November 25, 2008

Couldn’t Help But Comment ….. (112508, Morning)

Before the Treasury Secretary decided to uses funds from The Great SUCKUP (Seemingly Unlimited Cash Kitty Under Paulson) to “rescue” Citigroup for the second time, the firm’s common shares were worth about $20.5 billion ($3.77 Friday closing price times 5.449 million shares).

Now the government has announced that it will inject yet another $20 billion into the bank in return for a preferred equity position, over and above the $25 billion it injected, also for preferred equity, after the infamous “gun to their heads” meeting in mid-October.

Uncle Sam will probably have much more say than shareholders in how the Citi will be run from here on out. If true, we will have witnessed a de facto nationalization.

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This won’t last, but it should — “On Wall Street, (former Clinton Treasury Secretary Robert) Rubin is facing questions about his role as director of Citigroup given the bank’s current woes.”

Trouble is, his cronies are in most key Obama economic team positions. Rubin will probably get a pass.

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It would have taken extraordinary courage for President Bush to stare down Hank Paulson and say “no” in September when the Treasury Secretary orchestrated his blackmail campaign to intimidate the executive and legislative branches into supporting the bailout with the made-up $700 billion price tag that turned into the pork-laden bailout bill with the $850 billion price tag. After all, the threat was that Bush would be seen in history as the guy who could have prevented a train wreck and didn’t — never mind that he had nothing to do with its imminence.

But I am coming to believe that Bush should have refused, and that history will ultimately show that his failure to do so was his biggest mistake. Just watch — The bailout that Bush acquiescenced to, and that Congress embraced, will allow all manner of ill-informed and hostile parties into economic and business deliberations who have no qualifications, nothing real to contribute, and no real right to even be there. The last thing those parties care about is economic growth.

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Just when you think CNN can’t sink any lower, it invents a “snub” of Bush by foreign leaders that wasn’t. Noel Sheppard at NewsBusters noted that the network’s Jeanne Moos did a whole segment debundking the myth, in effect taking the network’s Bush-Deranged Rick Sanchez to the broadcasting equivalent of the woodshed.

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Just when you think the press groupies can’t get any more blindered in their Obama worship, there’s this: The new first couple is “fabulously fit.”

Leaving aside discussion of how President-elect Barack Obama is objectively unfit to even be president (meaning that we must pray daily such fitness somehow miraculously arrives), I’ll merely point out that:

  • Jonathan Chait at the LA Times in 2005 thought that George W. Bush’s fitness was some kind of character flaw (“Bush has an obsession with exercise that borders on the creepy”).
  • Until recently, if we are to believe press reports that he has quit (Update: Maybe, maybe not), this supposedly “fabulously fit” guy has smoked, and more than a little:

ObamaSmoking.jpg

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1 Comment

  1. It looks like they revised the GDP # again. Now -0.5%.

    Line 2008
    I 2008
    II 2008
    III
    1 Gross domestic product 0.9 2.8 -0.5
    2 Personal consumption expenditures 0.9 1.2 -3.7
    3 Durable goods -4.3 -2.8 -15.2
    4 Nondurable goods -0.4 3.9 -6.9
    5 Services 2.4 0.7 0.0
    6 Gross private domestic investment -5.8 -11.5 0.4
    7 Fixed investment -5.6 -1.7 -5.6
    8 Nonresidential 2.4 2.5 -1.5
    9 Structures 8.6 18.5 6.6
    10 Equipment and software -0.6 -5.0 -5.7
    11 Residential -25.1 -13.3 -17.6
    12 Change in private inventories — — —
    13 Net exports of goods and services — — —
    14 Exports 5.1 12.3 3.4
    15 Goods 4.5 16.3 3.9
    16 Services 6.4 3.8 2.4
    17 Imports -0.8 -7.3 -3.2
    18 Goods -2.0 -7.1 -4.4
    19 Services 5.5 -8.0 3.2
    20 Government consumption expenditures
    and gross investment 1.9 3.9 5.4
    21 Federal 5.8 6.6 13.6
    22 National defense 7.3 7.3 18.0
    23 Nondefense 2.9 5.0 4.5
    24 State and local -0.3 2.5 0.8

    Comment by dscott — November 25, 2008 @ 10:42 am

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