Posts filed under “Finance”

WAPO: Treasury Illegally Repeals Tax Law

Front page article in the Washington Post today, calling attention to a highly questionable aspect of the $750 billion bailout plan: A Quiet Windfall For U.S. Banks.

We learn from WaPo that the Treasury Department slipped through a $140 billion tax windfall to US banks — in theory repealing 1986 legislation, passed by Congress and signed by President Reagan.

The likely illegal change was aggressively lobbied for by banking officials, who sought to take advantage of the market turmoil and credit crisis.This is an ongoing issue we have witnessed in every prior bailout: Opportunism knows no sense of decency.

WaPo:

The financial world was fixated on Capitol Hill as Congress battled over the Bush administration’s request for a $700 billion bailout of the banking industry. In the midst of this late-September drama, the Treasury Department issued a five-sentence notice that attracted almost no public attention.

But corporate tax lawyers quickly realized the enormous implications of the document: Administration officials had just given American banks a windfall of as much as $140 billion.

The sweeping change to two decades of tax policy escaped the notice of lawmakers for several days, as they remained consumed with the controversial bailout bill. When they found out, some legislators were furious. Some congressional staff members have privately concluded that the notice was illegal. But they have worried that saying so publicly could unravel several recent bank mergers made possible by the change and send the economy into an even deeper tailspin.

“Did the Treasury Department have the authority to do this? I think almost every tax expert would agree that the answer is no,” said George K. Yin, the former chief of staff of the Joint Committee on Taxation, the nonpartisan congressional authority on taxes. “They basically repealed a 22-year-old law that Congress passed as a backdoor way of providing aid to banks.”

This should come as no surprise to long-time watchers of the Bush White House. From their extra-legal signing statements (they took them seriously, but legal scholars said they had no legal standing) to the abuses at the Justice Department, there was very little respect ever paid to the US Constitution.

How typical of the rogue elements within the outgoing administration.

Look for litigation about this shortly . . .

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Source:
A Quiet Windfall For U.S. Banks
With Attention on Bailout Debate, Treasury Made Change to Tax Policy
Amit R. Paley
Washington Post, November 10, 2008; Page A01

http://www.washingtonpost.com/wp-dyn/content/article/2008/11/09/AR2008110902155.html

Category: Bailouts, Credit, Finance, Legal, Taxes and Policy

Silly Money

Silly Money (part one) – Bremner, Bird and Fortune -

Category: Bailouts, Finance, Markets, Video

Bailouts to Banks

Nice interactive table from ProPublica: > > The full list is at ProPublica. > Source: Bailout Bucks to Banks ProPublica, October 29, 2008 1:43 pm EDT http://www.propublica.org/feature/bailout-bucks-to-banks-1028

Category: Bailouts, Credit, Finance

Campaign Finance Map: Monies Raised by Candidates

Fascinating graph of the candidates money raising this campaign cycle. What is so astounding this election cycle is not that John McCain trails Barack Obama in fund raising, but that he also trails Hillary Clinton: Obama $659.7m, Clinton, $249m, McCain $238.1m. I posted a bunch-o-election related graphs, polls, charts, tables, etc. over in digital media….Read More

Category: Data Analysis, Finance, Markets, Politics

Sending Money to the Wrong Banks

Category: Credit, Finance

Why Banks Have Become Schizophrenic

Category: Consumer Spending, Credit, Finance, Psychology

Bank Dividends ?

Category: Credit, Finance, Psychology

Is Wells Fargo “Sugarcoating” Balance Sheet?

Category: Data Analysis, Finance, Financial Press, Legal

Laid Off By Lehman: One Broker’s Story

Speaking of anecdotal sentiment indicatorsWhat does a Lehman Brothers’ broker do with his days now? Untucked Films found out. Directed by Chuck Divak and Jonathan Emmerling.

OMG, this is hysterical:

Perfect entertainment for a quiet Friday —

Hat tip: themessthatgreenspanmade

Category: Credit, Finance, Markets, Psychology, Video

Bank Earnings Are Fugly !

Category: Earnings, Finance