This is awesome. Everyone needs to visit this website and vote. Be sure to watch the video, too. Great Job and Kudos to Eric Cantor. I’m glad someone has some sense in Washington !
This is awesome. Everyone needs to visit this website and vote. Be sure to watch the video, too. Great Job and Kudos to Eric Cantor. I’m glad someone has some sense in Washington !
Welfare and social programs today are rampant with abuse. We need true welfare reform that requires stricter guidelines so people cannot make it a career.
If you are on welfare for longer than 12 months, you should undergo sterilization so that you cannot reproduce just to get more money. All welfare recipients should undergo drug testing and if tested positive, removed from the welfare rolls. Government workers need to be held accountable and actually enforce the rules and actively follow up with home visits to see who is actually living in the home and who is allowed to be there. The home visits should also be required for all people receiving HUD or rental assistance from the government and every visit should be unannounced. Medicaid recipients, especially those on welfare should be required to pay co-pays the same as working class people that have insurance. If our seniors are required to pay co-pays on their medicare, then medicaid recipients should have to as well, especially in the case of ems abuse. It is ridiculous that people are allowed to stay on the welfare rolls for years and years getting more money for breeding more children. Even with the so-called reform under Clinton, there is more incentive for these people to stay on welfare than there is to get off of welfare and it should be the other way around. Every welfare recipient should be required to perform community service, cleaning, painting, mowing, picking up trash, etc to actually earn this free money from the government and those with children already have government monies for child care when needed so that is not a problem. As a working class person, I get tired of seeing people on welfare wearing better clothes, driving better cars, better cell phones, big screen televisions, more food with better cuts of meat and overall living better than I do at the expense of me and every other working, taxpaying person in this country.
Immigration needs to be dealt with by securing our borders, sending back ALL illegals, including the ones in prisons and requiring everyone to go through the legal steps of becoming a citizen.
The illegals in this country cost us billions every year and take away jobs from our citizens. It is said that these are jobs nobody else will do but how do we know, especially with unemployment near ten percent. Send the illegals back to where they came from whether Mexican, Middle Eastern, Asian, European or whatever. It is a slap in the face to every person that came to our country legally and became a citizen. It is a further slap in the face for these illegals to fly their country’s flag in place of our flag. This is like spitting in our face. The illegals here that protest and march think that WE owe them and we do not. I applaud Arizona and their new law. If our federal government refuses to enforce the current laws then local governments need something to keep crime down in our communities. We do not need a half baked immigration reform law like we got with the so-called health care reform either. We need something that will help save our country billions of dollars annually and keep track of who comes and goes in our country, especially after 9/11.
Congressman Mollohan from West Virginia was ousted in the primary election Tuesday, May 11, 2010.
The rest of the country needs to follow West Virginia’s lead and Vote out ALL INCUMBENTS. This is the only way to get rid of the status quo in Washington. This isn’t a matter of voting out the Dems but voting out the incumbents. It is time for change in Washington and the only way to achieve that is to get rid of those that have been in there for years. Both parties are responsible for the mess our country is in and the so-called health care reform was just the icing on the cake. Term limits have been proposed in almost every new congress and is swept aside by the incumbents never seeing the floor for a vote. If the voters keep the same old cronies from both parties in office then there will never be real change in Washington. It is time “We, the people” took back our government from special interests, lobbyists,corporation and bankers. Follow WV’s lead and get rid of the incumbents.
The incumbents from both parties must go and the voters and taxpayers in this country need to demand fiscal restraint. Our borrowing and deficit is out of control. Portugal and Spain recently had their ratings dropped after the Greece financial crisis. Greece has a deficit vs. GDP of 118 percent. Portugal’s debt is 86 percent of their GDP and they were downgraded. By the end of this year, the United States debt will be 92.6 percent of the GDP. What does this say for the US? We have yet to be downgraded because it would put the entire globe into economic crisis. The United States is close to bankruptcy and our government keeps on spending and borrowing. Bailout after bailout at taxpayer expense with the latest being Fannie Mae, who is seeking another $8.4 Billion in aid. The housing crisis has continued even with the bank bailouts and the Fannie Mae and Freddie Mac bailouts. The banks are still foreclosing at record pace and the bailouts aimed at homeowners keeping their homes are not working. These agencies are keeping the money and investing it to make more money for themselves while the homeowners are kicked out. It seems that Washington thinks bailouts are the norm now. There are small businesses closing every day and they don’t receive help from the government so why should the bigger companies/corporations?
Government has to be held accountable and one way to succeed at this is to get rid of the incumbents. We need term limits today more than ever before. Every year, term limits are brought up by a newly elected member to Congress and each time the incumbents sweep it aside keeping it from reaching the floor for a vote. The incumbents do not want the new members in Congress to change the status quo. They enjoy the high life they are living with all of the perks at the expense of the taxpayer. Nothing will change until we get these incumbents from both parties out of office so that other members elected will realize that the people are now holding them accountable.
I for one am mad as hell at the political shenanigans of both parties. They do not seem to care what the people think or want. They do not seem to care about our country and the current shape it is in. They only seem to care about blaming each party, fighting with each party and having back room closed door meetings to ram through so-called reforms so they can give each other attaboys and pats on the back. It is time both parties work together and do what is best for the country or our country will be the next Greece and we will fall like Rome.
I received an email with this letter in it about immigration and I whole heartily agree. Immigrants of today are not the same as those of yesteryear. The ones today do not want to obey the laws and take the proper steps to citizenship. They want a handout and free medical care for them and their families without most contributing to our country. They do not want to “pledge allegiance” to our country because they want to stay faithful to Mexico and wave the Mexican flag in our country instead of the US Flag and then they wonder why nobody wants them here. If you are here legally, then welcome to our great nation, if you are an illegal, go home, we don’t want you here until you go through legal channels.
ORANGE COUNTY ( CALIFORNIA ) NEWSPAPER-New Immigrants
This is a very good letter to the editor. This woman made some good
For some reason, people have difficulty structuring their arguments
when arguing against supporting the currently proposed immigration
revisions.. This lady made the argument pretty simple. NOT printed in
the Orange County Paper……………….
Newspapers simply won’t publish letters to the editor which they either
deem politically incorrect (read below) or which does not agree with
the philosophy they’re pushing on the public. This woman wrote a great
letter to the editor that should have been published; but, with your
help it will get published via cyberspace!
From: “David LaBonte”
My wife, Rosemary, wrote a wonderful letter to the editor of the OC
Register which, of course, was not printed. So, I decided to “print” it
myself by sending it out on the Internet. Pass it along if you feel so
inclined. Written in response to a series of letters to the editor in
the Orange County Register:
So many letter writers have based their arguments on how this land is
made up of immigrants. Ernie Lujan for one, suggests we should tear
down the Statue of Liberty because the people now in question aren’t
being treated the same as those who passed through Ellis Island and
other ports of entry.
Maybe we should turn to our history books and point out to people like
Mr. Lujan why today’s American is not willing to accept this new kind
of immigrant any longer. Back in 1900 when there was a rush from all
areas of Europe to come to the United States , people had to get off a
ship and stand in a long line in New York and be documented. Some would
even get down on their hands and knees and kiss the ground. They made a
pledge to uphold the laws and support their new country in good and bad
times. They made learning English a primary rule in their new American
households and some even changed their names to blend in with their new
They had waved good bye to their birth place to give their children a
new life and did everything in their power to help their children
assimilate into one culture. Nothing was handed to them. No free
lunches, no welfare, no labor laws to protect them. All they had were
the skills and craftsmanship they had brought with them to trade for a
future of prosperity.
Most of their children came of age when World War II broke out. My
father fought along side men whose parents had come straight over from
Germany , Italy , France and Japan . None of these 1st generation
Americans ever gave any thought about what country their parents had
come from. They were Americans fighting Hitler, Mussolini and the
Emperor of Japan . They were defending the United States of America as
When we liberated France , no one in those villages were looking for
the French-American or the German American or the Irish American. The
people of France saw only Americans. And we carried one flag that
represented one country. Not one of those immigrant sons would have
thought about picking up another country’s flag and waving it to
represent who they were. It would have been a disgrace to their parents
who had sacrificed so much to be here. These immigrants truly knew what
it meant to be an American. They stirred the melting pot into one red,
white and blue bowl.
And here we are with a new kind of immigrant who wants the same rights
and privileges. Only they want to achieve it by playing with a
different set of rules, one that includes the entitlement card and a
guarantee of being faithful to their mother country. I’m sorry, that’s
not what being an American is all about. I believe that the immigrants
who landed on Ellis Island in the early 1900’s deserve better than that
for all the toil, hard work and sacrifice in raising future generations
to create a land that has become a beacon for those legally searching
for a better life. I think they would be appalled that they are being
used as an example by those waving foreign country flags.
And for that suggestion about taking down the Statue of Liberty , it
happens to mean a lot to the citizens who are voting on the immigration
bill. I wouldn’t start talking about dismantling the United States just
(signed) Rosemary LaBonte
The Fed needs to raise interest rates to avoid inflation and to make the dollar stronger. If they expect to invigorate the economy, which is two-thirds consumer spending, this is the way to do it. Every time the Fed keeps the interest rate unchanged, the dollar falls against other currencies creating a speculator frenzy on the commodities market causing oil and gasoline prices to increase. These increases are filtered down to the consumer, who is already having it rough in making ends meet. Consumers stop spending because they have to pay higher gasoline prices at the pump. One only has to look back at the beginning of the recession when gasoline first reached $3 per gallon to see consumer spending slowed sharply at that time and then almost stopped at $4 per gallon except for food spending. Once again, the dollar has fallen against the Euro, even with the Greece and Portugal financial crisis. This should send a message to the Fed but they continue to ignore the stress gasoline costs have on taxpayers, the working class.
Consumer spending increased in February and March and Wall Street had a frenzy thinking the economy was indeed on the rebound. Anyone with a little common sense could figure out the increased spending was the tax refunds people were getting and spending on long awaited items. Once again consumer spending has declined and with gasoline and oil prices hitting $2.40 per gallon and $86 plus per barrel on the futures market, it is only a matter of time before the pain hits at the pump. We have heard over and over again how foreign investors put their money in crude when the dollar falls against other currencies. It is simple to understand that by keeping interest rates unchanged, it keeps the dollar weak. The Fed is keeping the interest rates low so it is pretty much free money for banks to borrow from one another, even after the taxpayers bailouts. However, consumers still have to pay higher interest rates on money borrowed from banks, when they actually loan money, thereby allowing the banks to reap huge profits. It is appears the Fed doesn’t care about the economy and is only interested in helping the banking industry in making huge profits at the expense of the consumer. Once again, a good argument to do away with the Federal Reserve. Washington Politicians, Banking and Wall Street executives appear to be in cahoots with one another hell bent on making billions at our expense.
I believe it is time for real change in Washington by getting rid of EVERY Incumbent and trying to put representatives of the people back in Washington instead of the same old politicians. If the American voter would actually vote against every incumbent up for re-election in 2010 and 2012, we may be able to save our nation, otherwise the government earmarks, pork barrel spending and our march toward a crisis such as Greece is currently experiencing is in our future. Every great nation throughout history has fallen with the most remembered being Rome. Is the United States following in the path of those former nations?
If you love your country, then you must vote every incumbent out of office.
Here is a link to view the Futures market including oil and gasoline prices and below is an article well worth reading about some of the points I have mentioned in my rant above.
Stephen Bernard, AP Business Writer, On Friday April 30, 2010, 2:14 pm EDT
NEW YORK (AP) –Disappointment over two economic reports Friday sent stocks falling sharply.
Investors lost some of their optimism about the economy after the government’s weaker-than-expected gross domestic product report and news of a drop in consumer sentiment. Concerns surrounding financial regulation contributed to the selling, which took the Dow Jones industrial average down almost 66 points.
“The market may just be a little bit tired,” said Michael Sheldon, chief market strategist at RDM Financial Group in Westport, Conn. “A lot of good news is priced into the market.”
Many analysts have said the stock market was poised for a pullback after it climbed steadily for nearly three months.
In the last trading session of April, the Dow is still set to post its third straight monthly gain. However it looks like it will snap an eight-week winning streak.
Friday’s pullback began after the Commerce Department said the GDP rose at a 3.2 percent annual pace in the January-March period. That was below the 3.4 percent rate economists polled by Thomson Reuters had forecast.
While the GDP was up for the third straight quarter, it was down from the fourth quarter’s 5.6 percent, a rate that was inflated by government stimulus spending and companies restocking their depleted inventories. For the economy to show healthy growth, it would have to grow at a faster pace than it did the first three months of the year. Growth would have to equal 5 percent for all of 2010 just to lower the average jobless rate for the year by 1 percentage point.
The Labor Department will release its April employment report next week. Economists predict the unemployment rate held steady at 9.7 percent.
Analysts were relatively upbeat that the first-quarter growth rate, though slow, probably was good enough to help avoid a “double-dip” recession.
“GDP was slightly lower than expectations, but shows the economic recovery is probably sustainable,” said Peter Cardillo, chief market economist at Avalon Partners Inc. in New York.
Investors were disappointed by a separate report from Reuters and the University of Michigan that showed consumer sentiment rose to 72.2 in April from a preliminary April reading of 69.5. However, it was still lower than March’s 73.6. Economists had forecast a reading of 71.
The consumer sentiment report shows the “consumer isn’t fully recovered,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.
Investors want to see data that shows month-over-month improvement, Luschini added.
Financial stocks were pulled down by Goldman Sachs Group Inc., which is now facing a criminal investigation for its dealings in subprime mortgage securities. A Standard & Poor’s equity analyst downgraded Goldman Sachs’s stock to a “sell” rating Friday morning. Its shares dropped more than 7 percent.
In afternoon trading, the Dow fell 65.75, or 0.6 percent, to 11,101.57. The Standard & Poor’s 500 index fell 9.49, or 0.8 percent, to 1,197.30, while the Nasdaq composite index fell 27.43, or 1.1 percent, to 2,484.49.
The Chicago Purchasing Managers Index rose this month, further evidence of a recovery in the manufacturing sector. The index, which reflects economic activity in the Midwest, jumped to 63.8 in April, from 58.8 last month. Economists expected the index to rise to 60.
Signs of an improving domestic economy pushed stocks higher the past two days, after fresh concerns about European debt problems sent shares plummeting on Tuesday. The Dow jumped 122 points Thursday, its biggest jump since March 5, after another batch of strong earnings and a Labor Department report that showed initial claims for jobless benefits fell last week.
Despite the gains the past two days, investors are still keeping an eye on the European debt problems. The biggest concerns are in Greece, where the country faces loan repayments in a couple of weeks. If it is unable to tap a joint European Union and International Monetary Fund bailout package before May 19, the country could default on its debt.
Analysts fear that debt problems will spread across the continent and stunt a global economic recovery.
Greece, Portugal and Spain all saw their debt ratings slashed by Standard & Poor’s earlier this week. Greece’s was cut to junk status. Lower ratings make it more expensive to borrow money, which would only add to debt burdens already facing some European nations.
European markets fell. Britain’s FTSE 100 dropped 1.2 percent, Germany’s DAX index fell 0.2 percent, and France’s CAC-40 fell 0.8 percent.
The euro rose against the dollar, but analysts remain cautious about its long-term future. Some have said that the debt problems could further drive down its value or lead to a split among the 16 countries that share the currency.
Meanwhile, Goldman Sachs is again contending with negative headlines. The big Wall Street bank — which is already facing civil fraud charges for misrepresenting details about subprime mortgage securities — is now also facing a criminal investigation.
“They’re really going after Goldman pretty hard,” said Ryan Detrick, senior technical analyst at Schaeffer’s Investment Research. “That’s got people on edge.”
The Justice Department has opened a criminal investigation against the bank over mortgage securities deals it arranged. Many blame the credit crisis on the collapse of similar securities which were traded by many banks around the world.
Detrick said that after all asset bubbles, regulators and politicians look for companies or executives to blame and Goldman is currently at the top of that list.
Goldman shares tumbled $13.59, or 8.5 percent, to $146.65. Other big banks with trading operations like Morgan Stanley and JPMorgan Chase & Co. fell more than 2 percent.
Earnings again largely topped expectations. Both oil company and Dow component Chevron Corp., homebuilder D.R. Horton Inc. and consumer products maker Newell Rubbermaid Inc. saw shares rise after reporting better-than-expected profit.
Chevron shares were trading in a narrow range however, as the broader energy sector has been hurt on the day by concerns about an oil spill off the Louisiana coast and its potential impact on future exploration and drilling. Chevron rose 7 cents to $82.36.
D.R. Horton shares jumped 68 cents, or 4.8 percent, to $14.92. Newell Rubbermaid jumped 44 cents, or 2.6 percent, to $17.39.
About two stocks fell for every one that rose on the New York Stock Exchange, where volume came to 714.5 million shares, compared with 747.7 million shares traded at the same time Thursday.
Bond prices rose as stocks dipped. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.67 percent from 3.73 percent late Thursday.
Gold and oil prices both rose.
The Russell 2000 index of smaller companies fell 10.00, or 1.4 percent, to 727.74.
It amazes me that even with e-mails, Goldman-Sachs denies any wrong doing. I think they should be held accountable.
It also appears that Congress apparently is just going through the motions for the public and really cares little about how the crisis has affected everyone in a negative way while companies like Goldman and other may have been raking in billions at our expense. Greed is rampant in Washington and Wall Street.
Take for example just one congressman, Alan Mollohan. He became a multi-millionaire during his congressional tenure and ethics investigations turned up nothing and was dismissed. It makes one wonder if this was brushed aside in exchange for his YES vote on the health care bill.
Of course, with all of the Wall Street lobbyists, I’m sure our “leaders” will offer up a do nothing reform that will expand government while doing basically nothing other than allowing more government employees surf the net for porn.
Our government is in a sad state and it appears it continues to decline and it is “we the people” who are paying for it in many ways.
It will be interesting to see what unfolds with the entire financial situation in our country and how Greece and other European countries nearing financial collapse will affect us.
Below are the articles regarding Goldman.
Not us: Goldman execs deny wrongdoing in crisis
Marcy Gordon and Tom Raum, Associated Press Writers, On Tuesday April 27, 2010, 9:42 pm EDT
WASHINGTON (AP) — Defending his company under blistering criticism, the CEO of Goldman Sachs testily told skeptical senators Tuesday that customers who bought securities from the Wall Street giant in the run-up to a national financial crisis came looking for risk “and that’s what they got.”
Lloyd Blankfein and other Goldman executives were lambasted by lawmakers for “unbridled greed” in an often-electric daylong showdown between Wall Street and Congress — with expletives frequently undeleted. Unrepentant, five present and two past Goldman officials unflinchingly stood by their conduct before a Senate investigatory panel and denied helping to cause the financial near-meltdown that turned into the worst recession since the Great Depression.
“Unfortunately, the housing market went south very quickly,” Blankfein told skeptical senators. “So people lost money in it.”
Democrats hoped the hearing would build momentum for legislation, now before the Senate, to increase regulation of the nation’s financial system. That legislation would crack down on the kind of lightly regulated housing market investments that helped set off the crisis in 2007.
Elsewhere at the Capitol, Republicans succeeded for a second day in blocking efforts to move toward debate and a vote on that bill. At the same time, they floated a partial alternative that they said could lead to election-year compromise on an issue that commands strong public support.
Both sides are trying to harness voter anger toward Wall Street. Unlike with the health care debate, both Democrats and Republicans say they want tighter regulations passed — but they disagree on timing and significant details.
At the hearing, there was hour upon hour — nearly 11 hours in all, winding up just before 9 p.m. EDT — of combative exchanges, occasional humor and long stretches of senators and Wall Street insiders speaking past each other. There was talk of ethical obligations versus financial transactions so complex they all but defy explanation. And there were a half dozen protesters dressed head to toe in prison stripes with Goldman officials’ names around their necks.
Senators from both parties verbally pounded the Goldman executives, accusing them of a financial version of rigged casino gambling that they said endangered the entire U.S. economy.
That drew a protest from Sen. John Ensign, a Nevada Republican. In Las Vegas, he said, “people know the odds are against them. They play anyway. On Wall Street, they manipulate the odds while you’re playing the game.”
Outside the hearing room, analysts and investors suggested the firm was surviving the hearing with its reputation intact, something its stock performance for the day may have underscored. Goldman’s stock rose $1.01 per share, to $153.04, on Tuesday, a day in which the Dow Jones industrials had their worst drop in nearly three months, down 213 points.
Blankfein was the final witness in a daylong hearing on Goldman conduct that resulted in a Securities and Exchange Commission civil fraud charge earlier this month against the firm and one of its traders.
Sen. Carl Levin, D-Mich., the panel’s chairman cited a “fundamental conflict” in Goldman’s selling to clients home-loan securities that company e-mails showed its own employees had derided as “junk” and “crap” — and then betting against the same securities and not telling the buyers.
“They’re buying something from you, and you are betting against it. And you want people to trust you. I wouldn’t trust you,” Levin told Blankfein.
Blankfein denied such a conflict in a combative exchange. “We do hundreds of thousands, if not millions of transactions a day, as a market maker,” he said, noting that behind every transaction there was a buyer and a seller, creating both winners and losers.
Levin vigorously pressed about an e-mail between Goldman executives describing one product called Timberwolf as “one s—-y deal.”
“Your top priority is to sell that s—-y deal,” Levin said. “Should Goldman Sachs be trying to sell a s—-y deal?”
I didn’t use that term, the executive responded.
Other senators repeated the language in their questioning.
Goldman’s chief said the company didn’t bet against its clients — and can’t survive without their trust. He repeated the company’s assertion that it lost $1.2 billion in the residential mortgage meltdown in 2007 and 2008 that touched off the financial crisis and a severe recession. He also argued that Goldman wasn’t making an aggressive negative bet — or short — on the mortgage market’s slide.
He and other officials described their use of complex trading tools as a way to reduce risks for the company and its clients.
Earlier, Levin said that financial industry lobbyists “fill the halls of Congress, hoping to weaken or kill legislation” to increase regulation. He accused Wall Street firms of selling securities they wouldn’t invest in themselves. That’s “unbridled greed in the absence of the cop on the beat to control it,” he said.
Whether Tuesday’s hearing would help Democrats win Republican converts on the legislation remained an open question. “It’s too soon to tell,” Levin said in a brief interview outside the hearing. “We’ll have to wait until the dust settles.”
The Goldman witnesses strongly denied that the firm intentionally cashed in on the housing crash by crafting a strategy to bet against home loan securities while misleading its own investors.
“I will defend myself in court against this false claim,” said Fabrice Tourre, a French-born 31-year-old Goldman trader who was the only individual named in the SEC suit. “I deny — categorically — the SEC’s allegation.”
The SEC says Tourre marketed securities without telling buyers they had been chosen with help from a Goldman hedge fund client that was betting the investments would fail. The commission alleged that Tourre told investors the hedge fund, Paulson & Co., actually bought into the investments. Tourre said he didn’t recall telling investors that.
Tourre said: “I am saddened and humbled by what happened in the market in 2007 and 2008. … But I believe my conduct was proper.”
Was Goldman harmed by the hearing?
“Despite the interrogation, the Goldman team hasn’t really provided any new information,” market analyst Edward Yardeni said. “And the (senators) aren’t creating a more damaging view than already existed.”
“Right now, it looks like the PR battle has been fought to a draw,” Yardeni added.
Sen. John McCain, R-Ariz., said that while there may not be proof that Goldman did anything illegal, “there’s no doubt their behavior was unethical and the people will render a judgment as well as courts.”
Sen. Tom Coburn, R-Okla., said the blame doesn’t fall on Goldman alone. “There’s numerous causes to the financial crisis, not just one.” He said the blame must be shared by federal regulatory agencies who didn’t use the powers they already have and by Congress. “In truth, we all took turns in inflating the housing bubble,” he said.
Associated Press writers Stevenson Jacobs in New York and Jim Kuhnhenn and Michael Sandler in Washington contributed to this report.
Goldman Sachs Messages Show It Thrived as Economy Fell
By LOUISE STORY, SEWELL CHAN and GRETCHEN MORGENSON
Published: April 24, 2010
In late 2007 as the mortgage crisis gained momentum and many banks were suffering losses, Goldman Sachs executives traded e-mail messages saying that they were making “some serious money” betting against the housing markets.
The e-mails, released Saturday morning by the Senate Permanent Subcommittee on Investigations, appear to contradict some of Goldman’s previous statements that left the impression that the firm lost money on mortgage-related investments.
In the e-mails, Lloyd C. Blankfein, the bank’s chief executive, acknowledged in November of 2007 that the firm indeed had lost money initially. But it later recovered from those losses by making negative bets, known as short positions, enabling it to profit as housing prices fell and homeowners defaulted on their mortgages. “Of course we didn’t dodge the mortgage mess,” he wrote. “We lost money, then made more than we lost because of shorts.”
In another message, dated July 25, 2007, David A. Viniar, Goldman’s chief financial officer, remarked on figures that showed the company had made a $51 million profit in a single day from bets that the value of mortgage-related securities would drop. “Tells you what might be happening to people who don’t have the big short,” he wrote to Gary D. Cohn, now Goldman’s president.
The messages were released Saturday ahead of a Congressional hearing on Tuesday in which seven current and former Goldman employees, including Mr. Blankfein, are expected to testify. The hearing follows a recent securities fraud complaint that the Securities and Exchange Commission filed against Goldman and one of its employees, Fabrice Tourre, who will also testify on Tuesday.
Actions taken by Wall Street firms during the housing meltdown have become a major factor in the contentious debate over financial reform. The first test of the administration’s overhaul effort will come Monday when the Senate majority leader, Harry Reid, is to call a procedural vote to try to stop a Republican filibuster.
Republicans have contended that the renewed focus on Goldman stems from Democrats’ desire to use anger at Wall Street to push through a financial reform bill.
Carl Levin, Democrat of Michigan and head of the Permanent Subcommittee on Investigations, said that the e-mail messages contrast with Goldman’s public statements about its trading results. “The 2009 Goldman Sachs annual report stated that the firm ‘did not generate enormous net revenues by betting against residential related products,’ ” Mr. Levin said in a statement Saturday when his office released the documents. “These e-mails show that, in fact, Goldman made a lot of money by betting against the mortgage market.”
A Goldman spokesman did not immediately respond to a request for comment.
The Goldman messages connect some of the dots at a crucial moment of Goldman history. They show that in 2007, as most other banks hemorrhaged losses from plummeting mortgage holdings, Goldman prospered.
At first, Goldman openly discussed its prescience in calling the housing downfall. In the third quarter of 2007, the investment bank reported publicly that it had made big profits on its negative bet on mortgages.
But by the end of that year, the firm curtailed disclosures about its mortgage trading results. Its chief financial officer told analysts at the end of 2007 that they should not expect Goldman to reveal whether it was long or short on the housing market. By late 2008, Goldman was emphasizing its losses, rather than its profits, pointing regularly to write-downs of $1.7 billion on mortgage assets and leaving out the amount it made on its negative bets.
Goldman and other firms often take positions on both sides of an investment. Some are long, which are bets that the investment will do well, and some are shorts, which are bets the investment will do poorly. If an investor’s positions are balanced — or hedged, in industry parlance — then the combination of the longs and shorts comes out to zero.
Goldman has said that it added shorts to balance its mortgage book, not to make a directional bet that the market would collapse. But the messages released Saturday appear to show that in 2007, at least, Goldman’s short bets were eclipsing the losses on its long positions. In May 2007, for instance, Goldman workers e-mailed one another about losses on a bundle of mortgages issued by Long Beach Mortgage Securities. Though the firm lost money on those, a worker wrote, there was “good news”: “we own 10 mm in protection.” That meant Goldman had enough of a bet against the bond that, over all, it profited by $5 million.
Documents released by the Senate committee appear to indicate that in July 2007, Goldman’s daily accounting showed losses of $322 million on positive mortgage positions, but its negative bet — what Mr. Viniar called “the big short” — came in $51 million higher.
As recently as a week ago, a Goldman spokesman emphasized that the firm had tried only to hedge its mortgage holdings in 2007 and said the firm had not been net short in that market.
The firm said in its annual report this month that it did not know back then where housing was headed, a sentiment expressed by Mr. Blankfein the last time he appeared before Congress.
“We did not know at any minute what would happen next, even though there was a lot of writing,” he told the Financial Crisis Inquiry Commission in January.
It is not known how much money in total Goldman made on its negative housing bets. Only a handful of e-mail messages were released Saturday, and they do not reflect the complete record.
The Senate subcommittee began its investigation in November 2008, but its work attracted little attention until a series of hearings in the last month. The first focused on lending practices at Washington Mutual, which collapsed in 2008, the largest bank failure in American history; another scrutinized deficiencies at several regulatory agencies, including the Office of Thrift Supervision and the Federal Deposit Insurance Corporation.
A third hearing, on Friday, centered on the role that the credit rating agencies — Moody’s, Standard & Poor’s and Fitch — played in the financial crisis. At the end of the hearing, Mr. Levin offered a preview of the Goldman hearing scheduled for Tuesday.
“Our investigation has found that investment banks such as Goldman Sachs were not market makers helping clients,” Mr. Levin said, referring to testimony given by Mr. Blankfein in January. “They were self-interested promoters of risky and complicated financial schemes that were a major part of the 2008 crisis. They bundled toxic and dubious mortgages into complex financial instruments, got the credit-rating agencies to label them as AAA safe securities, sold them to investors, magnifying and spreading risk throughout the financial system, and all too often betting against the financial instruments that they sold, and profiting at the expense of their clients.”
The transaction at the center of the S.E.C.’s case against Goldman also came up at the hearings on Friday, when Mr. Levin discussed it with Eric Kolchinsky, a former managing director at Moody’s. The mortgage-related security was known as Abacus 2007-AC1, and while it was created by Goldman, the S.E.C. contends that the firm misled investors by not disclosing that it had allowed a hedge fund manager, John A. Paulson, to select mortgage bonds for the portfolio that would be most likely to fail. That charge is at the core of the civil suit it filed against Goldman.
Moody’s was hired by Goldman to rate the Abacus security. Mr. Levin asked Mr. Kolchinsky, who for most of 2007 oversaw the ratings of collateralized debt obligations backed by subprime mortgages, if he had known of Mr. Paulson’s involvement in the Abacus deal.
“I did not know, and I suspect — I’m fairly sure that my staff did not know either,” Mr. Kolchinsky said.
Mr. Levin asked whether details of Mr. Paulson’s involvement were “facts that you or your staff would have wanted to know before rating Abacus.” Mr. Kolchinsky replied: “Yes, that’s something that I would have personally wanted to know.”
Mr. Kolchinsky added: “It just changes the whole dynamic of the structure, where the person who’s putting it together, choosing it, wants it to blow up.”
The Senate announced that it would convene a hearing on Goldman Sachs within a week of the S.E.C.’s fraud suit. Some members of Congress questioned whether the two investigations had been coordinated or linked.
Mr. Levin’s staff said there was no connection between the two investigations. They pointed out that the subcommittee requested the appearance of the Goldman executives and employees well before the S.E.C. filed its case.
This appears to be just what the doctor ordered. With unemployment as high as it is, we do not need illegals taking jobs from citizens. The argument that these are jobs nobody will do is a farce. I think most people out of work would do jobs that are no so glamorous. I would rather spend taxpayer money on our citizens with low paying jobs that are trying to make a living with assistance from the government instead of giving illegals medicaid, food stamps, etc.
We need to secure our borders and take care of our own. One only has to look at California and their budget crisis to see the strain illegals put on a state budget from medicaid, food stamps and welfare to prison costs of criminals that are illegals.
If illegals are given amnesty then it would be a slap in the face to all immigrants that came to our nation legally and followed the proper procedure to become a citizen. Our leaders are too concerned about getting votes from the hispanic community to deal with the immigration problem and after the health care fiasco that was passed by a partisan vote, I am sure that any immigration reform offered by the current administration and Congress would follow along the same lines as the health care legislation and would allow all illegals to stay in the country.
It amazes me that the illegals protest about immigration but yet if a US citizen was to go to Mexico illegally, they would most likely be arrested and serve time before being deported. Mexico doesn’t allow anyone to obtain citizenship by anyone not born in Mexico. To me, they expect to be allowed to come to the USA but are not too friendly toward people from our country.
Good Job to Arizona for acting on something that costs taxpayers billions of dollars every year.
Ariz. governor signs immigration enforcement bill
AP By PAUL DAVENPORT and JONATHAN J. COOPER, Associated Press Writers Paul Davenport And Jonathan J. Cooper, Associated Press Writers – Fri Apr 23, 7:22 pm ET
PHOENIX – Gov. Jan Brewer ignored criticism from President Barack Obama on Friday and signed into law a bill supporters said would take handcuffs off police in dealing with illegal immigration in Arizona, the nation’s busiest gateway for human and drug smuggling from Mexico.
With hundreds of protesters outside the state Capitol shouting that the bill would lead to civil rights abuses, Brewer said critics were “overreacting” and that she wouldn’t tolerate racial profiling.
“We in Arizona have been more than patient waiting for Washington to act,” Brewer said after signing the law. “But decades of inaction and misguided policy have created a dangerous and unacceptable situation.”
Earlier Friday, Obama called the Arizona bill “misguided” and instructed the Justice Department to examine it to see if it’s legal. He also said the federal government must enact immigration reform at the national level — or leave the door open to “irresponsibility by others.”
“That includes, for example, the recent efforts in Arizona, which threaten to undermine basic notions of fairness that we cherish as Americans, as well as the trust between police and their communities that is so crucial to keeping us safe,” Obama said.
The legislation, sent to the Republican governor by the GOP-led Legislature, makes it a crime under state law to be in the country illegally. It also requires local police officers to question people about their immigration status if there is reason to suspect they are illegal immigrants; allows lawsuits against government agencies that hinder enforcement of immigration laws; and makes it illegal to hire illegal immigrants for day labor or knowingly transport them.
The law sends “a clear message that Arizona is unfriendly to undocumented aliens,” said Peter Spiro, a Temple University law professor and author of the book “Beyond Citizenship: American Identity After Globalization.”
Brewer signed the bill in a state auditorium about a mile from the Capitol complex where some 2,000 demonstrators booed county Supervisor Mary Rose Wilcox when she announced that “the governor did not listen to our prayers.”
“It’s going to change our lives,” said Emilio Almodovar, a 13-year-old American citizen from Phoenix. “We can’t walk to school any more. We can’t be in the streets anymore without the pigs thinking we’re illegal immigrants.”
The Mexican American Legal Defense and Education Fund said it plans a legal challenge to the law, arguing it “launches Arizona into a spiral of pervasive fear, community distrust, increased crime and costly litigation, with nationwide repercussions.”
Mexico has warned the proposal could affect cross-border relations. On Thursday, Mexico’s Senate unanimously passed a resolution urging Brewer to veto the law.
“Police in Arizona already treat migrants worse than animals,” said Francisco Loureiro, an activist who runs a migrant shelter in the border town of Nogales, Mexico. “There is already a hunt for migrants, and now it will be open season under the cover of a law.”
The bill will take effect in late July or early August, and Brewer ordered the state’s law enforcement licensing agency to develop a training course on how to implement it without violating civil rights.
“We must enforce the law evenly, and without regard to skin color, accent, or social status,” she said. “We must prove the alarmists and the cynics wrong.”
Brewer, who faces a tough election battle and growing anger in the state over illegal immigrants, said the law “protects every Arizona citizen.”
Anti-immigrant anger has swelled in the past month, after rancher Rob Krentz was found dead on his land north of Douglas, near the Mexico border. Authorities believe he was fatally shot by an illegal immigrant possibly connected to a drug smuggling cartel.
Arizona has an estimated 460,000 illegal immigrants, and its harsh, remote desert serves as the corridor for the majority of illegal immigrants and drugs moving north into the U.S. from Mexico.
U.S. Rep. Raul Grijalva, a Democrat, said he closed his Arizona offices at noon Friday after his staff in Yuma and Tucson were flooded with calls this week, some from people threatening violent acts and shouting racial slurs. He called on businesses and groups looking for convention and meeting locations to boycott Arizona.
The bill’s Republican sponsor, state Rep. Russell Pearce of Mesa, said Obama and other critics of the bill were “against law enforcement, our citizens and the rule of law.”
Pearce said the legislation would remove “political handcuffs” from police and help drive illegal immigrants from the state.
“Illegal is illegal,” said Pearce, a driving force on the issue in Arizona. “We’ll have less crime. We’ll have lower taxes. We’ll have safer neighborhoods. We’ll have shorter lines in the emergency rooms. We’ll have smaller classrooms.”
Associated Press Writer Julie Pace in Washington contributed to this report.