Daily Financial Capsule: Paulson Blasts Russia, Why Are We Really In Haiti? TARP This

January 31st, 2010 - by: danny

Times Online (UK)Goldman Goniffs

Goldman Sachs, the world’s richest investment bank, could be about to pay its chief executive a bumper bonus of up to $100 million in defiance of moves by President Obama to take action against such payouts.

Bankers in Davos for the World Economic Forum (WEF) told The Times yesterday they understood that Lloyd Blankfein and other top Goldman bankers outside Britain were set to receive some of the bank’s biggest-ever payouts. “This is Lloyd thumbing his nose at Obama,” said a banker at one of Goldman’s rival

Move Your Money? You betcha! Also … VOTE

• Move Your Politicians by Simon Johnson — MIT Professor and co-author of 13 Bankers

“… As early as this fall’s primaries, expect to hear people ask politicians in debates and through various kinds of interactions: (1) where do you, personally, keep and borrow money, and (2), in all relevant cases, where did you put public money when it was up to you?

These questions strike to the heart of democratic responses against overly concentrated financial power throughout US history — a topic we take up in Chapter 1 of 13 Bankers.

In the 1830s showdown between elected officials and big banks, President Andrew Jackson went toe-to-toe with Nicolas Biddle of the Second Bank of the United States. Both sides won several rounds and finally it came down to this — could Jackson really move the money of the US government away from the Second Bank? He could and did. And despite being threatened — by bankers, naturally — with dire consequences, the US had a very good 19th century. [More here Ã¢â€ â€™]

• Bloomberg: Paulson Says Russia Urged China to Dump Fannie, Freddie Bonds By Michael McKee and Alex Nicholson

Russia urged China to dump its Fannie Mae and Freddie Mac bonds in 2008 in a bid to force a bailout of the largest U.S. mortgage-finance companies, former Treasury Secretary Henry Paulson said.

Paulson learned of the “disruptive scheme” while attending the Beijing Summer Olympics, according to his memoir, “On The Brink.”

The Russians made a “top-level approach” to the Chinese “that together they might sell big chunks of their GSE holdings to force the U.S. to use its emergency authorities to prop up these companies,” Paulson said, referring to the acronym for government sponsored entities. The Chinese declined, he said. [More here Ã¢â€ â€™]

Tarp This

• The Hill: Report: TARP benefits have fallen far short By Silla Brush The $700 billion bailout program for the financial industry has so far done little to boost bank lending, aid small businesses or reduce home foreclosures, a top government watchdog said in a report.

• Boston Review: The Big Bank Theory: How Government Helps Financial Giants Get Richer By Dean Baker

Wall Street bankers, along with the rest of the players in the financial industry, like to think of themselves as swashbuckling capitalists. They battle cutthroat competition with one hand and oppressive government bureaucracy with the other. In reality, the financial industry is deeply dependent on the government. Far from the rugged, go-it-alone types they wish they were, they are more like well-dressed, coddled adolescents. And this is true in good times and bad.

The industry’s dependency takes five main forms:

Ã¢â‚¬Â¢ an explicit safety net provided by government deposit insurance;
Ã¢â‚¬Â¢ an implicit safety net provided by “too big to fail”;
Ã¢â‚¬Â¢ a special privilege of being the only untaxed casino;
Ã¢â‚¬Â¢ an open invitation to raid state and local governments for fees;
Ã¢â‚¬Â¢ a right to change contract terms after the fact. [More here Ã¢â€ â€™]

• Why Are We In Haiti — OIL?

• US Haiti Embassy 5th Largest

• The Fateful Geological Prize Called Haiti

Guardian: Why The West Owes Haiti A Bailout

• Las Vegas: Most foreclosures of any city in 2009

• Secret Banking Cabal Emerges From AIG Shadows

• Oliver Stone Says Banksters “Enabled” Hitler and the Nazis