Archive for October, 2008

The Great Bailout Giveaway!

I received this article via e-mail, this morning.  It supports one of your uncle’s long-running concerns about the $700+++Billion Wall Street Bailout plan.  Instead of reading a rant (fox guarding the chicken coop) from an un-real writer, such as myself, read what William Greider has uncovered.  Then consider one of his closing questions: Is anybody angry?  (I mean besides your Uncle Rave . . . duh!)


Paulson’s Swindle Revealed
By William Greider
October 30, 2008 “The Nation” — The swindle of American taxpayers is
proceeding more or less in broad daylight, as the unwitting voters are
preoccupied with the national election. Treasury Secretary Hank Paulson
agreed to invest $125 billion in the nine largest banks, including $10
billion for Goldman Sachs, his old firm. But, if you look more closely at
Paulson’s transaction, the taxpayers were taken for a ride–a very
expensive ride. They paid $125 billion for bank stock that a private
investor could purchase for $62.5 billion. That means half of the public’s
money was a straight-out gift to Wall Street, for which taxpayers got
nothing in return.

These are dynamite facts that demand immediate action to halt the bailout
deal and correct its giveaway terms. Stop payment on the Treasury checks
before the bankers can cash them. Open an immediate Congressional
investigation into how Paulson and his staff determined such a sweetheart
deal for leading players in the financial sector and for their own former
employer. Paulson’s bailout staff is heavily populated with Goldman Sachs
veterans and individuals from other Wall Street firms. Yet we do not know
whether these financiers have fully divested their own Wall Street
holdings. Were they perhaps enriching themselves as they engineered this
generous distribution of public wealth to embattled private banks and their
Leo W. Gerard, president of the United Steelworkers, raised these explosive
questions in a stinging letter sent to Paulson this week. The union did
what any private investor would do. Its finance experts vetted the terms of
the bailout investment and calculated the real value of what Treasury
bought with the public’s money. In the case of Goldman Sachs, the analysis
could conveniently rely on a comparable sale twenty days earlier.
Billionaire Warren Buffett invested $5 billion in Goldman Sachs and bought
the same types of securities–preferred stock and warrants to purchase
common stock in the future. Only Buffett’s preferred shares pay a 10
percent dividend, while the public gets only 5 percent. Dollar for dollar,
Buffett “received at least seven and perhaps up to 14 times more warrants
than Treasury did and his warrants have more favorable terms,” Gerard
pointed out.
“I am sure that someone at Treasury saw the terms of Buffett’s investment,”
the union president wrote. “In fact, my suspicion is that you studied it
pretty closely and knew exactly what you were doing. The 50-50 deal–50
percent invested and 50 percent as a gift–is quite consistent with the
Republican version of spread-the-wealth-around philosophy.”
The Steelworkers’ close analysis was done by Ron W. Bloom, director of the
union’s corporate research and a Wall Street veteran himself who worked at
Larzard Freres, the investment house. Bloom applied standard valuation
techniques to establish the market price Buffett paid per share compared to
Treasury’s price. “The analysis is based on the assumption that Warren
Buffett is an intelligent third party investor who paid no more for his
investment than he had to,” Bloom’s report explained. “It also assumes that
Gold Sachs’ job is to protect its existing shareholders so that it
extracted from Mr. Buffett the most that it could…. Further, it is
assumed that Henry Paulson is likewise an intelligent man and that if he
paid any more than Mr. Buffett–if he paid $1 for something for which Mr.
Buffett would have paid 50 cents–that the difference is a gift from the
taxpayers of the United States to the shareholders of Goldman Sachs.”
The implications are staggering. Leo Gerard told Paulson: “If the result of
our analysis is applied to the deals that you made at the other eight
institutions–which on average most would view as being less well
positioned than Goldman and therefore requiring an even greater rate of
return–you paid a$125 billion for securities for which a disinterested
party would have paid $62.5 billion. That means you gifted the other $62.5
billion to the shareholders of these nine institutions.”
If the same rule of thumb is applied to Paulson’s grand $700 billion
bailout fund, Gerard said this will constitute a gift of $350 billion from
the American taxpayers “to reward the institutions that have driven our
nation and it now appears the whole world into its most serious economic
crisis in 75 years.”
Is anyone angry? Will anyone look into these very serious accusations?
Congress is off campaigning. The financiers at Treasury probably assume any
public outrage will be lost in the election returns. I hope they are
About William Greider
National affairs correspondent William Greider has been a political
journalist for more than thirty-five years. A former Rolling Stone and
Washington Post editor, he is the author of the national bestsellers One
World, Ready or Not, Secrets of the Temple, Who Will Tell The People, The
Soul of Capitalism (Simon & Schuster) and–due out in February from
Rodale–Come Home, America.

They sold us a bill of goods, and our elected representatives (most of them), unfortunately bought it.

Listen to your uncle!

Cryptoquote Spoiler – 10/31/08

People who have no time don’t think.  The more you think, the more time you have.”   —   Henry Ford

(I think Henry stayed a little too long in a closed garage . . . with the engine running, that day.)   YUR 

Halloween Jumble Spoiler – 10/31/08


Visual Description:  Mother helping son with his scary costume.

Clue/Question:  What Mom did when her son needed a Halloween costume.


Cryptoquote Spoiler – 10/30/08

The great art to learn much is to undertake a little at a time.”   —   John Locke

Jumble Spoiler – 10/30/08


Visual Description:  Mother commenting on her own cooking.

Clue/Question:  Used for taste when eating.

Answer:  A PALATE

(Easy) Cryptoquote Spoiler – 10/29/08

I’m a man of simple wants – all I want is my share of the best there is.”   —   William Feather

(Easy) Jumble Spoiler – 10/29/08


Visual Description:  Maturing actress fretting over some wrinkles.

Clue/Question:  When the aging beauty queen developed laugh lines, it was . . .

Answer:  SERIOUS

Already, another Bailout Scandal!

Why was your uncle SO against the $700+Billion bailout?  Because having Hank Paulson calling the shots at the Treasury – and setting up a Wall Street bailout plan – is like asking a fox to guard the henhouse.  The original bill did not have enough oversight and transparency, and the re-worked one – that they shoved down our throats – was just as deficient, but with a lot of ADDED pork!

The transparency aspect has already been compromised.  (Not that your uncle is surprised any!)  Check out the story at this link:

Why do you think this blog’s tag-line is:  Listen to your uncle!

;~(  YUR

Cryptoquote Spoiler – 10/28/08

What you don’t see with your eyes, don’t witness with your mouth.”   —   Yiddish Proverb

(Great quote!  Not one I practice ALL the time, but sometimes it’s impossible NOT to gossip.)   YUR

Jumble Spoiler – 10/28/08


Visual Description:  Cowboy actors on the set.

Clue/Question:  Where the actor was shot in the movie.


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