NLPC Associate Fellow Mark Modica was a guest on Closing Bell today on CNBC. He was joined by Kevin O'Leary of Shark Tank.
Here is a transcript:
Sara Eisen: At first it seemed like it was just another activist investors at work but our next guest says something else is in play here. We're talking about Harry Wilson, the restructuring expert who served on President Obama's auto industry task force during the financial crisis and was instrumental in bringing GM out of bankruptcy. Now Wilson is a GM activist investor and represents hedge funds holding a total of 34 million shares asking General Motors' CEO Mary Barra for a seat on the board and is pressing for a stock buyback, Simon.
Simon Hobbs: Our next guest is a former GM bondholder who says the company isn't so financially healthy, that it shouldn't burn through its reserves with buybacks …
When is a government watchdog not really a watchdog?
When he rolls over and lays at the feet of his master rather than sink his teeth into a program that he’s been tasked to guard.
Such appears to be the (unsurprising) case with Herbert Allison, Jr. (pictured), a former Wall Street executive (Merrill Lynch and TIAA-CREF) until he was appointed president and CEO of Fannie Mae in 2008, after it was put into conservatorship. Subsequently President Obama named (and the Senate confirmed) him as overseer of the Troubled Asset Relief Program (TARP), the $700 billion asset acquisition fund that bailed out Wall Street financial institutions. He served in that role for about 15 months, until September 2010.
But it’s Allison’s role as a special investigator of the Department of Energy’s stimulus-funded loan program that is sparking curiosity, as explained in an Associated Press story published yesterday. Not long after …
Pension Benefit Guaranty Corporation, like Fannie Mae and Freddie Mac, is a case of “too big to fail.” At least various members of Congress see it that way. And they are planning a push for legislation designed to shore up underfunded multiemployer private-sector pension funds, but which would put taxpayers on the hook for billions, if not tens of billions, of dollars over the long term. Sen. Bob Casey Jr., D-Pa., and Reps. Earl Pomeroy, D-N.D., and Patrick Tiberi, R-Ohio, the driving forces behind this measure, seek to shift the primary responsibility of keeping pensions adequately funded from unions and unionized employers to the general public. It’s another example of the bailout culture in action.
National Legal and Policy Center covered this issue at length last November. Late that October, Rep. Pomeroy had introduced his Preserve Benefits and Jobs Act (H.R. 3936). The measure would bail out the deficit-ridden …
Charlie Gasparino of Fox Business Network reported yesterday that the Obama Administration, Federal Reserve and Wall Street firms (like Goldman Sachs, Citigroup, etc.) are exploring a “face-saving” measure by splitting the presidentially beloved ShoreBank Corporation in two, with the community/green jobs lender surviving with the “good” assets while the FDIC and private investors absorb the toxic assets. Another reporter following the story told me that ShoreBank’s Friday deadline from the investors has been extended but he didn’t know how long. A spokeswoman from Goldman Sachs refused to comment on the issue.
Here’s the split-the-baby scenario explained by Gasparino:
This is asinine: as was reported last week by Bloomberg , ShoreBank’s Tier 1 capital has fallen from $43.5 million in December 2009 to $4.1 million at the end of June. It is almost entirely worthless and is only being saved – while other …
For example, ShoreBank has two sub-entities based in the Pacific Northwest: the FDIC-backed ShoreBank Pacific, and the nonprofit ShoreBank Enterprise Cascadia. Both are institutions whose lending criteria are based upon progressively defined notions of “sustainability,” with the bank a partnership between ShoreBank Corp. and the environmental group Ecotrust. The bank’s mission is to “profitably assist businesses, and through them their communities, to be sustainable in economic, social, and environmental practices.” Here’s how they explain their lending criteria:
…Unlike other banks, we are conscientious to whom we lend, and
Today the National Legal and Policy Center (NLPC) asked Neil M. Barofsky, the Special Inspector General for the Troubled Asset Relief Program (TARP), for a formal review of the sponsorship by Bank of America and Citigroup of the Rainbow/PUSH Wall Street Conference currently taking place in New York City. The January 13-16 event is one of two of Jesse Jackson’s annual fundraisers.
According to official conference materials, Citigroup is a “Gold Sponsor,” a designation costing $50,000. Bank of America is identified as a “Silver Sponsor,” a designation costing $30,000.
Both Citigroup and Bank of America are major recipients of TARP funds. Taxpayers are now Citigroup’s largest shareholder after infusions of $45 billion. Bank of America has already received $25 billion. According to today’s Wall Street Journal, it is seeking billions more in order to make possible its acquisition of Merrill Lynch.
Peter Flaherty, President of the National Legal and Policy Center (NLPC), today made the following statement:
President-elect Obama should withdraw Timothy Geithner’s nomination for Treasury Secretary. Obama says that middle–class families with incomes of $250,000 are wealthy and their taxes should be raised, but he wants a Wall Streeter who didn’t pay his taxes to be his point man on the economy.
The amount of unpaid taxes — $42,000 — may sound like pocket change to Geithner and his Wall Street buddies, but it is a lot of money on Main Street.
Geithner’s claim that he didn’t know he was supposed to pay taxes doesn’t pass the laugh test. It is true that American citizens who work for the IMF are responsible for the employer’s share of the payroll tax, but IMF employment includes generous pay and a host of other perks. Anyone who has ever worked there is well …