assured that he
did.
Sheesh.
=============

Amazing how in this "brave new world order" the key to a secure
and comfortable old age remains having a number of successfule
and powerful offspring, as it has been for the last 100,000
years.

GM is correct about one thing however -- it is always easier and
safer to steal from the very old and the very young as they fight
back less.


Unka' George [George McDuffee]
-------------------------------------------
He that will not apply new remedies,
must expect new evils:
for Time is the greatest innovator: and
if Time, of course, alter things to the worse,
and wisdom and counsel shall not alter them to the better,
what shall be the end?

Francis Bacon (1561-1626), English philosopher, essayist, statesman.
Essays, "Of Innovations" (1597-1625).

I really liked this one.

Cut out the middle man...

http://www.jewishworldreview.com/too...g/deering1.asp

"John R. Carroll" wrote in message
...
cavelamb himself wrote:
Today is off to an interesting start:

John and George: If you guys don't get _The Economist_ by subscription, you
may want to pick it up on the newsstand tomorrow, when it should become
available. The cover story is about Freddie and Fannie ("Twin Twisters"),
and it's good stuff.

--
Ed Huntress

Ed Huntress wrote:
"John R. Carroll" wrote in
message ...
cavelamb himself wrote:
Today is off to an interesting start:

John and George: If you guys don't get _The Economist_ by
subscription, you may want to pick it up on the newsstand tomorrow,
when it should become available. The cover story is about Freddie and
Fannie ("Twin Twisters"), and it's good stuff.

Thanks Ed.
I subscribe to the latter and have read the advance copy of what I think you
are referring to.
I didn't think "Go Shopping" was the message to send in the first place.

The Limey's have an interest you know and the Economist may be forthright
but they are definitely behind the curve.
There interest ar theirs, not ours, which doesn't mean they are our enemies.
In fact, the opposite is true.
I posted this some time ago and it's as relevant today as it was then. When
Mike Milken was flumoxed by the reaction to Drexel's offer on behalf of a
client, I made a presentation just abbout like this and while it ws "Local"
then, it's global now.


When the United States finally entered into the Second World War in 1941,
Franklin Roosevelt did many things and took many actions in pretty short
order.
Three of his immediate actions are worth noting in the context of your
remarks.

First - The Ban on photographing American dead and wounded was revoked.
Roosevelt stated that he wanted America to see what the ultimate price paid
by the services would be.

Second - He ordered the War Department to form and distribute combat
photography teams among the Services.
He wanted Americans to see how we fought as well as who and what we were
fighting so that the American people would know what - exactly - we were
fighting FOR. These films also provided great training tools.

Third - He had the Treasury Department create a special issue of American
debt instruments referred to in promotional campaigns as "War Bonds".
Post war, these were what we all now know as Savings Bonds.
He did this to remove what he knew would be a huge influx of money into the
system as war production was ramped up. It contained inflation to some
degree, created savings for the masses and tamped down black market
activities. It also had the unintended, but extremely powerful, consequence
of giving the vast majority of Americans a way to make their own heart felt,
direct, and personal sacrifice in support of the war effort. Americans
responded - big time.

In other words, he lead his country, and the world, to a resounding victory
based on shared sacrifice. He lead the nation in a way deliberately
calculated to unite them, not behind his Presidency, but the country.

What he DID NOT do was tell the American public to go shopping.

America's lack of support for George Bush and his "war" has it's seeds in
the supercilious and unserious fool in the White House who can't now, nor
could he ever, lead warm **** to flow from a boot with the instructions
printed on the heel. He doesn't have the slightest inkling of what real
leadership is.

--

John R. Carroll
www.machiningsolution.com

F. George McDuffee wrote:
On Thu, 17 Jul 2008 16:38:13 -0700, "John R. Carroll"
wrote:


Amazing how in this "brave new world order" the key to a secure
and comfortable old age remains having a number of successfule
and powerful offspring, as it has been for the last 100,000
years.

GM is correct about one thing however -- it is always easier and
safer to steal from the very old and the very young as they fight
back less.

It looks like this is indeed the case George.
I've got the letter GM sent out in front of me.
Included is a calender of events as a time line and the first hing I thought
was how much this looked like the part D push.
Retirees will have about a month and a half to look over their options at
the end of September when GM sends out an information package. Considering
the importance of this issue to retirees that isn't much time.

Oh well.

--

John R. Carroll
www.machiningsolution.com

On Fri, 18 Jul 2008 16:22:46 -0700, "John R. Carroll"
wrote:

When the United States finally entered into the Second World War in 1941,
Franklin Roosevelt did many things and took many actions in pretty short
order.


FDR was, as Glen Beck stated,,,,,"one evil son of a bitch"

He kept the country in deep depression for 10 yrs, to make money for
his chums, he socialized and expanded government far greater than any
other president, he ran roughshod over both the Constitution and the
Supreme Court, he provoked the attack on Pearl Harbor, then made sure
the Navy had no warning, he sent a shipload of Jews back to Germany to
be murdered, he put many thousands of American Citizens in
concentration camps, murdered many and took all their property, he
Forced the NIRA on the American people, he stole private property by
fiat, he stole all the privately owned gold from Americans, he crawled
up Stalins ass and sucked his dick and formally declared war on a
nation we were on good terms with, just to name a few of his evils...

Not to mention giving us the :New Deal spit!


And you defend him? The biggest rat ******* ever to hit the Oval
Orifice bar none..and you slavishly brag on the few good things he
managed to fumble **** into?

And you have the gaul to bash the Shrub?

Fascinating..simply ****ing fascinating......

You must have loved his retarded but nearly as evil young
protege...LBJ


Gunner

The hottest places in hell are reserved for those who in times of great moral crisis maintain their neutrality",
John F. Kennedy.

"Gunner Asch" wrote in message
...
On Fri, 18 Jul 2008 16:22:46 -0700, "John R. Carroll"
wrote:

When the United States finally entered into the Second World War in 1941,
Franklin Roosevelt did many things and took many actions in pretty short
order.


FDR was, as Glen Beck stated,,,,,"one evil son of a bitch"

He kept the country in deep depression for 10 yrs, to make money for
his chums, he socialized and expanded government far greater than any
other president, he ran roughshod over both the Constitution and the
Supreme Court, he provoked the attack on Pearl Harbor, then made sure
the Navy had no warning, he sent a shipload of Jews back to Germany to
be murdered, he put many thousands of American Citizens in
concentration camps, murdered many and took all their property, he
Forced the NIRA on the American people, he stole private property by
fiat, he stole all the privately owned gold from Americans, he crawled
up Stalins ass and sucked his dick and formally declared war on a
nation we were on good terms with, just to name a few of his evils...

Not to mention giving us the :New Deal spit!


And you defend him? The biggest rat ******* ever to hit the Oval
Orifice bar none..and you slavishly brag on the few good things he
managed to fumble **** into?

And you have the gaul to bash the Shrub?

Fascinating..simply ****ing fascinating......

You must have loved his retarded but nearly as evil young
protege...LBJ


Gunner

Stick to handloading and fixing old machine tools, Gunner. That's about the
limit of your understanding of economics.

How do you keep getting dumber as you age? Most people get smarter.

--
Ed Huntress

Ed Huntress wrote:
"Gunner Asch" wrote in message
...
On Fri, 18 Jul 2008 16:22:46 -0700, "John R. Carroll"
wrote:

When the United States finally entered into the Second World War in
1941, Franklin Roosevelt did many things and took many actions in
pretty short order.



Stick to handloading and fixing old machine tools, Gunner. That's
about the limit of your understanding of economics.

How do you keep getting dumber as you age? Most people get smarter.

I wonder how he thinks the Republican "Contract with America" worked out?
LOL


--

John R. Carroll
www.machiningsolution.com

"John R. Carroll" wrote in message
news
Ed Huntress wrote:
"Gunner Asch" wrote in message
...
On Fri, 18 Jul 2008 16:22:46 -0700, "John R. Carroll"
wrote:

When the United States finally entered into the Second World War in
1941, Franklin Roosevelt did many things and took many actions in
pretty short order.



Stick to handloading and fixing old machine tools, Gunner. That's
about the limit of your understanding of economics.

How do you keep getting dumber as you age? Most people get smarter.

I wonder how he thinks the Republican "Contract with America" worked out?
LOL

That solemn contract is still binding, according to Gunner. And if we have
any moral character we'll keep paying on it until we're all eating beans and
the Masters of the Universe have all of the money in existence. Then we'll
do the honorable thing, which is to commit suicide.

--
Ed Huntress

Ed Huntress wrote:
"John R. Carroll" wrote in
message news
Ed Huntress wrote:
"Gunner Asch" wrote in message
...
On Fri, 18 Jul 2008 16:22:46 -0700, "John R. Carroll"
wrote:

When the United States finally entered into the Second World War
in 1941, Franklin Roosevelt did many things and took many actions
in pretty short order.



Stick to handloading and fixing old machine tools, Gunner. That's
about the limit of your understanding of economics.

How do you keep getting dumber as you age? Most people get smarter.

I wonder how he thinks the Republican "Contract with America" worked
out? LOL

That solemn contract is still binding, according to Gunner. And if we
have any moral character we'll keep paying on it until we're all
eating beans and the Masters of the Universe have all of the money in
existence. Then we'll do the honorable thing, which is to commit
suicide.

Gunner's preferred method is Sepuku as I recall.
LOL
Did you see that the McCain campaign gave brother Phil the axe?
Genghis Khan apparently became available G


--

John R. Carroll
www.machiningsolution.com

"John R. Carroll" wrote in message
...
Ed Huntress wrote:
"John R. Carroll" wrote in
message news
Ed Huntress wrote:
"Gunner Asch" wrote in message
...
On Fri, 18 Jul 2008 16:22:46 -0700, "John R. Carroll"
wrote:

When the United States finally entered into the Second World War
in 1941, Franklin Roosevelt did many things and took many actions
in pretty short order.



Stick to handloading and fixing old machine tools, Gunner. That's
about the limit of your understanding of economics.

How do you keep getting dumber as you age? Most people get smarter.

I wonder how he thinks the Republican "Contract with America" worked
out? LOL

That solemn contract is still binding, according to Gunner. And if we
have any moral character we'll keep paying on it until we're all
eating beans and the Masters of the Universe have all of the money in
existence. Then we'll do the honorable thing, which is to commit
suicide.

Gunner's preferred method is Sepuku as I recall.
LOL
Did you see that the McCain campaign gave brother Phil the axe?
Genghis Khan apparently became available G

He blamed it on the Democrats. What he means it that there's been a flood of
editorials lately that explain how the deregulation that led to much of the
subprime mess is the result of his budget maneuvering and late-night tricks
he pulled when he was in the Senate -- and the Democrats started picking on
him for it.

Maybe he can find a nice hedge fund to manage.

--
Ed Huntress

Ed Huntress wrote:
"John R. Carroll" wrote in
message ...
Ed Huntress wrote:
"John R. Carroll" wrote in
message news Ed Huntress wrote:
"Gunner Asch" wrote in message
...
On Fri, 18 Jul 2008 16:22:46 -0700, "John R. Carroll"
wrote:

When the United States finally entered into the Second World War
in 1941, Franklin Roosevelt did many things and took many
actions in pretty short order.



Stick to handloading and fixing old machine tools, Gunner. That's
about the limit of your understanding of economics.

How do you keep getting dumber as you age? Most people get
smarter.

I wonder how he thinks the Republican "Contract with America"
worked out? LOL

That solemn contract is still binding, according to Gunner. And if
we have any moral character we'll keep paying on it until we're all
eating beans and the Masters of the Universe have all of the money
in existence. Then we'll do the honorable thing, which is to commit
suicide.

Gunner's preferred method is Sepuku as I recall.
LOL
Did you see that the McCain campaign gave brother Phil the axe?
Genghis Khan apparently became available G

He blamed it on the Democrats. What he means it that there's been a
flood of editorials lately that explain how the deregulation that led
to much of the subprime mess is the result of his budget maneuvering
and late-night tricks he pulled when he was in the Senate -- and the
Democrats started picking on him for it.

Maybe he can find a nice hedge fund to manage.

He's at UBS. I don't think it gets nicer than that.
IIRC, they wrote down 70 billion dollars of Phil Graham snake oil recently
and I know they have forbidden their executives from travelling to the US.
Something about illegal tax shelters and unreported income.

--

John R. Carroll
www.machiningsolution.com

John R. Carroll wrote:
Ed Huntress wrote:

"John R. Carroll" wrote in
message news
Ed Huntress wrote:

"Gunner Asch" wrote in message
m...

On Fri, 18 Jul 2008 16:22:46 -0700, "John R. Carroll"
wrote:


When the United States finally entered into the Second World War
in 1941, Franklin Roosevelt did many things and took many actions
in pretty short order.


Stick to handloading and fixing old machine tools, Gunner. That's
about the limit of your understanding of economics.

How do you keep getting dumber as you age? Most people get smarter.

I wonder how he thinks the Republican "Contract with America" worked
out? LOL

That solemn contract is still binding, according to Gunner. And if we
have any moral character we'll keep paying on it until we're all
eating beans and the Masters of the Universe have all of the money in
existence. Then we'll do the honorable thing, which is to commit
suicide.


Gunner's preferred method is Sepuku as I recall.
LOL
Did you see that the McCain campaign gave brother Phil the axe?
Genghis Khan apparently became available G




Ya'll don't pick on Gunner.

He's doing the best he can...

cavelamb himself wrote:
John R. Carroll wrote:
Ed Huntress wrote:

"John R. Carroll" wrote in
message news
Ed Huntress wrote:

"Gunner Asch" wrote in message
...

On Fri, 18 Jul 2008 16:22:46 -0700, "John R. Carroll"
wrote:


When the United States finally entered into the Second World War
in 1941, Franklin Roosevelt did many things and took many
actions in pretty short order.


Stick to handloading and fixing old machine tools, Gunner. That's
about the limit of your understanding of economics.

How do you keep getting dumber as you age? Most people get
smarter.

I wonder how he thinks the Republican "Contract with America"
worked out? LOL

That solemn contract is still binding, according to Gunner. And if
we have any moral character we'll keep paying on it until we're all
eating beans and the Masters of the Universe have all of the money
in existence. Then we'll do the honorable thing, which is to commit
suicide.


Gunner's preferred method is Sepuku as I recall.
LOL
Did you see that the McCain campaign gave brother Phil the axe?
Genghis Khan apparently became available G




Ya'll don't pick on Gunner.

He's doing the best he can...

Were that true, I wouldn't unless you want to refine "best you can" to mean
the best he can do to lie through his eye teeth.


--

John R. Carroll
www.machiningsolution.com

"John R. Carroll" wrote in message
...
Ed Huntress wrote:
"John R. Carroll" wrote in
message ...
Ed Huntress wrote:
"John R. Carroll" wrote in
message news Ed Huntress wrote:
"Gunner Asch" wrote in message
...
On Fri, 18 Jul 2008 16:22:46 -0700, "John R. Carroll"
wrote:

When the United States finally entered into the Second World War
in 1941, Franklin Roosevelt did many things and took many
actions in pretty short order.



Stick to handloading and fixing old machine tools, Gunner. That's
about the limit of your understanding of economics.

How do you keep getting dumber as you age? Most people get
smarter.

I wonder how he thinks the Republican "Contract with America"
worked out? LOL

That solemn contract is still binding, according to Gunner. And if
we have any moral character we'll keep paying on it until we're all
eating beans and the Masters of the Universe have all of the money
in existence. Then we'll do the honorable thing, which is to commit
suicide.

Gunner's preferred method is Sepuku as I recall.
LOL
Did you see that the McCain campaign gave brother Phil the axe?
Genghis Khan apparently became available G

He blamed it on the Democrats. What he means it that there's been a
flood of editorials lately that explain how the deregulation that led
to much of the subprime mess is the result of his budget maneuvering
and late-night tricks he pulled when he was in the Senate -- and the
Democrats started picking on him for it.

Maybe he can find a nice hedge fund to manage.

He's at UBS. I don't think it gets nicer than that.
IIRC, they wrote down 70 billion dollars of Phil Graham snake oil recently
and I know they have forbidden their executives from travelling to the US.
Something about illegal tax shelters and unreported income.

Right. I had forgotten he's still there.

Yeah, I read a story somewhere about UBS recently. I used to think they were
just trapped in a different set of regulations, between the US and
Switzerland, and that they couldn't win. But now I see that they actively
tried to hide those US deposits through a variety of methods that clearly
were subterfuge, trying to dodge the IRS.

More pirates and thieves

--
Ed Huntress

"cavelamb himself" wrote in message
...
John R. Carroll wrote:
Ed Huntress wrote:

"John R. Carroll" wrote in
message news
Ed Huntress wrote:

"Gunner Asch" wrote in message
om...

On Fri, 18 Jul 2008 16:22:46 -0700, "John R. Carroll"
wrote:


When the United States finally entered into the Second World War
in 1941, Franklin Roosevelt did many things and took many actions
in pretty short order.


Stick to handloading and fixing old machine tools, Gunner. That's
about the limit of your understanding of economics.

How do you keep getting dumber as you age? Most people get smarter.

I wonder how he thinks the Republican "Contract with America" worked
out? LOL

That solemn contract is still binding, according to Gunner. And if we
have any moral character we'll keep paying on it until we're all
eating beans and the Masters of the Universe have all of the money in
existence. Then we'll do the honorable thing, which is to commit
suicide.


Gunner's preferred method is Sepuku as I recall.
LOL
Did you see that the McCain campaign gave brother Phil the axe?
Genghis Khan apparently became available G




Ya'll don't pick on Gunner.

He's doing the best he can...

No he's not. He just endlessly belittles others to cover up for his own
emotional problems. It grew pretty old a decade ago.

--
Ed Huntress