Scamming the USA
Who is Robert Rubin
Warren Buffet said it is and economic pearl harbor and he couldnt be more right. it is a deliberate attack on the U.S. economy. And here’s why I think that. You decide. Watch for the name Robert Rubin and the company names too. It may make you think about who you vote for in November.
Read the links if you have time for the full story.
http://en.wikipedia.org/wiki/Robert_Rubin
In 1999, affirming his career-long interest in markets, Mr. Rubin joined Citigroup. Of note, the supermerger between Travelers Group and Citicorp was facilitated by the repeal of the Glass Steagall Act (Gramm-Leach-Bliley Act). This legislation was passed under the Clinton administration, days before Rubin's resignation. Consolidation of investment, commercial banking, and insurance services as practiced by Citigroup under the direction of Rubin, has been implicated in the subprime mortage crisis. He sparked controversy in 2001 when he contacted an acquaintance at the Treasury Department and asked if the department could convince bond-rating agencies not to downgrade the corporate debt of Enron, a debtor of Citigroup. Rubin wanted Enron creditors to lend money to the troubled company for a restructuring of its debt; a collapse of the energy giant might have serious consequences for financial markets and energy distribution. The Treasury official refused. A subsequent congressional staff investigation cleared Rubin of any wrongdoing, but he was still harshly criticized by political opponents.
http://www.webofdebt.com/excerpts/chapter-22.php
Although the peso's collapse was supposedly unanticipated, over 4 billion U.S. dollars suddenly and mysteriously left Mexico in the 20 days before it occurred. Six months later, this money had twice the Mexican purchasing power it had earlier. Later commentators maintained that lead investors with inside information precipitated the stampede out of the peso.8 These investors were evidently the same parties who profited from the Mexican bailout that followed. When Mexico's banks ran out of dollars to pay off its creditors (which were largely U.S. banks), the U.S. government stepped in with U.S. tax dollars. The Mexican bailout was engineered by Robert Rubin, who headed the investment bank Goldman Sachs before he became U.S. Treasury Secretary. Goldman Sachs was then heavily invested in short-term dollar-denominated Mexican bonds. The bailout was arranged the very day of Rubin's appointment. Needless to say, the money provided by U.S. taxpayers never made it to Mexico. It went straight into the vaults of Goldman Sachs, Morgan Stanley, and other big American lenders whose risky loans were on the line.9
The late Jude Wanniski was a conservative economist who was at one time a Wall Street Journal editor and adviser to President Reagan. He cynically observed of this banker coup:
There was a big party at Morgan Stanley after the Mexican peso devaluation, people from all over Wall Street came, they drank champagne and smoked cigars and congratulated themselves on how they pulled it off and they made a fortune. These people are pirates, international pirates.10
Glass-Steagall Act
Repeal of the Act
See also Depository Institutions Deregulation and Monetary Control Act passed in 1980, the Garn-St. Germain Depository Institutions Act deregulating the Savings and Loan industry in 1982, and the Gramm-Leach-Bliley Act in 1999.
The bill that ultimately repealed the Act was introduced in the Senate by Phil Gramm (R-TX) and in the House of Representatives by James Leach (R-IA) in 1999. The bills were passed by a 54-44 vote along party lines with Republican support in the Senate[7] and by a 343-86 vote in the House of Representatives[8]. Nov 4, 1999: After passing both the Senate and House the bill was moved to a conference committee to work out the differences between the Senate and House versions. The final bipartisan bill resolving the differences was passed in the Senate 90-8-1 and in the House: 362-57-15. Without forcing a veto vote, this bipartisan, veto proof legislation was signed into law by President Bill Clinton on November 12, 1999. [9]
The banking industry had been seeking the repeal of Glass-Steagall since at least the 1980s. In 1987 the Congressional Research Service prepared a report which explored the case for preserving Glass-Steagall and the case against preserving the act.[10]
The repeal enabled commercial lenders such as Citigroup, the largest U.S. bank by assets, to underwrite and trade instruments such as mortgage-backed securities and collateralized debt obligations and establish so-called structured investment vehicles, or SIVs, that bought those securities. [11] Citigroup played a major part in the repeal. Then called Citicorp, the company merged with Travelers Insurance company the year before using loopholes in Glass-Steagall that allowed for temporary exemptions. With lobbying led by Roger Levy, the "finance, insurance and real estate industries together are regularly the largest campaign contributors and biggest spenders on lobbying of all business sectors [in 1999]. They laid out more than $200 million for lobbying in 1998, according to the Center for Responsive Politics..." These industries succeeded in their two decades long effort to repeal the act.[12]
The argument for preserving Glass-Steagall (as written in 1987):
1. Conflicts of interest characterize the granting of credit – lending – and the use of credit – investing – by the same entity, which led to abuses that originally produced the Act
2. Depository institutions possess enormous financial power, by virtue of their control of other people’s money; its extent must be limited to ensure soundness and competition in the market for funds, whether loans or investments.
3. Securities activities can be risky, leading to enormous losses. Such losses could threaten the integrity of deposits. In turn, the Government insures deposits and could be required to pay large sums if depository institutions were to collapse as the result of securities losses.
4. Depository institutions are supposed to be managed to limit risk. Their managers thus may not be conditioned to operate prudently in more speculative securities businesses. An example is the crash of real estate investment trusts sponsored by bank holding companies (in the 1970s and 1980s).
http://en.wikipedia.org/wiki/Glass_Steagall_Act
Obama and Robert Rubin
http://www.marketwatch.com/news/story/republican-national-committee...
Republicans aren’t clean either , but why did Clinton sign it into law just before he left office.
The bill that ultimately repealed the Act was introduced in the Senate by Phil Gramm (R-TX) and in the House of Representatives by James Leach (R-IA) in 1999. The bills were passed by a 54-44 vote along party lines with Republican support in the Senate[7] and by a 343-86 vote in the House of Representatives[8]. Nov 4, 1999: After passing both the Senate and House the bill was moved to a conference committee to work out the differences between the Senate and House versions. The final bipartisan bill resolving the differences was passed in the Senate 90-8-1 and in the House: 362-57-15. Without forcing a veto vote, this bipartisan, veto proof legislation was signed into law by President Bill Clinton on November 12, 1999. [9]
http://www.cbsnews.com/stories/2008/08/03/ftn/main4317557.shtml?sou...
Warren Buffet said it is and economic pearl harbor and he couldnt be more right. it is a deliberate attack on the U.S. economy. And here’s why I think that. You decide. Watch for the name Robert Rubin and the company names too. It may make you think about who you vote for in November.
Read the links if you have time for the full story.
http://en.wikipedia.org/wiki/Robert_Rubin
In 1999, affirming his career-long interest in markets, Mr. Rubin joined Citigroup. Of note, the supermerger between Travelers Group and Citicorp was facilitated by the repeal of the Glass Steagall Act (Gramm-Leach-Bliley Act). This legislation was passed under the Clinton administration, days before Rubin's resignation. Consolidation of investment, commercial banking, and insurance services as practiced by Citigroup under the direction of Rubin, has been implicated in the subprime mortage crisis. He sparked controversy in 2001 when he contacted an acquaintance at the Treasury Department and asked if the department could convince bond-rating agencies not to downgrade the corporate debt of Enron, a debtor of Citigroup. Rubin wanted Enron creditors to lend money to the troubled company for a restructuring of its debt; a collapse of the energy giant might have serious consequences for financial markets and energy distribution. The Treasury official refused. A subsequent congressional staff investigation cleared Rubin of any wrongdoing, but he was still harshly criticized by political opponents.
http://www.webofdebt.com/excerpts/chapter-22.php
Although the peso's collapse was supposedly unanticipated, over 4 billion U.S. dollars suddenly and mysteriously left Mexico in the 20 days before it occurred. Six months later, this money had twice the Mexican purchasing power it had earlier. Later commentators maintained that lead investors with inside information precipitated the stampede out of the peso.8 These investors were evidently the same parties who profited from the Mexican bailout that followed. When Mexico's banks ran out of dollars to pay off its creditors (which were largely U.S. banks), the U.S. government stepped in with U.S. tax dollars. The Mexican bailout was engineered by Robert Rubin, who headed the investment bank Goldman Sachs before he became U.S. Treasury Secretary. Goldman Sachs was then heavily invested in short-term dollar-denominated Mexican bonds. The bailout was arranged the very day of Rubin's appointment. Needless to say, the money provided by U.S. taxpayers never made it to Mexico. It went straight into the vaults of Goldman Sachs, Morgan Stanley, and other big American lenders whose risky loans were on the line.9
The late Jude Wanniski was a conservative economist who was at one time a Wall Street Journal editor and adviser to President Reagan. He cynically observed of this banker coup:
There was a big party at Morgan Stanley after the Mexican peso devaluation, people from all over Wall Street came, they drank champagne and smoked cigars and congratulated themselves on how they pulled it off and they made a fortune. These people are pirates, international pirates.10
Glass-Steagall Act
Repeal of the Act
See also Depository Institutions Deregulation and Monetary Control Act passed in 1980, the Garn-St. Germain Depository Institutions Act deregulating the Savings and Loan industry in 1982, and the Gramm-Leach-Bliley Act in 1999.
The bill that ultimately repealed the Act was introduced in the Senate by Phil Gramm (R-TX) and in the House of Representatives by James Leach (R-IA) in 1999. The bills were passed by a 54-44 vote along party lines with Republican support in the Senate[7] and by a 343-86 vote in the House of Representatives[8]. Nov 4, 1999: After passing both the Senate and House the bill was moved to a conference committee to work out the differences between the Senate and House versions. The final bipartisan bill resolving the differences was passed in the Senate 90-8-1 and in the House: 362-57-15. Without forcing a veto vote, this bipartisan, veto proof legislation was signed into law by President Bill Clinton on November 12, 1999. [9]
The banking industry had been seeking the repeal of Glass-Steagall since at least the 1980s. In 1987 the Congressional Research Service prepared a report which explored the case for preserving Glass-Steagall and the case against preserving the act.[10]
The repeal enabled commercial lenders such as Citigroup, the largest U.S. bank by assets, to underwrite and trade instruments such as mortgage-backed securities and collateralized debt obligations and establish so-called structured investment vehicles, or SIVs, that bought those securities. [11] Citigroup played a major part in the repeal. Then called Citicorp, the company merged with Travelers Insurance company the year before using loopholes in Glass-Steagall that allowed for temporary exemptions. With lobbying led by Roger Levy, the "finance, insurance and real estate industries together are regularly the largest campaign contributors and biggest spenders on lobbying of all business sectors [in 1999]. They laid out more than $200 million for lobbying in 1998, according to the Center for Responsive Politics..." These industries succeeded in their two decades long effort to repeal the act.[12]
The argument for preserving Glass-Steagall (as written in 1987):
1. Conflicts of interest characterize the granting of credit – lending – and the use of credit – investing – by the same entity, which led to abuses that originally produced the Act
2. Depository institutions possess enormous financial power, by virtue of their control of other people’s money; its extent must be limited to ensure soundness and competition in the market for funds, whether loans or investments.
3. Securities activities can be risky, leading to enormous losses. Such losses could threaten the integrity of deposits. In turn, the Government insures deposits and could be required to pay large sums if depository institutions were to collapse as the result of securities losses.
4. Depository institutions are supposed to be managed to limit risk. Their managers thus may not be conditioned to operate prudently in more speculative securities businesses. An example is the crash of real estate investment trusts sponsored by bank holding companies (in the 1970s and 1980s).
http://en.wikipedia.org/wiki/Glass_Steagall_Act
Obama and Robert Rubin
http://www.marketwatch.com/news/story/republican-national-committee...
Republicans aren’t clean either , but why did Clinton sign it into law just before he left office.
The bill that ultimately repealed the Act was introduced in the Senate by Phil Gramm (R-TX) and in the House of Representatives by James Leach (R-IA) in 1999. The bills were passed by a 54-44 vote along party lines with Republican support in the Senate[7] and by a 343-86 vote in the House of Representatives[8]. Nov 4, 1999: After passing both the Senate and House the bill was moved to a conference committee to work out the differences between the Senate and House versions. The final bipartisan bill resolving the differences was passed in the Senate 90-8-1 and in the House: 362-57-15. Without forcing a veto vote, this bipartisan, veto proof legislation was signed into law by President Bill Clinton on November 12, 1999. [9]
http://www.cbsnews.com/stories/2008/08/03/ftn/main4317557.shtml?sou...
Views: 37
Replies to This Discussion
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Permalink Reply by Gone Fishin on
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Here is a list of the congressmen and senators.
http://projects.washingtonpost.com/congress/110/states/tx/
you can google their website and email them or call them. Let them know you will fire them and not vote for their party if they bailout these crooks. There are better ways to do this than taxing us for 7 billion more dollars. remember they have been throwing billions of dollars at this already. Email or call your senators and congressmen every day till they do right by us. Dave Ramsey who is on fox news and many other programs has had alot of ideas brought to him that fix it imediately and without tax dollars to the banks. And actually helps the american people. Remember, if the reason the banks are in trouble is because the people of the usa cant make their payments. Do your part for the USA
here it is.....
Years of bad decisions and stupid mistakes have created an economic nightmare in this country, but $700 billion in new debt is not the answer. As a tax-paying American citizen, I will not support any congressperson who votes to implement such a policy. Instead, I submit the following three steps:
Common Sense Plan.
I. INSURANCE
A. Insure the subprime bonds/mortgages with an underlying FHA-type insurance. Government-insured and backed loans would have an instant market all over the world, creating immediate and needed liquidity.
B. In order for a company to accept the government-backed insurance, they must do two things:
1. Rewrite any mortgage that is more than three months delinquent to a 6% fixed-rate mortgage.
a. Roll all back payments with no late fees or legal costs into the balance. This brings homeowners current and allows them a chance to keep their homes.
b. Cancel all prepayment penalties to encourage refinancing or the sale of the property to pay off the bad loan. In the event of foreclosure or short sale, the borrower will not be held liable for any deficit balance. FHA does this now, and that encourages mortgage companies to go the extra mile while
working with the borrower—again limiting foreclosures and ruined lives.
2. Cancel ALL golden parachutes of EXISTING and FUTURE CEOs and executive team members as long as the company holds these government-insured bonds/mortgages. This keeps underperforming executives from being paid when they don’t do their jobs.
C. This backstop will cost less than $50 billion—a small fraction of the current proposal.
II. MARK TO MARKET
A. Remove mark to market accounting rules for two years on only subprime Tier III bonds/mortgages. This keeps companies from being forced to artificially mark down bonds/mortgages below the value of the underlying mortgages and real estate.
B. This move creates patience in the market and has an immediate stabilizing effect on failing and ailing banks—and it costs the taxpayer nothing.
III. CAPITAL GAINS TAX
A. Remove the capital gains tax completely. Investors will flood the real estate and stock market in search of tax-free profits, creating tremendous—and immediate—liquidity in the markets. Again, this costs the taxpayer nothing.
B. This move will be seen as a lightning rod politically because many will say it is helping the rich. The truth is the rich will benefit, but it will be their money that stimulates the economy. This will enable all Americans to have more stable jobs and retirement investments that go up instead of down. This is not a time for envy, and it’s not a time for politics. It’s time for all of us, as Americans, to
stand up, speak out, and fix this mess. -
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Permalink Reply by Grillin' - MmmMmm on -
pretty good plan. It would work but it probably wonn't see the light of day.
Why?
1. Dem's won't allow the cap gains elimination. They hate investing in America and priming the capital system because tax cuts weren't there idea.
2. Nothing in here continues what started the problem...the pressure put on mortgage companies to loan money to people with poor credit histories who just so happen to be large percentage Democratic voters bloc. They pressed for these junk loans so that they could 'buy' votes from the poor. Once the poor got their mortgages, they couldn't pay them. I doubt they would go along with something that doesn't "protect" these votes.
Again, I love the plan. Mostly market based and we get a tax cut to incentivize the investments from the private sector. Perfect...but diametrically opposed to Democratic ideals. This plan would probably get 100% GOP support.
Remember in the early 2000's when McCain and several others said we had a disaster coming at us? Remember who killed off all efforts to fix them? Yes, Mr. Dodd and Mr. Frank and Mr. Rangel. They called it "racist" and an attactk on the poor. Well, we have the disaster as predicted. And now we want to trust Larry, Curly and Moe above to fix it?? I don't think so. I'd rather see a depression than see those 3 work on a solution. -
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Permalink Reply by Gone Fishin on
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I admit it is not a perfect option however dont you think a temporary suspension of mark to market that would help with their accounting numbers till the home values make the turn back up. As taxes are increased to pay for this bailout everyone will exit the markets and go into tax free bonds etc. the selloff wont happen till they start the repeal of the tax exemption. and you know much of the money that would go into wallstreet would be from overseas not the usa. Its not perfect I admit but 700+ billion is not the answer. can you imagine what will happen to all those houses sitting vacant. every stick of copper pipe and wire, every a/c unit and light fixture will disappear. then the mold and broken windows will finish them off. you see it already happening. how will the taxpayer ever make money off that. If they do that I'll buy some of them at rock bottom prices like i did from the resolution trust in 1991. whats your idea of what they should do?
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Permalink Reply by Gone Fishin on
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Gingles, whats you take on this Robert Rubin guy? Everywhere I smell poop his name comes up.
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Permalink Reply by Martin on
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Keep the capital gains tax. Reestablish Glass-Steagall Act, repeal Phil Gramm's Commodity Futures Modernization Act -- the legal basis for the derivatives market which caused banks to become much more aggressive in investing in mortgages. Remember Phil Gramm is still a major advisor for McCain, and is expected to be his secretary of the Treasury. This summer Gramm was still staying that excessive regulation was the biggest problem facing the American economy. Another theory over come by events.
Increase regulation until all aspects of the financial markets are transparent. Vote the straight Democratic ticket. Don't let the toxic paper buy back be privatized by Bush -- a current rumor in the House -- one last gasp to help his buddies.
As for Phil Gramm -- he's much more of a problem than Rubin ever was. -
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Permalink Reply by Grillin' - MmmMmm on
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Keep the cap gains tax? are you freaking serious? Obviously not an economist, an investor or a business owner. But then again, you later say vote straight Dem ticket so we kind of know your political leaning. But socialism is what got us into this mess...the government forcing lenders to make loans to poor people who couldn't afford it. When the R's called folks on this, the Dem's screamed bloody murder...you can't cut off the milk to our biggest voting block!!!
Last night, Biden actually said that in addition to protecting homeowners in bankruptcy, we ought to lower their LOAN AMOUNT so they could afford the home!!!! Do you understand what he is saying?? He wants either the US Gov't or a private business to reduce the amount they borrowed. So if a family bought a $150,000 home with a $140,000 loan and they can't make the payments due to their income of $25,000 a year, he wants us to go in and "forgive" some of that loan. Yes, we the taxpayers will just reduce that loan to $100,000...give away $40,000 to the undeserving/unqualified person who made a bad loan in the first place. Or, he's going to force a private business to forgive that amount, which is the same thing as a gov't seizure/taking. Come on Biden and you other Dem's: say what you really want...you want the tax payers of this country to GIVE all of these folks homes free and clear...just give them away. Kind of like Habitat for Humanity, only not voluntary. Just start giving away homes like you did those little stimulus/welfare checks a few months ago. Except those of us who actually pay virtually all of the taxes DIDN'T GET ANY OF THOSE CHECKS!! We didn't qualify because we pay too much in taxes! Obama/Biden...a pair only Stalin would be proud of. -
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Permalink Reply by P.G. on
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Wouldn't that be the same as rewarding bad behavior? I mean if you purchased a home next door to one of those going into default at about the same time (you likely paid about the same) how would you feel if your defaulting neighbor got a chunk of the sales price knocked off his mortgage and you didn't?
Folk who were buying these kinds of homes in those price ranges couldn't have been so stupid to not know the risks involved when they signed the mortgage. If they intended to live in their houses long term and they signed an ARM mortgage, they likely did so to get lower interest and payments and planned to re-finance later. In other words, they were betting their house was going to keep appreciating.
So should someone like that get rewarded when their gamble failed and you, as a good citizen who are paying your bills, be stuck paying back a mortgage on a house that is worth much less than you purchased it for? -
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Permalink Reply by Grillin' - MmmMmm on
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i'm okay with all above...but Biden said he wanted "lower the loan amount". That's a give away...if you owe $100,000 we'll just make it $60,000. That's the same as giving them $40,000.
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Permalink Reply by Noel on
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You sure don’t here any of the politicians talking about doing an investigation into the causes of the market failure.
I think they should investigate the matter all the way back to the 1980’s.
Likewise the term "traitor" is used in heated political discussion – typically as a slur against political dissidents, or against officials in power who are perceived as failing to act in the best interest of their constituents.
http://en.wikipedia.org/wiki/Treason -
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Permalink Reply by Dorcheated A1 on
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Now that's a BBQ Washington style.
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