As Josh mentioned earlier in the week, the Fed has brought in — with next to no transparency — four firms to dispose of the $500 billion of toxic mortgage-backed securities the Fed has purchased as part of one of its bailout programs (separate and apart from the Treasury Department’s TARP program).
So how much are these guys making under their contracts with the Fed? We called around and all of them declined to say.
We’re still waiting to hear back from the Fed itself.
Last Fall PIMCO chief Bill Gross was on the airwaves
raising the alarm bell about how the backlog of toxic mortgage-backed securities were on the brink of crushing the US economy. And he certainly had some unique insight into the problem since over 60% of his firm’s $830 billion in holdings were made up of those mortgage-backed securities. At the time, Gross was on the airwaves (on CNBC in particular) pledging that just out of a sense of patriotic duty he’d be willing to have his firm manage the government bail-out (i.e., government purchase of the crap CDOs) for free. Just for the sake of patriotism.
So now that his firm is one of the four that got a contract to run the program from the Fed, is he following through on the pledge? Doesn’t seem like it. So far we’ve gotten through to three of the four firms, each of which has declined to comment on the fees the four companies are making for administering the program. PIMCO is the only one that hasn’t responded at all. So it’s seeming like the patriotic do-it-for-free plan hasn’t panned out.
From Bloomberg …
U.S. regulators working to untangle Bernard Madoff’s alleged $50 billion Ponzi scheme are probing other money managers suspected of using similar tactics, two people with knowledge of the inquiries said.
The U.S. Securities and Exchange Commission is pursuing at least one case in which investors may have been cheated out of as much as $1 billion, according to one person, who declined to name the manager and asked not to be identified because the probe isn’t public.
Political self-interest being what it is, I’m not really sure what the calculus was by which the Franken and Coleman campaigns came to agreement on these absentee ballots.
Interesting article by McClatchy’s Warren Strobel on the possibility of an international force in Gaza as the basis of a new ceasefire. Part of the equation might be having Fatah reassume control not over Gaza itself but over the border crossings into Gaza.
About 950 more ballots will be counted today (and possibly tomorrow) in the Minnesota Senate race, as Norm Coleman’s six-year term officially expires. That and other political news in today’s Election Central Saturday Roundup.
From Iyad Allawi, courtesy of Reuters …
Former U.S.-installed Iraqi Prime Minister Iyad Allawi has denounced the policies of President George W. Bush as an “utter failure” that gave rise to the sectarian venom that ravaged his country.
In an interview published on Saturday in the pan-Arab newspaper Asharq al-Awsat, Allawi found fault with American management of Iraq since the U.S.-led invasion in 2003 as well as the government of present Prime Minister Nuri al-Maliki.
…
“Yes, Bush’s policies failed utterly,” said Allawi, describing the U.S. administration that once backed him. “Utter failure. Failure of U.S. domestic and foreign policy, including fighting terrorism and economic policy.”
“His insistence on names like ‘democracy’ and ‘open elections’, without giving attention to political stability, was a big mistake. It cast shadows on Iraq, Iran, Afghanistan and Egypt, and I believe this will be remembered in history as President Bush’s policy,” he said.
As I said above, I certainly won’t disagree. But let’s not forget that Allawi connived with Bush for some time when Bush had power. In addition to being more or less accurate, Allawi’s judgment is a telling sign of what it means to have power — both in the deep sense and in the more immediate sense of controlling violence — and what it means to lose it. President Bush had none of the power rooted in respect, judgment and persuasion. He won two elections and he controlled an army. Now he has nothing.
With the recount now complete, absentee ballots have pushed Franken to a 225 vote lead over Norm Coleman, making Franken’s eventual victory now appear all but certain.