A rather sad post today. David Kellermann, age 41, CFO for Freddie Mac was found dead today at his home in Fairfax, Va. (a suburb of Washington DC). The police are reporting it as an apparent suicide without any explanation why. The police are still conducting a homicide investigation at his home. Mr Kellermann worked at Freddie Mac for 16 years. He became CFO when Freddie Mac was placed in conservatorship in September 2008.
This is the second loss of a senior executive for Freddie Mac in as many months. On March 1, 2009, David Moffett, CEO of Freddie Mac since it was put in conversatorship, announced his intention to resign as CEO and Board member by March 13 at the latest.
My condolences to the Kellermann family and everyone at Freddie Mac. You lost a good man way too soon.
Wednesday, April 22, 2009
Wednesday, April 15, 2009
How to kill 2 birds with no stones
During the recent Maersk Alabama piracy incident, I had a real brain storm. Since the US Government (AKA American taxpayers) is a major funder of the various and sundry plans to bail out/stimulate the economy, let's save them some money. Rather than set up this elaborate public private investment plan, let's cut out a few of the middle men/women and a few layers of regulatory bureaucracy all at once. Just take the absolute worst of the Legacy loans & securities (FKA toxic assets) & sell them off to the pirates (or their ransom victims) for ransom. The Somali pirates consider themselves voluntary coast guard to protect Somali waters from foreign fishing trawlers and toxic waste dumpers. Selling them legacy assets is not much of a reach beyond volunteer coast guardsmen. Remember, the pirates seized the Maersk Alabama, a loaded container ship which is not easily mistaken for a fishing trawler. The fact that the Maersk Alabama was carrying tons of food aid for Kenya, Mozambique and Somalia really makes the volunteer coast guard defense really indefensible. The millions of dollars received as ransom for seized ships speaks for itself.
President Obama should consider putting Bernie Madoff on a work release program to promote the idea to the Somalis. The possibilities are endless. Since the worst of these legacy assets are only suitable for extreme speculative investing or wrapping fish, the Somalis should get better use out of the assets than most nations or investors.
President Obama should consider putting Bernie Madoff on a work release program to promote the idea to the Somalis. The possibilities are endless. Since the worst of these legacy assets are only suitable for extreme speculative investing or wrapping fish, the Somalis should get better use out of the assets than most nations or investors.
Friday, April 3, 2009
Big Brother or Waxman the wimp??
On Thursday, April 2, 2009 the US House of Representatives passed H. R. 1256, the Waxman Family Smoking Prevention and Tobacco Control Act by a vote of 298-112. (Italics mine) This act gives the FDA authority to regulate tobacco products by such means as larger warning statements, disclosure of ingredients, limits on flavoring additives and control of marketing efforts, especially when children are targeted. (italics mine again) If you are interested in the details and want a better return on your tax dollars, visit this site http://thomas.loc.gov/ . Do not read this in front of your computer workstation. It is such a great antidote for insomnia you will end up with your head on your keyboard which could initiate a large bill for membership to very obscure websites you didn't know existed.
Rep. Waxman proclaimed his so-called triumph over the evil tobacco industry with this press announcement:
If this proclamation does not win the lamest, worst excuse of a pun award, there shouldn't be one!!
Also, please note that there are more regulations and restrictions in this bill than the earlier tobacco settlement. (AKA government sponsored extortion) Our fearless leaders in Congress justify this in the name of dramatic improvements in public health. It seems they have discovered what the American public has known for decades. Tobacco use can be bad for your health. Another noteworthy item, all of these draconian "Big Brother" regulations are the result of Congress' supposed altruistic concern for public health. If they are so concerned about their beloved taxpayers, why doesn't this proposed law ban the sale of tobacco products, rather than create more laws and bureaucracy?? The answer is banned products cannot be taxed. In other words, Mr. Waxman and conspirators do not wish to kill the cash cow, just cut back on how much pasture they can access. More on this to come.
And one more thing. Isn't the FDA the same government agency whose diligent efforts maintain our food safety and security from such diseases as Escherichia coli (E. coli), salmonella and Bovine Spongiform Encephalopathy(aka Mad Cow Disease)??? More on this to come as well.
Rep. Waxman proclaimed his so-called triumph over the evil tobacco industry with this press announcement:
"This is truly a historic day in the fight against tobacco, and I am proud that we have taken such decisive action," said Energy and Commerce Committee Chairman Henry Waxman, D-Calif., the bill's sponsor. "Today we have moved to place the regulation of tobacco under FDA in order to protect the public health, and now we all can breathe a little easier."
If this proclamation does not win the lamest, worst excuse of a pun award, there shouldn't be one!!
Also, please note that there are more regulations and restrictions in this bill than the earlier tobacco settlement. (AKA government sponsored extortion) Our fearless leaders in Congress justify this in the name of dramatic improvements in public health. It seems they have discovered what the American public has known for decades. Tobacco use can be bad for your health. Another noteworthy item, all of these draconian "Big Brother" regulations are the result of Congress' supposed altruistic concern for public health. If they are so concerned about their beloved taxpayers, why doesn't this proposed law ban the sale of tobacco products, rather than create more laws and bureaucracy?? The answer is banned products cannot be taxed. In other words, Mr. Waxman and conspirators do not wish to kill the cash cow, just cut back on how much pasture they can access. More on this to come.
And one more thing. Isn't the FDA the same government agency whose diligent efforts maintain our food safety and security from such diseases as Escherichia coli (E. coli), salmonella and Bovine Spongiform Encephalopathy(aka Mad Cow Disease)??? More on this to come as well.
Tuesday, March 31, 2009
US Congress's strengths and weaknesses
Quote of the Day
"Were we directed from Washington when to sow, and when to reap, we should soon want bread."
Thomas Jefferson, Autobiography, 1821
What Congress is good at:
Creating new taxes
Raising existing taxes
Filibustering
Grandstanding
Slandering and disrespecting people they grill at committees and hearings.
Catering to their own interests (AKA Pork Barrel legislation)
Writing incomprehensible laws
Micromismanagement
Usurping individual rights guaranteed by Our Constitution
What congress is bad at:
Managing Automobile Companies
Managing Banks
Managing Insurance Companies
Managing Investment Companies
Managing Mortgage Companies
Managing Tobacco Companies
Managing the US Government
Managing the US Economy
Protecting Individual Liberties
"Were we directed from Washington when to sow, and when to reap, we should soon want bread."
Thomas Jefferson, Autobiography, 1821
What Congress is good at:
Creating new taxes
Raising existing taxes
Filibustering
Grandstanding
Slandering and disrespecting people they grill at committees and hearings.
Catering to their own interests (AKA Pork Barrel legislation)
Writing incomprehensible laws
Micromismanagement
Usurping individual rights guaranteed by Our Constitution
What congress is bad at:
Managing Automobile Companies
Managing Banks
Managing Insurance Companies
Managing Investment Companies
Managing Mortgage Companies
Managing Tobacco Companies
Managing the US Government
Managing the US Economy
Protecting Individual Liberties
Tuesday, March 24, 2009
congressional follies redux 3/24/09
Here's a quick post on a lighter note. Today Treasury Secretary Timothy Geithner and Federal Reserve Board Chairman Bernard Bernanke testify before congress today. They will ask for increased regulatory oversight and power over financial institutions that are in dire straits. The press (AKA the media) report that the congressmen/women plan to "grill" Mssr. Geithner and Bernanke about the government's handling of the AIG Bonus payments. Yes, folks, you got that right. Our beloved legislators that amended the stimulus/bailout bill to allow the bonus payments in the first place will "grill" these men about how these payments were handled!! Sounds to me like Congress wants to pass the buck on their own legislation to the executive branch. The notion of Congress protecting the taxpayers from the executive branch is similar to using wild weasels to guard a chicken coop from a fox. DC is a town where blame is ladled out like gravy over a thanksgiving dinner at a homeless shelter while responsibility and accountability for acts committed or omitted is avoided at any cost. No wonder we are in an extreme recession. Will senator Michael Dodd (dem. Connecticut) have to sit between the congresspeople and 2 of Obama's biggest dogs of financial regulation?
Monday, March 23, 2009
A Few Thoughts on the 90% Bonus Tax.
Quote of the Day:
“We figure the local and state governments will take care of the other 10 percent.”
Rep. Charley Rangel's explanation for the 90% tax on tarp recipients bonus payments.
Counterquote of the Day:
"No man's life, liberty, or property are safe while the legislature is in session."
-- Mark Twain (1866)
Holy Smoke, America!! Did this really just happen to us? The American colonies rebel yell against England was "taxation without representation is tyranny!" Now we have a 90% tax rate with representation!! Perhaps it is time for another tax rebellion. The Senate is proposing a 70% tax on bonus payments, 35% paid by the company and the other 35% paid by the recipients. Even that is way too high. I think our representatives need to take a real deep breath, exhale slowly, then read the Constitution. Is this what they want for our future generations? I think not. This bill was composed mainly to make the most political hay over the public's distress over the bonus payments. It scares me how quickly this bill was passed. Congress, especially the house financial services committee, used delaying tactics and dogged resistance to prevent reform or overhaul of Fannie Mae/Freddie Mac for years. If they had acted half as fast on reform of these GSEs, (government sponsored enterprises, more on this later) the USA could have avoided the super recession we are experiencing and just had a nice regular recession that goes away in a year or two. If Congress can pass such outrageous tax bills for one reason, I am certain they will be able to think of more. Who knows, maybe all the opponents of war will tax the extra pay for overseas and dangerous duty military people receive.
Since the unions and activists have arranged busloads of people to hike to the AIG executives homes, would it not be fair to let the overtime pay of union workers be taxed the same as bonuses for people who do not get paid by the hour but by results? When it comes down to brass tacks, overtime is just another bonus. Since the UAW get paid when they are out of work, congress could really clean up here.
If the unions and activists cared more about all the taxpayers and not just the unionized ones, they would also organize a march in DC to all the congresspeople's DC homes to lodge complaints about their micromismanagement of this financial fiasco. Remember, all this started with Fannie Mae and Freddie Mac, not AIG.
“We figure the local and state governments will take care of the other 10 percent.”
Rep. Charley Rangel's explanation for the 90% tax on tarp recipients bonus payments.
Counterquote of the Day:
"No man's life, liberty, or property are safe while the legislature is in session."
-- Mark Twain (1866)
Holy Smoke, America!! Did this really just happen to us? The American colonies rebel yell against England was "taxation without representation is tyranny!" Now we have a 90% tax rate with representation!! Perhaps it is time for another tax rebellion. The Senate is proposing a 70% tax on bonus payments, 35% paid by the company and the other 35% paid by the recipients. Even that is way too high. I think our representatives need to take a real deep breath, exhale slowly, then read the Constitution. Is this what they want for our future generations? I think not. This bill was composed mainly to make the most political hay over the public's distress over the bonus payments. It scares me how quickly this bill was passed. Congress, especially the house financial services committee, used delaying tactics and dogged resistance to prevent reform or overhaul of Fannie Mae/Freddie Mac for years. If they had acted half as fast on reform of these GSEs, (government sponsored enterprises, more on this later) the USA could have avoided the super recession we are experiencing and just had a nice regular recession that goes away in a year or two. If Congress can pass such outrageous tax bills for one reason, I am certain they will be able to think of more. Who knows, maybe all the opponents of war will tax the extra pay for overseas and dangerous duty military people receive.
Since the unions and activists have arranged busloads of people to hike to the AIG executives homes, would it not be fair to let the overtime pay of union workers be taxed the same as bonuses for people who do not get paid by the hour but by results? When it comes down to brass tacks, overtime is just another bonus. Since the UAW get paid when they are out of work, congress could really clean up here.
If the unions and activists cared more about all the taxpayers and not just the unionized ones, they would also organize a march in DC to all the congresspeople's DC homes to lodge complaints about their micromismanagement of this financial fiasco. Remember, all this started with Fannie Mae and Freddie Mac, not AIG.
Thursday, March 19, 2009
Congressional follies about AIG
Quote of the Day:
"Some People say I make jokes. I just watch the government and report the facts."
Will Rogers
First of all, a standing ovation is due to Edward Liddy, CEO of AIG for standing up to the arrogance of Steven Lynch. (A Massachusetts democrat, definitely not the comedian!) Mr. Liddy took the job for $1.00 and no stock options to try and help out his country. Mr. Lynch was way out of line in his questioning of Mr. Liddy and should apologize. What do you have to say for yourself, Mr. Lynch?
Second, this is $165 million, that's 6 zeros and 2 commas, not the trillions (12 zeros and 4 commas) that the bailout efforts and economic stimulus packages will cost the American taxpayers. This is just political grandstanding to deflect the interest of the press and public away from the massive spending the Obama Administration and Congress want to enact in the name of economic recovery. Politicos are very good at straining minnows and swallowing whales. It's called micromismanagement.
Third, were President Obama and Rep. Lynch both absent from law school the days contract law was taught? This was a pre-existing contract and failure to pay could have exposed AIG to lawsuits.
Fourth, will Timothy Geithner get his old job as Governor of the New York Federal Reserve Board back if he takes the fall for all this congressional hubris over $.0000165 trillion retention bonus that the original bailout bill allowed to go through in the first place?
I think Mr. Liddy should be given the chance to do what he said he will do in his recent letters to Treasury Secretary Geithner. Repay the bailout money and keep the good businesses of AIG intact and contributing to the USA economy. He was the CEO of Allstate, another large insurance company. He is offering all his experience for $1.00. He has a better chance of succeeding than any and all members of the house financial services committee could do. Remember, this committee repeatedly defended Freddie Mac and Fannie Mae right up until they went into conservatorship. How many of them work for $1.00. My educated guess is none,zip, goose egg, zero.
"Some People say I make jokes. I just watch the government and report the facts."
Will Rogers
First of all, a standing ovation is due to Edward Liddy, CEO of AIG for standing up to the arrogance of Steven Lynch. (A Massachusetts democrat, definitely not the comedian!) Mr. Liddy took the job for $1.00 and no stock options to try and help out his country. Mr. Lynch was way out of line in his questioning of Mr. Liddy and should apologize. What do you have to say for yourself, Mr. Lynch?
Second, this is $165 million, that's 6 zeros and 2 commas, not the trillions (12 zeros and 4 commas) that the bailout efforts and economic stimulus packages will cost the American taxpayers. This is just political grandstanding to deflect the interest of the press and public away from the massive spending the Obama Administration and Congress want to enact in the name of economic recovery. Politicos are very good at straining minnows and swallowing whales. It's called micromismanagement.
Third, were President Obama and Rep. Lynch both absent from law school the days contract law was taught? This was a pre-existing contract and failure to pay could have exposed AIG to lawsuits.
Fourth, will Timothy Geithner get his old job as Governor of the New York Federal Reserve Board back if he takes the fall for all this congressional hubris over $.0000165 trillion retention bonus that the original bailout bill allowed to go through in the first place?
I think Mr. Liddy should be given the chance to do what he said he will do in his recent letters to Treasury Secretary Geithner. Repay the bailout money and keep the good businesses of AIG intact and contributing to the USA economy. He was the CEO of Allstate, another large insurance company. He is offering all his experience for $1.00. He has a better chance of succeeding than any and all members of the house financial services committee could do. Remember, this committee repeatedly defended Freddie Mac and Fannie Mae right up until they went into conservatorship. How many of them work for $1.00. My educated guess is none,zip, goose egg, zero.
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