The Front Office

[Vulcanl]

The below is a postscript to Reply # 251, page 17 of this thread.  Some Front Office Joker on the other thread was trying to tell me that our government has NOT been bought by special interests (the FO being one of the largest up until now). 

That recent diastrous Supreme Court decision proves the point.  Another point proven in the below is that the average Joe is NOT stupid, contrary to what the FO thinks.  As I have said before, revolutions are born and fed by the staggeringly arrogant 'let them eat cake' attitude of these people


Associated Press
1 hr 2 mins ago
Left and right united in opposition to controversial SCOTUS decision

Much has been made of late about the hyper-partisan political environment in America. On Tuesday, Sen. Evan Bayh explained his surprising recent decision to leave the senate by lamenting a "dysfunctional" political system riddled with "brain-dead partisanship."  It seems you'd be hard-pressed to get Republicans and Democrats inside and outside of Washington to agree on anything these days, that if one party publicly stated its intention to add a "puppies are adorable" declaration to its platform, that the other party would immediately launch a series of anti-puppy advertisements.

But it appears that one issue does unite Americans across the political spectrum.
A new Washington Post-ABC News poll finds that the vast majority of Americans are vehemently opposed to a recent Supreme Court ruling that opens the door for corporations, labor unions, and other organizations to spend money directly from their general funds to influence campaigns.

As noted by the Post's Dan Eggen, the poll's findings show "remarkably strong agreement" across the board, with roughly 80% of Americans saying that they're against the Court's 5-4 decision. Even more remarkable may be that opposition by Republicans, Democrats, and Independents were all near the same 80% opposition range. Specifically, 85% of Democrats, 81% of Independents, and 76% of Republicans opposed it. In short, "everyone hates" the ruling.

The poll's findings could enhance the possibility of getting a broad range of support behind a movement in Congress to pass legislation that would offset the Court's decision. Of those polled, 72% said they supported congressional action to reverse its effects. Sen. Charles Schumer, who's leading the reform effort in the Senate, told the Post that he hoped to get "strong and quick bi-partisan support" behind a bill that "passes constitutional muster but will still effectively limit the influence of special interests."

The findings of the poll are a bit surprising considering the fact that the case split the Supreme Court, with the five conservative justices in favor and the four more liberal justices against it. The decision was almost universally hailed by Republicans in Washington, who saw it as a victory for the free speech provided for under the Constitution, while President Obama and prominent Democrats in Washington almost universally derided it as a dark day for American democracy.

However, Sen. John McCain, one of the original sponsors of the campaign finance law struck down by Court's decision and one of its few prominent Republican opponents, may have been prophetic when he predicted Americans would turn against the Court. McCain told CBS's "Face the Nation" that there would be a "backlash" once awareness grew about "the amounts of union and corporate money that's going to go into political campaigns."

Perhaps the new poll numbers show that McCain might have been onto something.

[ummm......]

Vulcanl is it any different in Singapore? There is one party here and they do whatever they want

[Vulcanl]

ummm...,

"...Vulcanl is it any different in Singapore? There is one party here and they do whatever they want..."

Corruption exists everywhere and to varying degrees.  What happened in America, however defies belief.  In the early to mid 1990s The FO systematically dismantled the regulatory framework that had stood in place since the Great Depression and proceeded to steamroll any one else who posed even remote opposition to them. 

They did this by buying our elected representatives, and got even more power through their lobbying efforts.  Their blind lustful greed resulted in the collapse and aftermath we are living through in the States.

The Singapore system has its issues and is open to valid criticism, but it will not be by me.  I leave that to Singapore's citizens. 

My beef is with the Front Office.  They lectured us all on how Capitalism was the end all and be all, they told us to listen to them.  They told us that "Greed is good."   They said that an 'ownership society' was the American ideal.  They also said that debt didn't matter, that we can spend our way to prosperity.  They wanted to invest our Social Security money in the stock market, for heaven's sake!!

Well, look at what's happened.  They have been exposed as Emperors with no clothes.  It would be funny if the situation wasn't so tragic for the average Joe.

[Vulcanl]

Good for Iceland....I hope when it's out turn again (and it IS coming), we do the same:

March 7 (Bloomberg) -- Icelanders rejected by a massive majority a bill that would saddle each citizen with $16,400 of debt in protest at U.K. and Dutch demands that they cover losses triggered by the failure of a private bank.

Ninety-three percent voted against the so-called Icesave bill, according to preliminary results on national broadcaster RUV. Final results will be published today.

The bill would have obliged the island to take on $5.3 billion, or 45 percent of last year’s economic output, in loans from the U.K. and the Netherlands to compensate the two countries for depositor losses stemming from the collapse of Landsbanki Islands hf more than a year ago. The island’s political leaders say they’ve already moved on to talks over a new accord.

“The government’s survival doesn’t rest with this Icesave vote,” Prime Minister Johanna Sigurdardottir told RUV after the preliminary count was announced. “The government coalition remains solid,” Finance Minister Steingrimur Sigfusson told RUV.

Failure to reach an agreement on the bill has left Iceland’s International Monetary Fund-led loan in limbo and prompted Fitch Ratings to cut its credit grade to junk. Moody’s Investors Service and Standard & Poor’s have signaled they may follow suit if no settlement is reached.

‘Obsolete’

Iceland’s leaders are trying to negotiate a new deal with the U.K. and the Dutch that focuses on the interest rate payable on the loan, making the bill in yesterday’s vote “obsolete,” Sigurdardottir said on March 4.

Dutch Finance Minister Jan Kees de Jager in a statement posted on the Internet last night said he is “disappointed” the agreement hasn’t yet come into effect. The U.K. was “obviously disappointed,” while “not surprised,” said a Treasury official who declined to be identified in line with departmental policy.

Iceland’s government pointed to “steady progress toward a settlement” in the past three weeks in a statement.

“The British and Dutch Governments have indicated a willingness to accept a solution that will entail a significantly lower cost for Iceland than that envisaged in the prior agreement,” the statement said.

The U.K. and Netherlands have offered an interest rate of the London Interbank Offered Rate plus 2.75 percentage points, according to the U.K. Treasury official. That’s the same as the rate for the loan from the Nordic countries that the Icelandic Government accepted in July 2009. The new offer also gave relief on the first two years of interest for the loan, amounting to 450 million euros.

‘Ordinary People’

The three governments have declared their intention to continue the talks, the Iceland statement said.

Voters rejected the bill because “ordinary people, farmers and fishermen, taxpayers, doctors, nurses, teachers, are being asked to shoulder through their taxes a burden that was created by irresponsible greedy bankers,” said President Olafur R. Grimsson, whose rejection of the bill resulted in the plebiscite, in a Bloomberg Television interview on March 5.

The Icesave deal passed through parliament with a 33 to 30 vote majority. Grimsson blocked it after receiving a petition from a quarter of the population urging him to do so. The government has said it’s determined any new deal must have broader political backing to avoid meeting a similar fate.

Icelanders used the referendum to express their outrage at being asked to take on the obligations of bankers who allowed the island’s financial system to create a debt burden more than 10 times the size of the economy.

Protests

The nation’s three biggest banks, which were placed under state control in October 2008, had enjoyed a decade of market freedoms following the government’s privatizations through the end of the 1990s and the beginning of this decade.

Protesters have gathered every week, with regular numbers swelling to about 2,000, according to police estimates. The last time the island saw demonstrations on a similar scale was before the government of former Prime Minister Geir Haarde was toppled.

Icelanders have thrown red paint over house facades and cars of key employees at the failed banks, Kaupthing Bank hf, Landsbanki and Glitnir Bank hf, to vent their anger. The government has appointed a special commission to investigate financial malpractice and has identified more than 20 cases that will result in prosecution.

Economic Impact

The island’s economy shrank an annual 9.1 percent in the fourth quarter of last year, the statistics office said on March 5, and contracted 6.5 percent in 2009 as a whole.

Household debt with major credit institutions has doubled in the past five years and reached about 1.8 trillion kronur ($14 billion) in 2009, compared with the island’s $12 billion gross domestic product, according to the central bank.

Icelanders, the world’s fifth-richest per capita as recently as 2007, ended 2009 18 percent poorer and will see their disposable incomes decline a further 10 percent this year, the central bank estimates.

Grimsson, who has described his decision to put the depositor bill to a referendum as the “pinnacle of democracy,” says he’s not concerned about the economic fallout of his decision.

“The referendum has drawn back the curtain and people see on the stage the matter in a new perspective,” he said in an interview. “That has strengthened our position and our cause.”

[Vulcanl]

Amen:

Unrepentant Bankers Undercut Reform With Vengeance: David Pauly

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Commentary by David Pauly

March 16 (Bloomberg) -- Bankers should be a humble crew. Their reckless trading almost ruined the world economy. But they are as arrogant as ever.

While bank chiefs pay lip service to reform, their lieutenants in the trenches resist government attempts to prevent future financial disasters with the same old Chamber of Commerce gusto.

Bank lobbyists in Washington, for instance, have their cannons aimed at the proposed Volcker Rule, which would prevent banks from trading for their own account and from running hedge and leveraged-buyout funds.

The prohibition, named after its proponent, former Federal Reserve Chairman Paul Volcker, would mitigate the use of bank deposits to take inordinate risks, such as gambling on subprime mortgages with gobs of borrowed money.

A ban on proprietary trading won’t work, the banks say, because it’s hard to separate trades they make for themselves from ones they make for customers. Do they mean that the math geniuses they have on their payrolls couldn’t figure it out?

Banks insist on the status quo because taking risks is where the big profit and the huge bonuses are. That’s why commercial banks a decade ago got the law changed to allow them forays into investment banking.

This is the system that Wall Street wants to keep: One where Richard Fuld, who as chief executive officer of now- bankrupt Lehman Brothers Holdings Inc., signed off on misleading financial statements, making himself “at least grossly negligent,” according to a court-appointed examiner’s report last week.

Who, Us?

This is the system that Wall Street wants to keep: One where CEO Lloyd Blankfein sees nothing wrong with Goldman Sachs Group Inc. having made trading bets against the very investments it had sold to customers.

This is the system that Wall Street wants to keep: One where JPMorgan Chase & Co. got so caught up in the profit possibilities for mortgages that CEO Jamie Dimon told a government panel in January, “We never questioned that home prices would not go up forever.”

Bank CEOs support a new government body that would wind down failed big banks in a way that wouldn’t upset the financial system. They prefer not to think about a better option: Separating investment banks and commercial banks again and making sure no institution gets too big.

In Full View

Banks also fight against proposals that the trading of derivatives -- contracts that companies and investors use to hedge risks -- must be on exchanges. That would mean guaranteed trades made openly by firms with adequate capital.

Financial lobbyists say it’s not practical to trade all derivatives on an exchange because in many instances, banks have to customize hedges for certain risks. Looks like another worthy job for those Wall Street Ph.D.s -- hedging a one-of-a-kind risk with generic contracts.

Banks maintain that derivatives didn’t cause the credit crisis. Apparently, derivatives -- in this case credit-default swaps that were insurance on bonds -- didn’t cause the collapse of American International Group Inc. and the massive government bailout of that insurance company.

Giant banks resist derivatives reform because they fight anything that fosters disclosure. Information about their trades makes for more efficient markets. Banks make more money in inefficient markets; the combination of opaque pricing and their own information gives them an advantage.

Clamping down on the banks should be a no-brainer given their low standing with the public. Yet bankers still get a hearing when they try to undercut reforms, if not defeat them. In the end, it may be business as usual on Wall Street. Bank CEOs gloat at the prospect.

(David Pauly is a Bloomberg News columnist. The opinions expressed are his own.)

Click on “Send Comment” in the sidebar display to send a letter to the editor.

Last Updated: March 15, 2010 21:00 EDT

[agreed]

We can all agree bankers are arseholes Vulcan.

What do you do again?

[Vulcanl]

agreed,

I have covered this in the past.  No one in the Front Office will ever acknowledge that I am 'one of them,'  believe me.

Very early on in my career I decided that being part of the Front Office was not for me.

I do not enable - I perform a valuable CONTROL function. 

The way things are going in my industry, I do not expect to be out of work again!!

[agreed]

well if you guys were the control, you sure did a lousy job.

As for never being out of work again....... just give it time.
We will no doubt in future hear those words " this time it's different " once more.

At the end of the day, still a banker, or are you a coal miner?
expect "front office bastards, back office angels " thread title... anytime soon - see line 1 - to the rest of us you're just bankers.

[Vulcanl]

"...well if you guys were the control, you sure did a lousy job..."

Good one, mate.  You got me on that.  Will endeavour to do better next time

"...At the end of the day, still a banker, or are you a coal miner?..."

Some of us in this industry (although assuredly still the minority) equally despise what these people (the FO) have done, believe me.  We do what we can...but change comes slowly, especially the kind of change that is necessary.

The level of Groupthink, single-mindedness, and unwillingness to see the big picture is certainly the biggest obstacle to be overcome. 

I for one will continue to fight the good fight....

[Vulcanl]

Finally this Hack says something that makes sense.  While the Government is at it, they should also roll up Social Security into the National budget.  These would be sensible first steps towards transparency of the whole system:

Geithner Urges End to Fannie and Freddie ‘Ambiguity’ (Update1)
2010-03-22 23:51:26.492 GMT


     (Adds Geithner, Hensarling comments in sixth through 11th
paragraphs.)

By Rebecca Christie and Phil Mattingly
     March 22 (Bloomberg) -- U.S. Treasury Secretary Timothy F.
Geithner said the government should end the “ambiguity” over the government’s involvement in mortgage finance companies Fannie Mae and Freddie Mac.
     “Private gains can no longer be supported by the umbrella of public protection, capital standards must be higher and excessive risk-taking must be appropriately restrained,”
Geithner said in testimony prepared for the House Financial Services Committee that was obtained today by Bloomberg News.
The hearing is scheduled for tomorrow at 10 a.m. in Washington.
     Geithner said the Treasury Department and the Department of Housing and Urban Development will issue a request for comment by April 15 on how to overhaul the U.S. housing-finance system and its regulatory structure. The government needs to make sure there is “no ambiguity over the status or allowable activities of any private entity which enjoys any benefits or protections from the government,” he said.
     At the same time, Geithner pledged that the Obama administration would seek to avoid disruptions in the market for Fannie Mae and Freddie Mac’s debt and mortgage-backed securities. He said investors should not doubt the U.S.
government’s commitment to backstop the obligations of the two companies, which have been in conservatorship since 2008.

                          Sufficient Capital

     “It should be clear that the government is committed to ensuring that the GSEs have sufficient capital to perform under any guarantees issued now or in the future and the ability to meet any of their debt obligations,” Geithner said. “The administration will take care not to pursue policies or reforms in a way that would threaten to disrupt the function or liquidity of these securities or the ability of the GSEs to honor their obligations.”
     The testimony expands on Geithner’s call earlier today for a “fresh, cold look” at the government’s role in housing. In a speech at the American Enterprise Institute in Washington, the Treasury chief said he is “looking forward to reforming” the government-sponsored enterprises -- or GSEs, as Fannie and Freddie are known -- even though that process has been put off while the Obama administration focuses on priorities including a financial regulatory overhaul.
     The administration’s delay in offering its plan for Fannie and Freddie has drawn criticism from Republican lawmakers who are already critical of President Barack Obama’s approach to toughening financial oversight.

                          ‘No’ Strategy

     Representative Jeb Hensarling, a Republican from Texas, said today that the administration should explain why it has “no exit strategy” from its 2008 takeover of the two mortgage- finance companies.
     Geithner said in his prepared testimony for tomorrow’s hearing that the government had “few viable alternatives” to its extensive support of Fannie Mae and Freddie Mac because the two companies are so central to the housing market. Private capital isn’t available in sufficient strength to fund the mortgage market and make credit widely available, he said.
     Before the government stepped in, the two companies guaranteed more than $5 trillion in residential mortgage-based securities, or almost half of the U.S. residential mortgage market, Geithner said. They also had more than $1.7 trillion in outstanding debt, held equally by foreign and U.S.-based investors, he said.

                        Treasury Backstop

     The Treasury in December said it would provide as much support to the GSEs as needed over the next three years. At that time, the Treasury also eased its requirements for the two companies to shrink their portfolios.
     Geithner said the Treasury is still “firmly committed” to shrinking the firms in the long run. He also reiterated that the two companies are unlikely to exceed previous projections on government assistance.
     “Neither company was near the previous $200 billion per institution limit in December, and neither is likely to exceed those caps even under a range of very conservative assumptions,” Geithner said.
     The Treasury secretary laid out broad objectives for weighing how to change Fannie Mae and Freddie Mac, along with other housing organizations such as the Federal Home Loan Banks and the Federal Housing Administration. He said there are “a variety of mechanisms” the government could use to promote stability and also provide subsidies to parts of the market.

                         New Incentives

     The housing finance system needs to have incentives that are aligned to encourage the mortgage industry to work toward long-term health instead of short-term gains, Geithner said.
Private gains shouldn’t be allowed when the public bears the brunt of losses, and mortgage finance companies should be required to hold sufficient capital and avoid abusive practices.
     Mortgage products should be standardized and support a liquid secondary market, with a broad base of investors and “accurate and transparent pricing,” Geithner said. Government housing policy should aim to promote widely available mortgage credit, financial stability and affordable housing options for lower-income households, he said.
     “Action is needed to ensure that markets are more stable, consumers are protected, credit is widely accessible and important housing policy objectives, such as affordable housing for low and moderate income families, are administered effectively and efficiently,” Geithner said. “Government has a key role to play in that new system, but its role, and the role of the GSEs in particular, will be fundamentally different from the role played in the past.”

[another thought]

I have seen the light.

Front office is evil. Making money and selling stuff is evil.

Stop the lot, vulcans job enabling it will have gone and he will be on the shitheap where he belongs.

[Vulcanl]

I agree with the majority of my fellow Americans and I think that anyone with any sense of decency would as well.  I have said repeatedly that I am no fan of Gov't expansion in any way, however if regulation and Gov't control is the only way to rein in these people, then so be it.

Now that Obama has his signature victory on health care, the focus of the US gov't will shift to financial services.  They are an easy (and valid) political target to score some easy wins in preparation for the November 2010 election cycle.  European governments are naturally inclined towards regulation, and the Asian system is the most controlled already.

The days of easy money made at the expense of the regular Joe are over (Thank God).  Let's hope that nothing like the disgraceful events of this past decade are ever seen again.

Wall Street Despised in Poll Showing Majority Want Regulation
By John McCormick and Alison Vekshin

March 24 (Bloomberg) -- Americans are leery about creating a new federal agency to make consumer-protection rules for mortgages and credit cards and would prefer to enhance the existing powers of banking regulators.

Most people interviewed in the Bloomberg National Poll say they don’t like Wall Street, banks or insurance companies and favor letting the government punish bankers who helped cause the worst financial crisis since the Great Depression.

Almost seven out of 10 people surveyed support using current bank regulators for consumer protection, backing positions held by the financial industry and Republicans over President Barack Obama’s proposal to establish an independent agency.

“People are generally satisfied with the way consumer protection has worked with banks,” said Ernie Patrikis, a partner specializing in banking supervision at the White & Case LLP law firm in New York. “Most Americans could care less about redoing the financial regulatory structure.”

The poll’s findings come as the White House and congressional Democrats pivot to focus more election-year attention on an unpopular political target -- banks and Wall Street -- following this week’s victory on health-care legislation.

As the country struggles with a 9.7 percent unemployment rate while financial stocks surge, 57 percent of Americans have a mostly unfavorable or very unfavorable view of Wall Street, versus fewer than one-quarter who have a favorable opinion. Banks are viewed badly by 54 percent of poll respondents, and 60 percent have a negative opinion of insurance companies.

Disdain for Executives

The poll also shows most Americans don’t like the nation’s top corporate bosses. Almost two-thirds say they have an unfavorable opinion of business executives, a rating that rivals the public’s disdain for Congress, which was viewed with disfavor by 67 percent of respondents.

The poll of 1,002 U.S. adults was conducted March 19-22 by Selzer & Co. of Des Moines, Iowa. It has a margin of error of plus or minus 3.1 percentage points.

Low esteem for financial firms was reflected in resentment of big paychecks on Wall Street.

Fifty-six percent of those polled say they would support government action to limit compensation of those who helped cause the financial crisis, or to ban those people from working in the banking industry.

“The amount of money that people on Wall Street make seems to be really out of bounds,” said Laure Sinclair, 52, a part- time accountant who lives in Dallas. “But I don’t know that the government can regulate that because we want to be a capitalist society.”

Consumer Protection

Obama’s proposal for a stand-alone consumer agency has been a main sticking point in negotiations between Senate Democrats and Republicans on broader legislation to increase oversight of Wall Street.

The Senate Banking Committee on March 22 approved a bill by Senator Christopher Dodd, the panel’s chairman and a Connecticut Democrat, to set up a consumer-protection bureau at the Federal Reserve with the authority to write and enforce rules. Obama continues to make the agency a priority as part of what would be the biggest overhaul of the system policing Wall Street since the 1930s.

“By creating a new consumer agency, we will finally set and enforce clear rules of the road across the financial marketplace,” Obama said in a March 22 statement. “I will continue to fight to strengthen the bill and against attempts to undermine the independence of this agency.”

Populist Ire

As Democrats and Republicans seek to tap populist ire, the poll shows there may be political advantage in taking on big financial institutions such as Charlotte, North Carolina-based Bank of America Corp., and New York’s Goldman Sachs Group Inc.

The majority of poll participants -- 56 percent -- say big financial companies are more interested in enriching themselves at the expense of ordinary people, while 40 percent say such firms play a vital role in enabling the economy to grow.

At the same time, Americans are divided over the scope of government regulation. More than 40 percent of Americans say the government has gone too far in measures to fix the financial industry; 37 percent say it hasn’t done enough. Almost six out of 10 people say Wall Street hasn’t gone far enough on its own to protect against future emergencies.

“Anything the government gets their fingers in, they mess it up,” said poll participant Norman White, 60, a community college electronics instructor who lives in Colfax, Louisiana. “I don’t have a very high opinion of the government running anything.”

Views of Fed

The Fed could use some marketing help, the poll shows. More than a quarter of participants don’t have an opinion about the central bank, while 42 percent have a favorable view and 31 percent hold an unfavorable view.

While gloomy about the nation’s economic outlook, most Americans believe there is little chance in the next few years of another financial upheaval like the 2008 crisis that caused a near collapse of the U.S. banking industry. While 42 percent say they think such a scenario is at least fairly likely, 57 percent say it is only somewhat likely or not likely at all.

[Vulcanl]

We have another round of hearings starting today (this evening our time), probably will be broadcast live again:

http://www.fcic.gov/hearings/01-13-2010.php

Let's see what these weasels have to say for themselves...

[who pays]

Whose revenue pays your salary these days vulcan or is operations now a profit centre.

[work hard play hard]

As Gordon Gekko once said: "The point is, ladies and gentleman, that greed, for lack of a better word, is good. Greed is right, greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA. Thank you very much."

Agree or not, sure sounds cool.