Lair of the Poisonous Scribblers

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Big Brass Blog is a group blog founded in February of 2005 by Pam Spaulding of Pam's House Blend and Melissa McEwan of Shakesville (formerly Shakespeare's Sister). The mission of this collaborative effort is to stand as the premiere forum where strong, enduring voices of Progressivism provide what liberal politics has been missing: the unapologetic, unrelenting voice of liberalism in the darkness visited upon our world by Right-wing extremists, their ruinous policies, and their hypocritical beliefs.

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29 November 2011

"You Cannot Build a Financial System on Rumors and Lies"

by: Peter of Lone Tree

Is this what the markets have devolved to? The equivalent of gossip that borders on “he said, she said” nonsense? Also, why is it no one even checks with the reporters who publish the initial rumor-based news? Can reporters simply publish total lies these days and no one cares (that’s a rhetorical question, we already know the answer).

The whole thing just reminds us of the core issue pertaining to this Crisis: values.

This is not a monetary Crisis; it is a Crisis of values and morals. It is a Crisis caused by the notion that you can lie about virtually everything pertaining to a business deal (the quality of the assets, who owns them, whether they’re even legitimate, etc) and get away with it.

To review how we go into this mess, Wall Street and other industries lobbied Congress to loosen regulations.

Check out the rest at ZERO HEDGE.
15 October 2010

Forget about GOLD!

by: Father Tyme

I’m going to let you guys in on a little secret and a great, make that super great investment tip. It’s a secret I’ve learned from an economics professor who has had the uncanny ability to correctly predict the disasters we’ve faced for the last 6 years and his insights and writings have enabled me to make this bit of financial advice available to you for free.
Now, normally you’d pay big bucks to some Wall Street Broker or Financial Advisor for this kind of tip, but here it is for free:

Forget about gold! Forget about oil investments. Even forget about buying up land with water under it. Take all your money out of your banks, liquidate your 401Ks (if you have anything left in them), cash in any CDs and insurance policies, sell your new gas guzzler and buy a 1986 Corolla, sell your house and live with your parents or kids, take every penny you have or can get and invest, buy or steal every bit of stock in the companies that make Vaseline and Preparation H!
The return on just those two over the next 10 years will put you in the 36% tax bracket while you sip Grand Marnier (served by brown people) off the French Riviera on the deck of your yacht as you stuff your face with the most expensive cheese money can buy.


It seems the banks we bailed out are delaying the foreclosure stint so they will “appear” to lose money (they say they're doing everything the can. Does that sound familiar? Eh, Barry?), then since every politician knows those same banks are too big to fail, Congress and our “chains we can believe in” president will bail them out again! Simple, no?

You don’t have to be an economist to see what they’re doing.

You don’t have to be a math wizard to understand that if they spend more than they claim to take in, they could fail.

So. Banks give out huge bonuses (from the bailout they’ve already gotten from the taxpayers), stop lending to people and small business and sit on the money until the stock they owned drops low enough to buy it back at a huge profit, waste time telling America they're doing everything you can to help (someone!), then since their 1980s Reagan matured accountants, lawyers and financial usurers have made sure the books are as intelligible as a 25 inning score sheet, they'll cry to Congress for more money to bail them poor boys out.
The only problem they might face is not with the Republicans but whether the Democrats in Congress will prostrate themselves for the banks again.
Oh, they’ll use the same excuses they used the last time, because the public is even stupider this time and Congress knows it. And the politicians will do it with a smile this time instead of the feigned shock just like the last time.

Get ready to kick in even more of your tax dollars than you did last time and tighten your belts, save your pennies or whatever other cliché will be the phrase du jour. Oh, and Kleenex and toilet paper (but please don't squeeze the Charmin!) might not be a bad investment either.

Gold? Don’t make me laugh! A mere pittance. Sitting on cold, shiny metal can cause abnormal growths in certain areas and it really doesn't clean as well or provide healing or physical relief.

But if you invested in the stocks I mentioned, you should be sitting pretty, so to speak, while the rest of the country can’t get enough Vaseline and Preparation H!
…unless you think parts of your anatomy are already calloused enough to ignore the "coming" intrusions.

14 October 2010

Factories of Fraud - Literally

by: Anna Van Z

If the American people ever allow private banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all their property until their children will wake up homeless on the continent their fathers conquered.

--Thomas Jefferson

If you do nothing else today, watch this video clip. You will then begin to grasp the magnitude, as I did, of the levels of fraud being perpetrated against American citizens - tax-paying homeowners. And now, the government is looking for ways to let it slide.

(For all you smug, sanctimonious assholes out there who dismiss this as just being a problem of poor people with bad mortgages, guess again: YOUR HOME COULD BE SEIZED IF YOU DIDN'T EVEN HAVE A MORTGAGE! IT HAS HAPPENED IN SITUATIONS IN WHICH HOMEOWNERS PAID CASH FOR THEIR HOMES! WAKE UP, DUMMY! THE BANKS AND CORPORATIONS ARE ROBBING US BLIND!)

12 October 2010

Whoever the incumbent is, I ain't voting for them.

by: Peter of Lone Tree

Seniors Brace For Social Security Freeze

None this year. None the next.
The government is expected to announce this week that more than 58 million Social Security recipients will go through a second straight year without an increase in monthly benefits....Bette Baldwin won't be able to travel or help her children as much. Dorcas Eppright will give less to charity. Jack Dawson will buy cheap whiskey instead of his beloved Canadian Club.

Billions for bankers; not one red cent for Joe Shit the Ragman.
19 August 2010

Masters and Their Apprentice

by: Dark Wraith

What really happened (according to the Dark Wraith at the Cheezburger Network, anyway).

The suckers BELIEVE us!

· · · ·
20 May 2010

Senate Finally Passes Financial Reform

by: Foiled Goil

Today, the Senate passed its version of H.R. 4173, the Wall Street Reform and Consumer Protection Act of 2009:
A bill to promote the financial stability of the United States by improving accountability and transparency in the financial system, to end "too big to fail", to protect the American taxpayer by ending bailouts, to protect consumers from abusive financial services practices, and for other purposes.

The bill, as amended, passed by 59 to 39 vote.
The bill calls for new ways to watch for risks in the financial system and makes it easier to liquidate large failing financial firms. It also writes new rules for complex securities blamed for helping precipitate the 2008 economic crisis, and it creates a new consumer protection agency.

On December 11, 2009, the House passed its Wall Street Reform and Consumer Protection Act ( HR 4173 ) by a vote of 223-202.

The Senate version of this act will now have to be merged with the House version before going to the President for signing into law.

28 April 2010

Derivative Douchebags On Display

by: Foiled Goil

Senate Subcommittee Investigating Financial Crisis Releases Documents on Role of Investment Banks
April 24, 2010:

The Senate Permanent Subcommittee on Investigations released several exhibits that will be among those discussed on Tuesday at the fourth of its hearings on the causes and consequences of the financial crisis.

The exhibits are available at this link.

Using Goldman Sachs as a case study, the April 27 hearing will focus on the role of investment banks in contributing to the worst U.S. economic crisis since the 1930s, resulting in the foreclosure of millions of homes, the shuttering of businesses, and the loss of millions of American jobs. The Subcommittee, whose Chairman is Sen. Carl Levin, D-Mich., and whose Ranking Republican is Sen. Tom Coburn, R-Okla., has conducted a nearly year and a half investigation into the 2008 financial crisis.

“Investment banks such as Goldman Sachs were not simply market-makers, they were self-interested promoters of risky and complicated financial schemes that helped trigger the crisis,” said Sen. Levin. “They bundled toxic mortgages into complex financial instruments, got the credit rating agencies to label them as AAA securities, and sold them to investors, magnifying and spreading risk throughout the financial system, and all too often betting against the instruments they sold and profiting at the expense of their clients.” The 2009 Goldman Sachs annual report stated that the firm “did not generate enormous net revenues by betting against residential related products.” Levin said, “These e-mails show that, in fact, Goldman made a lot of money by betting against the mortgage market.”

Goldman Cited ‘Serious’ Profit on Mortgages
In late 2007, as the mortgage crisis gained momentum and many banks were suffering losses, Goldman Sachs executives traded e-mail messages saying that they would make “some serious money” betting against the housing markets.

In the messages, Lloyd C. Blankfein, the bank’s chief executive, acknowledged in November 2007 that the firm had lost money initially. But it later recovered by making negative bets, known as short positions, to profit as housing prices plummeted. “Of course we didn’t dodge the mortgage mess,” he wrote. “We lost money, then made more than we lost because of shorts.”

He added, “It’s not over, so who knows how it will turn out ultimately.”

In another message, dated July 25, 2007, David A. Viniar, Goldman’s chief financial officer, reacted to figures that said the company had made a $51 million profit from bets that housing securities would drop in value. “Tells you what might be happening to people who don’t have the big short,” he wrote to Gary D. Cohn, now Goldman’s president.

Senate Panel: Goldman Kicked Off The Financial Crisis
So it looks like Goldman Sach's strategy is going to be "deny, deny, deny." "We didn't mean it like that," "You're misinterpreting," and "We wouldn't dream of it."

And yet, here we stand, in the smoking rubble of the American dream. And there they are, laughing it up in Park Avenue penthouses. Time for some karma, baby!

Goldman to Employ So-Called 'Douchebag Defense'
(The Borowitz Report) In the event of a criminal case against the banking giant, Goldman Sachs is planning to employ a rarely-used legal strategy known as the "douchebag defense," sources confirmed today.

Davis Logsdon, Dean of the University of Minnesota School of Law, summarized the unorthodox strategy thusly: "Basically, they will be arguing that the Goldman executives had no control over their actions because they are ginormous dicks."

Goldman Executives: "No Regrets" for Deals That Accelerated Crisis
Goldman Sachs traders who helped the firm rack up billions of dollars in profits from secret bets against the housing market told a Senate investigating panel Tuesday that they'd done nothing wrong. [snip]

Dan Sparks, the former head of Goldman's mortgage department, told the panel that his team had no legal duty to tell investors that it was betting against its own products.

"Regret to me is something that you did wrong, and I don't have that," Sparks said. "That doesn't mean we didn't make mistakes … That doesn't mean we didn't do deals that didn't turn out the way we hoped they would … These deals performed horribly."

"You've got no regrets? You ought to have plenty of regrets," Michigan Democratic Sen. Carl Levin, the chairman of the Permanent Subcommittee on Investigations, told the four witnesses. [snip]

One of the testier exchanges thus far was between Sparks of Goldman and Levin. It surrounded one of the offshore deals Goldman peddled called "Timberwolf," which included securities backed by subprime mortgages that were most at risk if the housing market dropped.

Goldman documents show that the firm's sales force was told to make selling Timberwolf a priority. In 2007, Goldman sold about $300 million of Timberwolf securities to a hedge fund that collapsed later that year. A senior Goldman executive later described the deal as follows: "boy that timeberwof (sic) deal was one shitty deal." According to the subcommittee, 94 percent of the securities in the deal were from other offshore deals.

The hearing room then erupted in laughter — low titters at first, and then bigger laughs — as Levin repeatedly asked Sparks about the "shitty" deal and the e-mail.

Levin asked: Did you tell your clients that "this was a shitty deal?"

"Your top priority was to sell that shitty deal."

"Should Goldman be trying to sell a shitty deal?"

Levin grills Wall Street execs [ 5:58 ]

April 27: Sen. Carl Levin, D-Mi., quotes from an email as he repeatedly refers to "a shitty deal" while grilling bank executives during a hearing on Goldman Sachs' activities during the housing crisis.

'God, What a Piece of Crap'
It was the Perry Mason moment in the unraveling of what was left of Goldman Sachs's reputation. Only in this case, it involved a grizzled former prosecutor, Senator Carl Levin, rather than a genial defense attorney. The case was broken and the truth about the depth of Goldman's corruption revealed in his startling cross-examination of Goldman Chief Financial Officer David Viniar.

The Michigan Democrat, citing the language of the internal e-mails of Goldman traders concerning the deceptive products they were selling, asked: "And when you heard that your own employees in these e-mails are looking at these deals said `God what a shitty deal. God, what a piece of crap,' when you hear your own employees and read about those e-mails, do you feel anything?"

Viniar's answer told us all we need to know about the banal but profound immorality of Goldman's business culture: "I think that's very unfortunate to have on e-mail."

A flabbergasted Levin cut in with "On e-mail? How about feeling that way?" and Viniar, apparently moved by jeers of ridicule from the audience, conceded "I think it is very unfortunate for anyone to have said that in any form." Pressed further by Levin asking, "How about to believe that and sell them?" the CFO finally conceded, "I think that's unfortunate as well." To which Levin responded, "That's what you should have started with."

C-Span Hearing, Apr 27, 2010:
Investment Banks And The Financial Crisis, Directors
Senate Committee Homeland Security & Governmental Affairs

Related reading:
Computerized Front-Running: Another Goldman-Dominated Fraud
Also called High Frequency Trading (HFT) or "black box trading," automated program trading uses high-speed computers governed by complex algorithms (instructions to the computer) to analyze data and transact orders in massive quantities at very high speeds. Like the poker player peeking in a mirror to see his opponent's cards, HFT allows the program trader to peek at major incoming orders and jump in front of them to skim profits off the top. Note that these large institutional orders are our money - our pension funds, mutual funds, and 401Ks.

When "market making" (matching buyers with sellers) was done strictly by human brokers on the floor of the stock exchange, manipulations and front-running were considered an acceptable (if morally dubious) price to pay for continuously "liquid" markets. But front-running by computer, using complex trading programs, is an entirely different species of fraud. A minor flaw in the system has morphed into a monster.

24 February 2010

Other Uses for Wall Street Bonuses

by: Anna Van Z

Well, you'll be pleased to hear that in spite of our economy, rampant unemployment, municipal shortfalls, and record mortgage failures, the Wall Street players have seen their bonuses increase by 17% over last year. Even better, the movers and shakers at the top three investment banks saw their booty jump by 31% this year. You know, the banks we bailed out with OUR TAX DOLLARS?

I'm sure this must be a big load off your mind - gawd knows I was losing sleep, fretting over how these struggling millionaire grifters were making out. I mean, what if they had to sell the house in the Hamptons and the one in the Keys? Egads. Frightful!

Anyhow, back in reality land where the rest of us dwell, that kind of money could fund quite a few desperately needed supports and services for citizens - you know, us taxpaying drones who fund the whole mess. For example, do you realize that the 20 billion scored this year on Wall Street bonuses would pay the salaries of 390,000 public school teachers? And just about eliminate California's budget shortfall? Wait, there's more!
12 December 2009

House Passes Financial Regulation

by: Foiled Goil

A bill to overhaul and reform financial regulations passed in the House on Friday.

Major makeover of Wall Street regs passes House:
The House passed the most ambitious restructuring of federal financial regulations since the New Deal on Friday, aiming to head off any replay of last year's Wall Street failures that plunged the nation deep into recession.

The sprawling legislation would give the government new powers to break up companies that threaten the economy, create a new agency to oversee consumer banking transactions and shine a light into shadow financial markets that have escaped the oversight of regulators.

The vote was a party-line 223-202. No Republicans voted for the bill; 27 Democrats voted against it.

House Passes Wall Street Reform Bill With Zero GOP Votes:
In a close vote, the House of Representatives Friday afternoon passed a financial reform bill intended to re-regulate Wall Street and increase protections for Main Street.

The bill, passed in a 223-202 vote, calls for the creation of a new federal agency dedicated to protecting consumers that would police consumer credit products like mortgages and credit cards. It also establishes new rules for the trading of derivatives and increases the transparency of the credit-rating process -- two previously under-regulated parts of the economy that played a large role in last year's economic collapse.

Reuters FACTBOX — a short summary of the 1,279-page bill's provisions.

From the Speaker of the House:
On December 11th, the House passed the Wall Street Reform and Consumer Protection Act (HR 4173) by a vote of 223-202.

This comprehensive financial regulation reform bill will enact common-sense reforms including ending bailouts by helping ensure taxpayers are never again on the hook for Wall Street’s risky behavior and bad bets; protecting families’ retirement funds, college savings, and homes and businesses’ financial futures from unnecessary risk by Wall Street lenders and speculators and high-paid corporate executives; protecting consumers from predatory lending abuses, fine print, and industry gimmicks; and finally bringing transparency and accountability to a financial system that has run amok.

More information about the legislation (.pdf files):

Bill Summary

Bill Highlights

Full bill text

Summary of Title I - Financial Stability Improvement Act

Summary of Title II—Corporate and Financial Institution Compensation Fairness Act

Summary of Title III—Over-the-Counter Derivatives Markets Act

Summary of Title IV—Consumer Financial Protection Agency Act

Summary of Title V—Capital Markets

Summary of Title VI—Federal Insurance Office

Myths vs. Facts

· ·
03 December 2009

Broasting Bernanke

by: Foiled Goil

In the Senate Finance Committee hearing Thursday morning, Ben Bernanke faced an angry Jim Bunning (R-KY). Bunning is the second senator who has stated he will block this nomination.

Kentucky's Bunning blocks reappointment of Bernanke

McClatchy via Miami Herald, excerpts:
Jim Bunning, the conservative junior Kentucky senator who will retire next year, landed a parting punch Thursday against Federal Reserve Chairman Ben Bernanke.

Bunning, who has railed against Bernanke's performance during the nation's financial crisis, became the second Senator to put a "hold" on Bernanke’s confirmation for a second term. The procedural move by Bunning and Sen. Bernard Sanders, a Vermont independent, could require a super-majority of 60 votes in the 100-member Senate to achieve Bernanke's confirmation.

"I will do everything I can to stop your nomination and drag out the process as long as possible," Bunning said during Bernanke's confirmation hearing on Thursday. "We must put an end to your and the Fed’s failures, and there is no better time than now."

"Your time as Fed chairman has been a failure."

"You have decided that just about every large bank, investment bank, insurance company, and even some industrial companies are too big to fail. Rather than making management, shareholders, and debt holders feel the consequences of their risk-taking, you bailed them out."

"In short, you are the definition of moral hazard."


Shared sentiments:

Hell No on Bernanke!

Cenk Uygur:
I had large misgivings about Ben Bernanke before his hearings began. He's given credit for steering our economy to safe shores after we hit an enormous economic iceberg. First, I would argue we are nowhere near safe shores. Second, why are we rehiring the guy who steered the Titanic into the iceberg in the first place?

But despite all of that, I wasn't dead set against him. He does have Republicans and Democrats who believe in him. He obviously has the confidence of President Obama (though, so does Geithner and Summers, so that might not tell you much). He is an expert on the Great Depression. The problem is he was at least partly responsible for creating the situation that called for his expertise. His knowledge in handling depressions might not be so handy if he hadn't gotten us into one.

So, I was not predisposed to support him but I was not dead set against him, either. Until now.

He just said in his hearings that he would get more money by going after Social Security and Medicare. [snip]

He even has the nerve to quote famous bank robber Willie Sutton by saying that he would go after Social Security and Medicare because "that's where the money is." Well, give him points for honesty. He plans on robbing more of your money to give to his Wall Street friends - because that's where the money is. As if they haven't taken enough of our money. [snip]

Is Ben Bernanke the change we voted for? How can anyone believe that? What is the matter with Obama? Picking the same guy as Bush, and the same exact guy who was at the helm when the economy crashed, is definitely not change we can believe in. Ben Bernanke is the definition of the status quo. He is part and parcel of the Washington and Wall Street establishment that caused our economic problems in the first place. Why the hell would we put this guy back in charge?

TYT on YouTube

· ·
02 December 2009

Sanders Puts A Hold On Bernanke Nomination

by: Foiled Goil

Senator Bernie Sanders has put a hold on the nomination of Ben S. Bernanke to a second four-year term as chairman of the Federal Reserve.

Press Release:
December 2, 2009

WASHINGTON, December 2 – Sen. Bernie Sanders (I-Vt.) today placed a hold on the nomination of Ben Bernanke for a second term as chairman of the Federal Reserve.

“The American people overwhelmingly voted last year for a change in our national priorities to put the interests of ordinary people ahead of the greed of Wall Street and the wealthy few,” Sanders said. “What the American people did not bargain for was another four years for one of the key architects of the Bush economy.”

As head of the central bank since 2006, Bernanke could have demanded that Wall Street provide adequate credit to small and medium-sized businesses to create decent-paying jobs in a productive economy, but he did not.

He could have insisted that large bailed-out banks end the usurious practice of charging interest rates of 30 percent or more on credit cards, but he did not.

He could have broken up too-big-to-fail financial institutions that took Federal Reserve assistance, but he did not.

He could have revealed which banks took more than $2 trillion in taxpayer-backed secret loans, but he did not.

“The American people want a new direction on Wall Street and at the Fed. They do not want as chairman someone who has been part of the problem and who has been responsible for many of the enormous difficulties that we are now experiencing,” Sanders said. “It’s time for a change at the Fed.”

The Federal Reserve has four main responsibilities: to conduct monetary policy in a way that leads to maximum employment and stable prices; to maintain the safety and soundness of financial institutions; to contain systemic risk in financial markets; and to protect consumers against deceptive and unfair financial products.

Since Bernanke took over as Fed chairman in 2006, unemployment has more than doubled and, today, 17.5 percent of the American workforce is either unemployed or underemployed.

Not since the Great Depression has the financial system been as unsafe, unsound, and unstable as it has been during Mr. Bernanke's tenure. More than 120 banks have failed since he became chairman.

Under Bernanke's watch, the value of risky derivatives held at our nation's top commercial banks grew from $110 trillion to more than $290 trillion, 95 percent of which are concentrated in just five financial institutions.

Bernanke failed to prevent banks from issuing deceptive and unfair financial products to consumers. Under his leadership, mortgage lenders were allowed to issue predatory loans they knew consumers could not afford to repay. This risky practice was allowed to continue long after the FBI warned in 2004 of an "epidemic" in mortgage fraud.

After the financial crisis hit, Bernanke's response was to provide trillions of dollars in virtually zero-interest loans and other taxpayer assistance to some of the largest financial institutions in the world. Adding insult to injury, Bernanke refused to tell the American people the names of the institutions that received this handout or the terms involved.

“Mr. Bernanke has failed at all four core responsibilities of the Federal Reserve,” Sanders concluded. “It’s time for him to go."

· · ·
28 July 2009

Kucinich: the Federal Reserve is paying banks NOT to make loans to struggling Americans.

by: Anna Van Z

25 July 2009

What can I say?

by: Father Tyme

For only $14.96 (probably Confederate monies) you, too, can get this handsome 19 x 13 inch jigsaw (maybe some grammar-etic irony there) puzzle from freemarket warrior of N.C.

Don't ya'll rush out and clog his tubes now, ya hear?

This lends itself to all sorts of captions:
I'll see your Rhode Island and raise you Vermont!
Damn! I just lost another billion in medicare to George!

· ·
15 July 2009

Bank Chutzpah: Bailout, Bonuses, Secret Subsidies

by: Foiled Goil

Chutzpah on Steroids

Bob Herbert:
What is up with the banks and the rest of the financial industry? The people running this system remind me of gangsters who manage to walk out of the courthouse with a suspended sentence and can’t wait to get back to their nefarious activities.

These malefactors of great wealth developed hideously destructive credit policies and took insane risks that hurt millions of American families and nearly wrecked the economy. Then they were bailed out with hundreds of billions of taxpayer dollars, money that came from the very people victimized by the industry’s outlandish practices.

Now the industry is fighting against creation of an agency that would protect taxpayers and ordinary consumers from a similarly devastating onslaught in the future. And at the same time they are scrambling to raise credit card interest rates and all manner of exploitive fees to build a brand new superstructure of questionable profits on the backs of the taxpayers who came to their rescue.

We’re reaching a whole new level of chutzpah here. [snip]

There is nothing free or fair about a market in which one side uses double talk and mumbo jumbo to obscure important information and deliberately dupe the other side into making decisions against its own interests.

Goldman generated $38 million per day last quarter

Chris in Paris:
They insist it was down to basic "blocking and tackling" though something doesn't completely pass the smell test. Goldman is obviously making an effort to make this sound like basic business and nothing risky though generating such massive profits so quickly in this environment does raise some serious questions about how much "blocking and tackling" was involved versus trick plays.
A leading US labour organisation, the Service Employees International Union, said Goldman's pay practices are a strong argument for root and branch change in Wall Street's compensation policy to end a culture of rewarding bankers for taking risks.

Stephen Lerner, director of the SEIU's financial reform campaign said: "They have some kind of moral and economic amnesia. After we bail them out with tens of billions in taxpayers' funds, they go back to exactly the same practices as before."
Fed Secrecy and Banker Bonuses

Sen. Bernie Sanders:
Stepping up a campaign for Federal Reserve accountability, Sen. Bernie Sanders on Wednesday questioned whether some of more than $2.2 trillion in secret subsidies went to Goldman Sachs and other bailed-out banks now planning to shower executives with huge bonuses. Sanders voiced his concern in a letter to Fed Chairman Ben Bernanke and Treasury Secretary Timothy F. Geithner and during remarks at an Economic Policy Institute conference. [snip]

“The question I have is how do we know that right after Goldman and other banks pay back billions to the Treasury, the Federal Reserve doesn’t turn around and provide them with billions more with no strings attached?” Sanders asked. “The answer is that we don’t know. Ben Bernanke refuses to say.”

In a keynote speech at an Economic Policy Institute conference, Sanders argued that any firm that received a taxpayer bailout through the Troubled Asset Relief Program or the Federal Reserve should be subject to strict limits on compensation and should not be rewarding bonuses to senior executives.

The Senate in April approved 59 to 39 an amendment by Sanders calling on the Fed to disclose the names of all of the institutions that received more than $2.2 trillion in taxpayer assistance, how much each received and what they are doing with this money. The amendment was included in the final version of the Budget Resolution.

Sanders also is the chief sponsor of legislation to require the Fed to name the financial institutions that have received what could total more than $7 trillion in loans and loan guarantees. A separate Sanders bill would require the Government Accountability Office to conduct a comprehensive and independent audit of the Federal Reserve. [snip]

“Chairman Bernanke and the Federal Reserve have got to understand that this money does not belong to the Federal Reserve. It belongs to the American people,” Sanders said. “As long as the Federal Reserve is allowed to keep the information on their loans secret, we will never know the true financial condition of the banking system.”

Sanders Statement on Increasing Transparency at the Federal Reserve

· ·
02 July 2009

DoJ, IRS, UBS, Phil Gramm, U.S. Tax Cheaters

by: Foiled Goil

UBS, the IRS and Phil Gramm

Perrspectives, February 20, 2009:
News that the Justice Department has filed a lawsuit against Swiss banking giant UBS is just the latest chapter in the curious case of Phil Gramm. Just one day after UBS agreed to pay a $780 million criminal fine and admitted to conspiring to defraud the IRS, the DOJ demanded access to 52,000 accounts as part of its broad tax evasion probe. Which is more than just a little ironic. After all, before he became a UBS vice-chairman in 2002, then Senator Phil Gramm helped lead the 1990's Republican war to gut the Internal Revenue Service. [snip]

And what started out last year as an investigation into the possible criminal activity of 20,000 wealthy Americans has now mushroomed to involve as many as 52,000 people.

For UBS, Phil Gramm has brought a reverse Midas touch. Suffering billions in losses from subprime lending and steep losses in its stock price, UBS (along with other institutions) may soon witness the end of secret Swiss banking. As for the American people, the economic devastation wrought by Phil Gramm is far from over.

U.S.: UBS must release names of suspected tax cheats

USA Today:
Swiss bank UBS "systematically and deliberately" violated U.S. law by dispatching private bankers to recruit wealthy Americans interested in evading taxes and must be forced to reveal the identities of 52,000 of those clients, the Justice Department said in a court filing Tuesday.

The filing, which comes amid several published reports that the case may be near settlement, urges U.S. District Judge Alan Gold to hold UBS accountable for conducting years of illegal business on U.S. soil — business that earned the bank more than $100 million in fees but cost the U.S. hundreds of millions of dollars in unpaid taxes.

"It is time for UBS to face the consequences that it has brought upon itself," said Justice Department tax attorney Stuart Gibson in the 55-page filing. "The United States has proven its case for enforcement." [snip]

The IRS summons seeks the identities of all U.S. taxpayers who had an "undeclared" account at UBS between 2002 and 2007. Many of these UBS clients have already voluntarily come forward to settle tax obligations with the IRS, Byrne said.

UBS previously reached a deferred prosecution agreement with the Justice Department in which it agreed to disclose the identities of up to 300 U.S. clients and pay $780 million to the U.S. government. In that deal, UBS admitted regularly violating U.S. law through its client recruitment methods, use of sham offshore entities and filing of false paperwork.

"In sum, UBS has admitted that its bankers committed very serious crimes on U.S. soil, in ways that subjected UBS to the full jurisdiction of the IRS and the courts of the United States," Gibson said in the U.S. filing.

· ·


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