Tag: Politics

“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Punting the Pundits”.

Wednesday is Ladies’ Day

Follow us on Twitter @StarsHollowGzt

Katrina vanden Heuvel: It’s time to break up the big banks

Consider $2 billion lost on a bad bet, plus billions more as investors dumped the stock, a providential warning. When Jamie Dimon, the imperious head of JPMorgan Chase, revealed that the bank had lost so much on a derivatives trade gone bad, it was clear warning that, four years after blowing up the economy, the big banks are still playing with bombs. [..]

When Dimon testified before the Financial Crisis Inquiry Commission in 2010, he said that when his daughter asked him what a financial crisis was, he told her “it’s something that happens every five to seven years.” He seems intent on validating his prediction.

But the United States went for decades without a financial crisis after the New Deal regulations shackled the banks. It was only with deregulation under Reagan and Clinton that financial crises have been inflicted on us regularly. Now Dimon’s bank’s bad bets have given us one last warning: It is time to break up the big banks

Maira Sutton: Internet Freedom Activists Protest Secret Trade Agreement Being Negotiated This Week

The U.S. content industry will try anything to preserve its profit margin and power over the creative content market at the expense of the Internet. They will use any tactic that circumvents democratic processes to make new rules for the Internet that favor their interests and not the interests of Internet users or the technical community that actually builds the Internet as we know it. The Trans-Pacific Partnership (TPP) is yet another example of these tactics.

The TPP is a secretive plurilateral1 agreement that includes provisions dealing with intellectual property, including online copyright enforcement, anti-circumvention measures, and Internet intermediary liability. Due to the secrecy of the negotiations, we do not know what is in the current version of the TPP’s IP chapter; the general public has only seen a leaked February 2011 version of the U.S. IP chapter proposal pdf. Based on the one-sided nature of the groups directly involved, and the content of what has already leaked, we should all be concerned about the prospect of the TPP including provisions that will harm online expression, privacy and innovation on the Internet.

Felix Salmon, finance blogger at Reuters and Matt Taibbi, of ‘vampire squid” fame from “Rolling Stone“, were guests on “View Point with Eliot Spitzer“, discussing the implications JPMorgan’s $2 billion trading loss and why it should matter to anyone with a banking account at Chase, or any other to big to fail bank.

Taibbi and Salmon agree JPMorgan’s risk-taking has broad implications. “JPMorgan Chase takes deposits in from every single mom and pop, and small business and large business, in the world, and the President of the United States,” Salmon says. “They’re a utility bank and it is their job and their duty … to take those deposits and lend them out into the economy. And what do they do instead? They take $360 billion and put it in a hedge fund in London.”

Jamie Dimon’s failure

by Felix Salmon

Drew’s Chief Investment Office quadrupled in size between 2006 and 2011, reaching $356 billion in total, and it’s easy to see how that happened. On the one hand, it was incredibly profitable, with the London team alone, which oversaw some $200 billion, making $5 billion of profit in 2010, more than 25% of JP Morgan’s net income for the year. At the same time JP Morgan accumulated enormous new deposits in the wake of the financial crisis, both by acquiring banks and by attracting big new clients wanting the safety of a too-big-to-fail bank. Historically, JP Morgan has served big corporations by lending them money, but nowadays, as the cash balances on corporate balance sheets get ever more enormous, the main thing these companies want from JP Morgan is a simple checking account – one where they can be sure that their money is safe.

With lots of deposits coming in, and little corporate demand for loans, it was easy for all that money to find its way to the Chief Investment Office, which could take any amount of liabilities (deposits are liabilities, for a bank) and turn them into assets generating billions of dollars in profits.

Never mind the weak tea Volker rule, what is needed is a new, revised Glass-Steagal, the break up the TBTF and protection for investors and the economy.

“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Punting the Pundits”.

Follow us on Twitter @StarsHollowGzt

Richard (RJ) Eskow: Jamie Dimon’s JPMorgan Chase: Why It’s the Scandal of Our Time

They’re missing the point. When CEO Jamie Dimon announced that JPMorgan Chase had incurred at least $2 billion in losses from risky, unsecured, derivatives-types trading, it uncovered the scandal of our time once and for all.

The Chase disaster gives us a much-needed a glimpse into our corrupt political system, its Wall Street paymasters, and the media voices that allow people like Dimon to escape scrutiny.

The JPMorgan Chase story is the story behind the financial crisis that has thrown millions of people out of work. It’s the story behind our ever-growing wealth inequity. It’s the story behind Washington’s inability to prosecute criminal bankers, regulate reckless ones, and propose the economic solutions the rest of us urgently need.

New York Times Editorial: End of the Affair?

Investors are shunning the stock market, and who can blame them? As serial bubbles have burst, faith in the market has been rewarded with shattered retirements. At the same time, trust has been destroyed by scandals and – as demonstrated by the reckless trading at JPMorgan Chase – the slow, uncertain pace of financial reform.

There has been less buying and selling of stock, and there have been huge outflows of investor dollars from domestic stock mutual funds, as detailed recently by The Times’s Nathaniel Popper. If the trend continues, the result could be a less robust market, with fewer companies opting to raise money by issuing shares and fewer investors willing to put their retirement savings into stocks.

Policy makers should pay attention. Evidence suggests that investors are not merely reacting to tough conditions, but rather are staying away because they do not trust the market. Restoring trust is crucial to restoring the market.

Why is the CEO of JP Morgan Chase, or for that matter any bank CEO, sitting on the board of the body that is supposed to regulate their banks? This is a serious conflict of interest in the face of the 2008 bank crisis and, now, the $2 billion loss by Chase. $2 billion, a pittance you say. Well consider that loss triggered a drop in Chase’s market value by another $20 billion

As Matt Taibbi points this is a cause for public concern:

[..] J.P. Morgan Chase is a federally-insured depository institution that has been and will continue to be the recipient of massive amounts of public assistance. If the bank fails, someone will reach into your pocket to pay for the cleanup. So when they gamble like drunken sailors, it’s everyone’s problem. [..]

{T}he incident underscored the basic problem. If J.P. Morgan Chase wants to act like a crazed cowboy hedge fund and make wild exacta bets on the derivatives market, they should be welcome to do so. But they shouldn’t get to do it with cheap cash from the Fed’s discount window, and they shouldn’t get to do it with money from the federally-insured bank accounts of teachers, firemen and other such real people. It’s a simple concept: you either get to be a bank, or you get to be a casino. But you can’t be both. If we don’t have rules to enforce that concept, we ought to get some.

Dimon being on the board of the New York Federal Reserve is absurd:

The chief executive of JP Morgan Chase — the largest bank in the land, and the exemplar of a ‘too big to fail’ institution — is allowed to sit at the table with the people tasked with deciding when and how much of other people’s money gets earmarked for his rescue. This is not the fox guarding the hen house; this is the fox guarding the hen house while selling synthetic derivatives whose value increases with every hen he gobbles up, and who burns down the hen house so he can collect on his fire insurance policy, and then gets the government to build him a new hen house at taxpayer expense. And then, after that, he still gets to guard the new hen house.

Elizabeth Warren, a Massachusetts Democrat running for U.S. Senate, called for Dimon’s removal:

JP Morgan Chase CEO Jamie Dimon should resign from the NY Federal Reserve Bank Board

Last week, JP Morgan Chase announced a $2 billion trading loss in two months.

Sunday on Meet the Press, JP Morgan CEO Jamie Dimon said, “We know we were sloppy, we know we were stupid, we know there was bad judgment.”

After the biggest financial crisis in generations, Americans are frustrated that Wall Street has still not been held accountable and does not appear to consider itself responsible. Wall Street banks continue to have fundamental problems, and tough oversight and accountability are urgently needed.

Dimon is not only the CEO of JP Morgan, he is also a member of the Board of Directors of the New York Federal Reserve Bank, where he advises the Federal Reserve on the oversight of the financial industry.

Dimon should resign from his post at the New York Fed to send a signal to the American people that Wall Street bankers get it and to show that they understand the need for responsibility and accountability.

Sign Ms. Warren’s petition for Dimon to resign

Negotiations with party leaders to form a government in Greece fell apart again, as Greece inches closer to new elections in June that could usher in the left wing Socialist government opposed to the draconian austerity agreement with the European Central Bank, the International Monetary Fund and the Eurozone. Talks will resume on Tuesday but the moderate Democratic Left party in Greece says it will not join pro-bailout parties in a coalition without the more radical far-left Syriza. It doesn’t sound promising but technically President Karolos Papoulias has until Thursday when Parliament reconvenes:

Without the support of Democrat Left, a decidedly “pro-European” force which won 19 seats in parliament, the New Democracy party and centre-left Pasok party fall two seats short of being able to achieve a workable majority.

Syriza, an alliance of leftists and ecologists that emerged as the poll’s surprise runner-up – and has since seen its popularity surge on the back of anti-austerity sentiment – rejected the idea of participating in a government that it claimed was bent on “destroying Greece”. Alexis Tsipras, Syriza’s young firebrand leader, refused to even attend the negotiations. [..]

Syriza, whose popularity has risen on a platform of rejecting such measures, is projected to win the election with as much as 27%, according to polls conducted over the past week. Tsipras, an unabashed populist who counts Hugo Chávez among his heroes, has promised to renegotiate the painstakingly acquired bailout agreement Athens has signed with foreign lenders.

With the radical left fast dominating a political landscape whose traditional parties have been decimated for backing policies now blamed for record levels of poverty and unemployment, analysts believe it is only a matter of time before Greece is cut loose from Europe. The result, they say, will be a dramatic decline in living standards as the debt-stricken country, bereft of international rescue funds, slips ever deeper into poverty.

The markets reacted negatively with the prospect of a Greek withdrawal from the euro:

Financial and energy shares fell the most among 10 groups in the Standard & Poor’s 500 Index. JPMorgan Chase & Co. (JPM) and Bank of America Corp. (BAC) sank at least 2.6 percent as European lenders slumped. Alcoa Inc. (AA) and Schlumberger Ltd. (SLB) slid more than 1.5 percent to pace declines in commodity producers. Symantec Corp. (SYMC), the biggest seller of security software, retreated 1.4 percent after Goldman Sachs Group Inc. cut its recommendation.

The S&P 500 slid 1.1 percent to 1,338.35 at 4 p.m. New York time, the lowest since Feb. 2. The Dow fell 125.25 points, or 1 percent, to 12,695.35. The Chicago Board Options Exchange Volatility Index, which measures the cost of using options as insurance against S&P 500 losses, rose 10 percent to an almost four-month high of 21.87. About 6.6 billion shares changed hands on U.S. exchanges, in line with the three-month average.

Meanwhile, German Chancellor Andrea Merkel’s Christian Democratic Union was handed a defeat in Sunday’s election in Germany’s most populous state, North Rhine-Westphalia, receiving only 26% of the vote:

The outcome will be seen as a rejection by voters of the strict austerity policy promoted by Ms Merkel’s party at both local and national level, and a boost for the opposition. It will encourage the SPD and Greens to campaign all out for a “red-green” coalition at national level when Ms Merkel stands for re-election in autumn 2013. [..]

Opinion polls suggested that voters did not regard Ms Merkel’s national and European policies as relevant, and opted instead for the popular “red-green” coalition in the state, headed by Hannelore Kraft of the SPD, which had governed without an absolute majority for the past two years. The surprise election was caused by the defeat of Ms Kraft’s annual budget by the CDU, FDP and the far-left Linke party.

The defeat is the worst suffered by Ms Merkel’s CDU since the party lost control last year of the state of Baden-Württemberg in the wake of the Fukushima nuclear disaster.

Chancellor Merkel has chosen to ignore the defeat at home and stuck to her position on austerity agreement with Greece:

Merkel tells Greece to back cuts or face euro exit

Greece may be forced to leave the euro if the country refuses to implement spending cuts agreed with the European Union, Angela Merkel warned. [..]

Yesterday, Mrs Merkel raised the spectre of Greece leaving the euro. She is under increasing pressure in Germany to force the country out of the single currency to avert several more years of uncertainty. “I believe it’s better for the Greeks to stay in the euro area, but that also requires that we set out a path on which Greece gets back on its feet step by step,” said the chancellor.

“The solidarity for the euro will end only if Greece just says, ‘We’re not keeping to the [austerity] agreement.’ But I don’t expect that to happen. I do think they are making an effort. There are many, many people in Greece who actually want it.”

The worries over will happen to the Greek economy should they exit from the euro are really unknown. From Paul Krugman:

In particular, I keep reading that Argentina’s example is irrelevant, because Greece has hardly any exports.  [..]

What is true is that Greece doesn’t export a lot of goods. But it exports a lot of services – shipping and tourism (pdf). How might these respond to the devaluation of the new drachma? [..]

This isn’t a prediction that everything will be fine, but it is a caution that the pessimism about Greek prospects once the turmoil is past may be overdone.

If the left wing holds out and wins enough of a majority in June to form a new government, we’ll find out sooner than later who’s right about Greek prospects without the euro.

“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Punting the Pundits”.

Follow us on Twitter @StarsHollowGzt

New York Times Editorial: Backward on Domestic Violence

In an all-too-rare show of bipartisanship, 15 Senate Republicans joined with the Democratic majority last month to reauthorize the Violence Against Women Act, the landmark 1994 law that is key to efforts against domestic violence, sexual assault and stalking.

Unfortunately, the lopsided 68-to-31 Senate vote halted G.O.P. opponents only temporarily. The House Judiciary Committee last week approved its version of the reauthorization bill, which not only omits improvements the Senate bill made to the law but also removes existing protections for immigrant women, putting them at greater risk of domestic and sexual abuse.

Paul Krugman: Why We Regulate

One of the characters in the classic 1939 film “Stagecoach” is a banker named Gatewood who lectures his captive audience on the evils of big government, especially bank regulation – “As if we bankers don’t know how to run our own banks!” he exclaims. As the film progresses, we learn that Gatewood is in fact skipping town with a satchel full of embezzled cash.

As far as we know, Jamie Dimon, the chairman and C.E.O. of JPMorgan Chase, isn’t planning anything similar. He has, however, been fond of giving Gatewood-like speeches about how he and his colleagues know what they’re doing, and don’t need the government looking over their shoulders. So there’s a large heap of poetic justice – and a major policy lesson – in JPMorgan’s shock announcement that it somehow managed to lose $2 billion in a failed bit of financial wheeling-dealing.

“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Punting the Pundits”.

Follow us on Twitter @StarsHollowGzt

The Sunday Talking Heads:

Up with Chris Hayes: The guest list had not been announced at the time this diary was published.

The Melissa Harris-Perry Show: The guest list had not been announced at the time this diary was published.

This Week with George Stephanopolis: This Week’s guests Rep. Barney Frank (D-MA) and Rep. Marsha Blackburn (R-TN), debate President Obama’s historic shift in support of same-sex marriage; and the roundtable debates all the week’s politics, with Republican strategist Mary Matalin, former New York governor and host of Current TV’s “Viewpoint” Eliot Spitzer, Faith and Freedom Coalition founder and chairman Ralph Reed, Democratic strategist Hilary Rosen, and Politico senior political reporter Maggie Haberman.

Let’s hope that the George & his panel hold bigoted lying Reed’s feet to the fire like Chris Matthews did.

Face the Nation with Bob Schieffer: Mr. Schieffer’s guests are former Solicitor General and opponent of California’s anti gay marriage Prop 8, Ted Olson; Gov. Deval Patrick (D-MA) will discuss same sex marriage and the President’s announcement. A panel with Tony Perkins, the former head of the Christian Coalition; Clay Aiken, singer and winner of American Idol ; Evan Wolfson, the founder and president of Freedom to Marry; and Mark McKinnon, Newsweek Contributor will debate LGBT issues and marriage equality. Also, House Intelligence Committee Chairman Rep. Mike Rogers (R-MI) on the latest alleged terrorist threat. In honor of mother’s day, four moms talk about the women’s vote and Campaign 2012: Former White House Communications Director for Pres. Obama Anita Dunn; Conservative strategist Bay Buchanan; the Washington Post‘s Melinda Henneberger and CBS News Chief White House Correspondent Norah O’Donnell.

Bay Buchanan wrote a book, prepared for the hype.

The Chris Matthews Show: This week’s guests are Gloria Borger, CNN

Senior Political Analyst; Andrew Sullivan, The Daily Beast Editor, The Dish; Howard Fineman, The Huffington Post Senior Political Editor; and Nia-Malika Henderson, The Washington Post National Political Reporter

Meet the Press with David Gregory: JPMorgan Chase CEO Jamie Dimon joins MTP for an exclusive interview after his company announced a market-shaking $2 billion trading loss; the head of the Republican party, Reince Priebus, joins us for an overview of the campaign and a preview of the battle ahead; Senator Carl Levin (D-MI) joins MTP exclusively to respond to Jamie Dimon and make his case for why more government oversight could have prevented JPMorgan Chase’s loss; the co-anchor of CNBC’s “Squawk Box,” Andrew Ross Sorkin joins us to help to break it all down.

The roundtable weighs in: Lt. Governor of California Gavin Newsom; Chairman of the American Conservative Union Al Cardenas; Washington Post columnists Kathleen Parker and Jonathan Capehart; and MSNBC’s Chris Matthews.

State of the Union with Candy Crowley: Sen. Dick Durban (D- IL) and Sen John Cornyn (R-TX) discuss the Senate elections; Colorado Governor John Hickenlooper weighs in with an up date on his push for  Civil Unions in his state; Tony Perkins and Gary Bauer will judge Mitt Romney’s evangelical tightrope; and more om fear and terror with Homeland Security Chairman Senator Joe Lieberman (I-CT) and Congressman Peter King (R-NY).

Mothers’ Day breakfast order: French Toast, crisp bacon and Mimosas. Happy Mothers’ Day

“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Punting the Pundits”.

Follow us on Twitter @StarsHollowGzt

Paul Krugman: Obama Campaign Lacks Focus

Edward Luce says what many of us have been thinking: there’s a dangerous lack of focus in the Obama campaign, all too reminiscent of previous episodes.

Mr. Luce, a columnist at the Financial Times, wrote on April 22: “In the absence of a lift-off, Mr. Obama will be vulnerable to the question Reagan posed to voters in 1980 when he turned Jimmy Carter into a one-term president: ‘Are you better off than you were four years ago?’ Mr. Carter had no real comeback. Mr. Obama is still struggling to find his.”

Above all, President Obama isn’t telling a clear story about the economy.

Robert Reich: Of Bedrooms and Boardrooms

The 2012 election should be about what’s going on in America’s boardrooms, but Republicans would rather it be about America’s bedrooms.

Mitt Romney says he’s against same-sex marriage; President Obama just announced his support. North Carolina voters have approved a Republican-proposed amendment to the state constitution banning same-sex marriage. Minnesota voters will be considering a similar amendment in November. Republicans in Maryland and Washington State are seeking to overturn legislative approval of same-sex marriage there.

Meanwhile, Republicans have introduced over four hundred bills in state legislatures aimed at limiting womens’ reproductive rights – banning abortions, requiring women seeking abortions to have invasive ultra-sound tests beforehand, and limiting the use of contraceptives.

The Republican bedroom crowd doesn’t want to talk about the nation’s boardrooms because that’s where most of their campaign money comes from. And their candidate for president has made a fortune playing board rooms like checkers.

Yes, they are. And the change has finally struck right wing panderer Chris Matthews who finally called out Tony Perkins of the “Family Research Council” for “spreading hateful lies and junk research about the LGBT community.” On this May 10 segment of Hardball, Matthews, with the help of Rep. Barney Frank, challenged Perkins’ anti-gay misinformation, held him accountable for past statements, and demonstrated how out-of-the-mainstream his extreme positions really are:

Thank you, Mr. Matthews, for showing the rest of the media how a bigot should be treated. This is how a responsible journalist responds to hate speech.

h/t Gaius Publius at AMERICAblog

“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Punting the Pundits”.

Follow us on Twitter @StarsHollowGzt

New York Times Editorial The Human Cost of Ideology

For more than a year, House Republicans have energetically worked to demolish vital social programs that have made this country both stronger and fairer over the last half-century. At the same time, they have insisted on preserving bloated military spending and unjustifiably low tax rates for the rich. That effort reached a nadir on Thursday when the House voted to prevent $55 billion in automatic cuts imposed on the Pentagon as part of last year’s debt-ceiling deal, choosing instead to make all those cuts, and much more, from domestic programs. [..]

House Democrats offered an alternative bill that would replace the $109 billion sequester by raising taxes on the wealthy, ending oil company tax loopholes and cutting farm subsidies, but it was rejected. Republicans are determined to protect millionaires and defense contractors, no matter the costs to the country.

Paul Krugman: Easy Useless Economics

A few days ago, I read an authoritative-sounding paper in The American Economic Review, one of the leading journals in the field, arguing at length that the nation’s high unemployment rate had deep structural roots and wasn’t amenable to any quick solution. The author’s diagnosis was that the U.S. economy just wasn’t flexible enough to cope with rapid technological change. The paper was especially critical of programs like unemployment insurance, which it argued actually hurt workers because they reduced the incentive to adjust.  

O.K., there’s something I didn’t tell you: The paper in question was published in June 1939. Just a few months later, World War II broke out, and the United States – though not yet at war itself – began a large military buildup, finally providing fiscal stimulus on a scale commensurate with the depth of the slump. And, in the two years after that article about the impossibility of rapid job creation was published, U.S. nonfarm employment rose 20 percent – the equivalent of creating 26 million jobs today.