Tag Archives: TARP

The Economic Meltdown…… America: caught in a spider’s web, Part 1

So for years the American economy appeared to be cruising along; money was being made in the stock market, 401k’s were filling up and then almost without warning the bottom dropped out. What happened? Were all the warning signs being ignored?  Was it simply greed and unethical behavior? Or was it an unrealistic “redistribute the wealth” agenda of “progressive” politicians? Yes, yes, and yes!

It is this simple and this complicated. Bankers must behave ethically. Politicians must act responsibly. Citizens must behave sensibly and everyone must behave morally.

This meltdown represents more than just a breakdown of our financial system; it also reflects a meltdown of our national value system. Ours’ is a nation that was built with a system that rewarded hard work, contributions to society, leadership and self discipline. Our bedrock values included God, family, honesty, education, personal responsibility and patriotism. These values have been replaced with greed; instant gratification, breakdown of the family unit, erosion of religion’s place in society, a victim culture, and   lack of respect for the law.

“We have no government armed in power capable of contending with human passions unbridled by morality and religion. Our Constitution was made only for a religious and moral people. It is wholly inadequate for the government of any other”. – John Adams

A loss of civility is now reflected in the behavior of both parties during campaigns. No longer are campaigns about a difference in opinions on how to govern or debates about the merits of policy positions. Instead, they have become an exercise in mudslinging, destruction of the candidates, lies, propaganda, intimidation and bullying to turn political agenda into public policy.

“I offer my opponents a bargain:  if they will stop telling lies about us, I will stop telling the truth about them”.  ~Adlai Stevenson

In many ways, the financial crisis is the result of ruthless politicians, in league with unscrupulous citizens, exploiting anyone they can with entitlement programs, legislation and loopholes. The public has come to confuse these entitlement programs with “rights” and to provide these “rights”, our politicians are willing to spend future generations into bankruptcy. It is completely fair to refer to the stimulus bill as “The Generational Theft Act of 2009”.

“It is incumbent on every generation to pay its own debts as it goes. A principle which if acted on would save one-half the wars of the world.” – Thomas Jefferson 

So let’s begin to unravel the web in which we find ourselves. There are so many parts and pieces to this story. This is the first (and longest) installment. In this report we will establish the timeline of events surrounding the meltdown in detail. My goal is to shed light on the agenda at work and expose the trap we are being forced into. What’s at stake? Our liberty, our freedom and our national sovereignty! 

The Economic Meltdown   

I am going to outline the key events which set up and are prolonging our economic meltdown. To see graphical version of the timeline go to: http://www.timelinesoftware.com/Schedules/MortgageCrisisTimeline.pdf 

As you read through this list of events, you should take note of the level of intervention that the government undertook during this crisis. Their action is unprecedented. The amount of spending and “investing” of tax dollars in businesses and banks can only be viewed as the first step toward nationalization of the U.S. business and our economy. Keep in mind that this is not the full list but a sampling of the events. Another interesting note is the source of this information. The bulk of this list came from the website of the St. Louis Federal Reserve Bank. Each item on the list is a link to an actual government press release. A link to the full list is provided to the site later in the article. 

Summary of Events: 

1999 The Clinton Administration pressures Fannie Mae into lending to lower income borrowers 

2003 (Jun); Freddie Mac admits understating earnings by $5 billion 

2003 (Sep); The Bush Administration recommends an overhaul of Fannie Mae. 

2004 (Dec); Fannie Mae advised to restate earnings and reduce them by $9 billion 

2005 (Jan); Federal Housing Enterprise Regulatory Reform Act is proposed for the second time; never makes it to the floor for a vote. 

2005 (May) Greenspan calls home price speculation unsustainable 

2007, Bernacke starts to issue continual warnings of an impending economic disaster; ranging from derivatives, stocks, sub prime mortgages and inflation. 

==>> (St. Louis Fed list starts here) July 24, 2007 | SEC Filing  Countrywide Financial Corporation warns of “difficult conditions.”

July 31, 2007 | U.S. Bankruptcy Filing   Bear Stearns liquidates two hedge funds that invested in various types of mortgage-backed securities.

August 6, 2007 | SEC Filing   American Home Mortgage Investment Corporation files for Chapter 11 bankruptcy protection.

August 7, 2007 | Federal Reserve Press Release  The FOMC votes to maintain its target for the federal funds rate at 5.25 percent.

August 10, 2007 | Federal Reserve Press Release  The Federal Reserve Board announces that it “will provide reserves as necessary…to promote trading in the federal funds market at rates close to the FOMC’s target rate of 5.25 percent. In current circumstances, depository institutions may experience unusual funding needs because of dislocations in money and credit markets. As always, the discount window is available as a source of funding.”

August 16, 2007 | SEC Filing   Fitch Ratings downgrades Countrywide Financial Corporation to BBB+, its third lowest investment-grade rating, and Countrywide borrows the entire $11.5 billion available in its credit lines with other banks.

August 17, 2007 | Federal Reserve Press Release  The Federal Reserve Board votes to reduce the primary credit rate 50 basis points to 5.75 percent, bringing the rate to only 50 basis points above the FOMC’s federal funds rate target. The Board also increases the maximum primary credit borrowing term to 30 days, renewable by the borrower.

September 18, 2007 | Federal Reserve Press Release   The FOMC votes to reduce its target for the federal funds rate 50 basis points to 4.75 percent. The Federal Reserve Board votes to reduce the primary credit rate 50 basis points to 5.25 percent.

October 10, 2007 | Hope Now Press Release | Treasury Department Press Release   U.S. Treasury Secretary Paulson announces the HOPE NOW initiative, an alliance of investors, servicers, mortgage market participants, and credit and homeowners’ counselors encouraged by the Treasury Department and the Department of Housing and Urban Development.

October 15, 2007 | Bank of America Press Release   Citigroup, Bank of America, and JPMorgan Chase announce plans for an $80 billion Master Liquidity Enhancement Conduit to purchase highly rated assets from existing special purpose vehicles.

October 31, 2007 | Federal Reserve Press Release   The FOMC votes to reduce its target for the federal funds rate 25 basis points to 4.50 percent. The Federal Reserve Board votes to reduce the primary credit rate 25 basis points to 5.00 percent.

December 11, 2007 | Federal Reserve Press Release   The FOMC votes to reduce its target for the federal funds rate 25 basis points to 4.25 percent. The Federal Reserve Board votes to reduce the primary credit rate 25 basis points to 4.75 percent.

December 12, 2007 | Federal Reserve Press Release | Additional Information   The Federal Reserve Board announces the creation of a Term Auction Facility (TAF) in which fixed amounts of term funds will be auctioned to depository institutions against a wide variety of collateral. The FOMC authorizes temporary reciprocal currency arrangements (swap lines) with the European Central Bank (ECB) and the Swiss National Bank (SNB). The Fed states that it will provide up to $20 billion and $4 billion to the ECB and SNB, respectively, for up to 6 months.

December 21, 2007 | Bank of America Press Release   Citigroup, JPMorgan Chase, and Bank of America abandon plans for the Master Liquidity Enhancement Conduit, announcing that the fund “is not needed at this time.”

2008

January 11, 2008 | Bank of America Press Release   Bank of America announces that it will purchase Countrywide Financial in an all-stock transaction worth approximately $4 billion.

January 22, 2008 | Federal Reserve Press Release   In an intermeeting conference call, the FOMC votes to reduce its target for the federal funds rate 75 basis points to 3.5 percent. The Federal Reserve Board votes to reduce the primary credit rate 75 basis points to 4 percent.

January 30, 2008 | Federal Reserve Press Release   The FOMC votes to reduce its target for the federal funds rate 50 basis points to 3 percent. The Federal Reserve Board votes to reduce the primary credit rate 50 basis points to 3.5 percent. 

February 13, 2008 | Public Law 110-185   President Bush signs the Economic Stimulus Act of 2008 (Public Law 110-185) into law. 

March 5, 2008 | Carlyle Capital Corporation Press Release   Carlyle Capital Corporation receives a default notice after failing to meet margin calls on its mortgage bond fund. 

March 11, 2008 | Federal Reserve Press Release | Additional Information   The Federal Reserve Board announces the creation of the Term Securities Lending Facility (TSLF), which will lend up to $200 billion of Treasury securities for 28-day terms against federal agency debt, federal agency residential mortgage-backed securities (MBS), non-agency AAA/Aaa private label residential MBS, and other securities. The FOMC increases its swap lines with the ECB by $10 billion and the Swiss National Bank by $2 billion and also extends these lines through September 30, 2008. 

March 14, 2008 | Federal Reserve Press Release   The Federal Reserve Board approves the financing arrangement announced by JPMorgan Chase and Bear Stearns [see note for March 24]. The Federal Reserve Board also announces they are “monitoring market developments closely and will continue to provide liquidity as necessary to promote the orderly function of the financial system.” 

March 18, 2008 | Federal Reserve Press Release   The FOMC votes to reduce its target for the federal funds rate 75 basis points to 2.25 percent. The Federal Reserve Board votes to reduce the primary credit rate 75 basis points to 2.50 percent. 

March 24, 2008 | Federal Reserve Bank of New York Press Release   The Federal Reserve Bank of New York announces that it will provide term financing to facilitate JPMorgan Chase & Co.’s acquisition of The Bear Stearns Companies Inc. A limited liability company (Maiden Lane) is formed to control $30 billion of Bear Stearns assets that are pledged as security for $29 billion in term financing from the New York Fed at its primary credit rate. JPMorgan Chase will assume the first $1 billion of any losses on the portfolio. 

April 30, 2008 | Federal Reserve Press Release   The FOMC votes to reduce its target for the federal funds rate 25 basis points to 2 percent. The Federal Reserve Board votes to reduce the primary credit rate 25 basis points to 2.25 percent. 

June 5, 2008 | Federal Reserve Press Release   The Federal Reserve Board announces approval of the notice of Bank of America to acquire Countrywide Financial Corporation. 

July 11, 2008 | FDIC Press Release   The Office of Thrift Supervision closes IndyMac Bank, F.S.B. The Federal Deposit Insurance Corporation (FDIC) announces the transfer of the insured deposits and most assets of IndyMac Bank, F.S.B. to IndyMac Federal Bank, FSB.   

July 13, 2008 | Federal Reserve Press Release   The Federal Reserve Board authorizes the Federal Reserve Bank of New York to lend to the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac), should such lending prove necessary. 

July 13, 2008 | Treasury Department Press Release   The U.S. Treasury Department announces a temporary increase in the credit lines of Fannie Mae and Freddie Mac and a temporary authorization for the Treasury to purchase equity in either GSE if needed.    

July 15, 2008 | SEC Press Release   The Securities Exchange Commission (SEC) issues an emergency order temporarily prohibiting naked short selling in the securities of Fannie Mae, Freddie Mac, and primary dealers at commercial and investment banks.   

July 30, 2008 | Public Law 110-289   President Bush signs into law the Housing and Economic Recovery Act of 2008 (Public Law 110-289), which, among other provisions, authorizes the Treasury to purchase GSE obligations and reforms the regulatory supervision of the GSEs under a new Federal Housing Finance Agency.  

September 7, 2008 | Treasury Department Press Release   The Federal Housing Finance Agency (FHFA) places Fannie Mae and Freddie Mac in government conservatorship. The U.S. Treasury Department announces three additional measures to complement the FHFA’s decision: 1) Preferred stock purchase agreements between the Treasury/FHFA and Fannie Mae and Freddie Mac to ensure the GSEs positive net worth; 2) a new secured lending facility which will be available to Fannie Mae, Freddie Mac, and the Federal Home Loan Banks; and 3) a temporary program to purchase GSE MBS.   

September 15, 2008 | Bank of America Press Release    Bank of America announces its intent to purchase Merrill Lynch & Co. for $50 billion. 

September 15, 2008 | SEC Filing     Lehman Brothers Holdings Incorporated files for Chapter 11 bankruptcy protection.  

September 16, 2008 | Federal Reserve Press Release    The Federal Reserve Board authorizes the Federal Reserve Bank of New York to lend up to $85 billion to the American International Group (AIG) under Section 13(3) of the Federal Reserve Act.     

September 16, 2008 | Reserve Funds Press Release   The net asset value of shares in the Reserve Primary Money Fund falls below $1, primarily due to losses on Lehman Brothers commercial paper and medium-term notes.    

September 17, 2008 | Treasury Department Press Release     The U.S. Treasury Department announces a Supplementary Financing Program consisting of a series of Treasury bill issues that will provide cash for use in Federal Reserve initiatives.   

September 17, 2008 | SEC Press Release   The SEC announces a temporary emergency ban on short selling in the stocks of all companies in the financial sector. 

September 19, 2008 | Treasury Department Press Release   The U.S. Treasury Department announces a temporary guaranty program that will make available up to $50 billion from the Exchange Stabilization Fund to guarantee investments in participating money market mutual funds.  

September 21, 2008 | Federal Reserve Press Release   The Federal Reserve Board approves applications of investment banking companies Goldman Sachs and Morgan Stanley to become bank holding companies.     

September 25, 2008 | Office of Thrift Supervision Press Release    The Office of Thrift Supervision closes Washington Mutual Bank. JPMorgan Chase acquires the banking operations of Washington Mutual in a transaction facilitated by the FDIC. 

See Sep. 2008 timeline at: http://www.foxbusiness.com/story/markets/economy/timeline-financial-crisis/

http://www.cnn.com/2008/BUSINESS/09/30/us.bailout.timeline/index.html

The FDIC agrees to enter into a loss-sharing arrangement with Citigroup on a $312 billion pool of loans, with Citigroup absorbing the first $42 billion of losses and the FDIC absorbing losses beyond that. In return, Citigroup would grant the FDIC $12 billion in preferred stock and warrants. 

October 3, 2008 | Federal Reserve Press Release    Wells Fargo announces a competing proposal to purchase Wachovia Corporation that does not require assistance from the FDIC. 

October 3, 2008 | H.R. 1424 | Public Law 110-343   Congress passes and President Bush signs into law the Emergency Economic Stabilization Act of 2008 (Public Law 110-343), which establishes the $700 billion Troubled Asset Relief Program (TARP).    

October 8, 2008 | Federal Reserve Press Release   The Federal Reserve Board authorizes the Federal Reserve Bank of New York to borrow up to $37.8 billion in investment-grade, fixed-income securities from American International Group (AIG) in return for cash collateral.    

October 8, 2008 | Federal Reserve Press Release   The FOMC votes to reduce its target for the federal funds rate 50 basis points to 1.50 percent. The Federal Reserve Board votes to reduce the primary credit rate 50 basis points to 1.75 percent.  

October 12, 2008 | Federal Reserve Press Release    The Federal Reserve Board announces its approval of an application by Wells Fargo & Co. to acquire Wachovia Corporation. 

October 14, 2008 | Treasury Department TARP Press Release | Additional Information   U.S. Treasury Department announces the Troubled Asset Relief Program (TARP) that will purchase capital in financial institutions under the authority of the Emergency Economic Stabilization Act of 2008. The U.S. Treasury will make available $250 billion of capital to U.S. financial institutions. This facility will allow banking organizations to apply for a preferred stock investment by the U.S. Treasury. Nine large financial organizations announce their intention to subscribe to the facility in an aggregate amount of $125 billion.    

October 24, 2008 | PNC Press Release   PNC Financial Services Group Inc. purchases National City Corporation, creating the fifth largest U.S. bank. 

October 28, 2008 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $125 billion in preferred stock in nine U.S. banks under the Capital Purchase Program. 

October 29, 2008 | Federal Reserve Press Release   The FOMC votes to reduce its target for the federal funds rate 50 basis points to 1.00 percent. The Federal Reserve Board reduces the primary credit rate 50 basis points to 1.25 percent.    

November 10, 2008 | Federal Reserve Press Release   The Federal Reserve Board approves the applications of American Express and American Express Travel Related Services to become bank holding companies.     

November 10, 2008 | Federal Reserve Press Release | Treasury Department Press Release   The Federal Reserve Board and the U.S. Treasury Department announce a restructuring of the government’s financial support of AIG. The Treasury will purchase $40 billion of AIG preferred shares under the TARP program, a portion of which will be used to reduce the Federal Reserve’s loan to AIG from $85 billion to $60 billion. The terms of the loan are modified to reduce the interest rate to the three-month LIBOR plus 300 basis points and lengthen the term of the loan from two to five years. The Federal Reserve Board also authorizes the Federal Reserve Bank of New York to establish two new lending facilities for AIG: The Residential Mortgage- Backed Securities Facility will lend up to $22.5 billion to a newly formed limited liability company (LLC) to purchase residential MBS from AIG; the Collateralized Debt Obligations Facility will lend up to $30 billion to a newly formed LLC to purchase CDOs from AIG (Maiden Lane III LLC). 

November 11, 2008 | Treasury Department Press Release   The U.S. Treasury Department announces a new streamlined loan modification program with cooperation from the Federal Housing Finance Agency (FHFA), Department of Housing and Urban Development, and the HOPE NOW alliance.    

November 12, 2008 | Treasury Department Press Release   U.S. Treasury Secretary Paulson formally announces that the Treasury has decided not to use TARP funds to purchase illiquid mortgage-related assets from financial institutions.    

November 14, 2008 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $33.5 billion in preferred stock in 21 U.S. banks under the Capital Purchase Program.    

November 17, 2008 | Lincoln National Press Release | Hartford Press Release | Genworth Press Release   Three large U.S. life insurance companies seek TARP funding: Lincoln National, Hartford Financial Services Group, and Genworth Financial announce their intentions to purchase lenders/depositories and thus qualify as savings and loan companies to access TARP funding. 

November 18, 2008 | Senate Hearing   Executives of Ford, General Motors, and Chrysler testify before Congress, requesting access to the TARP for federal loans. 

November 20, 2008 | Fannie Mae Press Release | Freddie Mac Press Release    Fannie Mae and Freddie Mac announce that they will suspend mortgage foreclosures until Jan 2009. 

November 21, 2008 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $3 billion in preferred stock in 23 U.S. banks under the Capital Purchase Program. 

November 23, 2008 | Federal Reserve Press Release | Summary of Terms   The U.S. Treasury Department, Federal Reserve Board, and FDIC jointly announce an agreement with Citigroup to provide a package of guarantees, liquidity access, and capital. Citigroup will issue preferred shares to the Treasury and FDIC in exchange for protection against losses on a $306 billion pool of commercial and residential securities held by Citigroup. The Federal Reserve will backstop residual risk in the asset pool through a non-recourse loan. In addition, the Treasury will invest an additional $20 billion in Citigroup from the TARP. 

November 25, 2008 | Federal Reserve Press Release   The Federal Reserve Board announces the creation of the Term Asset-Backed Securities Lending Facility (TALF), under which the Federal Reserve Bank of New York will lend up to $200 billion on a non-recourse basis to holders of AAA-rated asset-backed securities and recently originated consumer and small business loans. The U.S. Treasury will provide $20 billion of TARP money for credit protection.     

November 25, 2008 | Federal Reserve Press Release    The Federal Reserve Board announces a new program to purchase direct obligations of housing related government-sponsored enterprises (GSEs)—Fannie Mae, Freddie Mac and Federal Home Loan Banks—and MBS backed by the GSEs. Purchases of up to $100 billion in GSE direct obligations will be conducted as auctions among Federal Reserve primary dealers. Purchases of up to $500 billion in MBS will be conducted by asset managers.    

November 26, 2008 | Federal Reserve Press Release   The Federal Reserve Board announces approval of the notice of Bank of America Corporation to acquire Merrill Lynch and Company. 

December 2, 2008 | Federal Reserve Press Release   The Federal Reserve Board announces that it will extend three liquidity facilities, the Primary Dealer Credit Facility (PDCF), the Asset-Backed Commercial Paper Money Market Fund Liquidity Facility (AMLF), and the Term Securities Lending Facility (TSLF) through April 30, 2009. 

December 3, 2008 | SEC Press Release   The SEC approves measures to increase transparency and accountability at credit rating agencies and thereby ensure that firms provide more meaningful ratings and greater disclosure to investors. 

December 5, 2008 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $4 billion in preferred stock in 35 U.S. banks under the Capital Purchase Program. 

December 11, 2008 | NBER Press Release   The Business Cycle Dating Committee of the National Bureau of Economic Research announces that a peak in U.S. economic activity occurred in December 2007 and that the economy has since been in a recession. 

December 12, 2008 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $6.25 billion in preferred stock in 28 U.S. banks under the Capital Purchase Program.  

December 15, 2008 | Federal Reserve Press Release   The Federal Reserve Board announces that it has approved the application of PNC Financial Services to acquire National City Corporation. 

December 16, 2008 | Federal Reserve Press Release   The FOMC votes to establish a target range for the effective federal funds rate of 0 to 0.25 percent. The Federal Reserve Board votes to reduce the primary credit rate 75 basis points to 0.50 percent. The Federal Reserve Board also establishes the interest rates on required reserve balances and excess balances at 0.25 percent for reserve maintenance periods beginning December 18, 2008.     

December 19, 2008 | Treasury Department Press Release | General Motors Term Sheet | Chrysler Term Sheet   The U.S. Treasury Department authorizes loans of up to $13.4 billion for General Motors and $4.0 billion for Chrysler from the TARP. 

December 19, 2008 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $27.9 billion in preferred stock in 49 U.S. banks under the Capital Purchase Program. 

December 22, 2008 | Federal Reserve Press Release   The Federal Reserve Board approves the application of CIT Group Inc., an $81 billion financing company, to become a bank holding company. The Board cites “unusual and exigent circumstances affecting the financial markets” for expeditious action on CIT Group’s application.  

December 23, 2008 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $15.1 billion in preferred stock from 43 U.S. banks under the Capital Purchase Program.    

December 24, 2008 | Federal Reserve Press Release    The Federal Reserve Board approves the applications of GMAC LLC and IB Finance Holding Company, LLC (IBFHC) to become bank holding companies, on conversion of GMAC Bank, a $33 billion Utah industrial loan company, to a commercial bank. GMAC Bank is a direct subsidiary of IBFHC and an indirect subsidiary of GMAC LLC, a $211 billion company. The Board cites “unusual and exigent circumstances affecting the financial markets” for expeditious action on these applications. As part of the agreement, General Motors will reduce its ownership interest in GMAC to less than 10 percent. 

December 29, 2008 | Treasury Department Press Release    The U.S. Treasury Department announces that it will purchase $5 billion in equity from GMAC as part of its program to assist the domestic automotive industry. The Treasury also agrees to lend up to $1 billion to General Motors “so that GM can participate in a rights offering at GMAC in support of GMAC’s reorganization as a bank holding company.” This commitment is in addition to the support announced on December 19, 2008. 

December 30, 2008 | Federal Reserve Press Release   The Federal Reserve Board announces that it expects to begin to purchase mortgage-backed securities backed by Fannie Mae, Freddie Mac and Ginnie Mae under a previously announced program in early January 2009 (see November 25, 2008). 

December 31, 2008 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $1.91 billion in preferred stock from seven U.S. banks under the Capital Purchase Program.

2009

January 5, 2009 | Federal Reserve Bank of New York Press Release   The Federal Reserve Bank of New York begins purchasing fixed-rate mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae under a program first announced on November 25, 2008. 

January 9, 2009 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $4.8 billion in preferred stock from 43 U.S. banks under the Capital Purchase Program. 

January 12, 2009 | White House Press Release | More Information   At the request of President-Elect Obama, President Bush submits a request to Congress for the remaining $350 billion in TARP funding for use by the incoming administration. 

January 16, 2009 | Treasury Department CPP Transaction Report    The U.S. Treasury Department purchases a total of $1.4 billion in preferred stock from 39 U.S. banks under the Capital Purchase Program. 

January 16, 2009 | Federal Reserve Press Release | Term Sheet   The U.S. Treasury Department, Federal Reserve, and FDIC announce a package of guarantees, liquidity access, and capital for Bank of America. The U.S. Treasury and the FDIC will enter a loss-sharing arrangement with Bank of America on a $118 billion portfolio of loans, securities, and other assets in exchange for preferred shares. In addition, and if necessary, the Federal Reserve will provide a non-recourse loan to back-stop residual risk in the portfolio. Separately, the U.S. Treasury will invest $20 billion in Bank of America from the TARP in exchange for preferred stock. 

January 16, 2009 | Treasury Department Press Release    The U.S. Treasury Department, Federal Reserve and FDIC finalize terms of their guarantee agreement with Citigroup. (See announcement on November 23, 2008.) 

January 16, 2009 | Treasury Department Press Release   The U.S. Treasury Department announces that it will lend $1.5 billion from the TARP to a special purpose entity created by Chrysler Financial to finance the extension of new consumer auto loans. 

January 23, 2009 | Treasury Department CPP Transaction Report    The U.S. Treasury Department purchases a total of $326 million in preferred stock from 23 U.S. banks under the Capital Purchase Program.      

January 30, 2009 | Federal Reserve Press Release     The Board of Governors announces a policy to avoid preventable foreclosures on certain residential mortgage assets held, controlled or owned by a Federal Reserve Bank. The policy was developed pursuant to section 110 of the Emergency Economic Stabilization Act. 

January 30, 2009 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $1.15 billion in preferred stock from 42 U.S. banks under the Capital Purchase Program. 

February 6, 2009 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $238.5 million in preferred stock from 28 U.S. banks under the Capital Purchase Program.  

February 10, 2009 | Treasury Department Press Release | Fact Sheet    U.S. Treasury Secretary Timothy Geithner announces a Financial Stability Plan involving Treasury purchases of convertible preferred stock in eligible banks, the creation of a Public-Private Investment Fund to acquire troubled loans and other assets from financial institutions, expansion of the Federal Reserve’s Term Asset-Backed Securities Loan Facility (TALF), and new initiatives to stem residential mortgage foreclosures and to support small business lending. 

February 10, 2009 | Federal Reserve Press Release   The Federal Reserve Board announces that is prepared to expand the Term Asset-Backed Securities Loan Facility (TALF) to as much as $1 trillion and broaden the eligible collateral to include AAA-rated commercial mortgage-backed securities, private-label residential mortgage-backed securities, and other asset-backed securities. An expansion of the TALF would be supported by $100 billion from the Troubled Asset Relief Program (TARP). The Federal Reserve Board will announce the date that the TALF will commence operations later this month. 

February 13, 2009 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $429 million in preferred stock from 29 U.S. banks under the Capital Purchase Program. 

February 17, 2009 | American Recovery and Reinvestment Act of 2009    President Obama signs into law the “American Recovery and Reinvestment Act of 2009”, which includes a variety of spending measures and tax cuts intended to promote economic recovery. 

February 18, 2009 | Executive Summary   President Obama announces The Homeowner Affordability and Stability Plan.   The plan includes a program to permit the refinancing of conforming home mortgages owned or guaranteed by Fannie Mae or Freddie Mac that currently exceed 80 percent of the value of the underlying home. The plan also creates a $75 billion Homeowner Stability Initiative to modify the terms of eligible home loans to reduce monthly loan payments.  In addition, the U.S. Treasury Department will increase its preferred stock purchase agreements with Fannie Mae and Freddie Mac to $200 billion, and increase the limits on the size of Fannie Mae and Freddie Mac’s portfolios to $900 billion. 

February 24, 2009 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $365.4 million in preferred stock from 23 U.S. banks under the Capital Purchase Program. 

February 26, 2009 | FDIC Quarterly Banking Profile   The FDIC announces that the number of “problem banks” increased from 171 institutions with $116 billion of assets at the end of the third quarter of 2008, to 252 insured institutions with $159 billion in assets at the end of fourth quarter of 2008. The FDIC also announces that there were 25 bank failures and five assistance transactions in 2008, which was the largest annual number since 1993. 

February 26, 2009 | Fannie Mae Press Release   Fannie Mae reports a loss of $25.2 billion in the fourth quarter of 2008, and a full year 2008 loss of $58.7 billion. Fannie Mae also reports that on February 25, 2009, the Federal Housing Finance Agency submitted a request for $15.2 billion from the U.S. Treasury Department under the terms of the Senior Preferred Stock Purchase Agreement in order to eliminate Fannie Mae’s net worth deficit as of December 31, 2008. 

February 27, 2009 | Treasury Department Press Release   The U.S. Treasury Department announces its willingness to convert up to $25 billion of Citigroup preferred stock issued under the Capital Purchase Program into common equity. The conversion is contingent on the willingness of private investors to convert a similar amount of preferred shares into common equity. Remaining U.S. Treasury and FDIC preferred shares issued under the Targeted Investment Program and Asset Guarantee Program would be converted into a trust preferred security of greater structural seniority that would carry the same 8% cash dividend rate as the existing issue.    

February 27, 2009 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $394.9 million in preferred stock from 28 U.S. banks under the Capital Purchase Program. 

March 2, 2009 | AIG Press Release | Federal Reserve Press Release | Treasury Department Press Release   The U.S. Treasury Department and Federal Reserve Board announce a restructuring of the government’s assistance to American International Group (AIG). Under the restructuring, AIG will receive as much as $30 billion of additional capital from the Troubled Asset Relief Program (TARP). In addition, the U.S. Treasury Department will exchange its existing $40 billion cumulative preferred shares in AIG for new preferred shares with revised terms that more closely resemble common equity. Finally, AIG’s revolving credit facility with the Federal Reserve Bank of New York will be reduced from $60 billion to no less than $25 billion and the terms will be modified. In exchange, the Federal Reserve will receive preferred interests in two special purpose vehicles created to hold the outstanding common stock of two subsidiaries of AIG: American Life Insurance Company and American International Assurance Company Ltd. Separately, AIG reports a fourth quarter 2008 loss of $61.7 billion, and a loss of $99.3 billion for all of 2008. 

March 6, 2009 | Treasury Department CPP Transaction Report    The U.S. Treasury Department purchases a total of $284.7 million in preferred stock from 22 U.S. banks under the Capital Purchase Program. 

March 11, 2009 | Freddie Mac Press Release    Freddie Mac announces that it had a net loss of $23.9 billion in the fourth quarter of 2008, and a net loss of $50.1 billion for 2008 as a whole. Further, Freddie Mac announces that its conservator has submitted a request to the U.S. Treasury Department for an additional $30.8 billion in funding for the company under the Senior Preferred Stock Purchase Agreement with the Treasury. 

March 13, 2009 | Treasury Department CPP Transaction Report    The U.S. Treasury Department purchases a total of $1.45 billion in preferred stock from 19 U.S. banks under the Capital Purchase Program. 

March 18, 2009 | Federal Reserve Bank of New York Press Release    The Federal Reserve Bank of New York releases more information on the Federal Reserve’s plan to purchase Treasury securities. The Desk will concentrate its purchases in nominal maturities ranging from 2 to 10 years. The purchases will be conducted with the Federal Reserve’s primary dealers through a series of competitive auctions and will occur two to three times a week. The Desk plans to hold the first purchase operation late next week. 

March 19, 2009 | Treasury Department Press Release   The U.S. Department of the Treasury announces an Auto Supplier Support Program that will provide up to $5 billion in financing to the automotive industry. The Supplier Support Program will provide selected suppliers with financial protection on monies (“receivables”) they are owed by domestic auto companies and the opportunity to access immediate liquidity against those obligations. Receivables created with respect to goods shipped after March 19, 2009, will be eligible for the program. Any domestic auto company is eligible to participate in the program. Any U.S.-based supplier that ships to a participating auto manufacturer on qualifying commercial terms may be eligible to participate in the program. 

March 20, 2009 | Treasury Department CPP Transaction Report    The U.S. Treasury Department purchases a total of $80.8 million in preferred stock from 10 U.S. banks under the Capital Purchase Program.     

March 23, 2009 | Federal Reserve Press Release   The Federal Reserve and the U.S. Treasury issue a joint statement on the appropriate roles of each during the current financial crisis and into the future, and on the steps necessary to ensure financial and monetary stability. The four points of agreement are 1) The Treasury and the Federal Reserve will continue to cooperate in improving the functioning of credit markets and fostering financial stability; 2) The Federal Reserve should avoid credit risk and credit allocation, which are the province of fiscal authorities; 3) The need to preserve monetary stability, and that actions by the Federal Reserve in the pursuit of financial stability must not constrain the exercise of monetary policy as needed to foster maximum sustainable employment and price stability; and 4) The need for a comprehensive resolution regime for systemically critical financial institutions. In addition, the Treasury will seek to remove the Maiden Lane facilities from the Federal Reserve’s balance sheet. 

March 26, 2009 | Treasury Department Press Release   The U.S. Treasury Department outlines a framework for comprehensive regulatory reform that focuses on containing systemic risks in the financial system. The framework calls for assigning responsibility over all systemically-important firms and critical payment and settlement systems to a single independent regulator. Further, it calls for higher standards on capital and risk management for systemically-important firms; for requiring all hedge funds above a certain size to register with a financial regulator; for a comprehensive framework of oversight, protection and disclosure for the over-the-counter derivatives market; for new requirements for money market funds; and for stronger resolution authority covering all financial institutions that pose systemic risks to the economy. 

March 27, 2009 | Treasury Department CPP Transaction Report   The U.S. Treasury Department purchases a total of $193 million in preferred stock from 14 U.S. banks under the Capital Purchase Program. 

April 3, 2009 | Treasury Department CPP Transaction Report    The U.S. Treasury purchases a total of $54.8 million in preferred stock from 10 U.S. banks under the Capital Purchase Program. 

April 10, 2009 | Treasury Department CPP Transaction Report    The U.S. Treasury purchases a total of $22.8 million in preferred stock from 5 U.S. banks under the Capital Purchase Program. 

April 17, 2009 | Treasury Department CPP Transaction Report   The U.S. Treasury purchases a total of $40.9 million in preferred stock from 6 U.S. banks under the Capital Purchase Program.  

April 24, 2009 | Treasury Department CPP Transaction Report   The U.S. Treasury purchases a total of $121.8 million in preferred stock from 12 U.S. banks under the Capital Purchase Program. 

May 1, 2009 | Treasury Department CPP Transaction Report    The U.S. Treasury purchases a total of $45.5 million in preferred stock from 7 U.S. banks under the Capital Purchase Program. 

May 15, 2009 | Treasury Department CPP Transaction Report   The U.S. Treasury purchases a total of $107.6 million in preferred stock from 14 U.S. banks under the Capital Purchase Program. 

May 20, 2009 | FDIC Press Release    President Obama signs the Helping Families Save Their Homes Act of 2009, which temporarily raises FDIC deposit insurance coverage from $100,000 per depositor to $250,000 per depositor.  The new coverage at FDIC-insured institutions will expire on January 1, 2014, when the amount will return to its standard level of $100,000 per depositor for all account categories except IRAs and other certain retirement accounts.  This action supersedes the October 3, 2008 changes.  

May 21, 2009 | FDIC Press Release   The Federal Deposit Insurance Corporation (FDIC) announces the approval of GMAC Financial Services to participate in the Temporary Liquidity Guarantee Program (TLGP).  GMAC will be allowed to issue up to $7.4 billion in new FDIC-guaranteed debt.  

May 22, 2009 | Federal Reserve Press Release    The Federal Reserve Board announces the adoption of a final rule that will allow bank holding companies to include in their Tier 1 capital without restriction senior perpetual preferred stock issued to the U.S. Treasury Department under the Troubled Asset Relief Program (TARP). 

May 22, 2009 | Treasury Department CPP Transaction Report    The U.S. Treasury purchases a total of $108 million in preferred stock from 12 U.S. banks under the Capital Purchase Program. 

May 27, 2009 | FDIC Quarterly Banking Profile   The FDIC announces that the number of “problem banks” increased from 252 insured institutions with $159 billion in assets at the end of fourth quarter of 2008, to 305 institutions with $220 billion of assets at the end of the first quarter of 2009. The FDIC also announces that there were 21 bank failures in the first quarter of 2009, which is the largest number of failed institutions in a quarter since the first quarter of 1992. 

May 29, 2009 | Treasury Department CPP Transaction Report   The U.S. Treasury purchases a total of $89 million in preferred stock from 8 U.S. banks under the Capital Purchase Program. 

June 1, 2009 | GM Press Release   As part of a new restructuring agreement with the U.S. Treasury and the governments of Canada and Ontario, General Motors Corporation and three domestic subsidiaries announce that they have filed for relief under Chapter 11 of the U.S. Bankruptcy Code. 

June 5, 2009 | Treasury Department CPP Transaction Report    The U.S. Treasury purchases a total of $40 million in preferred stock from 3 U.S. banks under the Capital Purchase Program. 

June 9, 2009 | Treasury Department Press Release    The U.S. Treasury Department announces that 10 of the largest U.S. financial institutions participating in the Capital Purchase Program have met the requirements for repayment established by the primary federal banking supervisors. If these firms choose to repay the capital acquired through the program, the Treasury will receive up to $68 billion in repayment proceeds. 

June 12, 2009 | Treasury Department CPP Transaction Report     The U.S. Treasury purchases a total of $39 million in preferred stock from 7 U.S. Banks under the Capital Purchase Program. 

June 17, 2009 | U.S. Treasury Department Regulatory Reform Proposal     The U.S. Treasury Department releases a proposal for reforming the financial regulatory system. The proposal calls for the creation of a Financial Services Oversight Council and for new authority for the Federal Reserve to supervise all firms that pose a threat to financial stability, including firms that do not own a bank. 

June 19, 2009 | Treasury Department CPP Transaction Report   The U.S. Treasury purchases a total of $84.7 million in preferred stock from 10 U.S. banks under the Capital Purchase Program. 

June 25, 2009 | AIG Press Release    American International Group (AIG) announces that it has entered into an agreement with the Federal Reserve Bank of New York to reduce the debt AIG owes the Federal Reserve Bank of New York by $25 billion. The Federal Reserve Bank of New York will receive preferred interests of $16 billion and $9 billion, respectively, in two new special purpose vehicles holding the equity of AIG subsidiaries American International Assurance Company and American Life Insurance Company. 

June 30, 2009 | Treasury Department Press Release   The U.S. Treasury proposes a bill to Congress that would create a new Consumer Financial Protection Agency. The bill would transfer all current consumer protection functions of the Federal Reserve System, Comptroller of the Currency, Office of Thrift Supervision, FDIC, FTC, and the National Credit Union Administration to the new agency. In addition, Treasury proposes amendments to the Federal Trade Commission Act with regards to coordination with the proposed Consumer Financial Protection Agency. 

To view the entire history, go to:  http://timeline.stlouisfed.org/index.cfm?p=timeline 

As you can see from the information above, the government has its’ fingerprints all over this mess. It can and should be argued that their attempt to manipulate this situation made it worse. Additionally, the use of taxpayer money to bailout through loans and buying ownership stakes in private businesses is unconstitutional. Especially when it is done by turning on the presses to print money we do not have. As a result we have accumulated massive public debt which has the potential to bankrupt the country. 

I apologize for the length of this post but to appreciate what has happened you must look at the details. The next installment in this series will focus on the players and their motivation for participating in this drama.

Quick Hits…..More “Bright Ideas” and other government idiocracy

“If we’re looking for the source of our troubles, we shouldn’t test people for drugs, we should test them for stupidity, ignorance, greed and love of power.”
P. J. O’Rourke   

President Obama announces new light bulb standards…

“I know light bulbs may not seem sexy, but this simple action holds enormous promise because 7 percent of all the energy consumed in America is used to light our homes and businesses,” the president said, standing alongside Energy Secretary Steven Chu at the White House. 

Obama said the new efficiency standards he was announcing for lamps would result in substantial savings between 2012 and 2042, saving consumers up to 4 billion annually, conserving enough energy to power every U.S. home for 10 months, reducing emissions equal to the amount produced by 166 cars a year, and eliminating the need for as many as 14 coal-fired power plants. 

The president also said he was speeding the delivery of $346 million in economic stimulus money to help improve energy efficiency in new and existing commercial buildings. 

The White House is working to keep energy in the spotlight even as Congress takes a break this week for the July 4 holiday. Obama has spent the past few days pressuring the Senate to follow the House while also seeking to show that the administration is making quick, clear progress on energy reform without legislation. 

Still, in an interview with a small group of reporters, Obama energy adviser Carol Browner said: “I am confident that comprehensive energy legislation will pass the Senate.” But she repeatedly refused to say exactly when the White House expected the Senate to pass the measure, and she wouldn’t speculate on whether Obama would have legislation sent to his desk by year’s end. 

The administration already had released new standards on commercial refrigeration. Lamps were next. (Source: Fox News)

Now that the President got the ball rolling, NJ has jumped on the band wagon with “Project Porch Light”. Free light bulbs for everyone….. Read more at:

http://www.projectporchlight.com/

This apparently is a “huge national issue” – light bulb efficiency, good thing we have that out of the way, now maybe we can focus on; job creation, fixing the economy, improving national defense, border security and reducing the national debt.

It is not an arrogant government that chooses priorities; it’s an irresponsible government that fails to choose.” – Tony Blair 

Barney Frank wants to spend the repaid TARP money again instead of returning the money to the Treasury to pay down public debt…

On June 27th, Rep. Barney Frank (D) MA, introduced new legislation to divert repaid TARP funds to new Democrat supported housing initiatives. His new bill is called TARP for Main Street Act of 2009.  According to the original bill recovered funds “shall be paid into the general fund of the Treasury for reduction of the public debt.” However, Barney wants to spend it again right away and ignore the requirements of the bill. This is becoming typical behavior for the Democrats these days.

The proposed bill breaks down as follows; take $1 billion and use it to create a trust fund for low-income rental housing which Frank has wanted for a long time.  (This unfunded measure was part of last year’s bailout of Fannie Mae and Freddie Mac.)  Another $1.5 billion would be used to set up a “neighborhood stabilization” fund.  Critics have charged that these measures might allow federal dollars to be distributed to activist groups such as ACORN. The thought of any more of our money ending up in the hand of those crooks is unthinkable!

The bill also includes $2 billion to subsidize individuals with delinquent mortgages and another $2 billion to “stabilize multifamily properties that are in default or foreclosure.”

“If stupidity got us into this mess, then why can’t it get us out?” – Will Rogers

Even worse, despite the near economic meltdown that was triggered by the mortgage defaults last year, Rep. Frank and N.Y. Rep. Anthony Weiner have sent a letter to the heads of Fannie and Freddie recommending that they lower lending standards for condo buyers. Wasn’t that how we got into this mess in the first place?

After blaming the current crisis on a lack of appropriate regulation and lax lending standards which resulted in bad loans that should not have been approved, Rep. Frank wants Fannie and Freddie to provide more aggressive (lower) lending standards again. These lower standards would specifically apply to condo developments with a high percentage of unsold units or high delinquency rates.

These guys are unbelievable! If we don’t get them out of office, their policies will destroy our economy. Of course, since social reengineering and redistribution of wealth are on their agenda that might just be part of the plan. Do you really want to live in a socialist, possibly even a fascist country? Think about it!

To read more go to:

http://www.washingtonexaminer.com/opinion/blogs/beltway-confidential/Barney-Frank–49649362.html

http://online.wsj.com/article/SB124580784452945093.html 

Gov. Schwarzenegger considers temporarily closing state parks to save money during California budget crisis… Feds threaten to seize parks if the plan is approved 

“The mystery of government is not how Washington works but how to make it stop.”
P. J. O’Rourke  

Scrambling to find ways to reduce operating costs Gov. Arnold Schwarzenegger has proposed closing 220 state parks to save $143 million. The California Legislature is considering the move to reduce the $26 billion budget deficit.

However, six parks on the list are on land that was formerly federal property and as a result the federal government could seize the land if the parks are closed. The Governor was recently warned that this was a possibility by National Park Service Regional Director Jonathan Jarvis. Schwarzenegger was also informed that the closures could result in the loss of other federal funding of the California Parks budget. 

While I have virtually no sympathy for California and the mess they find themselves in, I can’t help but be annoyed at the federal government’s position on this. It seems that no matter what Schwarzenegger tries to do to save money the Feds step in to tell him why he can’t do it. Remember when he tried to renegotiate state contracts with SEIU? That was  immediately shot down by the White House with funding cut threats. It makes you wonder if they really want California to solve their problems without Federal intervention. This type of interference is exactly the reason there needs to be separation between state and federal government. If state governments only took federal funding for things that are directly related to federal projects such as infrastructure and defense; they would be able to operate under the states’ rights provisions in the Constitution. Instead, the long strings attached to federal funds reduce the sovereignty states’ rights would otherwise provide. 

The six parks are; Angel Island, a former federal military and immigration facility; the top of Mount Diablo,  once a Navy microwave relay station; Point Sur State Park in coastal Big Sur; and three beaches Fort Ord Dunes near Monterey, Point Mugu State Park near Malibu, and Border Fields along the Mexican border. All prime California real estate; some is even beach front – Hmmm …. Maybe, this is just an opportunity for a federal land grab! 

After all, the way the administration is growing the size of the federal government; it might outgrow D.C. before we know it. Since so many of the crazies in charge are from the Golden State (Pelosi, Waxman, Feinstein and Boxer to name a few), maybe the real plan is to force the state into bankruptcy, buy it with taxpayer money, nationalize it and set up D.C. West. I mean think about it, the House and the Senate could just meet via video conference (D.C. East and West); each representative could travel to the closest site resulting in huge travel savings. How green would that be?  – (Plus Pelosi wouldn’t have to keep bugging the military for use of a jet) 

Best jobs ever… all play; no work, no worries 

(Karen Matthews, Associated Press, N.Y.) Hundreds of New York City public school teachers accused of offenses ranging from insubordination to sexual misconduct are being paid their full salaries to sit around all day playing Scrabble, surfing the Internet or just staring at the wall, if that’s what they want to do.

Because their union contract makes it extremely difficult to fire them, the teachers have been banished by the school system to its “rubber rooms” — off-campus office space where they wait months, even years, for their disciplinary hearings.

The 700 or so teachers can practice yoga, work on their novels, paint portraits of their colleagues — pretty much anything but school work. They have summer vacation just like their classroom colleagues and enjoy weekends and holidays through the school year.

Because the teachers collect their full salaries of $70,000 or more, the city Department of Education estimates the practice costs the taxpayers $65 million a year. The department blames union rules.

“It is extremely difficult to fire a tenured teacher because of the protections afforded to them in their contract,” spokeswoman Ann Forte said.

City officials said that they make teachers report to a rubber room instead of sending they home because the union contract requires that they be allowed to continue in their jobs in some fashion while their cases are being heard. The contract does not permit them to be given other work.

Of course, you probably won’t be surprised to find out that this practice also goes on in California…

The Los Angeles district, the nation’s second-largest school system with 620,000 students, behind New York’s 1.1 million, said it has 178 teachers and other staff members who are being “housed” while they wait for misconduct charges to be resolved. To read the full story, go to: http://news.yahoo.com/s/ap/20090622/ap_on_re_us/us_rubber_rooms

My guess is that L.A.’s 178 “special cases” are costing them about $25 million. You would think that if these people are going to get paid they should have to perform some productive work. Does anyone believe that there is nothing productive that they could be doing, if the contract was ammended? So why isn’t someone correcting this? I am sure if anyone tried to step in and fix the contract, the administration would step in to stop it. These days, the best jobs are union jobs. At least it seems, they are the only ones the government is interested in protecting. 

“Let’s reintroduce corporal punishment in the schools – and use it on the teachers.”


P. J. O’Rourke  

 

 

 

Quick Hits…… Part 2, Theater of the Absurd

America is now a state run corporation 

Today on Fox Business News, former Time Warner AOL CEO Gerald Levin declared, “You know basically what we have now is a new CEO and it happens to be the president of the United States and new CFO that happens to be — Tim Geithner. And I think we’ll never see business as usual again”.  So there you have it – even powerful business leaders are acknowledging that the President has taken the government and is using it to nationalize private businesses. He went on to say, “You know who’s to say, who’s going to do a better job with General Motors or Citibank at this point. Because up until now things have not been going well at all. And it’s time I think not only to put some principals back in executive pay but also trying to get CEOs to be — a part of society. You know let’s shop at Costco and you know let’s fly Coach for awhile and let’s not have a class society where the disparity between what — the CEO makes and what people in the company — is so large. As to be almost unfair and unjust.”….. Seriously? – this guy made tens of millions per year at Time Warner, I’m sure this made him a regular Joe at the office. 

However, the message here is the nationalization of American businesses and banks is real and is happening. Capitalism is on the ropes and socialism is on the rise. The question is what are we going to do about it? To see this disturbing interview, go to: 

http://www.foxbusiness.com/search-results/m/22471622/former-aol-time-warner-head-on-exec-pay.htm#q=gerald+levin

 Tough New Obama Terror Policy ……..Enemy Combatants get Miranda Rights! 

Miranda rights are being read to suspected terrorists at military detention facilities in Afghanistan. This practice could result in a shift from a war against terrorists to legal battles against criminal defendants.

The Department of Justice acknowledges terrorist suspects have been read Miranda rights, at Bagram Air Base in Afghanistan and other places but claim it is to “preserve the quality of evidence obtained.” 

Rep. Mike Rogers, R-MI of the House Intelligence Committee has visited bases in Afghanistan and Bagram. He said the practice is causing chaos, confusion and frustration in the field.  “We don’t want our soldiers thinking, is this a law enforcement event or is this, a combat event,” Rogers said, “It’s shocking to believe that we’re going to give non-United States citizens in combat zones who are training, equipping and planning to kill United States citizens and our military and treat them as if they’re U.S. citizens and afford them those rights.” Read more below:

http://www.foxnews.com/politics/2009/06/11/combatant-criminal-reading-miranda-rights-detainees-draws-criticism/

Today’s Crazy Quotes from the Left: On The Environment 

By David Foreman, co-founder of Earth First!: “We must make this an insecure and inhospitable place for capitalists and their projects. We must reclaim the roads and plowed land, halt dam construction, tear down existing dams, free shackled rivers and return to wilderness millions of acres of presently settled land.” 

By Harry Reid, Democrat, U.S. Senate majority leader: “Coal makes us sick. Oil makes us sick. It’s global warming. It’s ruining our country. It’s ruining our world.” 

By Robert F. Kennedy, Jr.: “Large-scale hog producers are a greater threat to the United States and U.S. democracy than Osama bin Laden and his terrorist network.” 

By Ted Turner, billionaire, founder of CNN and major UN donor: ‘Global warming’ will kill most of us, and turn the rest of us into cannibals.” 

By Noel Brown, UN official: “Entire nations could be wiped off the face of the Earth by rising sea levels if the global warming trend is not reversed by the year 2000. Coastal flooding and crop failures would create an exodus of “eco-refugees,” threatening political chaos.” (Yes, he meant the year 2000.) 

By Paul Ehrlich, professor, Stanford University: “Giving society cheap, abundant energy would be the equivalent of giving an idiot child a machine gun.” 

By Ted Turner, billionaire, founder of CNN and major UN donor: “A total population of 250-300 million people, a 95% decline from present levels, would be ideal.” 

By Jeffery Sachs, Columbia University, Director of The Earth Institute: “Obama is already setting a new historic course by reorienting the economy from private consumption to public investments…free-market pundits bemoan the evident intention of Obama and team to ‘tell us what kind of car to drive’. Yet that is exactly what they intend to do…and rightly so. Free-market ideology is an anachronism in an era of climate change.” 

By Emma Brindal, a climate justice campaigner coordinator for Friends of the Earth: “A climate change response must have at its heart a redistribution of wealth and resources.” 

These are examples of the agenda of left wing environmentalists. They are dangerous to all Americans. The Waxman Markey Climate Change Bill is one of the most dangerous pieces of legislation ever proposed. Please read my previous blogs on the bill and on cap & trade. This legislation will undermine our economy and by doing so our national sovereignty will be put at risk as well.  

There are many ways to improve our stewardship of the earth without destroying our country. I support cleaner cars, energy and general environmental stewardship but a balance must be established to protect both our country and our planet. Responsible citizens owe it to themselves and future generations to research the proposals being discussed and make their voices heard. We can not leave our future in the hands of politicians, lobbyists and zealot environmentalists. 

And now for a glimmer of hope………….. 

East Texas Congressman introduces bill in the House to sunset T.A.R.P. by year’s end 

(June 8, 2009)  Rep. Jeb Hensarling R-Texas, introduced a bill which sets a Dec. 31 deadline for the Treasury Department to loan remaining TARP (Troubled Asset Relief Program) money to banks or forfeit it. Also this week an announcement that some banks will be allowed to repay their TARP loans is expected. These banks, including JPMorgan Chase, American Express Co., BB&T Corp., U.S. Bancorp, Capital One Financial Corp. and Bank of New York Mellon Corp., have passed their stress tests clearing the way for repayment. 

Congressional Republicans have been unhappy with the way the TARP money was being used citing that the money was allocated to purchase the “toxic assets” of troubled financial institutions. However, both the Bush and Obama administrations have abused this program loaning money to the automakers and insurance companies as well as banks fueling “taxpayer ownership” of private businesses. In light of this, Republican lawmakers would like to return the unused and repaid money back to the Treasury and terminate the program.

“It’s time to terminate the TARP program,” Rep. Jeb Hensarling, R-Texas, told reporters. “TARP is increasingly not being a vehicle for economic stability and taxpayer protection but is evolving into 700 billion dollar revolving slush fund that the administration can use to advance economic, social and political agenda items far and apart from what Tarp was ever designed to do.”  He also said his legislation calls for reducing the amount of the TARP program by recalling all currently unspent funds and sets a Dec. 31, 2009 deadline for the allocation of TARP funds. It also kills a provision in last year’s Emergency Economic Stabilization Act that would enable Treasury Secretary Tim Geithner to renew the TARP program for two more years.

“The economy is in serious condition but we have gone past the emergency point. I fear that TARP is no longer what Congress thought it was when it passed it and I certainly do not believe it’s what the American taxpayer thought it was,” said Hensarling, who sits on the House Financial Services committee.

It appears that at least one Congressman realizes that the Federal government is not supposed to be buying up private businesses. America needs more of this kind of leadership in Congress! 

“The principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.” Thomas Jefferson, letter to John Taylor, May 28, 1816