Sunday, September 28, 2008

Good As Gold

This bailout is good as gold. Goldman Sachs, that is, or golden parachute, or gold, Dodd and Frank, gold! as Seinfeld might say. I'm going to get pissed now, just watch me.

Let's start with GS and former golden boy, Paulson, who made a mere $500 million for his seven years with the company. Is this really the man we want making decisions effecting most Americans for years to come? As John Markman wrote recently about Paulson's testimony before Congress, "In his close-up this week, Paulson appeared uncomfortable, unknowledgeable, uncaring and often unintelligible, as if notes he had scrawled on a cocktail napkin on the way in were just out of reach." How the hell are we letting an unelected official with half a billion dollars in private wealth determine, with a 3-page outline and an agenda to save the wealth of his former colleagues, our fiscal future? GS has contributed over $43 million dollars to lobbying and financial campaigns over the last 20 years, including over $264K to Dodd. No surprise that he and Frank, heads of the Senate banking committee, were willing to rubber stamp a proposal that made the treasuries decisions "permanent" and not reviewable by any court. In a word, criminal.

Gold. Golden parachute. As pointed out by James B. Stewart in his excellent account of the S&L scandal Den of Thieves, the golden parachute was invented by Martin Siegel. Siegel was working for a smaller I-bank at the time, Kidder Peabody, and sold this idea to clients ostensibly as a deterrent to corporate raiders. In practice, as we know, these buyout clauses have been so lucrative that CEOs such as orange man Mozillo can't wait to dump and burn their own companies to collect a huge paycheck and hopefully stay one step away from prosecution. We'll say if the bailout proposal addresses this in any meaningful way, but I doubt it.

I've read from several columnists about the impending disparity of Buffett's deal with our own. If he can earn 10% on $5 billion, shouldn't we demand a little more with $700 billion? It looks like investors aren't fully convinced this morning with futures down 200 points and banks and insurers following our healthy example of failure across the Atlantic.

I'd like to depart directly from analysis to address those congressmen voting for this scam. I've heard back from Mel Martinez and Robert Wexler, 2 of my own, who simply say the housing mess is too big in Florida to not give the appearance of doing something. Obama and McCain will both vote for this. So what are we to do?

Vote, of course. But not for anyone who supports this. If what Pelosi says is true, details about the bailout will be fully evident on the net within 48 hours of it passing. We should also have a list of who voted for it. If this potentially $700 billion albatross is pushed through, then what is our recourse? Reject anyone who put your money on the line. Vote for the independent, for the libertarian, for the green party, but don't vote these incumbent criminals back in. Sure, you might think that 1 vote won't matter. But take it from someone living in the epicenter of voting disasters, Palm Beach County, that lost votes for a candidate do matter. If we put people like Dodd and Frank back in office, we are admitting that we are sheep, willing to accept our billionaire masters as keepers of our country and financial futures. At least by casting a vote in the opposite direction, we make a stand as is our right.

I would also like to finish by adding that Cramer now predicts the Dow will hit 8K. My next post will cover how he should go to jail sooner than later.

1 comment:

Anonymous said...

Best Post to date!!