Bailout Halleleuiah: We Praise Maxine Waters For Finally Asking The Goldman Question (Video)

My favorite moment from today's Congressional testimony of Geithner and B-52.  California Rep. Maxine Waters forces Timmaaay to listen while she recounts the litany of inappropriate Goldman Sachs influence at Treasury and on financial crisis policy . 

Finally, somebody had the sack to ask Tim about it publicly.  She would have been better served to concentrate on Goldman's role in the AIG decision (why was Lloyd Blankfein at the AIG rescue meeting last Fall?).

There is still one more question that TG and Bernanke need to answer publicly.

Comments

[DailyBail]

Bernanke Bombshell: AIG Insurer Exposed to FP

http://www.ritholtz.com/blog/2009/03/bernanke-bombshell-aig-insurer-exposed-to-fp/

[DailyBail]

Unfortunately, I have a darker temperament, a spirit less generous and optimistic than Mark’s. I am filled with despair, not because what we are doing cannot “work”, but because it is too unjust. This is not my country.

The news of today is the Geithner plan. I think this plan might work very well in terms of repairing bank balance sheets.

Of course the whole notion of repairing bank balance sheet is a lie and misdirection. The balance sheets we should want to see repaired are household balance sheets. Banks have failed us profoundly. We want them reorganized, not repaired. A world in which the banks are all fixed but households are still broken is worse than what we have right now. Too-big-to-fail banks restored to health are too-big-to-fail banks restored to power. The idea that fixing legacy banks is prerequisite to fixing the broad economy is a lie perpetrated by legacy bankers.


http://www.ritholtz.com/blog/2009/03/dark-musings-2009-03-24/

[DailyBail]

The markets for toxic assets are frozen because they’re waiting for their bailout. The commercial banks couldn’t afford to mark their toxic assets down or sell them. Now the feds are going to provide for the banks to get somewhat higher than “market value” prices with their non-recourse leverage, but as Rolfe Winkler points out, who else without access to the funny money will be able to afford to pay the same prices? This newly liquid market could calcify quickly. Thus, the feds will have to pump up all the markets for the next several years to help the hedge funds find suckers to sell this stuff to. Lots of luck. The current market prices are probably entirely rational, looking ahead to the tsunami of rate resets and probable defaults over the next twenty-four months.

http://animalspiritspage.blogspot.com/2009/03/cash-for-trash.html

[DailyBail]

Felix Salmon


Revolution in the Air
It's getting impossible to keep up with the rhetoric and political noise surrounding AIG, the banks, and executive bonuses. Will the government try to rein in executive pay generally, rather than just at AIG? Is this an example of the kind of misguided policy and mass hysteria which results when you try to put politicians in charge of for-profit businesses? Will it wreck the economy outright? Or is the real problem that "the administration's officials are too marinated in the insiders' culture to police it, reform it or own up to their own past complicity with it"?

I don't have any answers, but I do have a question: might we might be seeing the first real rumblings of class warfare -- the genuine article, not the Republican talking-point -- in this country?


http://www.portfolio.com/views/blogs/market-movers/2009/03/22/revolution-in-the-air?tid=true

[DailyBail]

And it's all because Timmeh, and Larry, and most important of all, Barack -- have minds that have been warped by corporate propaganda, or souls that have been corrupted by power, or spirits that, for whatever reason, are pathetically timid -- and thus are unable to do the right thing. And not merely the right thing, but the only reasonable thing. Which is, of course, to tell the corporate elites to go fuck themselves, and start nationalizing the banks ASAP.

I pray that I am wrong. But the administration is rapidly heading in a very dangerous direction, and there's not a lot of time to change course. As of now at least, as Atrios says, it certainly looks as if all this is going to end very badly indeed

http://thegspot.typepad.com/blog/2009/03/yet-another-reason-why-the-bailout-was-a-terrible-idea.html

[DailyBail]

http://wonkette.com/407228/a-childrens-treasury-of-wacky-depressing-clips-from-todays-geithner-bernanke-hearing

[Ain't Bullshittin']

It will be far worse than very bad indeed. Look to your leader to make your way and you will be led to the gallows.

[Something Polish]

http://coveryourbutt.org/2009/03/why-yes-that-was-a-cover-your-butt-shirt-behind-ben-bernanke/

Nice...er...plug for the Colorectal Cancer Coalition.

[Chubbz the Delinquent]

Having one of the most blatantly clueless members of congress "axe" about Goldman was a very clever move by the cabal -- it completely trivializes any suspicion of the court financiers. GS wins again.

[DailyBail]

@ Something Polish

Nicely played.

[DailyBail]

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http://online.wsj.com/article/SB123783142333116161.html

[DailyBail]

In Geithner's defense, we should point out the challenges he's facing. It's not easy pulling the wool over people's eyes, especially when they've been repeatedly fleeced. The Treasury Secretary's main job is "to keep the big banks in private hands" and to remove over a trillion dollars of toxic mortgage-backed assets that are worth only a fraction of their original value. According to economist Dean Baker, these junk assets are worth roughly 30 cents on the dollar, although the banks have them listed on their books at 60 cents on the dollar. If the banks are unable get full price, then many of them will be forced into bankruptcy. Geithner's job is to make sure that doesn't happen, which is why he has created the "partnership" smokescreen to conceal the fact that the government is intentionally overpaying for significantly-downgraded sludge. Here's how economist James Galbraith puts it:

"The bad assets are bad because they are worth less than the banks say they are. House prices have dropped by nearly 30% nationwide. That has created something in the neighborhood of $5+ trillion of losses in residential real estate alone (off a peak market value of housing about $20+ trillion). The banks don't want to take their share of those losses because doing so will wipe them out. So they, and Geithner, are doing everything they can to pawn the losses off on the taxpayer."

http://informationclearinghouse.info/article22289.htm

[Something Polish]

"Having one of the most blatantly clueless members of congress "axe" about Goldman"

How about leaving that crap elsewhere. You know what I'm talking about. Thanks in advance.

[spideydouble]

At the end of the day this plan is doomed to fail anyway. Option ARMs and CMBS are the current elephants in the room that nobody wants to talk about. Somebody had the bright idea to feed those elephants a whole lot of beans and they are starting to twitch. Too bad there will be no fire exits when they finallly decide to relieve themselves. All the hazmat suits, toilet snorkels, and pressure relief valves in the world are not going to save us. Buckle in folks. It is about to get ugly.

Anybody know where we can source some Dung beetles en masse on the cheap? If only Congress had included a provision for engines based on feces as bio-fuel in the Stimulus bill. Well, look on the bright side, at least we will have a lifetime supply of fertilizer - enough to swim in for years.

[JoeCincy]

TG looked at least very annoyed (he looked very PO'd actually) at this line of questioning from Waters. I'm not a big Maxine fan, but these GS/Treasury/Fed "relationships" smack of conflicts, especially in light of the NYFed/AIG "meetings" where Blankfein attended and was admittedly consulted. What did GS get thru the AIG back door? $12B-$13B?

[Blue Duck]

As much as I HATE to praise Maxine Waters, at least she asked the question.

Of course, she lobbied hard TARP funds for a small bank that she has strong ties with.

I guess when they're all assholes you can't expect much more.

[DailyBail]

@Blue Duck

You are correct on both counts...Waters did inappropriately lobby for help for a bank in which she or her husband had a financial interest...

Yet, at least she asked the question...it's the first time in my life I have found myself supporting her...but bailout politics make for strange bedfellows...

[RecoverylessRecovery]

"We Praise Maxine Waters For Finally Asking The Goldman Question"

What's the FUCKING USE of asking "tough questions" when you LACK the authority to FORCE AN ANSWER?
NONE!

It's all just more bread & fucking circus.