Friday, March 20, 2009

Where are the freaking cops?

The AIG "retention bonus" fiasco has made me wonder something. Where are the cops?

It isn't much of a stretch at this point to suggest that massive fraud is occurring in the financial sector. I am not just talking about AIG. I am talking about Bear Stearns, Lehman Brothers, Goldman Sachs, hedge funds, private equity funds, and last if not least, the Federal Government itself. Which begs the question: If the SEC is truly tainted by Wall Street, why isn't the Department of Justice, the US Attorney General's office, or US Marshal's office starting investigations?

If this country's legislative branch can impeach a president over a BJ or go relentlessly after baseball icons for using hormones to enhance athletic performance, (while millions of teenage girls use similar hormones legally to avoid the natural outcome of their sexual forays) why can it not manage to concern itself over the loss of trillions of dollars of taxpayer's money?

Why does NY state attorney general Cuomo have the lonely task of investigating the bankers from the state level? Why is the federal government sitting on its hands?

Has the federal government become so thoroughly corrupt that it finds itself in the position of using taxpayer money to support a wealthy criminal group, rather than issue indictments under the RICO statutes?

How does a democratic government maintain legitimacy in the eyes of its citizens when the odor of corruption washes over 2 of the 3 branches? So far, only the judicial branch *seems* to remain free of this mess. The reason that I say *seems* with asterisks is because the only fraud the judicial branch had to deal with is Bernard Madoff, who uh... CONFESSED to running a Ponzi, then pled guilty as charged. Not exactly an acid test for the judicial branch.

While Fed Chairman Bernanke and President Obama have said that they are "angry" over the bonuses, apparently that anger has not translated itself into a resolve to determine whether or not these guys are, in fact, criminals.

My concern is that their overriding desire right now is to restore confidence in our financial system. News flash: It won't happen.

Nobody trusts the banks, their overpaid CEOs, their financial statements, nor their traders. Giving bankers gobs of taxpayer's money won't help to restore trust. It probably won't even make these problem-gamblers solvent again.

What is pathetic and shameful about this situation is that the government can't find the wherewithal to prosecute what appears to be a simple-to-follow confidence trick, but rather ends up defending, supporting, and FUNDING it. With our children's future income.

Let's just call that a reverse inheritance from our kids to Wall Street con artists. I sure hope we get health care for every American, and in particular our children. That's because much of their income has been pledged to banks (and not-really-banks like Goldman and AIG) that are arbitrarily deemed "too big to fail".

Credit Unions in the news again

March 20, 2009, Alexandria, Va. -- The National Credit Union Administration Board today placed U.S. Central Federal Credit Union, Lenexa, Kansas, and Western Corporate (WesCorp) Federal Credit Union, San Dimas, California, into conservatorship to stabilize the corporate credit union system and resolve balance sheet issues. These actions are the latest NCUA efforts to assist the corporate credit union network under the Corporate Stabilization Plan.

The two corporate credit unions were placed into conservatorship to protect retail credit union deposits and the interest of the National Credit Union Share Insurance Fund (NCUSIF), as well as to remove any impediments to the Agency’s ability to take appropriate mitigating actions that may be necessary. Service continues uninterrupted at both U.S. Central Corporate Federal Credit Union and WesCorp, and members are free to make deposits and access funds.

Valley Plaza Mall

I have read in the Californian that construction on the Target Store at Valley Plaza Mall stopped dead in its tracks.

My theory for the shutdown was because of financial issues with the owner of Valley Plaza Mall, General Growth Properties (ticker: GGP).

Isn't one wall of the mall now composed of temporary plastic sheets from tearing down the previous store? If so, it may stay that way for a while.

GGP may be forced into bankruptcy today.

Nabors Layoffs


Another 780 local jobs gone.

Blatantly copied and pasted From the Bakersfield Californian:

Oil services company warns of ‘mass layoff’

A Bakersfield oil services company has told local officials that it may have to lay off as many as 780 full- and part-time employees by June 16.

Nabors Well Services Co.’s warning of so many job cuts reflects widespread belt-tightening among local oil producers following a steep drop in crude prices since July.

In a letter dated March 12, Nabors said it may be forced to lay off workers if it cannot secure contracts for services rendered at four of its Bakersfield facilities — the ones on Earthmover Court, James Road, Pegasus Drive and Rosedale Highway.

“This mass-layoff may or may not be permanent depending on the (c)ompany’s ability to secure service contracts in the future from its clients and the general climate of the economy,” the letter reads.

The potential layoffs comprise, according to the letter:

• 580 equipment operators

• 90 supervisors

• 55 clerical administrative workers

• 30 mechanics

• 16 safety specialists

• 9 warehouse personnel

The company business development director listed on the letter would not comment on the record. He referred questions to a company official who could not be reached for comment Wednesday afternoon.

Nabors is part of an international oil services company based in Bermuda. Its Bakersfield services include drilling and maintaining oil wells.

Local well servicing companies experienced a boom in business last year as oil prices hit record highs, prompting a race to hire workers new to the field and retain those with experience.

But work orders have dried up since prices began heading south in late summer, leaving rig operators little choice but to cut back on labor costs.

Excalibur Well Services Inc., also based in Bakersfield, recently laid off as many as 100 full- and part-time workers, or about a third of the company’s work force, said Jim Tague, vice president of finance and planning for E & B Natural Resources, a sister company to Excalibur.

Tague said hiring at oil services companies will pick up if oil prices rise high enough.

“I am actually very positive,” he said. “I’m not sure (hiring would resume) within six months, but within one to two years I think that the oil price could firm back up to bring some activity” to local oil fields.

The Fed will need to print A LOT more money than they already are. Not that printing that money will do much good. The system is arranged to keep significant amounts of money away from those who need it most. Are they wrecking the currency in the hope that savers will spend it before it becomes Monopoly(tm) money?

Sorry, but I am having a difficult time with the pre-election campaign speeches that the American economy is "fundamentally strong". Really? Even Starbucks is closing down stores these days.