Paul-Grayson’s Audit the Fed Measure Added to Bill
November 20, 2009
(ChattahBox)– Rep. Ron Paul (R-TX) together with Rep. Alan Grayson (D-FL) were successful in securing approval for their audit the Fed amendment, which was tacked on to the bill to overhaul our nation’s financial-system. Since Paul first proposed the auditing of the secretive Federal Reserve in the wake of its controversial bailout decisions, the measure has gained momentum, drawing 300 co-sponsors to his original measure. Read more
Dem Wants Wall Streeters Geithner and Summers Fired
November 19, 2009
(ChattahBox)–Rep. Peter DeFazio (D-OR), a leading member of the Congressional Progressive Caucus is not impressed with the Wall Street backgrounds of Treasury Secretary Tim Geithner and White House economic policy director Larry Summers. Citing massive federal bailout giveaways to insurance giant AIG and Goldman Sachs, DeFazio is calling on President Obama to fire the two financial officials and replace them with an economic team that puts the concerns of ordinary Americans before those of Wall Street. Read more
Hershey to team with Ferrero for Cadbury Bid?
November 18, 2009
(ChattahBox) — Hershey Co. the maker of Reese’s Peanut Butter Cups, is supposedly getting it’s ducks in a row, to launch a rival bid to Kraft’s offer for British candy maker Cadbury. Cadbury last week rejected a formal $17 billion bid from U.S. food giant Kraft as “derisory.” Analysts had begun to write off the chances of a bidding war for Cadbury as Hershey is seen as too small to act alone and Nestle had seemed uninterested.
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Paul Allen, Owner of Trail Blazers, Seahawks Battles Cancer Again
November 17, 2009
(ChattahBox)—Paul Allen, co-founder of Microsoft and owner of the Portland Trail Blazers and Seattle Seahawks, has accomplished a lot in his life, but the biggest achievement has been his successful fight against cancer 25 years ago. And now the business mogul is having to face that dreaded prospect once again, as he announces his new cancer diagnosis. Read more
Report targets Geithner, Bush over ‘back-door’ bailout of AIG creditors
November 17, 2009
(ChattahBox) — A report issued Monday by a government watchdog details how the Federal Reserve under the leadership of Timothy Geithner now the nation’s Treasury Secretary failed to use its considerable leverage” to force major banks to make concessions on the money they were owed as part of their relationships with AIG, leaving taxpayers holding the empty bag. The audit by the Special Inspector General for the Troubled Asset Relief Program (TARP) claims that major Wall Street firms, most notably Goldman Sachs, Merrill Lynch and Wachovia got 100% of the value of complicated financial instruments that they had insured with AIG to the tune of $60 billion, “an amount far above their market value at the time,” the report notes. UBS actually conditionally agreed to accept a 2 percent cut in what it was owed, but since negotiations with the other counterparties proved fruitless, the Fed paid them off in full, like everyone else including foreign interests such as Deutsche Bank for $8.5 billion.
The inspector general Neil M. Barofsky’s conclusion is that, “Tens of billions of dollars of government money was funneled inexorably and directly to A.I.G.’s counterparties.” The Fed’s initial rush last fall to save AIG — and thereby avoid a widespread market meltdown — “was done with almost no independent consideration of the terms of the transaction or the impact that those terms might have on the future of AIG,” Barofsky said.
In a letter to Barofsky included in his report, the Fed said it “would not have been appropriate to use our supervisory authority on behalf of AIG to obtain concessions from domestic counterparties.” Doing so would have been a “misuse” of power that would have given an advantage to non-U.S. banks, the Fed said. Those claims ring hollow as the Treasury Secretary Henry Paulson forced banks to take TARP funds, during the crisis, even if they did not need the government money, and pushed Bank of America (BAC) to buy Merrill Lynch. Critics have suggested that the Bush administration gave Goldman Sachs, the biggest counterparty to AIG, a “backdoor bailout” in part because of a close relationship between senior treasury officials and executives at the bank.
Report: 15 Million May Owe Taxes on Stimulus Tax Credit
November 16, 2009
(ChattahBox)—The Making Work Pay tax credit, issued to taxpayers under the stimulus package last February, may bring some Americans an unwelcome surprise when the time arrives to prepare their tax returns. A new report released by the Treasury Department’s inspector general for tax administration, warns that many taxpayers may end up owing unexpected taxes on the credit benefit. Read more
GM to Repay $6.7bn Loan Early but 46 Companies Behind on TARP Payments
November 16, 2009
(ChattahBox) — The massive rescue of the financial system, has been a mixed bag so far. Officials poured about $700 billion into investments in scores of companies, and so far about 17 percent of Troubled Asset Relief Program (TARP) loans issued since the program began a year ago have been repaid, according to a 252-page report released in October by TARP’s Special Inspector General Neil Barofsky. According to the Washington Post, 46 companies have missed dividend payments to the government by the end of September.
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Goldman Sachs: No Health Reform Means Soaring Profits for Insurers
November 13, 2009
(ChattahBox)—A study released by Goldman Sachs on the effects of health care reform legislation on insurance companies’ profits, not surprisingly concluded that insurers would rake in the cash if no health care reform measures were passed. The next best scenario for insurers, according to the study, would be a watered down version of the Senate Finance Committee’s Baucus bill, which has been criticized as a big giveaway to insurance companies. The recently passed House reform bill, which includes a weak public option has insurance companies the most worried. Read more
Hewlett-Packard agrees to acquire 3Com for $2.7 billion
November 11, 2009
(ChattahBox) — Hewlett-Packard has reached an agreement to acquire 3Com Corporation, a provider of networking switching, routing and security solutions, for $2.7 billion in deal that has already been approved by the boards of both companies.
While analysts view this move in the computer- networking market space as a challenge to Cisco Systems Inc., which has pushed into HP’s server business, Hewlett-Packard said its acquisition of 3Com will bolster it’s Ethernet switching offerings, add routing options and will help improve its business in China.
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AIG Head Threatens to Quit Over Executive Pay Limits
November 11, 2009
(ChattahBox)–Robert Benmosche, chief executive of AIG, the giant insurer considered “too big to fail,” which received billions in federal bailout funds, is angered over government imposed compensation limits. After just three months as CEO, Benmosche told AIG directors last week that he was “done,” according to the Wall Street Journal. Read more