Hank Greenberg Sorta Liveblog

For reasons I explained here, I’m not going to do a full liveblog of Hank Greenberg’s appearance before Oversight today, though will keep half an eye on it. If you want to follow along, it’s on CSPAN3 and this Committee stream (which I can’t get to work).

Most interesting detail, thus far, is that Issa insisted that Greenberg’s lawyer be sworn in, as well as Greenberg. 

Greenberg’s complaining that by nationalizing AIG, it chased employees away. He’s saying it needs a new management team with experience in insurance (as if Edward Liddy doesn’t have insurance experience), emphasizing that said management team needed an internationalist focus, bc that’s what AIG is involved in. He’s arguing too that the govt should just limit its ownership to 15% so that private investors will get involved. He did say that AIGFP should be walled off–that’s a stance I suspect is smart.

Issa just asked Greenberg about the Ferguson case (involving Gen Re) in Connecticut, suggesting Greenberg was an unindicted co-conspirator. Greenberg’s name is all over that, but his lawyer wants to claim he was never tied to that. Also, apparently Greenberg has received a Wells Notice from the SEC. His lawyer didn’t explain what the Wells Notice pertained to.

Hank says to Kanjorski that he is a big fan of transparency. Issa takes that opportunity to introduce an SEC settlement showing that under Hank AIG was engaged in sham reinsurance schemes (this is the Gen Re thing). 

Lynch: The Maiden Lane CDS "are in the toilet."

Hank: Maiden Lane III terrible deal for the taxpayer. Purchased at par, even though the marks on those CDOs way down. 

Hank trying to assure Lynch that it was just chance that they picked OTS as regulator, rather than someone tougher. 

Patrick Kennedy just said he’s going to submit a bill to repeal the repeal of Glass-Steagall!!!

Hank had several conversations with Baxter NYF President, and two conversations with Geithner.

49 replies
    • readerOfTeaLeaves says:

      FOTFLMAO ;-)))

      Just clicked over here from TPM, which quotes someone at the London G-20 saying, “The era of banking secrecy is over.” More bad news for Hank, no doubt.

      EW, thanks for keeping attention on this item; I’d not realized this was happening.

  1. SaltinWound says:

    I was just researching Greenberg a bit to see if he’s related to the famous Detroit Tiger. He doesn’t appear to be but he sure is tied in to David Rockefeller. Do all roads really lead to Rockefeller?

  2. PJEvans says:

    Someone ought to slide a picture of a rack of pitchforks in front of him. Preferably one that’s slightly singed at the edges.

    (Who, me? Just making a polite suggestion to him, that’s all.)

  3. klynn says:

    ROTL @4

    Was reading a link from the Lake and left this comment irt Merkle’s comment. Merkel stated:

    “That is not a bargaining chip,” she said, adding, by contrast, “Regulation is something that is in everyone’s interest.”

    Hey, I think Obama may have gone into this asking his foreign counterparts to push the regulation theme. He’s new, dealing with a Bush mess and he can come back and say, “Folks, the world wants regulation. So regulate we must.”

    He can come home and say he pushed stimulus spending but that it was clear no more spending is gonna happen until regulation happens folks. So we must repeal the repeals that created disfunctional deregulation.

    This is Merkel’s “shoulder squeeze” back to Bushies.

    • klynn says:

      Jeffersonian Republicans understood the need to flip-flop on their politics when foreign policy and national security were at stake. Let’s hope our current GOP can take a lesson from the past…

    • readerOfTeaLeaves says:

      Wow, this is getting interesting.
      My morning check-in on media topics for the day has Adm. Mullen on the Today Show talking about ‘financial security’, and then branching out from there. http://www.msnbc.msn.com/id/21…..1#30008561

      Also being highlighted on the blogs and media: ‘financial reform’, and we see it linked with ‘national security’ in news reports from G-20, and by Adm Mullen and DNI Blair.

      If you go over to McClatchy’s “Nukes and Spooks” and scroll down a bit, you’ll see several very interesting items, http://washingtonbureau.typepa…..lsecurity/
      (1) ‘A New Kind of Warfare’, which is precipitated by financial collapse, and
      (2) Government contracts for embassy being cancelled; Dept of State [with Hilary as SecState] has just cancelled a $54 million dollar contract for a new embassy construction project in Gabon. The main subcontractor? First Kuwaiti General Trading & Contracting, same folks who built the Baghdad embassy. The actual contract, however, was from a firm in Rockville, MD… wonder whether that firm includes any of Cheney’s Stay Behinds?

      A project like that embassy project would surely involve currency transactions, multi-bank configurations, and insurance. Wouldn’t it be very simple to build in a tax haven or two while you’re at it…?

      Interesting convergence of topics on the day that Hank Greenberg is giving testimony to a House hearing. Here’s hoping something useful comes out of it.

      • klynn says:


        That is an interesting convergence.

        Would like to see some write-up on economic collapse as a form of war, not just form of war precipitated by financial collapse.

        As for regulatory muscle, I do not know if you ever read this MotherJones piece on Phil Gramm but it is a gem.

  4. BayStateLibrul says:

    Miss Waxman.
    While they are voting, take in Kudzu Kudlow… he is reporting
    a “roaring bull market”….

  5. nextstopchicago says:

    With the Senate succession decided, this may be of purely local interest, but it’s rumored that Fitzgerald will release the Blagojevich indictment today. The US Attorney’s office announced that there would be a court filing and a press release, but no press conference. Tribune “sources” say that this is the indictment. There is also some admittedly unsourced and unknowledgeable speculation that in the absence of a press conference, it could be that they are just filing for an extension.

    Trib breaking link (though they may move this to the main site at some point today):

  6. earlofhuntingdon says:

    If old Hank would limit his former company’s losses to 15% of cash reserves, then the USG could responsibly limit its ownership to 15%. When his former employees ramp up those losses to trillions, the polite response is screw you, strong letter to follow.

    “Insurance expertise” isn’t really what’s wanted here. AIG apparently didn’t have any. They bet the farm on non-insurance products disguised as insurance and on bogus tax shelter schemes that will costs billions more. AIG needs a receiver, a broom and lots of Lysol. It doesn’t need Mr. Greenberg’s advice and neither do we.

    • klynn says:

      “Insurance expertise” isn’t really what’s wanted here. AIG apparently didn’t have any. They bet the farm on non-insurance products disguised as insurance and on bogus tax shelter schemes that will costs billions more. AIG needs a receiver, a broom and lots of Lysol. It doesn’t need Mr. Greenberg’s advice and neither do we.

      (my bold)

      Lovely. To the point and hitting the mark.

      Thank you.

      (I’ve got the broom and Lysol President Obama. Anyone game to join a national Broom Brigade?)

      • earlofhuntingdon says:

        The “insurance expertise” Mr. Greenberg refers to includes the one thing glaringly absent in AIG and the failed investment banks and mortgage “lenders”. Underwriting.

        Underwriting is risk assessment. It includes research and analysis. It includes process controls, such as demanding, receiving and reviewing transaction tapes. Statistically significant samples are reviewed to verify that the correct paperwork was required and filled out, and that information asked for and supplied is accurate. It involves review committees whose job is to review major proposed transactions to verify that they meet the risk limits a competent organization imposes on itself in order to stay in business.

        The fake money to be grabbed was so great these companies put the sales people in charge of audit, accounting and legal. Internal controls were shut down. (That mirrors what Cheney did to shut down checks and balances inside the federal government.)

        AIG and its investment banking brethren, who taxpayers are subsidizing with no apparent limits, recklessly or intentionally drove down the highway at top speed while blindfolded. The taxpayers are paying to pick up the pieces left after their adrenaline rush. The chutzpah comes in their asking for more money and the same absence of controls to do the same thing all over again. I can understand why Mr. Greenberg and his peers would ask for it. Why they should get it is beyond me.

        • klynn says:

          The taxpayers are paying to pick up the pieces left after their adrenaline rush. The chutzpah comes in their asking for more money and the same absence of controls to do the same thing all over again. I can understand why Mr. Greenberg and his peers would ask for it. Why they should get it is beyond me

          . (my bold)

          Yep. Been having this conversation with my BIL who is a risk assessor. He is not so pleased with AIG or the government. Nor am I.

          Thanks for your insight.

        • Rayne says:

          The underwriting continued at the insurance and reinsurance levels; this gave the NAIC members and feds the impression that everything was on the up-and-up.

          But once they wrote swaps offshore — companies A,B,C,D all agree to trade bundles of risk with downsides and upsides to be shared, and only upsides anticipated according to side letters — there was no underwriting mandated, because the content below it had been vetted (at least when it came to insurance/reinsurance products) by underwriters and auditors. The use of CDOs really bolluxed up the mess because they didn’t go through the same level of scrutiny. What should we be doing to ensure that CDOs don’t ever meet insurance again if they are not actuarially screened and vetted?

          Hello, Glass-Steagall. Or more specifically, good riddance to Gramm-Bliley-Leach since this legislation allowed insurance companies to meet head-to-head with banks and vice versa.

          What’s left of AIG — the insurance and reinsurance businesses — might be salvageable on their own if the financial services holding company structure above them was forced to let go of them. If the insurance biz was spun off, AIGFP could be shut down in a more orderly fashion and consumers’ policies firewalled off from the remaining implosion.

          It was tax avoidance, ultimately — legal tax evasion. We also need to do something in tax code about this as well, to disincentivize the drive to find ways around exposure to taxes. It has to hurt worse to avoid it.

          • readerOfTeaLeaves says:

            It was tax avoidance, ultimately — legal tax evasion. We also need to do something in tax code about this as well, to disincentivize the drive to find ways around exposure to taxes. It has to hurt worse to avoid it.

            I think it was fraud in addition.

            But EOF synthesized it.
            And I caught parts of the hearing, but did not hear any member ask Greenberg about offshore banking. Anyone know whether he was asked about that? (Personally, watching Congress members treat him as an exec, rather than a criminal who’s regarded as so powerful that he’s managed to evade conviction was a galling sight, but oh, well…)

            Ultimately, this sure looks to me like governments vs neoFeudalist criminal gangstas — many of which have risen to upper levels of government and international finance positions, in order to better game things in their favor.

            G-20 leaders have to work together, or they’ll wake up finding that mafias and drug cartels have managed to gain power via mercenary forces, using offshored, tax-havened wealth serviced by seemingly legitimate banksters.

            What a disaster.
            At this point, though it’s ironic to watch, as near as I can tell the G-20 leaders have to stick together if they’re going to prevail against international crime.

            I did catch one bit where Greenberg blamed his successors for the failure of AIG. I sincerely hope the knives of upper AIG are sharpening after THAT little shove old Hankster gave them ;-))

          • earlofhuntingdon says:

            That was my point, that the control fraud took place in the most critical parts of AIG’s business and that of its investment banking brethren. That’s the part that brought AIG and like-minded fraudsters down, and US taxpayers with them.

            It does us no good to know that your and my car insurance was properly underwritten, with risks assessed, adequate capital in place and excess risks reinsured through businesses that themselves were adequately capitalized and which had risk management processes in place (required to make the reinsurance worth more than the paper it was written on).

            As you point out, the CDO business was wholly unregulated. That produced layer upon layer of uncapitalized bets, a false sense of solidity, and huge fictional profits.

            It’s like a nightmare tale out of Victor Hugo. The thief who steals the church candlesticks may go to prison or the galleys. The thief who steals everything in the church becomes bishop.

  7. emptywheel says:

    You know, one thing that’s interesting about this hearing is that thus far, none of the people on Finance have shown for questions, including PAul Kanjorski, and Carolyn Maloney.

  8. klynn says:


    manonfyre just posted this over at the Lake (comment 3):

    From Chris Whalen, writing at Barry Ritholtz’s Big Picture blog …

    The key point is that neither the public, the Fed nor the Treasury seem to understand is that the CDS contracts written by AIG with these various non-insurers around the world were shams – with no correlation between “fees” paid and the risk assumed. These were not valid contracts as Fed Chairman Ben Bernanke, Treasury Secretary Geithner and Economic policy guru Larry Summers claim, but rather acts of criminal fraud meant to manipulate the capital positions and earnings of financial companies around the world.

    Indeed, our sources as well as press reports suggest that the CDS contracts written by AIG may have included side letters, often in the form of emails rather than formal letters, that essentially violated the ISDA agreements and show that the true, economic reality of these contracts was fraud plain and simple. Unfortunately, by not moving to seize AIG immediately last year when the scandal broke, the Fed and Treasury may have given the AIG managers time to destroy much of the evidence of criminal wrongdoing.

    • Rayne says:

      Yes, the underlying source of that excerpt is here at this link.

      Read it all, it’s excellent, explains why there’s layer after layer to this toxic mess. The only challenges I have with this article are 1) reinsurance co-existed with the CDS, because the reinsurance and the underlying insurance were absolutely necessary sub-components to the CDS; 2) the faulting of the National Association of Insurance Commissioners (NAIC), and federal law enforcement authorities for not mentioning the “side letters” is flawed, since much of this happened offshore in businesses over which STATE insurance commissioners and U.S. federal law enforcement would have no jurisdiction or oversight.

      The problem still comes back to lack of regulatory muscle which would have given NAIC and feds the tools for oversight, and some as-yet undiscussed hole in SarbOx reporting. At uppermost corporate level, the AIGFP business should have been more fully detailed in AIG’s financials, but I suspect (as a non-accountant) that SarbOx didn’t have the teeth to force necessary transparency.

      Where is our friend and commenter Stephen Parrish CPA when you need him? (Oh yeah, it’s tax season, sorry…)

      • klynn says:

        Yep, read it. Just linked to manonfyre’s comment (he posted the links) to create “cross’ traffic here. Agree with your points.

        As for regulatory muscle, I really think Obama and G20 are playing good cop bad cop in order to get the regulatory issue nailed. At least, that is my hope.

        • Rayne says:

          Oh, I certainly do hope it’s a good-cop-bad-cop sitch, would be good to get some traction on the regulatory changes needed and in a hurry.

          So much of this is the last bits of Enron which did not get fixed; I have thought of Ken Lay and his “untimely” demise several times in the past couple of weeks, wondering if he knew this was the next direction that the offshore, off-the-books financing was headed.

          (The JSOC talk made me think of Lay at least a couple of times.)

          I remember talking with some hedge managers about the issue of Enron and risk management, how they were writing derivatives in such a way to monetize risk. At that point in time (1995-2001) every large corporation was looking at risk with new eyes, not as something they threw money at to keep at bay but as a way to improve revenue. CDSs were part of that equation, although the earliest discussions were about derivatives and hedging. On the face of it, it looks to me like they moved from derivatives and hedging as they were more tightly regulated or required more reporting, and move to CDSs more heavily to provide the hedging against loss. The “side letters” merely advised other parties involved that they were all of them participating in a hedge which provided protection against taxes on bundles of risks they believed they knew were limited in downside losses; the risk of exposure to taxes and subsequent reduction in revenues, in other words, was greater than the perceived risk of losses inside that pooled bundle in any CDS — and all the participants understood this.

          One other little thing has been bugging me: ISDA won’t give up a copy of their standard boilerplate terms for swaps without a US$1000 fee, under the guise of protecting their intellectual property. So how do we know what the limits of a standard swap are under ISDA without ponying up the money and without committing to using the info under their terms? Why would any organization so tightly guard what should be an industry standard and not proprietary info?

          Side letters are going to address terms not included in the boilerplate of swaps, so we can’t hazard a fairly specific guess as to the terms of the side letters without knowing the terms of a standard swap…

  9. klynn says:

    Hank trying to assure Lynch that it was just chance that they picked OTS as regulator, rather than someone tougher.

    That “tougher regulator” concern, we can fix that for you.

  10. klynn says:

    Patrick Kennedy just said he’s going to submit a bill to repeal the repeal of Glass-Steagall!!!

    They reading here EW (klynn at 7 -”repeal the repeals)!

    Well, while they are reading…How about they “chomp” on this while they are the repeal mood:

    But Gramm’s most cunning coup on behalf of his friends in the financial services industry—friends who gave him millions over his 24-year congressional career—came on December 15, 2000. It was an especially tense time in Washington. Only two days earlier, the Supreme Court had issued its decision on Bush v. Gore. President Bill Clinton and the Republican-controlled Congress were locked in a budget showdown. It was the perfect moment for a wily senator to game the system. As Congress and the White House were hurriedly hammering out a $384-billion omnibus spending bill, Gramm slipped in a 262-page measure called the Commodity Futures Modernization Act. Written with the help of financial industry lobbyists and cosponsored by Senator Richard Lugar (R-Ind.), the chairman of the agriculture committee, the measure had been considered dead—even by Gramm. Few lawmakers had either the opportunity or inclination to read the version of the bill Gramm inserted. “Nobody in either chamber had any knowledge of what was going on or what was in it,” says a congressional aide familiar with the bill’s history.

    It’s not exactly like Gramm hid his handiwork—far from it. The balding and bespectacled Texan strode onto the Senate floor to hail the act’s inclusion into the must-pass budget package. But only an expert, or a lobbyist, could have followed what Gramm was saying. The act, he declared, would ensure that neither the sec nor the Commodity Futures Trading Commission (cftc) got into the business of regulating newfangled financial products called swaps—and would thus “protect financial institutions from overregulation” and “position our financial services industries to be world leaders into the new century.”

    Repeal the Commodity Futures Modernization Act too.

  11. ezdidit says:

    Glass-Steagall can’t be “repealed” per se. (That would be as hard as reversing time or turning the clocks back nine years,) but Kennedy has a point to scare the shit out of them with his grandstanding:

    Finance CEO’s should be shaking in their shoes, selling off their assets for cash as fast as possible and leaving the country with the shirts on their greedy backs. If they weren’t afraid of voided bank secrecy laws – which would be easier to do – and Interpol – they probably would have left already.

    It’s called control fraud,
    and huffpost’s William K.Black wrote a great article about it. Greenberg has a point: Senate should be holding itself to account for new regulations. Republican moralists and Christian Conservatives would be the right people to do this little inquisition.

    Everybody but Byron Dorgan got it wrong.

  12. readerOfTeaLeaves says:

    I don’t want to be precipitous or too much the cheerleader, but a quick glance over the Guardian’s report on the outcomes of the G-20 really do make me wonder if this isn’t a watershed: http://www.guardian.co.uk/worl…..hails-deal

    Under the agreement, the G20 countries proposed:

    New reforms of the global banking system, including institutions such as hedge funds, and other parts of the so-called “shadow banking system” coming under global regulatory control for the first time

    • Tighter regulation for credit rating agencies, to prevent conflicts of interest

    A list of tax havens to be published immediately, and sanctions to be deployed against countries that do not comply with anti-secrecy regulations

    • Completion of the creation of international colleges of supervisors for national regulators

    • An agreement to do whatever is necessary to promote growth in individual countries, allowing for the possibility of the further use of fiscal stimuli in the future

    • The injection of an additional $1tn into the global economy through measures including a $500bn increase in the funding available to the IMF, an increase in the availability of money for developing countries through the IMF’s “special drawing rights” to $250bn and a total of $250bn being set aside for trade assistance

    • Reform of institutions such as the IMF to allow countries like China to have greater influence. Senior posts at the IMF and the World Bank will open to candidates from the developing world.

    • Renewed commitment to the millennium development goals.

    • $50bn for the world’s poorest countries.

    If they do the first item well, the rest may fall into place fairly reasonably.

    Too soon to say, but I don’t recall anything this hopeful since… well, since… since Al Gore’s 7/7/07 concerts, which at least showed that global cooperation was possible.

    I can’t imagine all the human hours of work that putting this together must have entailed, but before that 7/7/07 concert I don’t remember much of anything that was hopeful for a very long time, politically speaking.

    • selise says:

      thanks for that news. the devil of course will be in the details, but that does sound like progress to me too (i’m using the UN commission recommendations (stiglitz chaired) as my gold standard). will be very interested to read his take on whatever the g20 comes up with.

      • readerOfTeaLeaves says:

        Geithner has said over, and over, and over in different ways ‘We haven’t had the legal authority, and these guys were exploiting international regs to screw us all’. Given his international banking experiences, he should know — certainly moreso than his predecessor, who as near as I can tell was a Mammon Worshipper all his living days, and whose life experiences and worldviews were limited to elite schools and then Wall Street finance.

        I’m still ambivilent about Geithner, but it makes a lot of sense that he’s been working behind the scenes to get some international regs in place, given what he’s had to deal with in the U.S.

        At any rate, the thugs will now try to infiltrate these new institutions, but I do feel the spirit of Gene Roddenberry is alive and flourishing today as I read the news. Ferenghis will no doubt be pissed as hell, but the rest of us should be delighted. As long as the newbies can keep the Cheney Stay Behinds and Ferenghis out of these new international monetary institutions, this really is potentially seismic.

        Which may explain much of the sort of toned-down, button-down sense of public conversation about what was to occur at this G-20 meeting today.

        Clip from: http://www.guardian.co.uk/comm…..al-crisis3

        Potentially, the G20 declaration also goes much further than national governments have thus far dared. While the FSA left it to banks to police their own pay arrangements, the G20 has explicitly ruled out short-term bonuses…

        Whether it does or not depends on how proactive the new global regulator – the Financial Stability Board – will chose to get… Another surprise is the level of regulation now forced upon the fiercely-independent hedge fund community. The “hedgies” of Mayfair and Manhattan will all have to disclose how much they have borrowed – a major blow to those who use leverage to juice their performance.

        Accountants will also have to grapple with the end of the so-called “mark-to-market” approach. In future, long-term assets can be treated as more valuable than short-term market prices might suggest. But banks and companies must also apply a haircut to any assets deemed “illiquid” – or difficult to shift in a hurry.

        • selise says:

          everything i’ve been reading is that the push for regulations is coming from outside the usa (and we’ve been objecting). given geithner’s history at the imf (especially if reports of his role during the asian crisis are correct), i do not see him as regulation friendly (just the opposite). and summers has a long and well documented history of being anti-regulation. so i expect that regulations were a compromise that the usa made and not one we pushed for (although i expect that is not how it will be described in usa news).

          p.s. am NOT a fan of mark-to-myth.

          • readerOfTeaLeaves says:

            IMHO, a G-8 could not have pulled off what I seem to be reading about.
            It took all 20.

            It also took new leadership from the US, as well as other nations completely fed up with being looted by financial predators.

            We’ll know more a few years down the line about what really happened.
            I’m just saying that if the G-20 had achieved only 2 or 3 of these objectives it would have been a good thing; to have achieved what appears to be such a broad range of specific, concrete solutions to the problems of financial predation is really extraordinary.

            This really does boggle my mind, and I hope the Hank Greenbergs of the planet are having heartburn and migraines like they’ve never had before. Because this really is a complete smackdown of their predatory, irresponsible conduct — at least, superficially.

            • selise says:

              i agree it took g20 (if early reports pan out). g192 would have been even better. history is that it was the US/UK that pushed global financial industries deregulation (big push during the clinton years), that is why, absent some evidence, i don’t see the push to regulate coming from us now.

    • Rayne says:

      agree w/ you and ezdidit about the control fraud, the side letters potentially being the example.

      But some of the actions taken by banks/insurance companies wasn’t illegal even if it appears to be fraudulent. Kind of like the use of offshore tax havens — legal only by virtue of the lack of legislation — is tax avoidance and not evasion. What did not trip off investigation and prosecution by feds or NAIC members who saw the side letters? was there something else to them which made them appear legal — or was there simply no code to stop them?

      I can’t help but think of this piece by Dana Blankenhorn (who points to a video of Obama on Leno) who says the same thing — and he says more. Have we been prevented from doing more for diplomatic reasons?

      And were there also some other trade-related issues preventing any further push against AIG’s offshore business? goodness knows trade has been used in all manner of other, unexpected and still unrealized manners…

  13. readerOfTeaLeaves says:

    More at the links below, plus quotes that caught my eye.

    OECD is based in Paris, and I’d actually forgotten that they’ve been cheesed about tax havens for a long time now. These results really look momentous; long overdue. So long overdue that I’m kind of watching in a state of shocked amazement and a bit of disbelief.


    Sarkozy gave an impassioned answer to a question about how ordinary people would see any difference after the G20 summit: “Getting ourselves to agree with the British and Americans on a reasonable trader remuneration regime – if that isn’t capitalism with a conscience I don’t know what is. Sixty percent of hedge funds are registered in tax havens.

    “Putting hedge funds under supervision isn’t going to generate jobs in the textile industry. But we have to put behind us the madness of this time of total deregulation…

    Nicolas Sarkozy, the French president, had been pressing for every country – or in the case of the former colonies, every region – in the world to be included in the OECD list. But Hu Jintao, the Chinese president, succeeded in exempting Hong Kong and Macau from the list, though they will eventually be included.

    — ‘mark-to-myth’, great term ;-))))))
    Here’s hoping those days of illusory millions and bullshit predation are now going to generate prompt, serious consequences for their perps.

  14. readerOfTeaLeaves says:

    Have we been prevented from doing more for diplomatic reasons?

    Gosh, I wonder… 8^

    Yes, anyone who’s been around policy processes has seen this kind of bullshit.
    Particularly with environmental regs, where the devils really are in the details, and no matter how good a law, if it doesn’t cover all the actors — or if the actors can buy off some other jurisdiction (preferably one ‘upstream’ so to speak) they’ll just thumb their noses and laugh at the good guys getting screwed downstream.

    The criminals always, always get obsessed about the LETTER of the law.
    I figure they’re such literalists they can’t ‘read between the lines’ which is where the SPIRIT of the law generally lives.

    So you have to figure out how to write laws to be precise, explicit, and cover all jurisdictions if you’re going to stop the stupid, the venal, and the arrogant from exploiting decent, law abiding people. At least, that’s been my experience.

    But the more those criminals get a preview, the better they are at gutting proposed tougher rules as they go through the legislative process, as well as agency review. That’s why I’m hopeful — it appears on a cursory view that Geithner, et al, kept their mouths shut and got the work done, thereby serving it up to the worst predators as a ‘done deal’.

    Anyone who’s ever seen a GOOD, smart policy maker who’s actually tough has been witness to this kind of miracle; they’re rare, but wondrous.
    I’m not sure that’s that kind of miracle is actually happening here, but if so then we are actually witnessing the miraculous.

    One reason for my cautionary whiff of optimism is that Geithner has not been outfront announcing to hedgers that he’s participating in a process to cut their worst offenses off at the knees. Any time a policy maker serves up new regs that are actually tighter — without first announcing how he’s ‘getting tough’, it grabs my interest. Because it is so rare, and generally elegant (in my experience, which is limited).

    And we should savor it, if that’s what’s actually occurring here. It’s certainly possible.

  15. Rayne says:

    selise (34) — seriously, though, given the environment we live in, where the media is owned by the people who most benefit from lack of regulation: do you think we’d hear about people pushing for regulation? here it is, 10 years later, and we’re really hearing about Byron Dorgan’s objections to Gramm-Bliley-Leach. It’s as if his complaints were stuck in a tesseract traveling the universe before they were fully received, processed and understood by us.

    NBC was purchased by GE as a mouthpiece to help promote legislation and tax code favorable to GE and shareholders. Would we hear about any pro-regulation efforts from them, or from their competitors with similar interests?

    readerofTeaLeaves (35) — notice something missing in those Guardian articles? Insurance industry is not mentioned, nor are insurance-haven countries. Focus is solely on banking and taxes. [sigh]

    • selise says:

      given the environment we live in, where the media is owned by the people who most benefit from lack of regulation: do you think we’d hear about people pushing for regulation? here it is, 10 years later, and we’re really hearing about Byron Dorgan’s objections to Gramm-Bliley-Leach. It’s as if his complaints were stuck in a tesseract traveling the universe before they were fully received, processed and understood by us.

      no. i don’t. that’s why i think it’s important not to depend on the MSM for news. when i look back at the ’90s i see people like markey and born pushing for cdss regulation (and summers and gensler pushing for deregulation). when i read stiglitz and klein (among others) i see what the imf did during the asian crisis (geithner). as you know perhaps better than most anyone – there are other sources. and these people do have histories to investigate.

      p.s. and while dorgan has spoken out against g-b-l, he also did not vote against the cfma (which included the cdss deregulation and enron loophole).

  16. MartyDidier says:

    Hank Greeburg has a more interesting background than what is being discussed here. Unfortunately I’m not at liberty to discuss the details but want to encourage everyone to follow his unveiling closely. When I say “more interesting” I’m not “whistling Dixie” either. There are ties that link many who everyone will find to be a big surprise.

    Marty Didier
    northbrook, IL

    • Rayne says:

      Believe that Greenberg’s profile has been discussed here.

      And it’s a rebuttal to selise as to why we — using that word widely for a reason — cannot push for the regulation. The amount of money involved and the people who’ve been moving it aren’t above excising people they perceive as problematic, and there are already plenty of threats out there without encouraging more with real teeth. The kabuki we’ve seen over the last 24 hours will have to do.

        • Rayne says:

          Step into Obama’s shoes for a moment: how would you resolve this mess given the entities involved are engaged in decades-long realpolitik when not engaged in asymmetric warfare, and you are highly “touchable” by embedded fifth columnists or left-behinds?

          Would any short-term solution necessarily look more unattractive to some groups than others, in order to effect real long-term change?

          Given this thought exercise, it’s entirely too early, not even the 100-day mark, to assess the progress made against decades of Shock Doctrine damage. It’s also not his job alone; we still have to change the politics of the Senate sufficiently so that real change can happen; it’s going to take at least two more progressive seats to ensure this, and we’re more than 18 months from mid-terms, have to find a way to make rapid if incremental change happen while literally and figuratively under the gun.

          • selise says:

            the first thing i would not do is let larry summers anywhere near a gov policy making position.

            Given this thought exercise, it’s entirely too early, not even the 100-day mark, to assess the progress made against decades of Shock Doctrine damage.

            of course it’s not. it’s only too early to make a definitive assessment.

            and by my count, we have exactly one progressive in the senate now – his name is bernie sanders.

      • MartyDidier says:

        Thanks for the reply Rayne…

        Not well known to many is something else I’m referring to about Greenberg. You’ll know what I’m talking about when it surfaces. And yes it is expected to surface but when isn’t well known at this point.

        Marty Didier
        Northbrook, IL

  17. earlofhuntingdon says:

    What’s the surprise, that Mr. Greenberg has connections with a non-Arab Middle Eastern country’s intelligence service?

    Public references to those sorts of connections are not likely to require that you look under your car with mirrors. If they were, the comments already made would be enough. References to specific deals or hits would be another matter.

    Besides, every commentator here has to assume that the American intelligence community has access to names behind screen names and any further background that interests them. If our own alphabet soup agencies have that access, I doubt if finding that data would require much work for those whose alphabet implies missing vowels, to those whose language uses pictograms instead of phonetic symbols, or to those who take tea at 4.00 or wine at 8.00.

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