Obama's Press Conference Stirs the Buzz

According to Yahoo Buzz:

Chip Reid asked a tough question about Obama's controversial budget. Reid asked if the budget, which will increase the debt to "$7 trillion over the next 10 years," is a case of passing problems onto the next generation. Obama responded that investments need to be made to "meet our growth targets that put us on a pathway to growth." He then pointed out that the critics of his budget have yet to bring forth an alternative.

Classic bait and switch. "We have to do what I'm proposing because noone else is coming up with a better solution."
Wrong! The better solution, which you IGNORED was to do your job, which DOES NOT INCLUDE micromanaging or "fixing" the "problems" with the economy.
We're now at least 6 months behind because the failures that should have occurred haven't happened. So the businesses that are competent haven't been able to step up and fill in the gaps where the incompetents already dropped the ball (which they're continuing to do, by the way).
Many people are really beginning to see the fruits of your micromanagement, and they're realizing that your system rewards incompetence. While this makes incompetents quite happy, it makes competent people realize that there is no benefit to sharing that competence with the rest of society.

You can not expect success while you reward failure.
What you feed, grows.

If you want success, then reward it by letting the successful see the failures fail, and quit handicapping the successful with more regulations.
If you want failure, keep rewarding it. The successful will quit, because they realize there is no point.

AIG employees starting to return bonuses, CEO says

According to Yahoo Finance:

Meanwhile, President Barack Obama said Wednesday he wants legislation to give the federal government vast new powers over financial institutions like AIG to protect the public.

This is NOT a good thing. Government is not supposed to control private business. This business should have failed. Why did government step in and prevent it? THAT is NOT government's job.

Obama, speaking to reporters at the White House, said the powers would be similar to those now exercised over banks by the Federal Deposit Insurance Corporation. It would be part of the administration's broader package of new finance regulatory steps, he said.

Insurance isn't financial. Am I missing a step?

Since AIG is an insurance company and not a bank, it is not subject to the same oversight.

Well, somebody else connected those dots too. Bonus points for them.

"We've got a big mess that we're having to clean up," the president said.

YOU don't have to clean it up. It's NOT YOUR JOB. If you want to run THAT business, then become the president of THAT company and quit trying to be the president of THAT company by using your President of the US hat.

"Nobody here drafted those contracts" that resulted in the bonuses being paid out to AIG employees, he added.

No, you just bailed 'em out.

Obama also defended his administration -- and specifically Treasury Secretary Timothy Geithner -- against questions about its handling of the AIG fiasco.

"Nobody here was responsible for supervising AIG and allowing themselves to put the economy at risk by some of the outrageous behavior that they were engaged in," Obama said.

Now, however, "the buck stops with me," he said. "And my goal is to make sure that we never put ourselves in this kind of position again."

One more time, that's NOT your job.

Rep. Barney Frank, D-Mass., chairman of the Financial Services Committee, demanded that the company submit to Congress a list "of people who received the bonuses, whether they paid them back or not." If the names were not provided "without restriction," Frank warned, he would ask the committee to vote to subpoena them.

Liddy said he would "comply with the law:" but was "concerned about the safety of our people."

He said he would give the names of the bonus recipients only on the basis of confidentiality. He read aloud threats that AIG employees had received, including one that suggested that all bonus recipients should be "executed with piano wire around their necks."

Another one read: "If the government can't do this properly, we the people will take it in our own hands and see that justice is done. I'm looking for all the CEOs' names, kids, where they live, etc."

And now another guy wants to do things that aren't his job. Government's job was to leave things alone. And government failed. Big surprise.

Rep. Scott Garrett of New Jersey, the senior Republican on the subcommittee, complained that the administration still has no strategy for disentangling itself from the insurance giant.

"Part of me wants to say to some of the loudest critics, 'What did you expect and why weren't you asking more questions before?' I would argue that the real outrage now is the $170 billion of taxpayer money that's been pumped into this company and to what effect," he said.

Finally someone on Capitol Hill that actually has some sense.

The retention payments -- ranging from $1,000 to nearly $6.5 million -- were put together in early 2008, long before then-Treasury Secretary Henry Paulson asked Liddy to take over the company. Liddy, the retired former chief of Allstate Insurance Co., is not getting a bonus and is drawing only $1 a year in salary.

"No one knows better than I that AIG has been the recipient of generous amounts of governmental financial aid. We have been the beneficiary of the American people's forbearance and patience," he said. But he also said that "we have to continue managing our business as a business -- taking account of the cold realities of competition for customers, for revenues and for employees."

The company started doing what companies do when it's time for them to die. Trying to reanimate them, zombie style, by injecting them with misappropriated taxpayer dollars IS NOT A SOLUTION.

The clamor over compensation overshadowed AIG's weekend disclosure that it had paid out more than $90 billion of the federal aid to foreign and domestic banks, including some that had multibillion-dollar U.S. government bailouts of their own.

Well, one thing this administration has shown in the first 3 months. They're extremely efficient at wasting our taxpayer dollars... and getting NOTHING in value in return for it.

Great job there Mr. President Guy.

In case anyone can't tell, I'm pretty pissed. Though how you could miss that, I'll never know.

Obama berates AIG and vows to try to block bonuses

According to Yahoo News:

Joining a wave of public anger, President Barack Obama blistered insurance giant AIG for "recklessness and greed" Monday and pledged to try to block it from handing its executives $165 million in bonuses after taking billions in federal bailout money.

Well, gee. Why are you so surprised. If they had been operating properly, they wouldn't have needed a bailout in the first place, would they?

"How do they justify this outrage to the taxpayers who are keeping the company afloat?" Obama asked. "This isn't just a matter of dollars and cents. It's about our fundamental values."

And you, by pushing the bailout in the first place are helping to show that the fundamental values of this country are cracked. Quit acting shocked. And quit trying to "help".

The bonuses could contribute to a backlash against Washington that would make it tougher for Obama to ask Congress for more bailout help — and jeopardize other parts of the recovery agenda that is dominating the start of his presidency.

Good. This is a sign that some americans are starting to wake up and see that the bailout wasn't a good idea.

Thus, the president and his top aides were working hard to distance themselves from the insurer's conduct, to contain possible political damage and to try to bolster public confidence in his administration's handling of the broader economic rescue effort.

Too late. You've already paid the piper. Now you have to listen to the tune.

"This is a corporation that finds itself in financial distress due to recklessness and greed," Obama declared.

If you didn't know this already, then I feel sorry for us all.

One reason that the AIG bonus giveaway is such a compelling story — and a politically troubling one for Obama if not neutralized — is that it offers a simple story line that appears to sum up ways in which the federal bailouts have gone awry.

"Never should have been", you mean.

Bailout steps for AIG totaling over $170 billion since September have effectively left the federal government with an 80 percent stake in the faltering insurance giant

Congratulations. You bought a load of crap. Learn from your mistake. STOP!

Still, those surveyed generally gave the president favorable marks for doing as much as he can to try to fix the economy, and few blame him for making the economy worse.

Ok, maybe not enough of us are learning yet. Too bad really.

However, Obama officials made the rounds of Sunday talk shows to denounce the insurer. And even Federal Reserve Chairman Ben Bernanke weighed in, saying on CBS' "60 Minutes" that the AIG bailout angered him the most and that he "slammed the phone more than a few times on discussing AIG." Still, he said a collapse of AIG would have wreaked havoc on the global economy.

That's how most governments explain their doing of stupid things. "If we don't do anything things will be far worse." Get over yourself. You don't even know how to run a government, what makes you think you can run an insurance company too?

Senate Republican Leader Mitch McConnell called the bonuses "appalling" and said he hoped "the administration gets the message from the taxpayers on this issue."

We can hope. But I'm not holding my breath for any sanity out of this administration.

Citigroup shares tumble below $1

According to Yahoo Finance:

Citigroup, a Dow component, fell more than 13 percent to an intraday low of $0.98, hammered by continued fears over the bank's health and ability to avert nationalization.

Bad choices hurt. Can't say that I'm surprised by this.

If I thought there was any chance of them preventing nationalization, and/or then pulling themselves out of the toilet by themself, I might say that now is a good time to invest. But I know better.

The investors know that an ill wind blows (mostly out of Washington D.C.) and they're doing the smart thing... running away as fast as they can.

Citigroup reaches aid deal with government

Sure, Government doesn't want to nationalize the banking system. (That was sarcasm, in case you didn't catch it.)

According to Yahoo news

The U.S. government will exchange up to $25 billion in emergency bailout money it provided Citigroup Inc. for as much as a 36 percent equity stake in the struggling bank, greatly increasing the risks to taxpayers as voter unhappiness about the broader bailout program rises.

Investors appeared disappointed in the deal and expected dilution of their stake, sending shares plummeting 94 cents, or 38.2 percent, to $1.52 in afternoon trading. Stocks tumbled early but pulled off their lows as the Dow Jones industrial average came within 34 points of breaching the 7,000 mark for the first time in more than 11 years.

No big surprise here, the investors don't want anything to do with it.

The conversion will make the government the largest shareholder in Citigroup, but company officials said they still expect to call the shots.

Good luck with that.

Investors have punished the shares of Citigroup and other banks in recent weeks out of concern the government could nationalize troubled banks, which would involve replacing management and wiping out shareholders.

Treasury officials and Federal Reserve Chairman Ben Bernanke have said there are no plans to take such steps.

Of course these things are never "planned". They just happen. And it doesn't surprise me that the investors want to get out of the cave before the Indiana Jones giant marble runs them over.

Dean Baker, co-director for the Center for Economic Policy and Research, a liberal think tank, said the government's efforts to avoid a takeover amount to "a further handout to Citigroup."

"We really should own it outright," he said, given that taxpayers have provided the company $45 billion in assistance, several times its market value.

Sounds like government thinking to me.

I'd definitely say, if you have any investements there, get them out. Because when the government nationalizes it, you probably won't have anything left. I could be wrong, but I doubt it.