PBGC Scam: In the Summer, They Still Believed They Could Win

I have just one thing to add to the great discussion on the report that the Pension Benefit Guarantee Corporation’s decision last summer to move the pension fund out of bonds and into stocks.

Just months before the start of last year’s stock market collapse, the federal agency that insures the retirement funds of 44 million Americans departed from its conservative investment strategy and decided to put much of its $64 billion insurance fund into stocks.

Switching from a heavy reliance on bonds, the Pension Benefit Guaranty Corporation decided to pour billions of dollars into speculative investments such as stocks in emerging foreign markets, real estate, and private equity funds.

The agency refused to say how much of the new investment strategy has been implemented or how the fund has fared during the downturn. The agency would only say that its fund was down 6.5 percent – and all of its stock-related investments were down 23 percent – as of last Sept. 30, the end of its fiscal year. But that was before most of the recent stock market decline and just before the investment switch was scheduled to begin in earnest.

First, we know from the fear-mongering about voter fraud and the plans to use foreclosure lists to vote-cage that the Republicans still believed they had a shot of winning New Mexico, Nevada, Ohio, and Michigan. Last summer, at the time this decision was made but before the switch was enacted (according to the vague dates in the story), Republicans still believed they had a shot at winning the Presidency.

Second, we know that the Bush Administration used federal resources for political ends. 

Third, the market was already beginning to tank when they made this decision.  And Karl Rove knows you don’t win elections if the economy isn’t "strong."

Call me crazy. But it sure looks like some Bush flunkie put the potential retirement of a bunch of Americans up in smoke so a guy who married a $100 million sugar momma would have a shot at being President. 

Update: Prof Foland and drational say I’m wrong, and that the scandal is likely cronyism and not electoral politics.

Prof Foland:

Yves Smith has the allocation percentages before and after. To me at least, they don’t seem to suggest that this was done to rescue the US stock market. Actually, the US stock market investment percentage went down as a result of the change, from 25% to 20%.

The major change was to ramp up the international equity exposure, from 0% to 25%. A minor change was to ramp private equity exposure, from 0% to 5%.

“High yield fixed income” is, I believe, a euphemism for junk bonds.

If there are shenanigans, I’d guess they’re likely to be in the private equity category. It would be interesting to know just which PE firms got that money, and whether any of them are run by former Republican Vice Presidents or Treasury Secretaries.

drational:

Regarding timing:
Looks like they voted to implement the plan in February, 2008, before the market started descending.

After full consideration, PBGC’s Board of Directors unanimously adopted a new diversified investment policy on February 12, 2008.

Regarding P. Foland @34:
At the end of FY2007, they had 55 billion dollars of investible assets, 25% in risky stocks. They voted to increase the risk to 55%. It is not clear from congressional testimony and their FY 2008 financial statement whether they made the changes they approved (“PBGC has developed a plan for gradual implementation of the new policy to prevent any disruptions in financial markets”)
and from the 2008 annual review/a>:

In FY 2008 [Thru September 30, 2008], PBGC continued to hold a large portion of its investments in long duration fixed income securities, while working to transition the assets into the new target allocations. PBGC will continue to take a prudent and careful approach to the phased implementation of this long-term policy in FY 2009 and beyond.

If they did it, they took 2.5 billion out of the US stock market and put 12.5 billion in the foriegn markets. So this does not sound like electoral manipulation at all.

It seems the scandal may be found in (as Foland and klynn point out) the nature of the private equity allocations they moved into.

image_print
64 replies
  1. sojourner says:

    It sounds to me like Bush was going to get some more money into play, come hell or high water, if he could not get hold of the Social Security loot…l

  2. MadDog says:

    Hmmm…EW, I usually can follow your logic (me good follower), but I’m missing the connection here.

    Why would the PBCG scam to move from safe bonds to gambling speculative investments like stock, real estate, etc. benefit the Repugs chances with winning New Mexico, Nevada, Ohio, and Michigan?

    Am I just being slow tonight? *g*

    • emptywheel says:

      Oh, I may need to add that logic step.

      The market was beginning to crash, and Rove knows you can’t win an election if the economy sucks. Measured, among other things, in terms of the market.

      • MadDog says:

        Ok, now I’m catchin’ on. *g*

        No reporting of bad news and/or the lack of a “see how much money we’ve made for you” if the market had surged.

        I wonder if McSame and his gambling habit was involved in placing the PBGC bets? Wouldn’t put it past the loser.

    • readerOfTeaLeaves says:

      Call me crazy. But it sure looks like some Bush flunkie put the potential retirement of a bunch of Americans up in smoke so a guy who married a $100 million sugar momma would have a shot at being President.

      Wow, this is one of those unusual times when I’d had precisely this thought, and now feel like a smarty because I see that EW has the very same notion.

      MadDog, just imagine if Bush had succeeded in getting Social Security managed by Wall Street (!).

      And Citizen92, found your comment really interesting, especially b/c a friend, who is also retired from United (and had flown 747s, so top of the pilot scale) doesn’t get squat for retirement from United after helping build up that company for decades. Mind boggling.
      (And last week, SAS announced pullout from it’s direct Seattle-Copenhagen flights, after 40+ years… very depressing, airline-wise because SAS is just such a terrific airline…)

      • readerOfTeaLeaves says:

        Just one more comment that my heart really went out to that airline Capt Sullenberger when he gave Congressional testimony regarding how much of his retirement/pension has sunk. And it was clear to anyone who saw clips of the news that he has two teenagers, who I’m sure he’d like to get through college.

        Seeing this is the situation with airline captains really tells quite a story about the times in which we live — man with years of skill and dedication lands his plane in the Hudson and is the last guy off the plane after checking for any injured passengers. Maybe Taibbi or some other sterling writer will someday let us know how many CDOs or swaps were being traded – and how much pension plans were losing – within about 5 miles of that scene.

        Is this a good time to recall that Paulson had made something like $200 million in the short years before he became Sec of Treasury? Not once did he land a plane on the Hudson, IIRC.

        ———————-
        But yes, the timing of that federally controlled pension fund trying to make it appear that the economy was still ‘afloat’ last summer synchs with many other deceptions.
        Except for Cheney’s, obviously, since he ‘didn’t see it coming’.
        Ahem.

      • TheraP says:

        I had the same thought and posted it around several places yesterday. Was surprised everyone was so focused on the “end result” (the loss) rather than on why, what, and when. I too assumed they were trying to manipulate the market in an election year. Indeed, last year, on many occasions I said to Mr. TheraP, “they’re doing it again!” I didn’t know how. But it sure looked like it to me.

        What I want to see is the dates for those trades, what was traded, what else was going on. And so on. In my view they were trying to stave off the downturn and hoodwink the voters.

        Until we get really good info on what was purchased when, I’m sticking to this theory. And I’m thrilled emptywheel is on this!!!

        • klynn says:

          One aid, may be to go through a resource like CNBC and track the market advice. A great example was what Jon Stewart pointed out in the series of broadcasts by Cramer on his advise regarding Bear Sterns in the two weeks up to the day before the “tank”.

    • earlofhuntingdon says:

      The amount of stock PBGC could buy would have propped up the market, making it appear stronger or its slide weaker. A massively scaled up version of the Klamath River water release to big Ag interests that helped elect a GOP senator. Instead of a million dead fish, the maneuver has depleted PBGC’s capital at a time when major and minor businesses are going under in record numbers. Disaster Capitalism in a big way.

      • Rayne says:

        You realize, of course, that the dead fish were no big deal to them, only minor collateral damage; to Deadeye Dick, the Klamath project was a success.

        Ditto the loss of pension funds to retirees, with rather large representation of UNION workers. The more I look at this mess, the more I think they had other things in mind besides or in addition to the election.

        This piece from August last year, just a month before the market really tubed, lays out the financial industry’s plan to tackle the entire pension market. The last graf and the lone comment just make my skin crawl, thinking that somewhere somebody might have been looking at pensions as leverage for swaps.

        • earlofhuntingdon says:

          I realize that Dead-Eye Dick didn’t give a hoot about destroying the viability of an entire river’s salmon stock, and imagine he cares as much for Middle America as he did for the fish. His viewpoint is so high we’re ants to him, or so he would like to pretend.

          The article you cite makes several good points. Allowing the whole market access to pension investments would give predators a field day, like introducing sharks into the wading pool. The California grannies who couldn’t compete with Enron’s traders would fare better.

          It’s also a huge sop to corporate America. It would allow those corporations still providing pensions to unload them – and the costs of administering them as fiduciaries for their employees. But it wouldn’t replace those with a credible, regulated and supervised scheme. It would do the opposite, leaving average investors at the mercy of an unregulated market. The short term profits to market players would be enormous.

          I also think that move is consistent with current corporate management philosophy, which seems intent on deep sixing the notion that management owes any obligations to its employees. Getting out from under fiduciary obligations to them would be a major step, as would avoiding providing health care insurance or other benefits.

          I think the goal is to move to strait, fungible, short term cash for today’s services for everyone but top managers. They will imagine themselves to be even more essential to their corporations, as their only remaining employees. They will reward themselves accordingly.

  3. Citizen92 says:

    Perverse.

    The PBGC isn’t even a legitimate retirement fund. The PBGC is the “rescued” leavings of failed corporate America’s promises to the American worker.

    A friend of mine was a pilot for United Airlines. Fully vested in retirement, stood to clear $100k a year in benefits. Whoopsies, United can no longer honor its commitments so they handed the leavings of their retirement plan to the PBGC. Fallout, my friend the pilot, fully vested, now clears $10k a year from the government.

    But that wasn’t bad enough. Bushco had to take that $10k a year and gamble it, like a junkie.

    Perverse. Perverse. Perverse.

  4. Citizen92 says:

    Has anyone listed what stocks specifically were purchased by the PBGC brain trust? Frankly should’a seen this coming after Tom Noe’s success with Ohio workers pensions.

  5. Ishmael says:

    Based on the Globe article, the PBGC losses sound very optimistic with a 55% exposure to stocks, real estate and private equity. The Caisse de Depot et placement du Quebec is one of the largest pension funds in the world and manages 25 provincial pension funds in Quebec. It lost a quarter of its value last year ($40 billion), based on exposure to foreign index futures (essentially, derivatives on foreign stocks without actually buying them, on margin) of about 9%, and exposure to asset backed commercial paper that was frozen. The highest share of funds it had in equities was 36% – depending on what kind of shit they invested in, the PBGC is likely at least half gone, not 6 or 7%. Heckuva job.

    • Ishmael says:

      …adding, not to just pick on the Caisse, but almost all public sector pension funds took a hit in the area of 20% last year, as did the big university endowments like Harvard. And their benchmarks were much less aggressive than the PBGC allocations.

      • whitewidow says:

        Yes, and presumably those funds did not invest at or near the peak, so probably don’t have the nearly maximum loss of the PBGC.

  6. ohioblue says:

    STRS Ohio, the pension fund for Ohio teachers, lost 34% or more than 24 billion between July 1, 2008, and February 28, 2009. Maybe Charles E.F. Millard, the Director of the PBGC, was advising them, too.

  7. behindthefall says:

    I suppose that a cynic (who? me?) could say that this is in line with a conscious desire to see the U.S. become a two-tiered society, with a big, BIG gap between the tiers.

  8. prostratedragon says:

    [Adjusting her bustle] Though we have not been so much as introduced, Mr. Millard, who sounds thawed from an earlier era to me, gave me an Audrey Jr. moment with this:

    Asked whether the strategy was a mistake, given the subsequent declines in stocks and real estate, Millard said, “Ask me in 20 years. The question is whether policymakers will have the fortitude to stick with it.”

    I should think at least a gloveslap called for.

    And there you have the difference between the Rovians and the Age of Innocence crowd.

    • Rayne says:

      Millard needs to be ejected forcefully from his role, immediately.

      This piece of shite which PBGC tries to pass off as a 5-year strategic plan is absolutely worthless, not even worth the cost of ink to print.

      Paulson, Chao and Gutierrez are equally to blame as members of the too-small board of directors.

      That said, I don’t have enough info about Millard’s investment activities yet to be fully convinced PBGC was abused for the purposes of manipulating the overall market. As an example, the story in Boston Globe is a better edited and more fully fleshed version of a story CFO.com did more than a year ago, suggesting some of the concerns about PBGC have been rolling forward but very slowly. The CFO.com piece demonstrates there have been reports for more than a year which should have run up flags about PBGC’s “new” approach, pre-dating Bear Stearns crash in March 2008.

      Which makes me wonder if Millard’s manipulations mirrored that of the Bush administration’s assault on Iraq, in which the administration expected a short period of conflict which would ultimately be rewarded with flowers strewn in their direction in thanks for their heroic efforts. Did Millard think that the impending Bear Stearns crash offered a buy opportunity that would reward the PBGC in time for the election, persuading retirees dependent on the plan to stay with Republican leadership? I’m more likely to buy the idea that certain elements identifying as conservative would naively believe that Bear Stearns was a one-of event they could use to influence a more targeted audience.

      And did Millard have any encouragement from Paulson to take this new tack?

      There clearly was a buy opportunity, from March through June of 2008, as money shifted out of financials to other vehicles perceived as sure things, like energy stocks. Not certain if anyone ever figured out exactly which entities were driving up energy-related stocks and commodities during that time frame, right up until consumer spending collapsed and Sen. Levin’s sponsored bill requiring increased margins on crude oil trades nipped the run-up.

  9. fatster says:

    Thanks so much for your incisive addition to this pension mess, EW. I’m an old retired thing, hence it has an immediate impact (panic) on me.

    O/T, or back to Dark SIde Dick, here’s a very scary quote (plus a direct link to Seymore Hersh’s article in the April New Yorker):

    http://rawstory.com/blog/2009/…..gainst-uk/

      • readerOfTeaLeaves says:

        Joe Conason’s “It CAN Happen Here” traces the backgrounds of some of the neocons, back before Iran-Contra. Eliot Abrams studied in Italy, and studied Machievelli.
        Interesting that those Niger forgeries were created in… Italy; ‘ends justifies the means’ and all.

        But who’s been at Cheney’s right hand for many years…? Mussolini and Machievelli admirerer Eliot Abrams.

        ‘Perfidious Albion’ is perhaps Cheney quoting Abrams…?

  10. Dismayed says:

    Yup. Plus they were trying to stave of the meltdown till after the election in the likelyhood they would not win. They knew what was coming and desperately wanted it to happen on the dem’s watch. The trap just sprung early. No more evidence needed, but just in case anyone doubted this to be the sorryest bunch of bastards ever to slither through Washington – May we offer exhibit z.

  11. Rayne says:

    Thanks for that, Bob; I wonder when Millard stepped down. I didn’t run across an announcement while I was rooting around in past PBGC articles about the change in investment policy…

    “Acting Director” is interesting, too; is he a career hire, I wonder, filling in until a new appointee is named? going to go and look…

    Yuck, look what I found. Probably a Bushie embed. And a lawyer, not an economist, accountant or finance guy, either.

  12. Rayne says:

    Millard stepped down with the inauguration as noted in this article.

    But look what else the article says:

    The new policy already has resulted in the commitment of $2.5 billion to three money managers to serve as strategic partners for investments in private equity and real estate, Mr. Millard said.

    Under the deal, announced late last year, separate commitments of $900 million each were made to BlackRock Inc. and JPMorgan Asset Management, and $700 million was given to Goldman Sachs Asset Management. PBGC officials have declined to say how much each firm would run specifically in private equity or real estate.

    But along with investing the assets, the firms are providing the PBGC with advice on risk management, consolidated reporting and education of PBGC investment staff, Mr. Millard said.

    I feel soooo much more assured now. [shudder]

    I think I’d better go to bed, just realized the Boston Globe article indicated Millard stepped down on 20-JAN. What else am I missing due to sleep deprivation?

  13. Rayne says:

    Really, I swear, I’m headed to bed.

    While I’m off in the arms of the sand man, can anybody tell me if this Greenberg is related to Maurice “Hank” Greenberg? Hank had 4 kids of which I only know two, Jeffrey and Evan.

    • Rayne says:

      Asked about the Greenberg character upthread because he was named chief investor for PBGC the very week the market crashed hard.

      If the fund this guy managed for his former employer — State Retirement and Pension Fund of Maryland — gives any pointers into this guy’s investment strategy, we should be looking carefully at the Fixed Income, Real Estate and PE companies he’s used before, including Pimco, Carlyle, Morgan Stanley, JPMorgan.

      egregious (50) — didn’t wake up at 3 am actually; I had fallen asleep reading a story to my son at 9pm, woke up at 11:30 pm, got involved in too many icky things online after that including poking around in PBGC. And then I really couldn’t sleep after that. Ugh.

  14. bobschacht says:

    Thanks, Rayne, for your additional research!

    Why can’t we get some TARP money, or something, to bail out the PBGC, after kicking out this gaggle of fools? I mean, doesn’t PBGC have a serious legal obligation to its pensioners?

    Bob in HI

  15. bobschacht says:

    Slightly OT for this thread but well within Wheelhouse interests:
    One of the reasons I like the Spanish Court inquiring into possible war crimes of Addington, Yoo, et al., is that it shows that its not just DFH bloggers who are interested in this. I also have the fantasy spinning in my head that as Obama makes the rounds for the G-20, he will be asked by a few people (discreetly, and in private, of course) what he is planning to do about our war criminals.

    I hear Mary and bmaz’s cynicism, and they make compellingly good points, but we are still within the first 100 days, and many top DOJ appointees have yet to clear Congress. I remain hopeful that a convergence of forces will make Obama choose how closely he wants his reputation to be chained to Bush-Cheney-Rumsfeld, et al. as an aider and abettor of war criminals. He still has a chance to redeem himself.

    Bob in HI

  16. Professor Foland says:

    Yves Smith has the allocation percentages before and after. To me at least, they don’t seem to suggest that this was done to rescue the US stock market. Actually, the US stock market investment percentage went down as a result of the change, from 25% to 20%.

    The major change was to ramp up the international equity exposure, from 0% to 25%. A minor change was to ramp private equity exposure, from 0% to 5%.

    “High yield fixed income” is, I believe, a euphemism for junk bonds.

    If there are shenanigans, I’d guess they’re likely to be in the private equity category. It would be interesting to know just which PE firms got that money, and whether any of them are run by former Republican Vice Presidents or Treasury Secretaries.

    • klynn says:

      If there are shenanigans, I’d guess they’re likely to be in the private equity category. It would be interesting to know just which PE firms got that money, and whether any of them are run by former Republican Vice Presidents or Treasury Secretaries.

      And that is the $$ question to answer. Thank you Professor Foland.

      Thank you for this post EW.

      Rayne, some great added content.

      ohioblue @ 15 — just to back up ohioblue, the STRS in Ohio has been, for many years, rated as one of the top and most profitable/secure retirement systems in the country. Milliard will be toasted with his bad advise. It would be interesting to see who advised STRS to take his counsel on and what party ties the individual(s) might have.

    • earlofhuntingdon says:

      Yes, my thanks, too.

      This could be a standard diversification technique. Also, major corporations list their stock in several markets. It would be useful to know how stocks listed in foreign markets were chosen, that is, if companies were chosen for non-financial reasons. The Bush administration rarely seems to have made non-political choices regarding its use of any federal government resources.

      The selection of “high yield” junk bonds and private equity investments suggests a relatively high risk tolerance for a fiduciary investor, for whom protecting principal is meant to be a much higher priority than rate of return.

      My fear is that Bush treated these assets like he’s treated all others: it’s only someone else’s money. He has also proven that he gives in to his anger and seeks revenge when he feels he’s been slighted or hasn’t got his way. His top domestic priority – privatizing a chunk of Social Security – was roundly condemned.

  17. perris says:

    Call me crazy. But it sure looks like some Bush flunkie put the potential retirement of a bunch of Americans up in smoke so a guy who married a $100 million sugar momma would have a shot at being President.

    well, a guy who failed at everything started a war, killed thousands of our military personel, hundreds of thousands of middle eastern men, women and children, diplaced millions of families all to win a second term, so this is a no brainer here

  18. cbl2 says:

    drive by note for EW, Rayne and other Michiganders –

    happened to catch Congressman Gary Peters on msnbc just now. he was fabulous in his clear, succinct comments about Big 3 Bondholders playing chicken with WH. wow. bobblehead kept trying to get him to whine about “unfairness” of it all, and he kept on – explaining bondholder’s role and equally important, just who they are and how much TARP they’ve received.

    he was as clear in his explanation as the young Lansing mayor has been in his passion.

    note: looked him up and saw he represents MI-9 – didn’t that use to be a gooper stronghold ??

    • Rayne says:

      Peters won this past year over incumbent gooper Joe Knollenberg.

      Knollenberg kept his seat in 2006 by a narrow margin, making the district a target for 2008. I think this is still a swing district.

  19. drational says:

    Regarding timing:
    Looks like they voted to implement the plan in February, 2008, before the market started descending.

    After full consideration, PBGC’s Board of Directors unanimously adopted a new diversified investment policy on February 12, 2008.

    Regarding P. Foland @34:
    At the end of FY2007, they had 55 billion dollars of investible assets, 25% in risky stocks. They voted to increase the risk to 55%. It is not clear from congressional testimony and their FY 2008 financial statement whether they made the changes they approved (“PBGC has developed a plan for gradual implementation of the new policy to prevent any disruptions in financial markets”)
    and from the 2008 annual review:

    In FY 2008 [Thru September 30, 2008], PBGC continued to hold a large portion of its investments in long duration fixed income securities, while working to transition the assets into the new target allocations. PBGC will continue to take a prudent and careful approach to the phased implementation of this long-term policy in FY 2009 and beyond.

    If they did it, they took 2.5 billion out of the US stock market and put 12.5 billion in the foriegn markets. So this does not sound like electoral manipulation at all.

    It seems the scandal may be found in (as Foland and klynn point out) the nature of the private equity allocations they moved into.

    • earlofhuntingdon says:

      A “large portion” could be any size; the mind often assumes it means majority or large majority. In this phrase, it need only be a lot of money, which the PBGC had in droves. It’s a convenient phrase to use when you don’t want to disclose ratios, which would reveal vulnerability.

      • drational says:

        Agreed. They are opaque. But I think it important to note that the max proportion of risk in their new portfolio is 55%, and it seems that as of 9/30/08 they had not transitioned all the way from 25% to 55%. Maybe they were at 54.99%, but even still, I think we need more details.

        • earlofhuntingdon says:

          That risk proportion seems skewed toward rate of return, putting the capital itself at considerable risk. That risk tolerance favors the dream of meeting government obligations through high rates of return – the fiction Bush tried to sell us when promoting privatization of Social Security. It doesn’t seem to comport with a fiduciary’s obligation to preserve capital.

          A neocon might argue that subjecting pension funds to high, raw market risk investments is just their putting the necessary skin in the game. That rationalization is aided by assuming that average rates of return equal real rates of return for the government’s portfolio. To me, that’s a dodge by market players who get paid via transaction fees to maximize their profits regardless of the outcome to investors.

          • readerOfTeaLeaves says:

            To me, that’s a dodge by market players who get paid via transaction fees to maximize their profits regardless of the outcome to investors.

            Yup.

  20. JEP07 says:

    Anyone know which stocks were invested in?

    Were they exclusively Bush bubbas? Or even predominantly Bush-connected or conservative-owned (wingnut owned?) stocks?

    Did someone simply get another”transfer of wealth” installment, paid by pensioners to billionaire (Texas) businessmen?

    Just wondered what that stock portfolio looks like and cui bono from that transfer of wealth.

    • readerOfTeaLeaves says:

      Well, who knows what PE firms got the money, but here are the last two grafs from Rayne’s link @30:

      Wall Street firms will dip their hands in the pension fund honeypot. They could follow Britain’s lead, where companies offload pension assets by purchasing a group annuity from an insurer. The market took off 18 months ago, when British regulators instituted stricter pension-accounting standards. Since then, nearly a dozen small, specialized insurers have begun offering the investments, many backed by Goldman Sachs, JPMorgan, Cerberus, Warburg Pincus,*** and Deutsche Bank—some of the same firms leading the charge in the U.S.

      A dozen U.S. life insurance companies, including John Hancock, Prudential, and MetLife, already offer a way for companies to get rid of their pension burdens through such annuities. Although the market remains small, insurers sold $2.88 billion worth of policies last year, triple the amount three years ago. If Congress stymies Wall Street’s frontal assault, big firms could switch to Plan B, setting up little insurance subsidiaries to offer those types of annuities. There’s no end to Wall Street’s creativity when billions of dollars in assets are up for grabs.[italics mine]

      Okay, they sold $2.88 billion on policies last year. Backed up with what…?

      June 2, 2008 a Senate subcommittee had a hearing on market speculation in energy. And it’s now clear that some energy speculators were leasing oil tankers (loaded with oil), and then putting them in harbors to wait for higher prices before selling. (However, I’m not sure that specific activity is mentioned in that subcommittee hearing.)

      Energy prices were being spiked by speculators and hit highs in July 2008, just before McCain speech that ‘we’re all Geogians now’ (so that we can control oil pipelines across Russian Georgia) of August 2008.

      Also, today TPM is reporting that Cassano’s ‘derivatives products’ were designed to provide all the amenities of tax havenry — you get your huge profits, with zero regulation, zero taxes, and total secrecy. So if any of those pension funds went to AIG, where is the money…?

      Or was the pension fund simply a device by which to scam more fees — while also propping up markets as the economy began to implode? (A two-fer.)

      *** Cerberus who controls majority shares of Chrysler.
      Pincus Warburg — isn’t that a subsidiary of UBS? If so, then it’s gotta be largely about tax havens and offshore money, IMVHO.

      • Rayne says:

        Oh, you noticed the three-headed dog that popped up in that article. Gave me the heebie-jeebies when I saw that; I laid in bed from 3:40 am to 4:40 am thinking about this and what they might have been trying to do. So tired and groggy now, have no theories about this besides pure greed.

        • egregious says:

          Glad to see I’m not the only one who wakes up at 3am worrying about this stuff.

          I still think there is a much broader issue of corporate, municipal, and other pensions – they are mostly gone or unpayable. The funds are bankrupt.

  21. Kinmo says:

    Why do the Cheney secret “energy” meetings keep popping into my head? I can’t help but think there’s a connection there also. May be going way out on a limb here, but I can’t help it.

  22. Mary says:

    I also don’t think you can rule out just being plain old bad investors, who, since they are dealing with OPM and no real oversight issues, lost their brakes.

    To give a little context, a broker with a major brokerage (which gets discussed here a lot) is a good friend of a member of my extended family and at a similar point in time last year he was “sharing” the brokerage’s predictions for 2008 with my family member. He gave a spiel on how great the two economists they used for their internal modeling were and then said that while they were projecting up and downs in the first 1/2 of the year, they were both firmly predicting that the second half would end up 20% over the beginning of the year. One predicting close to 20, one quite a bit more. I literally laughed out loud and asked him what kind of joy juice they were feeding those economists, but he really was serious.

    • Leen says:

      What were all those investigations into false pre-war intelligence for? Silbermann/Robb (I think I remember the Office of Special Plans, the Office of Net Assesments and the White House Iraq Group were all off limits to this investigation and Phase I of the SSCI) about? What were they for just for fun…for process just to say they investigated and did what…nothing? Phase II of the SSCI was finally completed late in the Bush administration.

      Did I miss it or was someone held accountable for all of that false pre-war intelligence? For those Niger Documents? Hell the same group started pushing for pre-emptive military action against Iran the minute after we illegally and immorally invaded Iraq.

      Niger Documents? Who what where when why? Accountability Now

  23. fatster says:

    Unbelievable, or not.

    “As IBM was firing thousands of American workers last week, the U.S.
    Patent and Trademark Office published Big Blue’s application to
    copyright a computerized system that calculates how to offshore jobs
    while maximizing government tax breaks.”

    http://www.recordonline.com/ap…../903300315

Comments are closed.