This morning Bloomberg reported the email trail now confirms that the New York Fed pressured AIG to pay Goldman Sachs and other banks 100 cents on the dollar to make whole 62 billion in deeply compromised credit default swaps and URGED AIG TO SUPRESS DISCLOSURE OF THE PAYMENT DETAILS TO THE AMERICAN PUBLIC. Tim Geithner was the head of the NY Fed at this time, then just stepping over to become Treasury Secretary.
The US public was funding this nightmare and they were to be kept in the dark on the sordid details of which buddies paid each other what. (!) This is a freakin' outrage. If Tiny Tim gets to keep his job after this, honestly, God help America and democratic ideals everywhere. Obama, where the **!!& are you? Whatever happened to the doctrine of fairness: basic tenants of disclosure and that there cannot be an ‘apprehension of bias’ as justice must not only be done, but must also “be seen to be done’ in order to uphold respect for legal process.
Watch this morning's discussion with two of the more useful commentators, the always lucid Josh Rosner of Graham Fisher & Co and Keith McCullough of Research Edge. See: Time to say goodbye to Tim Geithner.
Meanwhile sceptics continue to mount about the poor volume, breathtaking stock rally the past few months. See Seeking Alpha: is the US government supporting the stock market? The most difficult question for investors is the extent to which they are prepared to stay in a Ponzi-like market. Sudden-sharp reversals should be expected. We should govern our risk accordingly.
And Joseph Stiglitz reminds us today that Wall Street is talking up the recovery to sell us stocks, while most independent economists are concerned about not ” if” “but when the next crisis is going to happen.” See Bloomberg clip: Stiglitz says Wall Street is Talking Up The Economy.
I think there is little doubt that taxes are headed up in most countries as the bill for the credit crisis continues to mount. Politicians promising otherwise should be discounted. See WSJ today: Testing Taxpayers' Pain Threshold.
Follow
____________________________
Cory’s Chart Corner
;
Your outrage is more than justified. However, your knowledge level is more sophisticated than that of the general public, and I think many of our fearless leaders are counting on that.
Like most Ponzi scheme victims, the investing public will realize what's happened too late.
Thanks for doing your part to keep us updated.
After 8 years of President Bush, people wanted a change. In walks Obama the 'Anti-Bush'.
President Obama's entire campaign was based on tapping into peoples resentment of Bush and it worked beautifully. The problem is, like Ron Paul had warned, change is just a word, it means nothing unless you specify what exactly that change is going to be. So far, most things seem the same: wars are expanding, crooks on Wall Street wielding more power than ever,
and the common person is still getting the shaft.
George Carlin sums it up best:
http://www.huffingtonpost.com/rep-darrell-issa/geithners-time-to-give-an_b_415476.html
My bad – wrong link:
http://www.youtube.com/watch?v=acLW1vFO-2Q
Further writing about fraud at the highest level – http://wallstreetpit.com/13259-is-it-all-just-a-ponzi-scheme.
Danielle – what are your thoughts about this?
Good for you. Go on BNN and tear their pom-pom off. For the last three weeks or so the S&P has been trading in a very tight range of up or down 3 or 4 points at most. The only exception being the sell off on the last tax loss selling day. Do you have any insight on what mechanism is putting on such tight restrictions?
I see someone else noticed the 'cheering' that has been happening on BNN this past while. I remember going into the jobs data today, it was touted as being a very important piece of information. When it came out negative, I noticed the emphasis suddenly change away from that report and instead focus on the trend over the past 3-4 months.
Nice little flip-flop, but then again, everyone seems to be bullish these days. It seems no matter if the data is negative or positive the markets edge higher.
I think 2010 will be a very interesting year.
The trouble I have with Sprott and company is that they are heavily promoting their new gold fund so everything they come out with seems to be along that theme; ie distrust of government and fiat currency etc. I do not buy into the idea that the government can hold up the stock market through its buying power. If that were true, then stocks would not have lost money over the past 10 years; if they are intervening they seem to be very ineffective at propping things up in any event. I see the stock market presently as Ponzi-like because of it’s disconnect from economic and fundamental reality re future earnings and world growth and how the cheerleaders keep cheering trying to pull others in with them. All of the usual “long always suspects are out beating the drum for why stock markets should keep going up and investment advisor sentiment is back at a high. But as I see it, the buyers here are all the weak hands and those that are tied to a constantly long mandate, those that are free to think and wait are doing so, and that is my preference at this point as well. That doesn’t mean the market can’t run up some more I just don’t like the risk/reward probabilities from these levels.