The Fed Under Fire

[Sapiens]

The Federal Reserve is one of the most powerful and secretive institutions in Washington, long considered beyond the reach of lawmakers. But now, as details emerge of how the Fed secretly doled out more than a trillion dollars during the financial crisis, a rare bipartisan movement in Congress demands that the Fed be held accountable.

[ThePythonicCow]

Re: The Fed Under Fire

Good video - thanks.

It seems that several major elements of our worlds economy and financials are threatened or at least under attack: the dollar, the Fed, Goldman Sachs, the euro, cheap oil, ... :eek::eek::eek:

I say that "the euro is threatened" because some European countries and banks seem as at risk of bankruptcy from the debt collapse as their American counterparts. Perhaps saying "the euro is threatened" is a poor short hand for this circumstance.

This all makes planning for ones own financial health challenging. It is seldom a good bet to bet against such long standing major institutions. This is so until the day after one of them fails catastrophically. Then if one didn't have some salvagable "insurance" position, one is Toast.



Perhaps (likely, actually) I don't fully understand what iTulip has to say on these matters. But my (newbie) understanding is that other than in the matter of the dollar losing value in the POOM phase, even iTulip can mostly only draw these other possible cataclysmic events on the "Map of the Future" as "Dragons of Unknown Specifics."



Question: Is there some old timer out there who has been Cynical far longer than this old timer? I've only become a serious cynic of my government (USA) and some major related Corporations (Banks, Pharma, Ag, Defense Contractors) and Institutions (the Fed) in the last few years. So it seems to me that things have gotten much worse of late; however I can't tell whether things are getting worse, or it is just that I'm noticing more. Perhaps someone else who has been watching with a jaundiced eye for longer has an informed opinion here.

[D-Mack]

Re: The Fed Under Fire

I wonder how this period will be looked upon by historians, it's interesting now.

...

Hosts Trish Regan and Larry Kudlow took issue with Kucinich’s zeroing in on Paulson, with both suggesting Lewis was more to blame.

Kudlow shouted at the two-time former presidential candidate over inconsistencies in his assessment of the situation, saying, “None of this makes any sense to the viewer, to investors, whatsoever!”

Kucinich countered, “We have to have the ability to tell shareholders that things are legit, and they weren’t legit for the shareholders of Bank of America.”

This further inflamed Kudlow, which led to loud crosstalk between him and Kucinich, before co-host Regan stepped in and again questioned the congressman’s stance. Taken aback, Kucinich said, “How can you even have a show about this when you say shareholders can be notified after the fact?”

Kucinich is not the only lawmaker to grill the embattled Paulson.

...
http://rawstory.com/08/news/2009/07/...ns-cnbc-hosts/

[ThePythonicCow]

Re: The Fed Under Fire

I wonder how this period will be looked upon by historians, it's interesting now.

Hosts Trish Regan and Larry Kudlow took issue with Kucinich’s zeroing in on Paulson, with both suggesting Lewis was more to blame.

I hear Kucinich taking a position in your video clip that I had not heard before. He is saying that Paulson should have threatened to have Lewis removed if Lewis failed to inform Bank of America shareholders, before the vote, of Merrill's financial problems.

My position has been that Paulson (and/or Bernanke, whomever) had no lawful right to threaten Lewis like that. Kucinich seems to be taking it as a given that the Secretary of the Treasury (Paulson) has a right to make such a threats, and indeed even an obligation to make them in order to coerce bank CEO's to act legally (inform share holders of material facts or even withdraw offers in the face of material adverse conditions.)

[ricket]

Re: The Fed Under Fire

I hear Kucinich taking a position in your video clip that I had not heard before. He is saying that Paulson should have threatened to have Lewis removed if Lewis failed to inform Bank of America shareholders, before the vote, of Merrill's financial problems.

My position has been that Paulson (and/or Bernanke, whomever) had no lawful right to threaten Lewis like that. Kucinich seems to be taking it as a given that the Secretary of the Treasury (Paulson) has a right to make such a threats, and indeed even an obligation to make them in order to coerce bank CEO's to act legally (inform share holders of material facts or even withdraw offers in the face of material adverse conditions.)

If someone is in violation of the law (and there is proof) can they not be arrested, held in jail, until trial, during which time they are incapable of performing their job? Is this not the same as removing management?

Kucinich's argument was clearly that there was a clear violation of SEC rules and Paulson should have taken action immediately, since the SEC already has the authority to enforce the violations that Lewis had obviously already made.

[ThePythonicCow]

Re: The Fed Under Fire

Kucinich's argument was clearly that there was a clear violation of SEC rules and Paulson should have taken action immediately, since the SEC already has the authority to enforce the violations that Lewis had obviously already made.

Ah, that would be the detail I had missed, that there was already (at the time Lewis is complaining that Paulson threatened him) clear violations of law by Lewis known to Paulson.

If that was the case, and I am willing to suppose it was, then yes Paulson should have enabled the SEC to take Lewis down unconditionally, rather than letting it all slide on the condition that Lewis played ball.

If Paulson, by his prior and subsequent behaviour, had demonstrated an altruistic dedication to what was best for America, rather than what was best for Goldman Sachs, then I might allow for the alternative, that being that it was better for Paulson to excuse Lewis's criminal acts in order to achieve a more serious objective. Were I on that jury, I might still vote guilty, but on the least serious charge allowed, for a minimum sentence, on the grounds that Paulson acted for a higher moral purpose.

However the hypothetical in the previous paragraph is entirely disconnected from any reality I am aware of.