Over a $10 trillion dollar deficit today? That didn't happen on O's watch.

The messages you are viewing are archived/old.
To view latest messages and participate in discussions, select the boards given in left menu

they happened in London, England and you don't see people London whining and acting like the world is coming to the end. They got up and got on those darned buses and trains. These terrorists made very little headway at all yesterday.

You all don't get the point do you? You really don't. No matter where we are in the world you're going to find fault with it as long as it is done under conservative leadership.

For those of you who are not in love with our current POTUS, kindly skip over the first paragraph.

I'm about sick............

Dec. 12 (Bloomberg) -- The Federal Reserve refused a request by Bloomberg News to disclose the recipients of more than $2 trillion of emergency loans from U.S. taxpayers and the assets the central bank is accepting as collateral.

Bloomberg filed suit Nov. 7 under the U.S. Freedom of Information Act requesting details about the terms of 11 Fed lending programs, most created during the deepest financial crisis since the Great Depression.

The Fed responded Dec. 8, saying it's allowed to withhold internal memos as well as information about trade secrets and commercial information. The institution confirmed that a records search found 231 pages of documents pertaining to some of the requests.

"If they told us what they held, we would know the potential losses that the government may take and that's what they don't want us to know," said Carlos Mendez, a senior managing director at New York-based ICP Capital LLC, which oversees $22 billion in assets.

The Fed stepped into a rescue role that was the original purpose of the Treasury's $700 billion Troubled Asset Relief Program. The central bank loans don't have the oversight safeguards that Congress imposed upon the TARP.

Total Fed lending exceeded $2 trillion for the first time Nov. 6. It rose by 138 percent, or $1.23 trillion, in the 12 weeks since Sept. 14, when central bank governors relaxed collateral standards to accept securities that weren't rated AAA.

Congress is demanding more transparency from the Fed and Treasury on bailout, most recently during Dec. 10 hearings by the House Financial Services committee when Representative David Scott, a Georgia Democrat, said Americans had "been bamboozled."

Bloomberg News, a unit of New York-based Bloomberg LP, on May 21 asked the Fed to provide data on collateral posted from April 4 to May 20. The central bank said on June 19 that it needed until July 3 to search documents and determine whether it would make them public. Bloomberg didn't receive a formal response that would let it file an appeal within the legal time limit.

On Oct. 25, Bloomberg filed another request, expanding the range of when the collateral was posted. It filed suit Nov. 7.

In response to Bloomberg's request, the Fed said the U.S. is facing "an unprecedented crisis" in which "loss in confidence in and between financial institutions can occur with lightning speed and devastating effects."

The Fed supplied copies of three e-mails in response to a request that it disclose the identities of those supplying data on collateral as well as their contracts.

While the senders and recipients of the messages were revealed, the contents were erased except for two phrases identifying a vendor as "IDC." One of the e-mails' subject lines refers to "Interactive Data -- Auction Rate Security Advisory May 1, 2008."

Brian Willinsky, a spokesman for Bedford, Massachusetts- based Interactive Data Corp., a seller of fixed-income securities information, declined to comment.

"Notwithstanding calls for enhanced transparency, the Board must protect against the substantial, multiple harms that might result from disclosure," Jennifer J. Johnson, the secretary for the Fed's Board of Governors, said in a letter e-mailed to Bloomberg News.

"In its considered judgment and in view of current circumstances, it would be a dangerous step to release this otherwise confidential information," she wrote.

New York-based Citigroup Inc., which is shrinking its global workforce of 352,000 through asset sales and job cuts, is among the nine biggest banks receiving $125 billion in capital from the TARP since it was signed into law Oct. 3. More than 170 regional lenders are seeking an additional $74 billion.

Fed Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson said in September they would meet congressional demands for transparency in a $700 billion bailout of the banking system.

The Freedom of Information Act obliges federal agencies to make government documents available to the press and public. The Bloomberg lawsuit, filed in New York, doesn't seek money damages.

"There has to be something they can tell the public because we have a right to know what they are doing," said Lucy Dalglish, executive director of the Arlington, Virginia-based Reporters Committee for Freedom of the Press.

"It would really be a shame if we have to find this out 10 years from now after some really nasty class-action suit and our financial system has completely collapsed," she said.

The Fed lent cash and government bonds to banks that handed over collateral including stocks and subprime and structured securities such as collateralized debt obligations, according to the Fed Web site.

Borrowers include the now-bankrupt Lehman Brothers Holdings Inc., Citigroup and New York-based JPMorgan Chase & Co., the country's biggest bank by assets.

Banks oppose any release of information because that might signal weakness and spur short-selling or a run by depositors, Scott Talbott, senior vice president of government affairs for the Financial Services Roundtable, a Washington trade group, said in an interview last month.

"Americans don't want to get blindsided anymore," Mendez said in an interview. "They don't want it sugarcoated or whitewashed. They want the complete truth. The truth is we can't take all the pain right now."

The Bloomberg lawsuit said the collateral lists "are central to understanding and assessing the government's response to the most cataclysmic financial crisis in America since the Great Depression."

In response, the Fed argued that the trade-secret exemption could be expanded to include potential harm to any of the central bank's customers, said Bruce Johnson, a lawyer at Davis Wright Tremaine LLP in Seattle. That expansion is not contained in the freedom-of-information law, Johnson said.

"I understand where they are coming from bureaucratically, but that means it's all the more necessary for taxpayers to know what exactly is going on because of all the money that is being hurled at the banking system," Johnson said.

The Bloomberg lawsuit is Bloomberg LP v. Board of Governors of the Federal Reserve System, 08-CV-9595, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporters on this story: Mark Pittman in New York at mpittman@bloomberg.net;

He's talking about people that got schnuckered so they can keep their homes. Maybe they would reduce the principle, but that would also keep people in their homes and make the other homes in that neighborhood keep their value.

Do you understand the concept that if the homes around you go into foreclosure then that brings your home value down?

Peter Peterson. (Photo: Reuters)

Peter Peterson is coming to get your Social Security and Medicare. Peterson was the commerce secretary in the Nixon administration. He then went on to make billions of dollars as one of the top executives at the Blackstone Group, a private equity fund. Mr. Peterson is known as one of the top beneficiaries of the fund managers' tax break, through which he personally pocketed tens of millions of dollars.

Mr. Peterson has been using his Wall Street wealth to attack these social insurance programs for decades, but he recently stepped up his efforts. Last year, he spent $1 billion to endow the Peter G. Peterson Foundation to further his efforts.

In politics, it's not easy to counter the impact of $1 billion. In addition to its money, the Peterson crew enjoys the support of many important news outlets, most importantly The Washington Post, which pushes his line on both its editorial and news pages.

In fact, The Post even went so far as to identify Peterson's foundation by its boilerplate, an organization that "advocates for federal fiscal responsibility," instead of telling readers of its political leanings, the normal mode of identification for such organizations. (The Center for Economic and Policy Research was established "to promote democratic debate on the most important economic and social issues that affect people's lives.")

While the Peterson crew may have the money and the support of the media, the rest of us can rely on logic and ridicule to counter the attack. In this spirit, we have the Peter G. Peterson Intergenerational Fairness Tax Credit. (Mr. Peterson is apparently fond of having things named after him. In addition to his new Peter G. Peterson Foundation, he also has a think tank named after him, the Peter G. Peterson Institute for International Economics.)

The Peterson tax credit would essentially take the Peterson crew at their word. They claim that they are worried that huge tax burdens will leave future generations worse off than the generations that preceded them.

This isn't true. There is no plausible scenario, short of war or environmental disaster, that would leave future generations worse off than their parents or grandparents. But we don't have to argue with the billionaire; let's just give future generations the option to trade places with their parents or grandparents who made out so well.

This is where the tax credit comes in. The tax credit would allow an individual to trade her after-tax income for the after-tax income that someone born 20 or 40 years sooner would have earned at the same age. For example, if someone born in 1990 believes in 2020 that their grandparents got a better deal, they would simply check off the year 1940, and they would have their taxes adjusted so that they would have the same after-tax income of a person born in 1940, when they were also age 30.

Of course, the young ones would end up big losers in this story. Real wages, on average, will be more than 50 percent higher in 2020 than they were in 1970. Even if tax rates were, on average, 5 percentage points higher, workers in 2020 will still have after-tax wages that are more than 40 percent higher than their counterparts in 1970.

This means that anyone who chose to take advantage of the intergenerational equity tax credit would end up as a big loser. That is why it can help solve the deficit problem. If people check off the tax credit, they will pay more in taxes and, therefore, increase government revenue.

It might be hard to convince large numbers of people to voluntarily pay more in taxes. This is where the Peterson Foundation comes in. They are spending huge amounts of money trying to convince young people that they are being ripped off by their parents and grandparents. They are even promoting front groups of young people to advance this effort.

With his billion dollars, Peterson could convince a huge number of gullible young people to tax advantage of the intergenerational equity tax credit. Insofar as he is successful in this effort, he can help to generate billions of dollars that can be used for items like health care, preschool education, and other pressing needs.

So, let's join efforts with Mr. Peterson and encourage his followers to take advantage of the Peter G. Peterson Intergenerational Fairness Tax Credit. There is a word for taking money from willfully ignorant young people who would deny their parents and grandparents the Social Security and Medicare benefits they need to survive: justice.

how do you know no one has anyone serving over there. You have no way of knowing that.

Now, what Americans need to understand is that that means every single day of the year, our government goes into the market and borrows money from other countries to finance Iraq, Afghanistan, Katrina and our tax cuts, Clinton added. We depend on Japan, China, the United Kingdom, Saudi Arabia and Korea primarily to basically loan us money every day of the year to cover my tax cut and these conflicts and Katrina. I don't think it makes any sense. I think it's wrong.

Clinton also discussed bringing world leaders together to combat the world's chronic problems � including extreme poverty, global warming and religious conflicts � as well as the Hurricane Katrina recovery effort and Hillary Clinton's political future.

STEPHANOPOULOS: We're here on your initiative, and I want to talk about that, but let's begin with Katrina. President Bush has brought you into the recovery effort, but he's not taking all of your advice. You say roll back the tax cuts for the wealthy. He says no tax increase of any kind. We're spending $5 billion a month in Iraq, probably $200 billion on Katrina. Something's got to give.

CLINTON: Well, that's what I think. I think this idea � I think it's very important that Americans understand, you know, tax cuts are always popular, but about half of these tax cuts since 2001 have gone to people in my income group, the top 1 percent. I've gotten four tax cuts.

They're responsible for this big structural deficit, and they're not going away, the deficits aren't. Now, what Americans need to understand is that that means every single day of the year, our government goes into the market and borrows money from other countries to finance Iraq, Afghanistan, Katrina and our tax cuts. We have never done this before. Never in the history of our republic have we ever financed a conflict, military conflict, by borrowing money from somewhere else.

CLINTON: They should continue to oppose it, and they should make it an issue in the 2006 election, and they should make it an issue in the 2008 election. And they should hope, to goodness, for the sake of our country, that the cows don't come home before we have time to rectify it.

I mean, sooner or later, just think what would happen if the Chinese � We're pressing the Chinese now, a country not nearly rich as America per capita, to keep loaning us money with low interest to cover my tax cut, Iraq, Afghanistan, and Katrina and at the same time to raise the value of their currency so their imports into our country will become more expensive, and our exports to them will become less expensive. And by the way, we don't want to let them buy any oil companies or anything like that.

So what if they just got tired of buying our debt? What if the Japanese got tired of doing it? Japan's economy is beginning to grow again. Suppose they decided they wanted to keep some of their money at home and invest it in Japan, because they're starting to grow?

We depend on Japan, China, the United Kingdom, Saudi Arabia and Korea primarily to basically loan us money every day of the year to cover my tax cut and these conflicts and Katrina. I don't think it makes any sense. I think it's wrong.

STEPHANOPOULOS: Is there anything coming out of this initiative here that you can apply directly to Katrina and the poverty we saw revealed there?

CLINTON: Oh, yes, we have raised quite a bit of money for Katrina here. And former President Bush and I, you know, we were asked to raise money. We already have $90 million to $100 million. And what we're trying to do is make sure that our money goes directly to the poorest people who have been dislodged by working with church groups and others. We're working on some mechanisms now to do that, and we'll have some announcements in the next week or so.

But I think there will be a lot of money coming forward from the federal government. A lot of it will be necessary, you know, to build the infrastructure, rebuild the fabric of life and not simply in New Orleans but along the Gulf Coast.

CLINTON: Yes; you know, keep in mind, Mississippi was devastated. Everything from a mile in Mississippi was blown down, and Alabama, but we've got to do that.

STEPHANOPOULOS: Excuse me; the problems of race that were tied to poverty here, and I know you don't think there's any conscious racism at play in the response, but we saw one more time blacks and whites looked at this event through very different eyes. What can President Bush do about that, and looking back, do you think there was anything more you could have done as president?

CLINTON: Well, I think we did a good job of that. For example, we had the lowest African-American unemployment, the lowest African-American poverty rate ever recorded. We had the highest homeownership, highest business ownership, and we moved 100 times as many people out of poverty in eight years as had been moved out in the previous 12 years.

This is a matter of public policy, and whether it's race-based or not, if you give your tax cuts to the rich and hope everything works out all right, and poverty goes up, and it disproportionately affects black and brown people, that's a consequence of the action made. That's what they did in the '80s; that's what they've done in this decade.