• The Obama General Motors Duplicity

    For three years our consciousness has been bombarded with assertions from Obama, his handlers, and his justifiers, that he is pro-business, understands the private sector, and is a leader -- after all did he not singlehandedly “save” General Motors and America’s auto industry? Enough with the lies already!

    Now that there is an actual businessman running against him for the Oval Office rather than a pol, the President’s machine has been turning up the volume on Obama’s GM escapade. We too easily recall his preening three years ago as the media declared him the new CEO of General Motors. Today Obama claims that without him, there would be no auto industry in America and he further claims that GM is a roaring success.

With admiration from the vast majority of the media, Obama is spiking the football on his prime example of crony-capitalism. This is not just any version of capitalism. This three year saga of GM has been a White House mandated, directed, orchestrated, manipulated, sleaze filled, top-down, “I-know-better,” abuse of laws and industry with taxpayer money to achieve egoistic and self-serving purposes.

This Administration persevered in abusing its power to ignore laws and common sense, in order to pull-off the biggest heist in US government history. And it did so in broad daylight.

The fourth estate’s fear, adulation, and mostly uncomplicated ignorance, allowed this larceny to occur. Law makers allowed it to materialize without backlash. Taxpayers watched, confused. Some, not so confused, but unable to act.

Geithner orchestrated the redirection of TARP funds for the bailout - yes, that very same slush fund specifically established to bailout financial institutions, NOT corporations. While we may never fully know the total cost to taxpayers, and we will never know the full extent of the damage done to individuals harmed by the process, we can accept as a base amount the initial $80+ billion dollars from TARP and the government stock purchase of 60% ownership. Why is this a “base” amount?  On behalf of the Nation’s taxpayers, and circumventing the country’s bankruptcy/tax laws, the orchestrators of the GM scheme ALSO sacrificed taxpayer treasure in the form of a $45 billion gift of business-loss tax credit.

Section 382 of the tax code, limits net operating loss carry-forwards in ‘loss corporations.’  Did this restrict Obama, Jarrett, Axelrod and Geithner in any way? Not when they were buying the permanent financial backing of a powerful union. The same union which this year committed one half billion dollars to Obama’s re-election campaign. Did the rank and file have ANY say in what their leaders did with their union dues?

To circumvent laws limiting transfers of Net Operating Losses” (NOL), Geithner, (that infamous tax expert of tax cheating notoriety), issued “Notices” claiming the laws would not apply to the Treasury’s machinations as it converted TARP loans to GM for shares, and then sold those shares.

 

By law, accumulated tax write-offs evaporate in bankruptcy for ALL corporations, unless they are enjoying the process of Obama-commanded-bankruptcy. Do we really wonder how other auto manufacturers such as Ford, or any other corporations for that matter, felt about this serious breech of the Nation’s laws and assault on the capitalist system? This is politics at its worst.

Taxpayers were not provided an opportunity to opine on this $125 billion being used by an out-of-control Administration to purchase the eternal support of the AWU/UAW leadership. Keep in mind that the UAW was an unsecured creditor, unlike most of the creditors pillaged by this Administration. The union was gifted a 17% share position in GM in trade for some health and pension commitments and the UAW sold a third of this position for $3.5 billion when GM made a public share offering in 2010.

When you consider how team Obama handed control of GM to its union cronies while on the other hand it obliterated 100% of the original broadly held common shares; gave pennies on the dollar worth of shares to bond holders composed of families, retirees, middle class average Americans and pension funds; wiped out the debt held by GM supplier Delphi; gifted $1 billion to Delphi UAW retirees, but nothing to Delphi’s non-union and non-UAW retirees; stiffed the bond holders; terminated the existence of thousands of long-time dealerships who were not Obama funders; unceremoniously fired the GM CEO Rick Wagoner, replacing him with car czar Steve Rattmer who in turn placed crony Ed Whitacre as titular CEO while czar Rattner made all critical decisions (against all common sense, and corporate law and governance); politicized the restructure and politicized the eventual actualization of action plans for GM; wiped out non-union salaried employee pensions; enabled GM to pay for ads in China promoting the “The Birth of a Party” – a party for the 90th anniversary of the Chinese Communist Party (CCP), . . . . you begin to understand the full meaning of crony-capitalism as it is practiced in Beijing and Moscow.

 

Ask the retirees who depended on those bonds or the Pension, Mutual and Hedge funds which Obama so cavalierly demeaned as “speculators,” how they feel about the Obama version of “redistribution.”

The vast majority of individuals who were scammed weren’t aware of all the minutia of the complex deal. Many are very likely still in the dark about Obama’s redistribution of taxpayer cash, NOT to the needy, but to this Administration’s UAW friends, and in turn to himself. This is redistribution for Obama’s personal gain, and the personal gain of his crew.

Is it any wonder the top of the UAW’s food-chain has permanent passes to the White House?

Did the media admonish the President or Treasury Secretary for failing to carry out their fiduciary responsibilities?  Did the media support the free enterprise system which the country’s economic health depends on? Not at all. The media still yawns as laws are trampled, and rights are assaulted.

 

When you have access to a camouflaged, almost limitless mountain of cash to purchase ‘friends,’ your dreams of world-grand-mastership might just take on a veneer of reality, particularly when over 85% of your nation’s MSM is championing your cause, though it doesn’t understand what your cause really is.

The lying and nauseating demagoguery continued unabated at a recent Colorado pep rally, “. . . we created 4½ million new jobs. We saved an auto industry on the brink of collapse. . . . . what we did with the auto industry, we can do it in manufacturing across America. . . . ,” bragged Obama.

Would it educate the President to point out the fact that before the bailout, 75% of GM cars were built in the U.S., while today 2/3 of GM employees are overseas and 75% of its automobiles are made outside the country with most of the manufacturing occurring in China? Such questions might trouble his evidently limited capacities and confuse his mind about his claims that Romney  “Led the outsourcing of American jobs to India and China.”

This restructuring of a failing company by dictatorial decree was nothing more than theft from the highest power in government. If and when the details of this heist become clearer in the minds of all taxpayers, we may yet see legal recourse taken on behalf of those whose lives were damaged irreparably by the abusive and despotic actions of this Administration.

The return of America toward sustainable healthy economic growth, and away from 15% real unemployment, will only occur with leadership which comprehends and respects business and the entrepreneurial spirit, and not from a leader who has done nothing but live off the largesse of others and government.

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• Geithner's Waterloo?

When Tim Geithner became Treasury Secretary he was appointed even though he had skipped on taxes and paid $42,702 to make up his omission. He pretended at the time that this failure to pay taxes owed for a number of years had simply been an oversight. Anyone really paying attention at the time, and applying reasonable judgment, was astonished. The Former head of the New York Fed was being placed into the control seat of the Nation’s Treasury.

Not a single taxpayer in the Nation who trudges through the annual process of filing income taxes believed Geithner’s excuses on this egregious wrong doing. The MSM however slobbered all over itself protecting Obama’s nominee, pretending that when someone so busy and so smart is working so selflessly for his country, he can forget to pay his taxes. That was a lie. Average wage earners, millionaires and billionaires do not forget to pay their taxes - minimize them as much as they can, but they don’t forget.

From your very first job you knew, we all knew, to pay income taxes owed. We are all intimately familiar with that annual date with destiny - tax time. Still, Geithner was given a pass. We don’t need to get into the details here of the additional distaste his judgment left us with when we discovered he had hired of an undocumented housekeeper.

Was this a telltale? Yes it was - look to what someone did yesterday, and you’ll know what he or she will do tomorrow. It’s called listening. It’s called paying attention. It’s called basic human common sense. We find ourselves with an MSM void such competence, and too broad a sector of the electorate willing to forego such proficiency.

We skip forward to this week’s Congressional hearings, and witness our same Tax avoiding Treasury Secretary, the very same person who pushed for the bailout of AIG, slipping on a pair of Gretzky skates, racing circles around the rink, and slapping pucks at the foreheads of the questioning House Financial Services Committee. Gretzky would have been envious. How dare a bunch of Representatives ask impudent questions of Geithner about something so complex as Libor?

So we were entertained. Geithner admitted knowing that the Libor rate was vulnerable to exploitation - this was at least six years ago. He knew it was being manipulated and did some speed-skating. "That was the best alternative available at the time, and you can't say now with confidence that that choice in any way disadvantaged the American taxpayer," Geithner said. It gives you a genuinely balmy feeling, doesn’t it, knowing the astute mind of Geithner is looking after your interests? No? How about this then, “I think it's quite unlikely, but we're going to take a careful look at that." When? After November? After all, Geithner was only head of the New York Fed when he discovered this monstrosity.

If that is not enough to summon your favour, it gets better, “and we felt, and I still believe this, that it was really going to be on the UK to take responsibility.” Geithner basically said, “it wasn’t my job.” Keep in mind that JP Morgan, Citigroup, and B of A, participate in the daily Libor interest rate setting. Oh, and the first two are supervised by the New York Fed. But, hey, “it’s not my job.”

The Representative asking if Geithner was aware of wrongdoing, was met with a, "We don't know that. But I think that is a question you need torefer to the enforcement agencies." Again, when? When will this fraud be taken seriously and be arduously investigated? When another Attorney General replaces Holder?

Should taxpayers care?Aside from the fact that almost everything you spend money on is affected inone way or another by the Libor rate, it also happens that the Libor rate was used for the $182 billion bailout of AIG and the trillion dollar emergency Term-AssetBacked Securities Loan Facility program. Geithner said it "was the best alternative available at the time." He knew the Libor interest rate was being manipulated, but this genius now claims there was nothing better. Why? Because he was winking and nodding? In response, a committee member used the phrase, “someone dropped the ball,” so as to not offend Geithner's ego and sensitivities. Dropped the ball?

Dropping the ball is forgetting the sandwiches on your picnic. Dropping the ball cannot and should not refer to defrauding the taxpayers of billions of dollars through interest rate “fixing.” Dropping the ball cannot and should not refer to defrauding the borrowers around the world of billions of dollars through conspiring on the fixing of interest rates. Because he knows no one will really investigate the Too Big To Analyze theft, Geithner sanctimoniously hides behind the shield, "We don't know at this point what impact that behaviour had [in moving] the rate up or down for investors or borrowers.” Well, that settles it then. No one will do any due diligence, and no one will renegotiate interest rates on any of the billions used inbailouts and backed by the Nation’s taxpayers.

There remains the remote possibility that the man who fought against the notion of breaking up the largest banks, today thinks the bankers looked after the best interests of taxpayers. Well, that is until we recall that we already knew what he was. We learned that before he was officially appointed, and it was before that that he knew of the Libor dishonesty.

We can be confident that Geithner is watching attentively as Paul Tucker, the Deputy Governor of the Bank of England, gets grilled in the UK by the Treasury Select Committee overthe Libor rate scandal. Tucker will inevitably invoke “market confidence” as being the overwhelming concern at the time, but if he’s asked of his discussions with the likes of Geithner, he may have to slip on some Gretzkys.

Truth emanating from mouths of those who initiate fabrications with such ease will be hard to come by. How about not placing individuals in positions of power who in the past have had such difficulty with truth? We already know what they will do.

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• Obama Cannot Explain This:

Twenty four centuries ago Socrates argued that the greatest of evils and the only evil worse than doing wrong was getting away with it. Since we experienced the economic near-collapse four years ago, we have also witnessed complete and utter failure in the administration of justice. Senior levels of the Department of Justice, of the banking industry, of the political system, are all “getting away with it.”

Is there any chance that Covington and Burling, the firm which represents JP Morgan, Goldman Sachs, Morgan Stanley, B. Of A., Wells Fargo, etc., and spawned AG Eric Holder and AAG Lanny Breuer, might be receiving disdain and a wagging finger from Socrates looking down from wherever he now sits and observes? Where have ethics gone?

We were recently provided with results of research which claimed that of five hundred financial sector senior executives in the US and the UK, 24% said unethical or illegal conduct was necessary, 26% said they had firsthand knowledge of wrongdoing, and 30% said their compensation pressured them to violate their ethical standards or violate laws. What a surprise, we thought. How could that be? Even the talking heads pretended to be flummoxed. Here’s another one to stupefy the public: 26% of the respondents in this survey said they had firsthand knowledge of wrongdoing. I don’t believe it. Any of it. Actually, it’s not that it’s not believable, because this is not an opinion arrived at through analysis - it is that this is simply not true. Such low percentages would fly in the face of common sense and human nature, . . .  oh, and observation.

These percentages are likely off from reality by 100%. No one with any faint familiarity of the Street reading these fictional statistics would have difficulty, if applying objectivity and assessment that driven by motivations such as self preservation, a vast majority would throw ethics aside in favour of bonuses and prolonged career well-being.

Anyone who has hovered around the Wall Street crowds knows, for example, that insider trading is “de rigueur.” There are laws which traders heed, such as, “don’t you dare make a trade for the house without inside information or some knowledge.” But we will continue to hear otherwise, and occasionally be spectators to a very public destruction of a sacrificial lamb.

HSBC Holdings this past week made news when it became the subject of allegations that it conducted money-laundering for drug lords, dictators, and thieves, operating in places from Mexico to Saudi Arabia. It didn’t help that the bank provided terrorists with access to U.S. Dollars and the U.S. Financial system. Why does this bank still have anyone holding an account after news like this? Why isn’t the executive suite and the Board of Directors flushed? Oh, of course, a resignation or two, like David Bagley, the head of HSBC compliance, and all is forgiven. No harm done.

When we watch a Congressional committee pretend to question Jamie Dimon, the head of JP Morgan, we know the sparring will not be a public admonishment, or even a censure. JP Morgan turned $5 billion into noxious vapors, and Dimon faces Congressmen and eats their lunch, or as Daniel Day Lewis might say, “Drinks their milkshake.” He is evidently smarter than anyone who faced him from the bench, and his arrogance intimidated them. Congressmen will not get truth from Dimon or any of the guys controlling the money joystick. What they seem not to know, is that Arrogance is rooted in Insecurity. Don’t back off, go get him.

Are we not amazed when we observe Ben Bernanke in front of the Senate Banking Committee telling them nothing, and being asked nothing? It’s a thing of beauty. Deer-in-the-headlights would look more effective from behind the bench. When Bernanke makes profound statements like, “The most effective way that the Congress could help to support the economy right now would be to work to address the nation’s fiscal challenges in a way that takes into account both the need for long-run sustainability and the fragility of the recovery,” followed by the unequivocal, desk pounding, and seizure causing, “We will evaluate our options going forward,” . . . and the Senators sit numb and clueless, but struggle to appear plugged-in. We shake our heads in disbelief at the dearth of political leadership. We then cross our fingers and turn to Justice and the system that should be getting answers and marching fraudsters unceremoniously to a tiny room. We hear nothing. Silence.

Trillions have been created to bailout financial institutions, governments, and a few too many companies. We have become numbed to the term “bailout.” Who controlled the bailouts? The very individuals who control the printing presses which you most fear, or should fear. Those very same presses which have decimated the purchasing power of your money over the past fifty years while moving economic controls beyond power of governments. It did not help to frame our confidence when we learned at least 18 former and current directors sitting on Boards of Federal Reserve Banks handed their own banks and companies over $4 Trillion in low-interest loans from the Federal Reserve. GE received $16 billion from The Fed, but does anyone in position to do something about it care that GE CEO Jeffrey Immelt was a New York Fed Board Member?

Jamie Dimon trumps Immelt, however, with JP Morgan getting $391 billion of the $4 trillion in emergency Fed funds. The amounts are insane, and of course, so are the bonuses these guys paid themselves. Their own Boards would never argue with them. That isn’t how the system works. It is not surprising that a Dimon walks into Congress and treats it as an annoyance. A gnat on his arm would get more respect. He doesn’t even approach Congress with contempt, he regards it as a bad joke. Conflict of interest? Abuse of power? No one asks. Guys like Dimon make Putin look like a kleptocratic piker.

Forbes magazine digs into its humour drawer and comes up with, “If Jamie Dimon had been on the Titanic, he’d have jumped in a lifeboat … and then issued a press release describing his heroism.” What jokes will Forbes come up with when the full extent of the Libor scandal finds daylight? Manipulating interest rates sounds uninteresting, compared to oil price manipulations. Uninteresting, unappetizing and tedious, until you discover that up to $800 Trillion in financial products depend on the Libor rate. No one knows the extent of the fraud. While you toil at your job, or trudge through the want ads looking for one, think of what shaving a few points here and there off $800,000,000,000,000 might mean as it bounces at the speed of electrons around the world.

And yet, from the well connected and well-paid heads of the DOJ, not a squeak. Still silence. Ssshhhh. There are no consequences. There can be no repercussions. The pretence for this inaction revolves around the supposed “complexities” of the financial sector where many heads should be rolling. The books are too big to understand, too big to analyze, too big for a forensic audit, and, well, . . . just too darned complicated to find guilt. Who believes this insanity? If any of the senior politicians who led the social/economic experiment which brought us the financial implosion, and a few senior bankers who took advantage of the abuse possibilities were even charged, not even convicted but just charged, there might be a chance at clarity going forward.

We hear nothing but misrepresentations from our genius experts and the media on the state of the National and global economies. The top of the food-chain on these misrepresentations, and those in the MSM feeding us the distortions without intelligent analysis, are anesthetizing the majority of taxpayers into paralysis.

So back to Socrates and consequences. Where is the most senior cop in America in all this? Where is his boss? Nowhere. With induced condoning from the AG and his needy leader, a lazy and uninformed MSM, and an inept Congress, the “they” whom we are intimately familiar with, are all “getting away with it.” Narcissism must be a contagious disease. Ethics or integrity anyone? Anyone? As Socrates claimed, getting away with it is the worst of evils.

Therein lies the product of Leadership Missing in Action.

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• The Challenge Being Drowned Out By Noise

As we watch the battle for the Presidency get thrown into the gutter by a President unable to lead the Nation out of its disastrous stagnation, no serious action from Washington will be applied to the national debt, the deficit, or the international banking system heading for a major crash.

For well over one generation, America’s and the world’s middle class has been primed and pumped by financial institutions to borrow. The majority was persuaded to incur debt because debt was good. Debt fed the system and placed you in a home. Debt filled that home with appliances and furniture suitable to your preference and taste. Debt placed you in an automobile, and placed you in a boat. Debt had to be good. Wasn’t it the capitalist way? Wasn’t this the road to economic growth? The banks said so.

No. Absolutely not. This level of debt is not the capitalist way. It is not the road to economic growth. It is not the path to economic independence and sovereignty. Some debt can be stimulative to growth. The out-of-control debt we are now saddled with, is not. It has been a deceptive illusion. It has been a beguiling fraud.  Savings? What savings? This beautifully executed but virulent elevation of debt to the dizzying heights of the economic firmament by banks has harmed savers and pushed them into risky and treacherous waters - right into the arms of brokerages which were also owned by the banks.

Load yourself up with debt - you can afford it. You have nothing to worry about, we’ll keep the interest rates low. Your dollar or pound or franc is dropping in value, and your earning power is sliding, but you won’t notice, because as far as you’re concerned, you’re doing fine. The new home you think you own tells you so, and aren’t you on your way to purchase the latest flat-screen-digital TV?

The mindset on main street toward personal debt, affected and infected the attitude toward debt in government. For too many years our politicians at all levels accepted the mantra - “what magic this debt business is, I can buy votes and support wherever and whenever I need them.”

Bankers didn’t care who was in office or what ideology they promoted. They still don’t. Couldn’t care less. The higher the office being sought, the more money the campaign needs. Who’s the weaker person running? Who has no understanding of anything remotely related to anything economic? Who understands nothing of the the critical elements governing finance, business and money? That’s what they really concerned themselves with. The weaker the politician, and the more ignorant, the better for bankers, particularly as it came to the most important office in the land. Ideology be damned. Why?

Bankers may appear to be based in New York or London or Zurich. Not true. Their game has no borders, and they control a licensed cartel. The best part of the monster they have created is that their frauds hold no consequences. Keep in mind, these bankers control debts worth Hundreds of Trillions of Dollars - not billions, trillions.

We are fast moving in the middle of a hurricane propelling us toward a world fiscal authority with no borders. Europe is the initial maelstrom where complete integration and absolute loss of national sovereignty will be effectively and surreptitiously implemented, with North America to follow, and the seduction of king dollar used as the convincing bait.

Loss of sovereignty will mean that someone not of your choosing or election, will dictate how you conduct yourself. Greeks have been maligned by all banks, central and national, and by the MSM parroting their message. What? Greece borrowed too much? Really? Borrowing like a marriage, takes at least two parties agreeing to the financial transaction. Bankers knew what they were doing better than did their prey. They were running hell-bent-for-leather to convert as many countries as possible into overwhelmed debtor nations. Already the same is being written of Spain, Italy, France, and other Eurozone countries - structural concerns, worsening deficits etc. And England? It’s economy has become principally dependent on banking. England is a lost cause and it will push to strengthen whatever demands satisfy bankers, particularly central bankers. Don't misconstrue my intent here. I don't aim to defend borrowers, but point to the long term objective of those bankers whose thumbs control the joystick.

Mariano Rajoy, the Spanish Prime Minister, recently said “The European Union needs to reinforce its architecture. This entails moving towards more integration, transferring more sovereignty, especially in the fiscal field. And this means a compromise to create a new European fiscal authority which would guide the fiscal policy in the eurozone, harmonize the fiscal policy of member states and enable a centralized control of finances.” He is simply voicing the attitude and inclination of more powerful insiders who control the most critical strings of all.

The European Commission makes its demands and countries cower in fear. Just imagine a banker from somewhere in the netherlands levitating in the middle of the Atlantic, telling America, “your austerity measures aren’t enough and we don’t care that you have over 20% unemployment.” And yet, unfortunately, the trend is heading us in that direction.

Amidst all this uncertainty which everyone hopes someone else understands and will do something about, we have Ben Bernanke announcing a non-announcement that he might unleash QE3 on America. On that vacuous expectation we will see the markets buoyed, possibly with Greenspan type “irrational exuberance.” What might come as a mid-term follow-on might just be a market implosion worse than we witnessed four years ago. This time, the shorts won’t be there to provide a floor and support. The big shorts have been scared and expunged right out of the system by such measures as government intervention on cave-ins which we have come to know and puzzle about, and named, “bailouts.” Uncertainty is dangerous.

The world’s debt crisis is looming as America faces what may well prove to be the most significant Presidential election in generations. America must elect an individual who has understood economics, business, trade and entrepreneurialism. America must elect someone not from the Wall Street and not a banker, but someone who understands them because they will have to be brought to heel and punished for their frauds. A different relationship to fiat money will have to be considered. Above all other considerations, America must bring creative energies to putting its workforce back to work. America is offered in Mitt Romney the only candidate who has a chance of filling the Oval Office with such capacities.

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Steve Paul Jobs, Thank You

Steve,

You have directly affected the consciousness of hundred of millions around the world through your uncommon grasp of the most critical elements guiding the human interaction with technology.

You opened new paths in aesthetics, transforming mundane technologies into design marvels which each of us absolutely had to take home.

You set standards of quality and reliability that all others could only strive to emulate, but never imitate.

You established a standard for every executive running a large corporation, completely ignoring the corrupting siren songs of Wall Street brokerages. You couldn’t be bought. That maintenance of independence enabled a clarity of thinking and an unadulterated direction of America’s greatest company.

It was a pleasure to have participated in those earliest days of the ride.

All best wishes as you continue your voyage of discovery.

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