Like a potential good stock that could yield profit and dividend, Americans trusted Barack Obama and elected him as President on his promise of “Change”. In stock market, the investors usually buy on rumor and sell on fact. That rule still applies to the President elect. Barack Obama is beginning to recede on his promise to change.
He is no longer a dashing flawless speaker. He is intermittent, evasive, confused and disenchanted. Instead of adopting change that he had promised, he is following the same beaten path as his predecessors, counting on old guards in Clinton Administration for his new cabinet. It looks like that Bill Clinton is having paramount influence on Barack Obama. Will he be the proxy of Bill Clinton the way George W. Bush was for his mentor father, former President George Henry Bush?
Change? What Change? Obama is beginning to ask himself while facing hard reality. Mr. Obama, you had a safe journey in the space so far. Now face the hostile home for a change. Welcome back to this planet.
From whatever we hear and see from his utterances in print and media, he seems to be making startling beginning. It seems that he was during campaign guided on economic front by Robert Rubin, former Treasury Secretary, now with Citigroup, who is the most dangerous man around in the United States.
Rubin was wholesale destructive. He destabilized and eventually destroyed the Glass Steagall Act, 1933 during Clinton Administration. He saw it as an impediment to the merger of Citi Bank and Travelers group. Rubin therefore unduly influenced or advised President Clinton to approve the abolition of the 65 years old law that finally sow the seeds of today’s sub-prime related crisis, where banking, securities and insurance businesses could be conducted by a single institution.
This was what exactly opposed by the Glass Seagall Act, 1933 formulated under President Roosevelt Administration that separated the business of Banking, Insurance and Securities for common good to avoid the conflict of interest. The integration of Commercial banking, Insurance and Securities business earlier had caused massive stock market crash in 1930s and saw closing down of over 4000 Banks, Security houses and Insurance companies that resulted into deeply recessed depression. Had that act survived today, we would not have seen today’s crisis in Banking, Investment banking (securities) and Insurance world.
Almost all these troubled banks, brokers and insurance companies today are engaged in concurrent banking, insurance and securities business. No one knows who should control whom. SEC would consider banking as FED job, FED will consider derivatives as SEC job and SEC will consider banking default as FDIC job. It finally turns out to be no one’s job. Rubin also objected to CFTC (Chicago Futures and Trade Commission) role to oversee the “derivative trades” and legally removed their authority with the help of Alan Greenspan, then FED Chairman. These very derivatives are the crux of the present day problems.
Rubin created the web of non accountability, a specialization of his parent firm – Goldman Sachs. Paulson, also from same firm, recently followed it up while seeking $700 billions from the Senate on one condition – he would not be accountable or obliged to make any disclosure.
Non-accountability has gained momentum – from a few billions to $ 700 billions. Bernanke perfected it with massive $ 2000 billions or 2 trillions of infusion in the name of easing credit crunch!
Is it not silly that while both Paulson and Bernanke were soliciting Senate’s authority for $ 350 billions of TARP funds in first installment, Bernanke alone was distributing largesse of $ 2 trillions ($2000 billions) without seeking any authority from anywhere! When Bloomberg asked for the details of the distribution, the Fed did not even bother to reply under the weil of secrecy and national security. Now Bloomberg is filing a lawsuit under Freedom of Information Act.
Even the husky voiced Senator Barney Frank expressed dis-satisfaction at the use (or misuse or abuse) of $ 350 billions that evaporated in just under 30 days. California fire, my dear Barney, California wild fire!
President Bush was non-plus. In 8 years, he knew only three things – Iraq (Saddam Hussein), 911 (Twin Towers) and Afghanistan (Osama Bin Laden). In his quest for Middle East and Afghanistan, he forgot the map of the United States. While he went on terrorizing Middle East with Patriot missiles, his financial team of Paulson and Bernanke invented and practiced home grown terrorism on the Senators, Representatives, Senate, the House Banking Committee, the President and the American people.
It was a classic act of “Green” blackmail. “You do this else these terrible consequences will follow. Don’t blame us we did not warn you.” was the kind of address they gave to the Senators who were stunned as if they were observing a few minutes silence in deferential respect to the departed soul.
LTCM was destroyed by John Meriwether, former executive of Salomon Brothers. Rubin therefore started hating the Russians who brought about LTCM debacle. LTCM (that lost $1 trillions in derivatives, officially $ 4 billions as its own capital) was covertly encouraged by Rubin with remote control. This is why he helped organize its rescue when so many skeletons were about to come out in the open.
Warren Buffett, who took over Salomon Brothers in 1987 with great fanfare as great financial bargain, finally got rid of it when it was sold to Travelers Group in 1997. Travelers Group then merged with Citi Bank to become a Citigroup.
In similar fashion, he was seen to fondle Enron to manipulate the oil and gas prices in the world market through paper trading. Citigroup and JPMS actively supported him by financing Enron’s oil and gas related deals. When he saw the oil bets going against, he quietly resigned without attracting any notice.
No one asked him why did he resign? Not even his ardent admirer, Bill Clinton, then President, who crowned him as the greatest Treasury Secretary ever since Alexander Hamilton. (1789~95)
All bad companies promoted or rescued during Rubin’s regime, finally converged into Citigroup. Rubin then eased himself out of his position as Treasury Secretary into $115 Millions a year job at Citigroup to cover his tracts relating to dubious assets followed by newly developing bad asset – Enron. Citigroup and JP Morgan Chase (JPMC), who financed Enron, sold everywhere its spurious bonds similar to sub prime bonds and CDO/CDS derivatives of today, and got into hot trouble losing several billions.
During his tenure at Citigroup, he managed to settle Enron related lawsuits by defraying $ 2 billions to Investors in 2005 followed by recent settlements of $ 1.67 billions claim of the creditors. He also oversaw the $2.5 billions of Worldcom related settlement by Citigroup to irate investors and creditors. In short, it appears that he deliberately went there to cover all his tracts at fat fees of $ 100 Million plus per year.
In less than 5 years of Rubin’s Co-Chairmanship, after eating almost $500 Millions of salary as a parasite, Citigroup lost $ 70 billions in cash ($50 billions before + $17 billions in the from of taking over liabilities of its subsidiaries in the form Structured Investment Vehicles). He also forced (persuaded) the Fed to guarantee its lousy and worthless portfolio of $ 360 billions, presumably in the form of CDO (Collateralized Debt Obligations) CDS (Credit Default Swaps) or CLN (Credit Linked Notes). In short, he managed to persuade his compatriot Hank Paulson and Ben Bernanke to spend $ 430 billions of known figures to finance Citigroup. How many of $ 2 trillions additional largesse was given away by bearded Bernanke are still not counted.
And what did the Citigroup do with $430 Billions? It fired 75,000 employees. In short, the Fed and Treasury gave away $5.74 million to Citigroup for firing each employee. It will cost the State additional $4.5 billions towards unemployment allowance and lost taxes of $ 1.5 billions had these employees remained employed and paid taxes.
Rubin followed the doctrine or mantra of strong dollar policy to manipulate the world market. He was in fact strongly suspected to be instrumental in causing Asian Crisis when Euro was about to be borne. He did not want Asian nations to shift their reserve lying with FED to Euro. He therefore appear to have destroyed Asian currencies with the help of two renowned Hedge Fund managers – George Soros and Julian Robertson. What you see today of strong dollar in spite of gigantic troubles are the “ditto” measures adopted by him during Clinton Administration. This time, his other colleague from Goldman Sachs, Hank Paulson is doing that dirty job.
Rubin was clever enough to remain always in the background, allowing pawn players to do the dirty jobs on the foreground. In the event of troubles breaking out, he was always there on crime scene like a forensic expert searching for clues with intent to search and destroy whatever remaining hints floating around that might point fingers at him later.
Obama was looking at the same old Rubin during campaign for economic guidance which was the first disastrous mistake he was making in the dressing room before going to play his first game at the White House on January 20, 2009.
Obama appointed his formidable opponent Hillary Clinton as Secretary of State. She is a hawk whereas Obama himself is a Dow. There is no matching chemistry. She will wage war with anyone – a female replica of George Bush – completely opposite character of her affable spouse Bill Clinton.
The internationally acclaimed and a rational person could have been former Secretary of State – Gen Colin Powell who is highly respected by almost all leaders, friends and foes, around the world. Obama missed him in his first baseball shot. He sacrificed Gen Powell in an act of balancing colors to avoid pointed fingers – his first grave mistake on foreign policy front even before he took over the office. It may be argued that Gen Powell was ineligible as Republican. However, Gen. Powell voted for him and also officially endorsed his candidature. There are no official restrictions to such appointment except in party politics,
Just as President Bush inherited the caucus team of Dick Cheney (Vice President), Don Rumsfeld (former Defense Secretary), Greenspan and other dumb heads from his father Sr. George H Bush, President elect Obama is following the same pattern by inheriting the legacy of Bill Clinton. Change? What Change? There is no change – same dud and dirty politics.
And here comes another firm. Goldman Sachs. Entire Fed and Treasury buildings are infested with the mammals from Goldman Sachs. Robert Rubin belonged to that clan. Hank Paulson also belongs to same clan. Neel Kashkari also comes from same place. It is Goldman who is calling the shots for over 15 years of America’s mismanagement of economy. Many of the Anchors of business channels have GS stamp on their butts.
The entire policy appears to be conceptualized in Goldman HQ, politicized at the Treasury, monetized at Fed, and finally sold like Sub Prime assets through massive publicity in perfect harmony and orchestration via business channels manned by trusted friends who were once upon a time were with Goldman Sachs.
Obama is now trying to pump in another $ 1 trillion into infrastructure spending, after massive $ 2 trillions influx into the system by the gang of Bernanke and Paulson. He is also hell bent on reducing taxes on individuals.
Never did he answer nor did anyone ask, how was he going to bring in income while spending on all fronts and destroying America at the speed of Katrina.
The whole nation has become a typified New Orleans where stupefied corpses are found every where in immediate aftermath.
Obama has given first glimpses of his carefully nurtured personality. When the “red blood” is oozing through the main street and Wall Street, he is talking nonsense about the “green air” exhorting all 3 Auto manufacturers to invent green cars.
It will be years before those Auto makers would turn their cars green, provided they exist. The immediate priority is to take them out of deep trouble and rejuvenate demand for their products by any means. For instance, He could announce impending immediate policy directive to all government departments to use only those vehicles made by 3 US auto makers for about 2 years temporarily.
That will give breathing time to Auto makers who need demand for their goods, not bail out funds which will be exhausted in no time if there were no demand for their vehicles. They could restart the plants and job firings will be halted immediately. In fact, it will start creating jobs in auto sectors and its ancillaries sending positive feelers all around in the period gloom and doom.
His currently reflected priorities are not of the becoming of a great leader about to sit on the coveted throne at the White House. He has demonstrated so far that he is neither a leader seeking “Change” nor a “Santa Clause” willing to part acceptable gifts – JOBS – to American Citizens on the eve of Christmas. Only a day before, an unemployed youth started firing in California and killed 9 peoples on the spot. This is only a beginning.
The only thing that changed during last 52 days of post election process is – his name. He has decided to use his middle name while taking oath at the White House. He is now Barack Hussein Obama about to stride into White House (Obama is a Christian, not Muslim). What is he trying to do by changing his well known name by including “Hussein” in the middle? Pacify Arabs and Islamic nations that a mixed secular name is going to lead America in future? If he had used “Hussein” as his middle name during campaign, I am 100% sure that he would have lost the election in most disastrous fashion. He does not have the mandate from the people to use his “Hussein” brand.
If name change were to usher in the dramatic change in the economy, George Bush would be left wondering why not he thought of it while facing disaster after disaster at home and overseas during 8 years of his ignominious presidency.
Obama is therefore showing the sure sign of just another “mediocre” at the White House!
The crisis is so acute that there were reports that “US military was preparing for domestic disturbance” Click here for Newsmaxx Report. With guns being freely licensed through out the United States, the nation is sitting on a huge volcano about to erupt. After years of practice of firing billions of bullets in other countries during last 60 years, US Military Commanders will have uphill battle back home for the first time firing for a change at their own people.
Will Barack Hussein Obama be the last ruling President of the beautiful nation once upon a time called “United States of America”? Don’t be surprised. It happened to USSR in recent past. It could happen again, this time in America for a change. Is this the CHANGE he was talking about?
And the distraught investor, Warren Buffet will be awaiting the final verdict from his city – Omaha, after investing $ 8 billions in Goldman Sachs and General Electric at the instance of Hank Paulson, who will no longer be around after 20th January, 2009
Obama, Osama and Omaha – what a rhyme in the American politics and finances!
Let us prepare ourselves for the “Great Royal Circus” in Washington. The curtain will be lifted on 20th January, 2009. It will be a battle royal in the far flung Afghanistan and Iraq – Obama vs. Osama.
Poor Lady Liberty must have been tired holding the torch for so long in the middle of the sea. It is time to find new home, she must be murmuring. Where, she does not know.
Kalidas, Hong Kong
Ref: 0812-020 of 2008/12/26