It is very easy for someone to say that a plan will not work and criticize it excessively.  It is much more difficult to offer sound alternative solutions in the light of such criticism.  Every time I hear the President speak I walk away feeling completely confident of our eventual recovery.  So I pull up my bootstraps and head out to do my part by using a small amount of purchasing power to help in the cause.  Just as I’m about to head for the door, I hear someone from the GOP screaming ‘oh my goodness…..the sky is falling….the sky is falling.’  So what do I do instead….I go out and buy an umbrella. 

The GOP has been all over the Sunday shows and the political spectrum shouting that the budget proposed by President Obama spends too much and will impose insurmountable debt on future generations.  Such an argument confuses the immediate priorities.  Who amongst us would forgo an opportunity to provide our starving child with food knowing that it will result in a larger credit card bill next month even if there was a possibility that the grocer may not accept credit and you may walk away empty handed.  In times of emergency all reasonably viable opportunities must be pursued.  Besides, give a child a fish and he/she will eat for a day. Teach a child to fish and he/she will eat for a lifetime. It is a much better proposition to sacrifice the funds now and clean up the ocean so that future generations can eat for a lifetime.

Unfortunately, the GOP have failed miserably at offering any plausible alternatives to the president’s budget that have not already been tried during the eight years of the Bush administration.  In spite of the fact that the GOP has all of a sudden got fiscal religion, lets revisit history for a moment in terms of its fiscal track record.  The budget was balanced for the first time in 30 years under President Bill Clinton.  That means that the four Republican presidents preceding Clinton (Reagan, Bush 41, Nixon, Ford) and the single democratic president (Carter) could not balance the budget.  Lets also remember that President Bush and a republican controlled Congress entered office with a 86.4 billion dollar surplus.  President Bush, with the help of a GOP controlled Congress six out of his eight years in office, left the presidency and the country with a staggering $638 billion dollar deficit.  One wonders if on the Titanic the GOP were the ones bailing water into the ship. Needless to say, the Republican party has absolutely no credibility when it comes to debt left to future generations or fiscal discipline in general.

The President proposes that the best way to bring down our deficit is to have a budget that leads to broad economic growth. It also makes sense that the president’s budget is inseparable from our economic recovery because it lays the necessary foundation for a secure and lasting prosperity.  The administration plans to create a new foundation for the economy by creating a new health care system, new energy technology, and achieving great progress in education so that it will enable us to become a much stronger competitor in the global economy.  There is an enormous need to counter the incredible drop in demand currently plaguing the nation and pull us out of this crisis.  The only sector with money to do so is the government.  That means that the government is the liquidity source of last resort right now. It must spend to stimulate demand and prevent us from sinking into a depression. As a matter of fact, the Congressional Budget Office (CBO), a nonpartisan body, says that the adoption of the Reinvestment and Recovery Act will help to end the recession by fall of this year. 

We must make the necessary investments in education, health care, and renewable energy infrastructure now in order to equip future generations for future and sustained prosperity.  So instead of just putting a band-aid on the broken economy this administration has opted to confront it, operate, and heal it.  The biggest drain on future funds is health care.  More specifically, Medicare and Medicaid.  Therefore, investing in an information technology system to make the health care industry more efficient will also contribute significantly to decreasing our deficit. Now that all the relevant players in the health care industry now recognize that the industry must be reformed including the majority of the GOP, twelve years later, but at least they are on board now, now in the time to do it.  We must face the fact that we as a people must make a tectonic shift in how we move throughout or day to day lives.  During this challenging time it will be inconvenient and we will have to make sacrifices now in order to secure a prosperous future.

Other obstructionist arguments offered by the GOP.

 The GOP argues that the small businesses will be hurt most by a tax increase on Americans making over $250,000 a year.

According to Politifact, a small business would have to ”make” $250,000 in net profit after deducting all his expenses (employees pay, supplies, and other legitimate business expenses) to be subject to the tax increase.  The nonpartisan Tax Policy Center says that only two percent of small businesses will be subject to the tax increase.  Which means that 98 percent will more than likely receive a tax cut.

Charities will lose by a decrease in the deductions allowed for charitable giving by the wealthy.  There will be a cap on such deductions for those earning $250,000 or more a year.

The best way to encourage and enable charitable giving is to have a flourishing economy. When the economy is booming people are much more charitable. In addition, a significant amount of charitable giving comes from low income people through religious institutions etc.

Requires a Cap and Trade or energy tax on all Americans.  

The cap and trade plan is designed to reduce green house emissions and address climate change in addition to investing in necessary infrastructure building. Further, building such infrastructure will enable us to decrease our dependence on foreign oil.  The plan will also move toward providing us with alternative sources of energy and provide millions of green jobs in the process.  Not to mention that it will help us to become an energy producing rather than an energy consuming economy.  This part of the president’s budget is a necessary investment in our infrastructure, by way of updating the electric grid among other things, for the jobs of the future.  Our outdated electricity grid is costing the U.S. over $100 billion dollars a year.  It wastes twice as much energy as it did thirty years ago.  We need to update and modernize our energy grid.  The GOP has criticized this part of the budget by referring to it as an energy tax. Why you ask? Because the GOP is significantly dependent on oil company money and it is not in the interest of the oil industry for the U.S. to become less oil dependent.  Why you ask?  Because the cap and trade plan will result in consumers using less energy (driving less)which cuts into oil industry profits.

Repealing tax credits to the oil and gas industry that may result in putting the industry at a competitive disadvantage.

Exxon Mobil shatters U.S. records in January 2009 by reporting profits of 45.2 billion for 2008.   Nuff said.

Where is the GOP’s budget you ask? They don’t have one.

The Obama administration has decided that General Motors CEO Rick Wagoner must go if the company plans to restructure in manner sufficient to make it profitable.  The government rejected the restructuring plans of General Motors and Chrysler and has given GM sixty days to come up with a better plan.  Chrysler has received an additional thirty days.  Wagoner was replaced as CEO by Fritz Henderson, the company’s vice chairman and chief operating officer.

Kent Kresa, a former chairman and CEO of Northrop Grumman Corp., has been named interim chairman.  Kresa released the following statement:

“The board has recognized for some time that the company’s restructuring will likely cause a significant change in the stockholders of the company and create the need for new directors with additional skills and experience,” Kresa said in a written statement.

Remarks of President Barack Obama
Weekly Address
Saturday, March 28, 2009
Washington, DC

 
Even as we face an economic crisis which demands our constant focus, forces of nature can also intervene in ways that create other crises to which we must respond – and respond urgently. For the people of North and South Dakota and Minnesota who live along rivers spilling over their banks, this is one such moment.

Rivers and streams throughout the region have flooded or are at risk of flooding. The cities of Fargo and neighboring Moorhead are vulnerable as the waters of the Red River have risen. Thousands of homes and businesses are threatened.

That is why, on Tuesday, I granted a major disaster declaration request for the State of North Dakota and ordered federal support into the region to help state and local officials respond to the flooding. This was followed by an emergency declaration for the State of Minnesota.  And we are also keeping close watch on the situation in South Dakota as it develops.

The Department of Homeland Security and the Federal Emergency Management Agency continue to coordinate the federal response.  Homeland Security Secretary Janet Napolitano is helping to oversee federal efforts and she remains in close contact with state officials. Acting FEMA administrator Nancy Ward has been in the region since yesterday to meet with folks on the ground and survey the area herself.

In addition, The U.S. Army Corps of Engineers is assisting in the emergency construction of levees. The Coast Guard is aiding in search and rescue efforts while the Department of Defense is helping to move people and supplies. Members of the National Guard have been activated and are on the scene as well.

Hospitals and nursing homes in the area are being evacuated and residents in poor health or with special needs are being transported to higher ground. Teams from the Department of Health and Human Services are aiding in this work. And the Red Cross is in place to provide shelter and supplies for folks in need.

It is also important for residents in these states to remain vigilant in monitoring reports on flood crests and to follow instructions from their state and local leaders in the event that evacuations become necessary.

My administration is working closely with Governors John Hoeven, Mike Rounds and Tim Pawlenty. And I’ve been meeting with Senators Byron Dorgan, Kent Conrad, and Amy Klobuchar, as well as Congressmen Earl Pomeroy and Collin Peterson, to pledge my support. I will continue to monitor the situation carefully. We will do what must be done to help in concert with state and local agencies and non-profit organizations – and volunteers who are doing so much to aid the response effort. 

For at moments like these, we are reminded of the power of nature to disrupt lives and endanger communities. But we are also reminded of the power of individuals to make a difference.

In the Fargodome, thousands of people gathered not to watch a football game or a rodeo, but to fill sandbags. Volunteers filled 2.5 million of them in just five days, working against the clock, day and night, with tired arms and aching backs. Others braved freezing temperatures, gusting winds, and falling snow to build levees along the river’s banks to help protect against waters that have exceeded record levels.

College students have traveled by the busload from nearby campuses to lend a hand during their spring breaks. Students from local high schools asked if they could take time to participate. Young people have turned social networks into community networks, coordinating with one another online to figure out how best to help.

In the face of an incredible challenge, the people of these communities have rallied in support of one another. And their service isn’t just inspirational – it’s integral to our response.

It’s also a reminder of what we can achieve when Americans come together to serve their communities.  All across the nation, there are men, women and young people who have answered that call, and millions of other who would like to. Whether it’s helping to reduce the energy we use, cleaning up a neighborhood park, tutoring in a local school, or volunteering in countless other ways, individual citizens can make a big difference.

That is why I’m so happy that legislation passed the Senate this week and the House last week to provide more opportunities for Americans to serve their communities and the country.

The bipartisan Senate bill was sponsored by Senator Orrin Hatch and Senator Ted Kennedy, a leader who embodies the spirit of public service, and I am looking forward to signing this important measure into law.

In facing sudden crises or more stubborn challenges, the truth is we are all in this together – as neighbors and fellow citizens.  That is what brought so many to help in North Dakota and Minnesota and other areas affected by this flooding.  That is what draws people to volunteer in so many ways, serving our country here and on distant shores.

Our thanks go to them today, and to all who are working day and night to deal with the disaster.  We send them our thoughts, our prayers, and our continued assistance in this difficult time.

Thank you.

Click here for full transcript

Treasury Secretary Geithner will appear before Congress today to propose his plan to address the current state of the financial industry.

The administration’s signature proposal is to vest a single federal agency with the power to police risk across the entire financial system. The agency would regulate the largest financial firms, including hedge funds and insurers not currently subject to federal regulation. It also would monitor financial markets for emergent dangers.

Geithner plans to call for legislation that would define which financial firms are sufficiently large and important to be subjected to this increased regulation. Those firms would be required to hold relatively more capital in their reserves against losses than smaller firms, to demonstrate that they have access to adequate funding to support their operations, and to maintain constantly updated assessments of their exposure to financial risk.

The designated agency would not replace existing regulators but would be granted the power to compel firms to comply with its directives. Geithner’s testimony will not identify which agency should hold those powers, but sources familiar with the matter said that the Federal Reserve, widely viewed as the most obvious choice, is the administration’s favored candidate.

See the remainder of the article here.

Officials of the Treasury Department speaking on the condition of anonymity spoke about the three major parts of the Treasury department’s plan to reboot the economy and get the banks to start lending again.   Treasury expects to remove as much as $1 trillion in toxic assets from the banks ledgers freeing such banks up to resume normal lending.  The administration plans to rely on the Federal Reserve and the Federal Deposit Insurance Corporation for funding the plan.  Treasury Secretary Tim Geitner is rumored to make the official announcement fifteen minutes before the opening bell of Wall Street today.  See below for the basics.

_a public-private partnership to back private investors’ purchases of bad assets. The $700 billion bailout fund would provide the backing. The government would match private investors dollar for dollar and share any profits equally.

_expanding a recent Fed program that provides loan for investors to buy securities backed by consumer debt. It’s an effort to make it easier for people to get auto, student and credit card loans. The Term Asset-Backed Securities Loan Facility (TALF) program is getting up to $100 billion from the bailout fund; that money then is being leveraged to support up to $1 trillion in Fed loans. Under Geithner’s plan for the toxic assets, part of that $1 trillion would now go to support purchases of banks’ troubled assets.

_using the FDIC, which guarantees bank deposits, to purchase toxic assets. Officials said the agency would create special investment partnerships and then lend them money to buy up troubled assets.

Economists Reactions
“The key is going to be if the government buys these assets quickly,” said Mark Zandi, chief economist at Moody’s Economy.com. “The sooner they get these assets off banks’ balance sheets, the quicker the system will find its footing and get the economy moving again.”

“The market is looking for a `wow’ factor where they can see the administration is finally doing enough,” said Sung Won Sohn, an economics professor at the Smith School of Business at California State University.

Representative and Chairman of the House Ways and Means Committee Charles Rangel will introduce legislation on the floor of the House that will tax the AIG bonus receivers at a ninety percent rate leaving the state governments to tax the remaining ten percent.  Ultimately the employees will not receive any of the funds.  AIG CEO, Edward Liddy, testified yesterday that the bonuses were given to employees as retention bonuses and were intended to incentivize for such employees to wrap up their book of business in a manner satisfactory to AIG.  To be honest these bonuses are a mere drop in a billion dollar bucket.  This writer is more concerned with the billions of dollars given by AIG to foreign banks after receiving the bailout funds. The executive bonus scandal seems to be more of a diversion to distract the American people away from what is really going on.

WASHINGTON — Rep. Charles Rangel says the House plans to take up a bill Thursday that would impose a 90 percent tax on bonuses paid to top-earning employees at AIG and other companies receiving big government bailouts.

The New York Democrat, who chairs the tax-writing House Ways and Means Committee, said Wednesday the tax would hit employees making more than $250,000 a year.

He said the $5 billion threshold for companies to be covered would exclude community banks and other smaller companies that have received bailout money.

 This is what happens when corporations blog.  The following post was from Peter Tulupman of AIG.

Peter Telupman, January 13, 2009 

First, here are the facts regarding AIG’s compensation practices, and more specifically, the importance to the American taxpayer of retaining talented people in AIG’s businesses. We fully understand the concerns surrounding executive compensation, which have been capped at the highest levels of AIG. Our new Chairman and CEO, Edward Liddy, will receive an annual base salary of $1 for 2008 and 2009.  He will not receive a bonus in those years.  Also, AIG’s top seven officers will not receive annual bonuses for 2008 performance or salary increases through 2009, and AIG’s top 60 managers will not receive salary increases through 2009.

At the same time, our plan to pay back taxpayers is predicated on the divestiture of our assets to strong, competent buyers. To do that, AIG must preserve the value of its businesses, which is based on the people who work for us and, in particular, the strong and experienced leadership of key business units. Talented management is important both to the lines of business that will remain part of AIG going forward, and attractive to prospective buyers in any asset sales.

That is where the retention comes in – trying to keep your key players who have the best business relationships and the best specialized knowledge about the business in place. This applies to the property/casualty businesses AIG plans to keep and helps AIG get the best value for other businesses AIG is selling to pay back the government. For AIG to compete moving forward and to get best value for these businesses, AIG needs people to stay. If you’re selling the Cleveland Cavaliers, the team would be worth a lot more with Lebron James than without him.  

But even with retention, compensation is down. Including retention payments, compensation for our top five officers was down 60 percent in 2008 vs. 2007. For our top 60 officers, compensation was down 40 percent in 2008 vs. 2007, including retention. So this is a small investment on our part to repay taxpayers.

Second, there were a number of questions related to what happened to AIG, how AIG is managing the government’s investments and support, and where we go from here. To address each of those topics, I’d like to point you to a speech that Mr. Liddy gave a couple weeks ago in Hong Kong, where he addressed each of these areas with some degree of specificity. The speech is available at  www.aig.com/movingforward(where we also house updates on our situation).
Thank you again for following AIG, and for your patience as we continue to adapt to this process.

A few more questions and answers:

AIG’s role in health insurance plans and health care reform.

First, AIG is not a provider of traditional healthcare insurance, nor does AIG compete with healthcare insurance providers. AIG provides life, property and casualty insurance and does offer some health-related insurance products that pay insureds cash for medical expenses or lost income resulting from illness or accidental bodily injury.  This same Daily Kos reader asks if “AIG (will) remove itself from the American’s Health Insurance Plans lobbying firm” and if the company will “support a public option to any health care reform that passes.”   AIG has stopped all federal lobbying activities. In the past, AIG has never lobbied for or against health care reform.

Would you be willing to tell us how many employees you have in the following categories?More than $2 million/year:
$1-2 million/year:
$500,000 – $1 million/year:
$250,000 – $500,000/year:
$100,000 – $250,000/year:
$80,000 – $100,000/year:
$60,000 – $80,000/year:
$40,000 – $60,000/year:
< $40,000/year:

During the last several months, AIG has disclosed various voluntary compensation restrictions for our top executives, including a $1 salary for our CEO; no 2008 annual bonuses and no salary increases through 2009 for AIG’s top-seven-officer Leadership Group; and no salary increases through 2009 for the 50 next-highest executives, in addition to other bonus, severance and retention award restrictions.

Does AIG own any jets? If so will you sell them and start flying all your executives in coach?

AIG owns eight jets, all of which were purchased before September 2008.

AIG has sold three jets and a helicopter, has two more jets for sale and will divest itself of two other jets when it sells its domestic life operations and American General Finance.  Unfortunately, current market conditions, combined with an increase in the number of corporate aircraft available for sale have created a very difficult sales environment for private aircraft.  AIG uses its private aircraft sparingly. In fact, usage for 0ctober, November and December 2008 was reduced 56 percent, 71 percent and 47 percent respectively compared with the same months during 2007.

When Robin Roberts on Good Morning America asked First lady Michelle Obama her thoughts upon hearing that many military families are having to go on food stamps in order to make ends meet, Mrs. Obama demonstrated why she is the best person to be in the position of First Lady at this moment. The compassion and committment to real people with real issues is what put this family in the White House at THIS time. Below are some of the excerpts from the First Lady’s interview.

It hurts. It hurts,” the first lady said of hearing about military families on food stamps. “These are people who are willing to send their loved ones off to, perhaps, give their lives — the ultimate sacrifice. But yet, they’re living back at home on food stamps. It’s not right, and it’s not where we should be as a nation.”

“I think that’s one of my jobs, is to try and shed some light on some of these issues,” she said, “to not just be in that conversation with military spouses and hear those stories, but to take that information back to the administration to share it with the nation, so that we can think again about how we can better support these families.”

The Securities and Exchange Commission may be giving Mr. Cramer a call.  

-On manipulating the market: “A lot of times when I was short at my hedge fund, and I was positioned short, meaning I needed it down, I would create a level of activity before hand that could drive the futures,”

-On falsely creating the impression a stock is down (what he calls “fomenting”): “You can’t foment. That’s a violation… But you do it anyway because the SEC doesn’t understand it.” He adds, “When you have six days and your company may be in doubt because you are down, I think it is really important to foment.”

Sen. Arlen Specter was interviewed by a Pennsylvania morning radio this morning and had the following to say about RNC Chairman Michael Steele and Rush Limbaugh.  See the transcript below.

NANCY: Let me ask you this now. Where do you stand with Rush Limbaugh? Because Rush Limbaugh has not said many pleasant things about you over the years, and I know you weren’t one of his favorite with the latest spending bill. But where do you stand on him, because it’s been interesting to watch what’s been going on with Michael Steele and other Republicans ho speak out against Rush Limbaugh? Where do you stand with him? Where do you stand with him?

SPECTER: Nancy, I think it’s a free country and we ought to let Rush Limbaugh express himself. I think that when the White House attacks him, they’re making a mistake for a couple of reasons. One reason is he’s got a right to say what he likes. And when you get into a fight with the White House, it elevates the guy who’s fighting with the White House.

KEVIN: Absolutely. What a mistake.

SPECTER: And national chairman Steele, well he’s said so many contradictory things I wouldn’t pay a whole lot of attention to him.

KEVIN: [Laughter]

NANCY: So what’s going on with the Republican Party? Who’s leading it?

SPECTER: Well, [laughs] I’m trying to lead it, Nancy. Moving more toward the center, which is where America wants to be governed. I’m trying to put up programs on health care, where I’ve got my legislation, to save the mortgage market, on ways to handle the economy, I’m trying to provide that leadership. But right now, it’s fairly well splintered. When you lose two big elections in 2006 and 2008, you asked about my opponent from the last election — his group the Club for Growth was directly responsible for defeating Sen. Chafee in Rhode Island. And had he been elected, we would have maintained control of the Senate during that two year period. So the leadership right now in the face of those two defeats is pretty splintered. There are a few of us trying to bring it back in a sensible, centrist approach.

Please read our post on 03/06/2009 that posits why we should not trust CNBC analyst and Jim Cramer in particular.

Weekly Address

Saturday, March 7, 2009

Washington, DC

Yesterday, we learned that the economy lost another 651,000 jobs in the month of February, which brings the total number of jobs lost in this recession to 4.4 million.  The unemployment rate has now surpassed 8 percent, the highest rate in a quarter century.

     These aren’t just statistics, but hardships experienced personally by millions of Americans who no longer know how they’ll pay their bills, or make their mortgage, or raise their families. 

     From the day I took office, I knew that solving this crisis would not be easy, nor would it happen overnight.  And we will continue to face difficult days in the months ahead.  But I also believe that we will get through this — that if we act swiftly and boldly and responsibly, the United States of America will emerge stronger and more prosperous than it was before. 

     That’s why my administration is committed to doing all that’s necessary to address this crisis and lead us to a better day.  That’s why we’re moving forward with an economic agenda that will jumpstart job creation, restart lending, relieve responsible homeowners, and address the long-term economic challenges of our time:  the cost of health care, our dependence on oil, and the state of our schools. 

     To prevent foreclosures for as many as 4 million homeowners — and lower interest rates and lift home values for millions more — we are implementing a plan to allow lenders to work with borrowers to refinance or restructure their mortgages.  On Wednesday, the Department of Treasury and Housing and Urban Development released the guidelines that lenders will use for lowering mortgage payments.  This plan is now at work.

     To restore the availability of affordable loans for families and businesses — not just banks — we are taking steps to restart the flow of credit and stabilize the financial markets.   On Thursday, the Treasury Department and the Federal Reserve launched the Consumer and Business Lending Initiative — a plan that will generate up to a trillion dollars of new lending so that families can finance a car or college education — and small businesses can raise the capital that will create jobs.

     And we’ve already begun to implement the American Recovery and Reinvestment Act — a plan that will save and create over 3.5 million jobs over the next two years — jobs rebuilding our roads and bridges, constructing wind turbines and solar panels, expanding broadband and mass transit.  And because of this plan, those who have lost their job in this recession will be able to receive extended unemployment benefits and continued health care coverage, while 95 percent of working Americans will receive a tax break beginning April 1st.

     Of course, like every family going through hard times, our country must make tough choices.  In order to pay for the things we need — we cannot waste money on the things we don’t. 

     My administration inherited a $1.3 trillion budget deficit, the largest in history.  And we’ve inherited a budgeting process as irresponsible as it is unsustainable.  For years, as Wall Street used accounting tricks to conceal costs and avoid responsibility, Washington did, too.

     These kinds of irresponsible budgets — and inexcusable practices — are now in the past.  For the first time in many years, my administration has produced a budget that represents an honest reckoning of where we are and where we need to go.

     It’s also a budget that begins to make the hard choices that we’ve avoided for far too long — a strategy that cuts where we must and invests where we need.  That’s why it includes $2 trillion in deficit reduction, while making historic investments in America’s future.  That’s why it reduces discretionary spending for non-defense programs as a share of the economy by more than 10 percent over the next decade — to the lowest level since they began keeping these records nearly half a century ago.  And that’s why on Wednesday, I signed a presidential memorandum to end unnecessary no-bid contracts and dramatically reform the way contracts are awarded — reforms that will save the American people up to $40 billion each year.

     Finally, because we cannot bring our deficit down or grow our economy without tackling the skyrocketing cost of health care, I held a health care summit on Thursday to begin the long-overdue process of reform.  Our ideas and opinions about how to achieve this reform will vary, but our goal must be the same:  quality, affordable health care for every American that no longer overwhelms the budgets of families, businesses, and our government.

     Yes, this is a moment of challenge for our country.  But we’ve experienced great trials before.  And with every test, each generation has found the capacity to not only endure, but to prosper — to discover great opportunity in the midst of great crisis.  That is what we can and must do today.  And I am absolutely confident that is what we will do.  I’m confident that at this defining moment, we will prove ourselves worthy of the sacrifice of those who came before us, and the promise of those who will come after. 

It turns out that Jim Cramer along with other cronies within the Wall Street chattering class may not always be on the up and up when predicting how well a company or stock is doing.  Read the following account of how CNBC and many of their financial “journalist” are manipulating Wall Street for their own personal gain.  This relates to the current financial crisis because the SEC is currently investigating whether abusive or illegal practices such as those described below brought down Bear Stearns and Lehman.

This rabbit hole involves the thugs surrounding Jim Cramer and some of the top financial “journalists” from the New York Times, WSJ, Fortune magazine and BusinessWeek, top hedge funds, the Mafia, and the DTCC. It also includes “blackmail, smear campaigns, espionage, fraud, harassment, extortion, bribery, rumor-mongering, sabotage, off-shore money laundering, political cronyism, frivolous lawsuits, witness tampering, biased financial research, false identities, bogus credit ratings, bribery, libelous blogs, bad science, forgery, wiretapping, counterfeiting, collusion, lying, cheating, threats and theft.”

Apparently Cramer and his wife had figured out how to manipulate the markets by way of the media long before his entry into television punditry.   This is directly from Cramer himself:

“We had it down to a science in 1992: my wife would pick stocks that technically looked ready to go up, or she would keep track of merchandise to see what was down to tag ends. She would then generate a list of stocks that could move quickly on good news. Jeff would then go to work calling the companies to try to find anything good we could say about them. I would call the analysts to see I they were hearing anything. When we found a stock that looked ready technically to break out, or where the supply had been mopped up, and Jeff found something positive at the company, and I knew the analyst community didn’t know anything positive, we would load up with call options and common stock and then give the good news to our favorite analysts who liked the stock so they could go do their promotion. That would get the buzz going and we would then be able to liquidate the position into the buzz for a handsome profit.” (Confessions of a Street Addict, page 61).

More detail about Cramer’s background from the distinguished and highly repected business editor and financial reporter for the Columbia Journalism Review Mark Mitchell.

Cramer, who is a sociopath, owns TheStreet.com with Marty Peretz, who is an aristocrat. Peretz is also the former editor of the New Republic magazine. He dabbles in high finance and Harvard professing, which has resulted in his entrusting a large portion of his family fortune to a close-knit group of hedge fund managers, several of whom were his students. For example, Cramer was his student. Then Cramer was destitute. He lived in a car with a loaded gun hidden under the seat. Eventually, though, Peretz gave Cramer some money to start a hedge fund, which Cramer managed with celebrated ruthlessness until he resolved to seek spiritual enlightenment as a TV news host.

Cramer had originally planned to run his hedge fund out of the offices of Ivan Boesky. Shortly before he was to move in, however, the feds busted Boesky for insider trading, making him one of the most famous criminals of the 1980s. (This is not necessarily to suggest that Boesky is the “Sith Lord” mentioned in Patrick’s “Miscreants Ball” presentation. Some people have wagered that Patrick was referring to Michael Milken, a business colleague of Boesky known as the “junk bond king,” who also went to prison in the 1980s. Patrick has since modified the analogy, saying that the crime has multiple masterminds – “like Al Qaeda”).

When Boesky went to prison, Cramer worked instead with hedge fund manager Michael Steinhardt. The media portrays Steinhardt as a financial wizard, a deep thinker and an all-around swell guy. The truth is, he’s a thug who perfected the concept of trading on privileged information, and pounded it into the heads of his employees. “What’s your edge!?” he’d shout, pacing his trading room floor. “What’s your fucking edge!?” After one of Steinhardt’s tirades, a top employee (and the godfather to Steinhardt’s children) had a heart attack. It is said that Steinhardt showed no remorse.

Indeed, Steinhardt has one of the most fearsome reputations on Wall Street. Which is perhaps unsurprising given that Steinhardt’s father, Sol “Red” Steinhardt, was a mobster once described by a Manhattan district attorney as the biggest Mafia fence in America. Steinhardt Sr. worked for the Genovese organized crime family, with goons like Meyer Lansky and Vinnie “Blue Eyes” Alo, before he was sentenced to a number of years in Sing-Sing prison.

By Steinhardt Jr.’s own account, the principal partners in his first hedge fund were the Genovese Mafia, Ivan Boesky, Marty Peretz (the aristocrat who funded Cramer), and a man named Marc Rich. Rich is closely connected to Ronald Greenwald, described in the authoritative book Red Mafiya as the man who, along with the Genovese family, brought the Russian Mob to America.

In 1983, Rich was indicted for trading illegally with Iran while Islamic revolutionaries were holding the American embassy hostage in Tehran. Along with his associate, “Pinky” Green, he fled to Switzerland. In 2001, Steinhardt, a big-time operator in Democratic circles, convinced Bill Clinton to give Rich a scandalous presidential pardon, but Rich remains in Switzerland to avoid paying his tax bill.

In the early 1990s, Steinhardt shut down his hedge fund after he was implicated in a scheme to corner the U.S. treasuries market – a horrendous infraction with serious implications for the U.S. economy.

So this is a rough crowd. Says one Wall Street trader: “It was the day the bad guys came to town — when Steinhardt and his people arrived.”

One of Steinhardt’s people is Jim Cramer. Another is Cramer’s wife, who was known as the “Trading Goddess” when she worked as Steinhardt’s head trader. Maria Bartiromo, a CNBC anchor known as the “Money Honey,” is married to the top partner in Steinhardt’s newest hedge fund. (A former employee of Cramer’s hedge fund has written that Cramer often fed tips to the Money Honey, trading ahead of her stories, and it is rumored that she recruited him to CNBC.)

And then there is David Rocker, the short-selling hedge fund manager believed to be scheming, along with Cramer and Herb, with Gradient Analytics, the financial research shop under SEC investigation in 2006.

Cramer says he’s met Rocker only once – apparently while squeezing the grapefruit at some grocery store. But the truth is, Cramer knows Rocker well. Rocker is a former employee of Steinhardt’s hedge fund. He worked there at the same time as the Trading Goddess.

And, until recently, Rocker was the largest outside shareholder in Cramer’s website, TheStreet.com. Cramer sometimes quotes the hedge fund manager on his television show, and once interviewed him live. Rocker is also a regular writer for TheStreet.com, where he bashes stocks that Cramer subsequently also bashes in multiple stories on both the website and CNBC.

In February 2006, the SEC is investigating Gradient Analytics for disseminating false information about public companies. The agency has affidavits from former employees who say that Gradient’s “independent research” is produced by recent University of Arizona graduates who know little to nothing about finance and essentially take dictation from hedge fund managers, including David Rocker.

One of these employees says that Herb conspired with Rocker to hold his negative stories (premised on Gradient’s false information) until Rocker could establish short positions. This is called front-running – a jailable offense. It is reasonable to suspect that Rocker had similar relationships with TheStreet.com (of which he has owned a substantial portion) and other media.

Not long before Cramer announced his SEC subpoenas, Rocker sold all of his shares in TheStreet.com. Cramer sold around $2 million of his own shares. If Cramer knew about the SEC investigation before he sold his shares, which was almost certainly the case, he was trading on insider information – another jailable offense.

But Cramer don’t know nothin’ about nothin’. And Herb thinks the SEC investigation is an outrage. So Herb and Cramer have commandeered CNBC. They are live on CNBC. Herb has jabbered something about a conspiracy – a conspiracy to get Herb.

And now Cramer is going to show us something.

He’s pulled out a big, red magic marker. Veins are popping, rope-like, from his bald cranium. And he’s snarling. Cramer is actually snarling while he uses the big red magic marker to scribble something on a piece of paper.

He holds the paper up to the camera.

It’s…it’s his government subpoena…Cramer has vandalized his government subpoena! On live TV… in big red letters…

It says, “BULL!”

See full account here

I struggled with whether or not to write about the Chris Brown and Rihanna situation but the details of the police report below are so disturbing that I am compelled as a matter of public service.  We must strengthen our domestic violence laws in this country.  Abusers in domestic violence situations need to know that when you put your hands on a female, or male in some instances, during the course of a romantic relationship you are going to jail regardless of whether you later reunite.  Chris Brown has this very clean-cut boy next door image and most would never suspect, if the report below is true, that he is capable of such violence.  Something else most would not suspect, Rihanna has reunited with Brown and the two are apparently trying to work things out in spite of the fact that he allegedly almost killed her.  There are other rumors that the two are either engaged or were married last week after they reunited in Florida.  This is quite tragic if true.  With the increasing amount ot teenagers reported to be involved in abusive relationships parents have an opportunity to use this as a teaching moment.  In doing so, they can communicate to their tweens and teenagers who hold these two pop stars in high esteem that the actions of both Rihanna and Brown are completely unacceptable and under no circumstances should be tolerated or imitated.  As for Rihanna, someone really needs to introduce her to Tina Turner.  As a survivor of domestic violence, perhaps the young pop star will be more apt to listen to someone like the iconic Turner who has been there and not only successfully escaped the situation but thrived in the aftermath.  Rihanna allegedly admits in the police report that the violence got progressively worst throughout the course of her and Brown’s relationship.  Why she thinks that all of a sudden it will get better after a couple of weeks of separation is beyond this writer but can probably be easily explained by a multitude of mental health professionals.  This is not okay and little girls and boys everywhere need to know that.  One of the main reasons that I am writing about this is because some in the media are asking whether Rihanna provoked Brown in some way as if to say that Brown may have been justified in allegedly beating the daylights out of her.  Are you kidding me?!  Not only is such a conclusion completely ridiculous given the photographs of the victim, the gender disparity, Brown’s history and apology, and other circumstantial evidence being circulated. But just read the police report below that was taken right after the incident,  defendants have been convicted of murder with less. 

If you or someone you know is a victim of domestic violence please call the following 24-hour hotline for immediate help (800) 799-SAFE (7233).

 From the detective’s notes:

“Christopher B and Robyn F have been involved in a dating relations for approx 1 and half year. On Sunday Feb 8 at 25 hours Brown was driving a vehicle with Robyn F as the front passenger on an unknown street in Los Angeles. Robin F picked brown,s cellular phone and picked up a three-page text message from a woman Brown had had a previous relationship with.

“A verbal argument ensued and Brown pulled a vehicle over in an unknown street. Reach over Robyn F with his right hand and open the car door and attempted to force her out. Brown was unable to force Robyn F out of the vehicle because she was wearing a seat belt.  When he could not force her to exit he took his right hand and shoved her head against the passenger window of the vehcile causing an approx 1 inch raised circular contusion.

“Robyn F turned to face Brown and punched her in the left eye with right hand. He then drove away in the vehicle and continued to punch her in the face with his right hand while steering the vehicle with his left hand. The assault caused Robyn F Osmouth to fill with blood and blood to splatter all over her clothing and the interior of the vehicle. Brown looked at Robyn F and stated “I am going to beat the s–t out of you when we get home! You wait and see!?

“Robyn F picked her cellular phone and called her personal assistant Jennifer Rosales. Rosales did not answer the telephone but while her vm greeting was playing Robyn F pretended to talk to her and stated “I am on my way home. Make sure the cops are there when I get there? (this statement was made while greeting was playing and was not captured) after Robyn f faked the call, Brown and looked at her and stated, ‘You just did the stupidest thing ever! Now I really am going to kill you.’

“Brown resumed punching Robyn F and she interlocked her fingers behind her head and brought her elbows forward to protect her face. She then bent over at the waist placing her elbows and face near her lap and in attempt to protect her face and head from the barrage of punches being levied by Brown. Brown continued to punch Robyn F on her left arm and hands, causing her to suffer a contusion on her left triceps that was approx 2 inches in diameter and numerous contusions on her left hand. Robyn f attempted to send another text message to other personal assistant Melissa Ford. Brown snatched the cellular telephone out of her hand and threw it out of the window to an unknown street. Brown continued driving and Robyn F observed his cellular phone in his lap. She picked up the cellular phone with her left hand, and before she could make a call, he placed her in a head lock with right hand and continued to drive the vehicle with his left hand.

“Brown held Robyn F close to him and bit her on her left hear. She was able to feel the vehicle swerving from right to left as Brown sped away. He stopped the vehicle in front of [address] and Robyn F turned off the car removed the key from inignition and sat on it. Brown did not know what she did with the key and began punching her in the face and arms. Brown began applying pressure to Robyn F left and right carotid arteries causing her to be unable to breath. She began to lose consciousness. She reached up with her left hand and began to attempting to gauge his eyes in attempt to flee herself. Brown bit her left ring and middle fingers and released her. While brown continued to punch her she turned around a place her back to against the passenger door. She brought her knees to her chest and placed her feet against Brown,s body and began pushing him away.

“Brown continued to punch her on legs and feet causing several contusions. Robyn F began screaming for help. And Brown exited the vehicle and walked away. A resident in the neighbor heard Robyn F,s plea for help and called 911, causing a police response. An investigation was conducted and Robyn F was issued a domestic violence protective order (EPO). Affiant conducted an interview with Melissa Ford who advised on Feb. 8 2009 at 2500 hours she received a phone call from Robin F from an unknown telephone number later identified as the telephone number of Officer Chavez. Robin F had advised Ford that she had been assaulted by Brown. At approx at 1 am Brown called Ford as nothing happened. Ford advised Brown that she had already talked to Robin F and was aware of what happened. Ford had advised brown that the neighbors had called police and that they were with Robyn F. Brown had asked Ford if robin F had provided police with his name. And ford advised him that she had. Brown hung up the telephone and did not call back.

“On Feb. 8, Brown turned himself in and was given a copy of the EPO and advised to not contact Robyn.

“On Feb. 17 Ford advised the affiant that she had received text messages from … a number that Ford recognized as belonging to Brown. In the text message Brown apologized for what he had done to Robin F. and advised Ford he was going to get help.”

 We really need to strengthen our domestic violence laws.

For those of you who do not know Jack Cafferty he is the endearing curmudgeon on CNN that pretty much speaks his mind without filter.  Mr. Cafferty lost his wife Carol of 35 years last September.  In the midst of all the economic turmoil his recent revelatory commentary made me smile.  I hope it does the same for you.  See Jack Cafferty’s own words below.

NEW YORK (CNN) — I think I am developing a crush on America’s first lady. Michelle Obama is more compelling than her husband. He’s good, but she’s utterly fascinating.

Mrs. Obama has blown away the stale air in a White House musty from eight years of the Bushes. It’s like the sun came out and a fresh spring breeze began wafting through the open windows.

It’s the people’s house, and Michelle Obama totally gets it. So much so that she has taken to inviting people in from the streets to see her home. Nice touch — one completely lacking in her recent predecessors.

Watch her when she visits a local school and you see the warmth and affection she instantly triggers in people. Kids are pretty much totally honest with very good BS-detectors. If they sense you’re a phony, forget it. But around the first lady, they want to hug her and laugh with her and tell her stories.

You can see the same qualities these kids recognize in her daughters. She is the consummate mother as evidenced by the poised, polite smiling children she and her husband are raising. I have four daughters, and trust me — they don’t turn out like the Obama children without devoted parents.

New to the Washington neighborhood, Michelle Obamahas taken it upon herself to go around and introduce herself to the people in the various agencies of government. When’s the last time a first lady did that? I don’t ever remember it before. And during her visits she listens rather than lectures. And people respond to her.

She was raised on the south side of Chicago by blue-collar parents. She went to Princeton University, and Harvard Law School. But in many ways she’s still a kid from the south side of Chicago, and that’s what makes her special. She knows exactly who she is.

The Obamas bring a humanity and humility to their tasks which sets them far apart from the run-of-the mill phonies who populate Washington. It’s exactly what the doctor ordered for this wounded nation.

Michelle Obama’s unassuming, but dead-on, sense of style has the fashion press gushing all over itself.

Her arms are becoming the stuff of legend. Who appears sleeveless on the cover of Vogue, let alone in front of a joint session of Congress while her husband delivers one of the most important speeches of his life? And the reviews were rave.

Cindi Leive, the editor of Glamour magazine gushed, “Oh my god! The first lady has bare arms in Congress in February at night!” If she keeps it up, Seventh Avenue will soon stop making women’s clothes with sleeves.

Ok, I admit it. When it comes to the first lady, I’m smitten.

Governor Tim Kaine released the following press statement regarding RNC Chairman Michael Steele running back to Rush Limbaugh in order to kiss his brass ring.

“I was briefly encouraged by the courageous comments made my counterpart in the Republican Party over the weekend challenging Rush Limbaugh as the leader of the Republican Party and referring to his show as ‘incendiary’ and ‘ugly.’ However, Chairman Steele’s reversal this evening and his apology to Limbaugh proves the unfortunate point that Limbaugh is the leading force behind the Republican Party, its politics and its obstruction of President Obama’s agenda in Washington. Just this weekend, Rush Limbaugh repeated his claim that he is rooting for the President to fail. The last time Rush Limbaugh said he wanted the President to fail, virtually every single Republican in Congress followed his lead and voted against the President’s plan to create or save 3.5 million jobs.

“As Congress works to pass the President’s budget, Republicans need to stop following divisive figures like Rush Limbaugh, stop apologizing to him and put aside the failed politics of the past so we can put our economy back on track, reform our health care system, break our dependence on foreign oil, improve our schools, and lay the foundation for long-term growth in the 21st Century.”

Remarks of President Barack Obama
Weekly Address
Saturday, February 28th, 2009
Washington, DC
Two years ago, we set out on a journey to change the way that Washington works.  

We sought a government that served not the interests of powerful lobbyists or the wealthiest few, but the middle-class Americans I met every day in every community along the campaign trail – responsible men and women who are working harder than ever, worrying about their jobs, and struggling to raise their families.  In so many town halls and backyards, they spoke of their hopes for a government that finally confronts the challenges that their families face every day; a government that treats their tax dollars as responsibly as they treat their own hard-earned paychecks.  
 
That is the change I promised as a candidate for president.  It is the change the American people voted for in November.  And it is the change represented by the budget I sent to Congress this week.  
 
During the campaign, I promised a fair and balanced tax code that would cut taxes for 95% of working Americans, roll back the tax breaks for those making over $250,000 a year, and end the tax breaks for corporations that ship our jobs overseas.  This budget does that.
 
I promised an economy run on clean, renewable energy that will create new American jobs, new American industries, and free us from the dangerous grip of foreign oil.  This budget puts us on that path, through a market-based cap on carbon pollution that will make renewable energy the profitable kind of energy; through investments in wind power and solar power; advanced biofuels, clean coal, and more fuel-efficient American cars and American trucks.  
 
I promised to bring down the crushing cost of health care – a cost that bankrupts one American every thirty seconds, forces small businesses to close their doors, and saddles our government with more debt.  This budget keeps that promise, with a historic commitment to reform that will lead to lower costs and quality, affordable health care for every American.  
 
I promised an education system that will prepare every American to compete, so Americans can win in a global economy.  This budget will help us meet that goal, with new incentives for teacher performance and pathways for advancement; new tax credits that will make college more affordable for all who want to go; and new support to ensure that those who do go finish their degree.  
 
This budget also reflects the stark reality of what we’ve inherited – a trillion dollar deficit, a financial crisis, and a costly recession.  Given this reality, we’ll have to be more vigilant than ever in eliminating the programs we don’t need in order to make room for the investments we do need.  I promised to do this by going through the federal budget page by page, and line by line.  That is a process we have already begun, and I am pleased to say that we’ve already identified two trillion dollars worth of deficit-reductions over the next decade.  We’ve also restored a sense of honesty and transparency to our budget, which is why this one accounts for spending that was hidden or left out under the old rules.    
 
I realize that passing this budget won’t be easy.  Because it represents real and dramatic change, it also represents a threat to the status quo in Washington.  I know that the insurance industry won’t like the idea that they’ll have to bid competitively to continue offering Medicare coverage, but that’s how we’ll help preserve and protect Medicare and lower health care costs for American families.  I know that banks and big student lenders won’t like the idea that we’re ending their huge taxpayer subsidies, but that’s how we’ll save taxpayers nearly $50 billion and make college more affordable.  I know that oil and gas companies won’t like us ending nearly $30 billion in tax breaks, but that’s how we’ll help fund a renewable energy economy that will create new jobs and new industries.   In other words, I know these steps won’t sit well with the special interests and lobbyists who are invested in the old way of doing business, and I know they’re gearing up for a fight as we speak.  My message to them is this:
 
So am I.  
 
The system we have now might work for the powerful and well-connected interests that have run Washington for far too long, but I don’t.  I work for the American people.  I didn’t come here to do the same thing we’ve been doing or to take small steps forward, I came to provide the sweeping change that this country demanded when it went to the polls in November.  That is the change this budget starts to make, and that is the change I’ll be fighting for in the weeks ahead – change that will grow our economy, expand our middle-class, and keep the American Dream alive for all those men and women who have believed in this journey from the day it began.  
 
Thanks for listening. 

An employee of Tiversa, a defense contractor for the President’s helicopter Marine One, by downloading a music file-sharing program, inadvertently gave the world access to his Tiversa hard drive.  More specifically, the employee gave access to an IP address in Tehran, Iran that retrieved the engineering and communications information for Marine One from the Tiversa employee’s hard drive.  “Bob Boback, CEO of Tiversa, told WPXI-TV: ‘We found a file containing entire blueprints and avionics package for Marine One, which is the president’s helicopter.”  Countries such as Pakistan, Yemen, Qatar and China actively search these music file-sharing programs to gain intelligence or information.  What is very disturbing is the passive way that Tiversa and Gen. Wesley Clark appear to be treating such a serious breach. 

Retired Gen. Wesley Clark, an adviser to Tiversa, said the company discovered exactly which computer the information came from. “I’m sure that person is embarrassed and may even lose their job, but we know where it came from and we know where it went.”

May even lose their job?????  This person should have been FIRED yesterday!!!  Un-freakin-believable!