Friday, January 15, 2010
OUI, JE PARLE FRANCAIS
The arrogance is sunning, the stupidity unimagined and the question as to whether ANYTHING The Leader proposes will stand the test of constitutionality remains out there. It is clear he doesn't care. Like FDR he is determined to install his vision of this nation in stone and hope that it lasts. Getting it there is important for he realizes that once enacted, givaway programs are very hard to undo. And so the transfer of wealth continues this time from the hated banks to the UAW, to the lower middle class to every Democratic support group to be found without any concern as to effect. This administration has become entirely political in every action it takes. It exists only to survive and grow like some giant Hydra, devouring every thing to feed itself and its young.
To place a tax on the 50 largest banks is merely a cover-your-ass procedure to deflect attention from the monumentally failed programs of the president and the Democratic party: Fanny and Fred, GM, GMAC, Chrysler and the mortgage protection program. Yes, I am making assumptions but is there any doubt when just this week the "New" GM made it clear that there success depends on...wait for it...TRUCKS! Where have we heard that before.
Now France is a wonderful country and I, unlike many Americans, have never had a problem in France or with Frenchmen. Besides, the food is fabulous. But I fear this reshaping of this country: I fear the spirt a individualism that has shaped and is so much a part of what has made this country grate is being squeezed out of it in favor of an elitism of the political left who for the most part have never struggled with making a deadline, making a payroll or a mortgage payment. They are the new Elite, the children for the most part of privilege and of the eastern finishing schools referred to as Universities, offspring of those who grew up with the sounds of eastern European socialism argued around the dinner table. I grew up with their grandparents and their parents. I recognize the music. I am afraid they are the only band in town.
The Leader then gave another of his vacuous speeches about all we (he says "I") am going to do for that poor, benighted country, Haiti. Am so we should. But The Leader doesn't recognize that we are still capable of perhaps bringing this situation back from the brink because of what America has been, not what it will be in his vision of the future. Great nations are great because they stand apart, not blend in. They do this because of the will of the their people who refuse to be just another face in the crowd. The are great because their people have a overwhelming desire to overachieve; who when asked to lead and motivate and overachieve they say, "I will" not, "why should I?" The fruits of that attitude and labor allow us to save Haiti. As I said, I love France, but I don't want to be France. Every day The Leader and his mob gets us closer. Pour moi, NON! Sorry for the rant
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I though I was on to a really great idea as I mentioned, but as I worked on it it didn't come together. Hence nuttin' happened yesterday. I'm still working on it. Sorry again
Tuesday, January 12, 2010
WHAT A DIFFERENCE A DAY MAKES
First, The Leader and his boys let it drop that they were trying to figure out ways to insure that the American Taxpayer gets all of his money from TARP back. Of course they couldn't give a damn about the taxpayer but here presented itself another way to lay a tax on the banks which they believe no one in the country cares about anyway. These guys are like Willie Sutton , who wen asked why he robbed banks replied,"Because that's where the money is." Actually, they are worse than Willie; he didn't lie about his reasons.
Anyway, what we have seen is that almost all the "banks" have repaid their TARP funds, with interest and with an additional healthy return generated for the USG by way of the sale of the warrants that were part of the deal. But it would appear that there might be a few problems along the way because if one remembers, a whole bunch of taxpayer money went to GM (now owned by the Gov.), GMAC, Chrysler, Chrysler Financial and AIG. That aint comin' back soon. Then of course there is the little matter of Fanny and Freddie, the makers of the feast about whom we have spoken ad nauseam over the months. So why tax the banks for the decision to bail out this bunch? Think Willie Sutton. Actually, if the actions of the Government were to be viewed from the prospectus of Cui Bono, why not tax the United Auto Workers? How far do you think that idea would get? Or better yet, is there a way to garnish the salaries of Congress? Just a little midwest populist jibe there, don't take me seriously. I'm a little past my "use by" date, but in my lifetime I have never seen a more venial, useless bunch than has been put together by The Leader and his handlers. These guys are the worst.
Well, let me rethink that. Came today Shelia ("Poo") Bair, head of the FDIC with another idea. With a split vote, the FDIC is now proposing a tiered level of deposit insurance to be paid by banks based upon the perception of risk that SOMEBODY will determine exists on the banks' balance sheets. To put it another way, she is proposing to tax liabilities (she claims it's not a tax) according to some credit determination made by SOMEBODY (you see, she doesn't have nearly the talent in house) at some point for some non-defined period of time. This is a Bair of very little brain. When questioned about this on TV this morning she was unable to come close to explaining her theory behind this. Nor has she apparently considered the fact that the cost of this hair brained scheme will be passed right through to the consumer depositors in the form of either lower interest payments, additional fees, reductions of service or all of the above including a few other delicious charges all of which will be blamed on the FDIC. Nor has she considered the fact that the two biggest risk takers, Goldie and Morgan Stanley have little if any consumer deposits but as bank holding companies they now come under the FDIC umbrella and the implied protection that that brings. If there is a X rated version of "Dumb and Dumber," she should be the star.
Finally, it now appears that Helicopter Ben may well be back in trouble as to his re-confirmation. He deserves it, the jerk, and on top of it all he is now in a nasty little open-air brawl with John Taylor, now of Stanford over the "Taylor Rule" which the good prof feels Mr. Bernanke has deliberately mis-catorgorized. Academics at each other's throats!! Hide the Children! I could care less if the Chairman gets himself into this little brawls except that it does no good for his institution in these times. Somebody had better start standing up for the only group of people who actually know what the hell is going on out there otherwise we are heading for a real mess if not catastrophy .
Thursday, April 30, 2009
CINQUE CENTO
Petulant is probably too soft a description of The Leader's attitude this afternoon. He didn't get his way and was damn mad. In not being able to bully a group of bond holders to give up their legal rights and accept a crappy deal by which a Chrysler bankruptcy would have been prevented The Leader fell back on claims of anti-Americanism, excoriating all involved and pointing out the hedge fund involvement in particular. The Leader always plays to the masses; it is generally agreed that hedge fund is a four-letter word...or at least fund is. So now we are facing a chapter 11 filing that will settle things in, according to The Leader and Mr. Nardelli, no more than 60 days. Good luck to them. During this period, the Treasury (that means YOU) will put up debtor in possession financing in the amount of $3.5 billion and make available to Chrysler $8 billion to run the company after the proceeding is over. From then on it's away to the races with Chrysler making and selling, "The kind of cars Americans want to buy," according to The Leader, noted expert on motor cars who just a few short weeks ago thought the damn things were invented by Americans. Hummmm. Buy a car made by the management team of the UAW and Our Hero? I'm not sure I want to go there. But wait! As part of this proposed industrial juggernaut rides in FIAT in what must be the greatest parody of all spaghetti westerns to save the day!
Now FIAT is an Italian car company with a long, long history filled with success and...well, lets just say there have been some downs as well. FIAT made cars for the people of Italy in the same sense that Volkswagen made cars for the people of Germany, just not as well. Fiat is supposed to provide "world-class technology" for this happy union and one supposes they have some of that inasmuch as they own Ferrari which also makes cars that go very fast, cost up to half a mil and use about 5 liters of fuel (high test) to get around the block. They also make Il Cinque Cento which in English means the 500 which goes very far on very little fuel which is why The Leader loves this company so. The problem is the 500 isn't very big; to call it a sub-compact is being generous. Now I hate motor cars and know nothing about them but my neighbor out here in the heartland--let's call him Bubba--tells me the reason the damn thing goes forever on nuthin' is not because of technology but because it's so damn small. Bubba says if the wife put wheels on her washing machine she could call it a 500 but probably couldn't sell it 'cause, "it don't have no Eye-tal-in styling." Makes sense to me.
Anyway, this bunch is supposed to sell a hell of a lot of cars that Americans have never bought before but which The Leader loves, and make a hell of a lot of money in two years...assuming they are out of bankruptcy by that time. It may work. I think I will still keep driving my Acura.
What really is getting to me though, is why FIAT stayed around for this deal. I have a suspicion that they think they can make money if it works and not lose anything if it doesn't. Brilliant, eh? But what troubles me is that I have another suspicion that FIAT may be influenced by the involvement of the government in this transaction making it look very much like a European venue with which they are very familiar. FIAT and the government of Italy have had a close and meaningful (corrupt) relationship for years and both parties have benefited. They could be in for a real awakening for in Europe and especially in Italy politicians are honest; once they're bought they stay bought and you know exactly what you are getting. This is not to suggest that any of The Leader's people are corrupt--at least not lately--but it is to suggest that this mob will turn on a dime whenever the political winds change or when the UAW tells them how high to jump. If this thing doesn't get reorganized in a relatively short period of time, the internal relationships between the parties are going to be interesting to watch. Buona fortuna, FIAT. Forza Italia! I am also going to be fascinated to see how much and what kind of pressure The Leader is going to put on those traitorous hedge fund and bond management guys to fold. Hell, we don't want grand designs ruined by these bums trying to fulfill their fiduciary duties by managing their clients' moneies in the best possible manner. Not in The Leader's America by God!
Monday, April 27, 2009
WITH FRIENDS LIKE THIS...
There are the standard clips to Provide "balance;" testimonials to the fact that Mr. Geithner would never place personal relationships or the thought of personal reward before his duty as a public servant. Nor is there any real hint as to what might have motivated Mr. Geithner to take some of the positions he has taken over the past five years from which he might have personally benefitted. On the contrary, at about 400 Large a year, Our Hero seems to have severely underpaid given the company with whom he broke bread.
But this wasn't a puff piece, far from it. Nor was it intended to inspire confidence in the director of the finances of the western world. This was a hit job...an elegant hit job but a hit job none-the-less. So the question is, as my friend Guido would put it, who let out the contract on Our Hero? An even more interesting question would be why, and the final piece would be why the Times Mob would allow themselves to be used as the contractor and who is the button man in the organization?
The Times and Democratic politics are pretty much joined at the hip. Disagreements with the policies of this Administration are hardly drawn in bright, vivid colors but in shades and degrees of gray. Then why, one may ask, would they choose to place the supposed architect of the Administration in such a tenuous position as to suggest...nay...imply that he might be severely conflicted as a result of his relationships and past actions? The Times has for quite some time been suspect as the harbinger of policy shifts and pronouncements for their political favorites, not only through their editorial pages but through their news reporting as well (these days, admittedly, the distinction may be without a difference). Is this a warning to Our Hero that his actions are being watched verrrry carefully and a scenario being created for his ultimate demise, or is it just The Times sending a message on it's own that you are not doing what WE want you to do and you better start listening to us and in particular our op ed page guys and girls a lot more closely. Either way, the ante in this game has just gone up for Our Hero in a most unpleasant way. I must admit, however, that the reporting delivered more tid bits from inside the New York Fed than have been revealed in years. I'd certainly like to be in a couple of senior officers' luncheons over the next few days.
In a related financial event today (understatement) the new CEO of GM announced the long-awaited restructuring plan that ills Pontiac as a brand and, if agreed, turns over ownership of the company to the UAW and the government. The equity guys and the bond holders get it in the neck but as Maria Caruso Cabrera said on CNBC today that EVERYONE knew the union would come out in first place, so shed no tears gang, the fix was in. Smart lady. Now it is going to be interesting to see if the bond holder fold and take at best 10 cents on the dollar for a company who's future chance of success is somewhere between unknown and who cares. Actually, it will be important to witness how brutal the Administration plans to be in forcing this "solution" down the throats of the Bond guys in relation to their possible tactics with the banks. Bets anyone.
Sorry, it's a slow day when one has to get John LeCarre-like and talk about non-deals, but that's life in the mid west.
Monday, March 30, 2009
CLEAR AS MUD
This morning The Leader once again went on tv to talk motorcars. "Let me make this clear, we have no intention of running General Motors..." All we are going to do is fire the chairman, restructure the board, reinvent the strategic plan and in the mean time tell Chrysler to do a deal with Fiat within the next 30 to 60 days. Uh huh. The Leader appears to think this is arms length. In the midst of this little diversion from the Endless Campaign, Our Hero announced that the banks are going to need more money, Huh? Forty years or so ago, one of the best sports writers (or any kind of writer for that matter) Jimmy Breslin, wrote a book on the first year of the New York Mets entitled, "Can't anybody here play this game?" Where is Jimmy when you need him? If you aren't confused (and possibly scared to death) at this stage of the game it's because you haven't been listening. The administration's pronouncements of late seem to be a completely disjointed streams of consciousness with no coherency nor sense of plan with either a lack of regard as to the possible consequences or a total lack of understanding of the same. I spent a week one night with Jimmy in an East Side gin mill, but that's another story.
Imagine, placing Chrysler in a negotiating position with a non-American counterparty and giving them 30 days to do a deal. Now place yourself in the position of Fiat. Would you simply sit back and say, "Ima tink Ima gonna wait." Sure you would; that is unless you look at the fact that Chrysler has already taken The Leader's penny at which point you might say, "Ima no wanna no part of dis," and run like hell the other way. If Nardelli and his private equity bosses don't run lickety split into Chapter 11, I would be very surprised.
As for the case of GM. Remarkably, some of the talking heads are mouthing that this is really great because it shows how "tough" The Leader and his administration really are and how they are going to protect the public purse. I have a somewhat different view which holds that reality has finally caught up with the intense desire to protect the UAW at all costs and the next 60 days are going to be devoted to doing just that in a "pre-packaged" bankruptcy. To be honest, I have no idea what a pre-packaged bankruptcy is but I suspect it's something like all parties going in to court and telling the judge that we are all in agreement that this should be the restructuring plan. Now the last time I looked, GM operated in about 50 countries, every one of the 50 states, had uncountable subsidiaries and multiple thousands of supplier contracts not to mention equity and debt holders at multiple levels os seniority. Of course the Congress will have nothing to say about this either. Sixty days will bring us to the first of June. The weather will be nice by then. We can all pull out our lawn chairs, a case of suds in the cooler, sit in the sun and watch this one unfold because it's going to be better than a twi-nighter at Wrigley. While all of this was going on, Honda announced a new car to compete with the Prius which doesn't quite match Prius' MPG but is bigger, faster and has some pretty neat features. While the pricing is not certain, it appears that the top of the line, the car with all the bells and whistles will sell for under $27,000, including tax, tip and recappable tire. Next time someone gets a chance to communicate with The Leader at some televised town meeting, will you point out to him that Detroit can't MAKE a car for that price much less sell it at a profit.
So, what does this mean for Our Hero and his plan? Wellllll, if I were running a bank, would I really want to get involved with this mob where the deal changes by the hour and despite protestations of non-involvement, they appear to be simply idle comments made at the spur of the moment. And what of this up-coming "stress test" ...(doesn't that remind you of Al Gore's , "Lock Box?") GOD! Seems as though Our Hero has already made up his mind as to what he is going to find. And wouldn't you be wondering if there might be a pay-off at the end to another of the administration's favorite entities...Democrats run hedge funds as well and gave copious amounts to The Leader's campaign. And as to the real formulation of the plan and its structure: wouldn't you wonder about...
But that is for tomorrow. Stay tuned.