Conservation In The Time Of Control Fraud

(Commentary posted by Roger Erickson.)

Conservation In The Time Of Control Fraud

This is an interesting story on the role of Hank Paulson in personally funding conservation in China.

What are your thoughts while considering Hank Paulson simultaneously involved in conservation PLUS epic financial looting the last 15 years?

That brings up contradictory implications of Biblical proportions. Forget Peter, Hank's been robbing the entire US MiddleClass to pay Paulson, and apparently feels compelled to do penance by conserving some but not all habitats.

Maybe Hank's funding a private reserve for Control Frauds, so they'll never again have to get down on bended knee in front of their victims & accomplices.

Wouldn't Middle Classes everywhere do a far better job of conserving their own environments if they weren't robbed blind beforehand? No habitat for the human Middle Class?

Methinks "Herr-los" Paulson is uselessly robbing his own mirror here. He can't see the conservation for the robbery, so he vainly pursues one in order to try to personally fund the other.

Hank, Hank, Hank. Just give it a rest? NeoLiberalism is not a prerequisite for Christian Scientists.

A surprising inability to see the big picture? Or a massive, purposeful Control Fraud, and an outright traitor to his own nation, in more ways than one. So far, no court has subpoenaed Hank to find out, nor investigated him thoroughly enough to display the implications for an American ex Middle Class that has yet to decide how to respond to Hank's weirdly selective conservation efforts.

Rebecca Leber — What Climate Change Looks Like on Your Front Porch

A new report, published on Tuesday, represents an attempt to change that. It’s called “Risky Business” and it comes from a year-long research project, convened and financed by Michael Bloomberg, Hank Paulson, and Tom Steyer. It’s the latest in a series of new reports that sound alarms about climate change: the health effects, glaciers melting, and impact on food nutrition, to name a few. But the researchers and scientists who produced Risky Business are trying to do something a little different. Using new, more sophisticated projections, they have broken down the U.S. into the same regions used in the National Climate Assessment and attempted to show what climate change will mean for each one. They are also trying to put a dollar value on the risk climate change represents in these regions, particularly for businesses.

That last part is important. The primary audience for the report isn’t really Main Street. It’s Wall Street—and corporate boardrooms. The backers include a number of people with credibility in this world—not just Paulson, who used to run Goldman Sachs and served as Treausry Secretary in the Bush Administration, but also George Shultz (Treasury Secretary under George H.W. Bush) and Olympia Snowe (the former Republican senator). Paulson, who has apparently been particularly active in this project, argued in a weekend New York Times op-ed that “risk management is a conservative principle.”

New Republic
What Climate Change Looks Like on Your Front Porch
Rebecca Leber

The Huffington Post — Hank Paulson: 'Flawed Government Policies' Cause 'Every Financial Crisis'

Surprise! Hank Paulson blames government for the financial crisis — apparently forgetting that he was government at the time and somehow overlooked mention it then. What a loser.

The Huffington Post
Hank Paulson: 'Flawed Government Policies' Cause 'Every Financial Crisis'

Janet Tavakoli on crony capitalism

On Nov. 29, 2011, Bloomberg magazine's Richard Teitelbaum published an article revealing a secret meeting on July 21, 2008, with then secretary of the treasury and former Goldman Sachs CEO Hank Paulson, and around a dozen hedge-fund managers and Wall Street executives.

Five of the hedge fund managers were former Goldman Sachs employees. The meeting was held at the offices of the founder of hedge fund Eton Park Capital Management, Eric Mindich, a former 15-year employee of Goldman Sachs who rose to be the senior strategy officer of Goldman's executive office. He is also current chair of the asset managers' committee of the President's Working Group on Capital Markets.

Then Secretary Paulson asked the hedge fund managers what the market might think if he placed mortgage giants Fannie Mae and Freddie Mac into conservatorship, a move that would have wiped out value for the shareholders and possibly wiped out value for subordinated debt holders.According to the article, one hedge fund manager had a short position in these stocks when he walked into the meeting. He was shocked that Secretary Paulson blabbed specifics, and the hedge fund managers therefore believed the Treasury Department would implement the plan. Seven weeks later, it did.

The hedge fund manager called his lawyer at a break in the meeting, and his lawyer told him Paulson had divulged non-public material information. His lawyer advised him to stop trading in the shares of these companies immediately. Ironically, that meant the hedge fund manager could not cover his short positions, so he profited by riding the value of the shares all the way down to the bottom. If he hadn't been at the meeting, and if he had any doubts, he might have covered his short position earlier and made less money. One will never know, because Secretary Paulson tied the hedge fund manager's hands.

But the more interesting implication is for the other managers in attendance. If they didn't already have a short position in Fannie Mae and Freddie Mac, they now had non-public material information that would allow them to almost certainly profit mightily by initiating such a trade. They could even be more confident in shorting other financial institutions that would likely take a shellacking....

Meanwhile, then Secretary Paulson told the public a different story than he told the meeting attendees. According to Bloomberg's research, earlier that day, Paulson told the New York Times that the Federal Reserve and the Office of the Comptroller of the Currency were inspecting Fannie and Freddie's books and he expected the result of this would inspire confidence. The Times's articleappeared the following day. Any investor in the shares of Fannie and Freddie would be less likely to sell their shares in the face of this reassuring message.

There is no way of knowing whether the hedge fund managers initiated new trades as a result of this meeting, but the key issue is that then Secretary of the Treasury Paulson communicated non-public material information that could financially benefit the recipients at the public's expense.

Read the rest at The Huffington Post

Is Crony Capitalism Wrong?

by Janet Tavakoli

Janet Tavakoli is the president of Tavakoli Structured Finance, a Chicago-based firm that provides consulting to financial institutions and institutional investors. Ms. Tavakoli has more than 20 years of experience in senior investment banking positions, trading, structuring and marketing structured financial products. She is a former adjunct associate professor of derivatives at the University of Chicago's Graduate School of Business. Author of: Credit Derivatives & Synthetic Structures (1998, 2001),Collateralized Debt Obligations & Structured Finance (2003), Structured Finance & Collateralized Debt Obligations (John Wiley & Sons, September 2008). Tavakoli’s book on the causes of the global financial meltdown and how to fix it is: Dear Mr. Buffett: What an Investor Learns 1,269 Miles from Wall Street (Wiley, 2009).

UPDATE: Crony Capitalism? Hank Paulson’s Extraordinary Meeting
by Jesse Eisinger
 at ProPublica,