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WASHINGTON (Reuters) - U.S. lawmakers on Thursday slammed former Treasury Secretary Henry Paulson over the government's role in Bank of America's merger with Merrill Lynch, saying authorities suppressed information about losses and bullied executives into going through with the deal. "The American people, investors, and the Congress were kept in the dark," Rep. Edolphus Towns told Paulson at a hearing. "There was no oversight to determine whether this arrangement made sense. In my view, this is unacceptable and must be prevented from happening again," said Towns, the New York Democrat who chairs the House of Representatives Oversight and Government Reform...

The raison d'etre for this post.....to inform. The quotes are accurate. The info is out there---from numerous published sources. Savvy conservatives suspected something like this, but many “middle of the road” independents would be quite surprised and shocked if this becomes public knowledge. FREEPER ACTION Pass the word far and wide--blast-mail email addresses. Post the info on message boards. Email the info to the media. It was assumed that any bank bailout money or profit givebacks would be returned to the govt's general funds--- from whence it had come--- in order to pay down the debt. The truth, however, is...

The Treasury Department is selling stock warrants back to TARP recipients for only 66 percent of fair market value, according to a report issued Friday by the Congressional Oversight Panel. Through the Troubled Asset Relief Program, known as TARP, the Treasury Department purchased preferred stock and warrants from banks in an effort to prop up lending. Warrants, which give the holder the right to buy a company’s stock at some point in the future for a specific price, presented a lot of potential upside for taxpayers, should bank stock prices rise above the face value of the warrants. Many banks...

WASHINGTON – The huge amount of money tied up in complex derivative transactions helped cripple the economy, Treasury Secretary Timothy Geithner told lawmakers Friday as he laid out a case for greater government control over a generally unregulated sector of the financial markets. "Establishing a comprehensive framework of oversight is crucial," Geithner said .. Despite apprehension among Republicans, the effort to add government restrictions to these more freewheeling financial instruments has gained support within the Democratic-controlled Congress. "Clearly, we're going to be significantly expanding regulation of derivatives," said Rep. Barney Frank, ..

On Wednesday, the Treasury Department announced [1] that nine asset managers (see the list below) had been picked [2] to partner with the government to buy older, hard-to-value mortgage-backed securities. Up to $30 billion in taxpayer money will go toward the effort. The fund managers will raise up to $10 billion, which will be matched by up to $10 billion in TARP money, with $20 billion more available from the TARP as cheap financing to boost the size of the buys.Originally conceived [3] as the whole purpose of the TARP, then a major portion ($100 billion) of the TARP, the...

Back in April, the Department of Treasury released this statement about the criteria they were looking for in determining companies that would be eligible to compete to be bidders in the private public investment partnership. (PPIP) The Treasury Department today announced the receipt of more than 100 unique applications from potential fund managers interested in participating in the Legacy Securities portion of the Public Private Investment Program (PPIP). A variety of institutions applied, including traditional fixed income, real estate, and alternative asset managers.

Treasury Works on 'Plan C' To Fend Off Lingering Threats Troubling Issues in Lending Could Still Disrupt Economy By David Cho and Binyamin Appelbaum Washington Post Staff Writers Wednesday, July 8, 2009 As the financial system tries to right itself after its near-collapse last fall, the Treasury Department has assembled a team to examine what could yet bring it down and has identified several trouble spots that could threaten the still-fragile lending industry. Informally known as Plan C, the internal project is focused on vexing problems such as the distressed commercial real estate markets, the high rate of delinquencies among...

Treasury ready to twist arms over consumer agencyReuters - 1 hour 34 minutes ago By Patrick Rucker WASHINGTON - The Treasury Department is warning the financial services industry that it will not back down from its proposal to create a new consumer protection agency, even while lobbyists build a warchest and strategy to defeat the plan. The new agency, part of a wider revamp of U.S. financial rules proposed by the Obama administration, would have the power to regulate products like mortgages and credit cards in what advocates have likened to a safety commission for financial products. The proposal, detailed...

On June 9 President Obama called a press conference where he announced, "Several financial institutions are set to pay back $68 billion to taxpayers." He said, "It's worth noting that in the first round of repayments from these companies the government has actually turned a profit." The moment was hailed as a policy triumph for the Obama administration, and a sure sign the economy was on the road to recovery. While Mr. Obama's announcement came as welcomed news, few questioned what would become of the returning funds, as it was rightly assumed that any money or profit would be returned...

The U.S. Treasury has apparently found another way to lose more taxpayer money. Perhaps $9 billion down the drain, unless changes are made soon. Last year, when the Treasury doled out some $200 billion from the $700 billion Troubled Asset Relief Program (TARP), it also acquired warrants to purchase common stock in banks that received TARP assistance. However, as the law was written, the Treasury must sell those same warrants back to the banks once they have paid back their original TARP loan. What the law does not state is for how much. One of the first banks to pay...

Tax Revenues Take a Dive Washington, D.C. (May 27, 2009) By WebCPA Staff PrintE-mailReprints Federal tax revenues plunged 34 percent in April to $266 billion, compared to $404 billion in April of last year, according to a new study. An analysis of Treasury Department data by the American Institute for Economic Research found that individual income tax revenues fell 44 percent in April 2009 to $137 billion, compared to $244 billion in April 2008. That’s not good news because April is the month when federal tax revenues tend to be highest because of the tax-filing deadline. Corporate income tax revenues...

Today the US Treasury Department announced an update to allow refinancing of mortgages backed by Fannie Mae and Freddie Mac up to a first lein position of 125% of the home’s appraisal value. This is a level that was previously set at 105% loan to value.

WASHINGTON -- The Obama administration's proposed consumer-protection agency would have broad oversight for a range of products, beefing up the government's regulation of credit cards, mortgages and gift cards, as well as expanding its authority over financial firms. Draft legislation unveiled Tuesday by the Treasury Department would for the first time make a single entity, the Consumer Financial Protection Agency, responsible for writing and enforcing rules across a range of financial products used by consumers. "This agency will have only one mission -- to protect consumers," Treasury Secretary Timothy Geithner said.

The Obama adminstration has imposed financial sanctions on a company accused of involvement in North Korea's missile proliferation network.

Buried in the late wire news on Friday – and therefore barely registering in the newspapers over the weekend – Treasury announced the rules for pricing its option to buy shares in banks that participated in TARP. The Treasury Department said the banks will make the first offer for the warrants. Treasury will then decide to sell at that price or make a counteroffer. If the government and a bank cannot agree on a fair price for the warrants, the two sides will have the right to use private appraisers. This is a mistake.  The only sensible way to dispose...

Ever since two middle-aged men with Japanese passports were caught in Italy this month trying to smuggle a purported $134.5 billion in United States government bearer bonds into Switzerland, the Internet has been abuzz with theories. Was the Japanese government, or some other creditor nation, secretly trying to dump Treasury bonds to drive down the value of the dollar? Had the Italian mafia stolen the equivalent of 1 percent of the American gross domestic product, using the paper, which supposedly was instantly convertible into cash, to run a giant scam? Adding spice was the whole Bond — James Bond —...

Dresdner withdraws as primary dealer for Fed NEW YORK (MarketWatch) -- Dresdner Kleinwort Securities has withdrawn from the Federal Reserve's primary U.S. government security dealers, the U.S. central bank said Friday. The change, effective after business closes, brings the number of dealers back down to 16, after Jefferies & Co. joined last week. Dealers trade directly with the Fed and are required to bid at Treasury auctions. The last firm to drop out was Nomura Securities International, a division of Nomura , in late 2007.

Securities seized in Chiasso still between a wall of silence and a flow of disinformation Neither Italian nor US authorities have officially said whether the seized US Treasury bills worth US$ 134.5 billion are real or fake. A US Treasury spokesperson said they were fakes, but acknowledged that he only saw them in a photo on the internet. For Italy’s financial police, if they are forgeries, they are practically indistinguishable from the real stuff. Both the US Federal Reserve and the Bank of Japan have an interest in denying their authenticity. Milan (AsiaNews) – Italy’s financial police (Guardia di Finanza)...

June 22, 2009 Theories abound, but facts are in short supply. One fact that can be surmised is that there is a cover-up. The evidence for this is circumstantial, but overwhelming. It meets the standard of “beyond all reasonable doubt”, the supposedly highest standard set in American jurisprudence. It has been 19 days and the two alleged perpetrators/victims have not been identified to the public. The Japanese consulate general in Milan confirmed that the detention had taken place and said it was trying to confirm the authenticity of the bonds. Colonel Rodolfo Mecarelli of the Guardia di Finanza in Como,...

You have to love Goldman Sachs: Staff at Goldman Sachs staff can look forward to the biggest bonus payouts in the firm's 140-year history after a spectacular first half of the year, sparking concern that the big investment banks which survived the credit crunch will derail financial regulation reforms. A lack of competition and a surge in revenues from trading foreign currency, bonds and fixed-income products has sent profits at Goldman Sachs soaring, according to insiders at the firm. Nothing like a little taxpayer money funneled through AIG to add to the pool, right? In April, Goldman said it would...

Bailout Watchdog Defends Independence From TreasuryJune 19, 2009 5:28 PM ABCNews' Matthew Jaffe reports: Bailout watchdog Neil Barofsky today emphasized that his office was independent from the Treasury Department and the administration's decision to seek a Justice Department ruling was "unnecessary". Barofsky, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), sent a letter to Sen. Chuck Grassley, R-Iowa, and Rep. Darrell Issa, R-Calif., about the ongoing dispute with Treasury, as both sides await a decision from DOJ's Office of Legal Counsel. "We continue to believe the inquiry to OLC is unnecessary given the very clear intent of...

GOP Lawmaker Rips Treasury for "Gagging" SIGTARP, Sees Parallels with Nixon Era & Calls for InvestigationJune 18, 2009 9:29 PM ABC News' Matt Jaffe reports: The lone sitting Republican member of Congress on the Congressional Oversight Panel tonight dubbed the Treasury Department's challenge of the independence of bailout watchdog Neil Barofsky "outrageous, "unprecedented", and "disturbing", and he called on the Panel to launch an immediate investigation. "It's highly outrageous and highly irregular and we are going to get to the bottom of it," warned Rep. Jeb Hensarling, R-TX, in an interview with ABC News. "For Treasury to assert some kind...

The Obama administration’s disputes with government watchdogs do not end with fired Inspector General Gerald Walpin. Behind the scenes, the Treasury Department is embroiled in a disagreement with Neil Barofsky, the watchdog for the $700 billion government bailout Troubled Asset Relief Program, or TARP. The dispute was revealed in a letter that Sen. Chuck Grassley, R-Iowa, sent on Wednesday to Treasury Secretary Tim Geithner, first reported by the Los Angeles Times’ Peter Wallsten.

The government will provide another $3.1 billion to a group of mortgage servicing companies as an incentive to modify loans to combat record levels of foreclosures. The Treasury Department said Tuesday that the modifications, which included reductions in projected payments for some companies, pushed the total amount for the program to $18.3 billion, from $15.2 billion. The department also added one company, Residential Credit Solutions of Fort Worth, Texas, to the program. It is scheduled to receive up to $19.4 million, and joins 15 other mortgage companies approved to participate in the program. The biggest adjustment was made for Countrywide...

WASHINGTON (Reuters) - The Obama administration plans to call for the U.S. Office of Thrift Supervision to close as part of its overhaul of financial regulation, which would also include the elimination of the federal thrift charter for banks. The plan would require large, interconnected firms to draft a "credible plan" for how they would be unwound if they ran into severe trouble, a senior administration official told reporters on a conference call on Tuesday. The official said the proposal would also call for the creation of a financial oversight council that would be led by the Treasury Department, and...

White House appoints executive pay czarGlenn Somerville and Karey Wutkowski, Reuters Published: Wednesday, June 10, 2009 WASHINGTON -- The Obama administration Wednesday named Kenneth Feinberg, the lawyer who oversaw the government's compensation fund for victims of the Sept. 11, 2001, attacks, as its pay czar to police compensation of top earners at companies receiving "exceptional" government aid. The administration also urged new laws to give ordinary shareholders more say on how executive salaries are set. The pay packets of top executives, which sometimes are equal to several hundred times the pay of average employees, ignited a storm of controversy after...

It’s pretty hard to dress up a disaster as something less than that, but the Associated Press’s Martin Crutsinger gave it his best shot in his report yesterday about Uncle Sam’s the May Monthly Treasury Statement, in effect understating the amount and significance of federal government’s rapidly deteriorating financial situation. With the help of dubious handling of last year’s stimulus payments in May 2008’s Treasury Statement, Crutsinger ignored serious declines in tax receipts from economic activity that are, if anything, accelerating. I’ll cover that problem in this post. Additionally, after only briefly mentioning it last month (noted at the time...

A total of $332 million would be devoted to new Internal Revenue Service (IRS) enforcement efforts, including $128.1 million to add nearly 800 new IRS employees to combat offshore tax evasion and improve compliance with U.S. international tax laws by businesses and high-income individuals. Another $130 million would go to bolster the security of the IRS information technology, improve the efficiency of its business systems and upgrade its fraud detection capabilities. Although not directly under the jurisdiction of this Subcommittee, our Budget also includes funds to meet our international obligations to help us in mounting a global response to the...

Wait! Isn't that the same thing everyone else says? Read » Perhaps it's the limitation of the medium, but if your only introduction to Nasssim Taleb was his appearance on CNBC this morning, you'd think he was a very conventional thinker. The main theme he kept hammering home: There's too much debt and leverage in the system. In other words, he's making the same point as almost everyone else talking about the economy these days. The way to restart everything is restructuring, conversion of debt into equity, convince people that debt is not good," Taleb said. "Do not delay a...

Last October, then-Treasury Secretary Henry Paulson ordered nine banks that the Treasury Department described as "healthy" financial institutions to surrender ownership interests to the government or else face regulatory action that would force them to surrender ownership interests to the government, according to an internal Treasury Department document. Paulson's extraordinary threat culminated in one of the most sweeping government intrusions into the free-enterprise system in the history of the United States. Judicial Watch, a nonpartisan watchdog organization, used the Freedom of Information Act to obtain a copy of the internal Treasury Department "talking points" that were prepared for Paulson to...

In his debut as the nation's 75th treasury secretary, Timothy Geithner has been a smashing success -- if success is measured by more federal debt and less accountability to American taxpayers. It was never supposed to be this way. When our first treasury secretary, Alexander Hamilton, sought to establish the nation's first bank in 1791, he faced challenges from those who condemned the move as an unconstitutional power grab to control the flow of credit and direct the national economy. Against these criticisms, Hamilton drafted numerous provisions to ensure solvency, transparency and fiscal restraint on the part of the federal...

...Geithner ... most of his childhood living outside the United States, including present-day Zimbabwe, Zambia, India and Thailand where he completed high school at International School Bangkok. He attended Camp Becket-in-the-Berkshires-for-boys, a summer camp located in western Massachusetts. He then attended Dartmouth College, graduating with a B.A. in government and Asian studies in 1983. He earned an M.A. in international economics and East Asian studies from Johns Hopkins University's School of Advanced International Studies in 1985. He has studied Chinese and Japanese. ...grandfather, Paul Herman Geithner (1902–1972), emigrated with his parents from Zeulenroda, Germany to Philadelphia, Pennsylvania in 1908. His...

Richard Fisher, president of the Dallas Federal Reserve Bank, said: "Senior officials of the Chinese government grilled me about whether or not we are going to monetise the actions of our legislature." "I must have been asked about that a hundred times in China. I was asked at every single meeting about our purchases of Treasuries. That seemed to be the principal preoccupation of those that were invested with their surpluses mostly in the United States," he told the Wall Street Journal. His recent trip to the Far East appears to have been a stark reminder that Asia's "Confucian" culture...

There was a serious decline in the U.S. Treasury market on Thursday and Friday, accompanied by a sharp drop in the U.S. dollar, which backed over $1.40 against the euro. The 10-year T-note traded to yield 3.45% on Friday, and the 30-year bond almost reached 4.40%. Yields are down slightly this morning, and the dollar is a bit stronger. (There is speculation that jitters over the North Korean nuclear blast are behind some of this action.) But it’s hard to miss a sense that sentiment is changing in this extremely important market.

CBs And Other "Real Money" Had Enough? Oh oh...... From the forum, wire from Reuters claimed original source: 21. There apparently is a new wrinkle to the intermediation trade between buying from Treasury to sell to the Fed with real money, including central banks, now in on the act. Indeed, several Street sources relay central banks were aggressive offers into this morning's coupon pass, with one letting go of a large block of old 5-years. Other offers too are coming in from embedded Asian real money longs -- in the higher coupons -- also looking to sell size without unduly...

The U.S. Treasury Department is preparing to announce as early as Wednesday that it will invest an additional $7.5 billion in lender GMAC LLC in a deal that could allow the U.S. government to hold a majority stake in the Detroit-based auto finance company, the Detroit News reported. GMAC (GJM), which also provides loans for consumers to buy General Motors Corp (GM) and Chrysler LLC vehicles, has been in talks for several weeks to secure additional capital, the newspaper said. The U.S. Treasury declined to comment. A GMAC spokesman could not be immediately reached for comment. U.S. Treasury Secretary Timothy...

The Treasury has issued an enormous volume of debt into the frightened hands of investors seeking default-free securities. This has allowed the Treasury to finance a massive and largely needless transfer of wealth to bank bondholders so easily over the short-term that the longer-term cost has been almost completely obscured.

WASHINGTON (AFP) – China is pumping more money into US Treasury bonds, recent data show, despite concerns expressed in Beijing in recent months over the safety of dollar-linked assets. Mainland China's holding of Treasury securities jumped to 767.9 billion dollars in March from 744.2 billion dollars the previous month, according to US Treasury data. The figure does not include those of Hong Kong, China's special administration region, which climbed to 78.9 billion dollars from 76.3 billion dollars. The statistics showed China sitting comfortably as the top purchaser of Treasury bonds despite years trying to diversify its reserves from the US...

TG-132 SNIPPET: "WASHINGTON-- The U.S. Department of the Treasury today targeted the support network of al-Qa'ida in Iraq (AQI) by designating Syria-based Sa'ad Uwayyid 'Ubayd Mu'jil al Shammari (aka Abu Khalaf) under Executive Order 13224. E.O. 13224 targets terrorists and those providing support to terrorists or acts of terrorism. AQI is a Terrorist Organization and a Specially Designated Global Terrorist. "We will continue to aggressively implement the international obligation to target al-Qa'ida-linked terrorists, like Abu Khalaf, who threaten the safety of Coalition Forces and the stability of Iraq," said Stuart Levey, Under Secretary for Terrorism and Financial Intelligence. Abu Khalaf...

Bumpy though the last decade has been, most Americans have continued to trust in the basic institutions that undergird the nation’s economy. Until now. Recent polling reveals a public toying with doubts about American-style capitalism yet equally suspicious of the alternatives. Ironies abound: Nearly half of Americans express reservations about capitalism, yet overwhelming majorities distrust large government stakes in major industries and object to the way federal stimulus dollars are being spent. As a dyspeptic public alternately blames and looks to Congress, President Obama, and “big business” for solutions to our economic woes, Americans have largely missed the real sea-change:...

NEW YORK – Stocks are finishing lower after weak demand at a Treasury bond auction touched off worries about the government's ability to raise funds to fight the recession. The government had to pay greater interest than expected in an auction of 30-year Treasurys. That is worrisome to traders because it could signal that it will become harder for Washington to finance its ambitious economic recovery plans. The Dow Jones industrial average is down 102 at 8,410, the same amount it rose Wednesday. The S&P 500 index is down 12 at 907. The Nasdaq composite index is down 43 at...

China fears bond crisis as it slams quantitative easing China has given its clearest warning to date that emergency monetary stimulus by Western governments risks setting off worldwide inflation and undermining global bond markets. By Ambrose Evans-Pritchard Last Updated: 1:13PM BST 07 May 2009 Comments 5 | Comment on this article "A policy mistake made by some major central bank may bring inflation risks to the whole world," said the People's Central Bank in its quarterly report. "As more and more economies are adopting unconventional monetary policies, such as quantitative easing (QE), major currencies' devaluation risks may rise," it said....

Tim Geithner has a clever new way to "recapitalize" banks that fail the stress test: Convert the taxpayer's preferred stock to common stock. From Geithner's perspective, this technique has several advantages: The banks will suddenly seem healthy, because their assets-to-common equity ratios will rise. Geithner doesn't have to ask Congress for more baillout money yet. Taxpayers won't understand that they're giving up a nice dividend and a safer security just to make the banks look better. If Geithner is right that what's wrong with the banks is just a temporary liquidity problem, the taxpayer should do well when the stocks...

Last week, almost every major US bank manufactured profits out of thin air by changing their regular reporting periods to exclude months in which huge losses occurred by changing their definitions of bad debt, and by revaluing their assets at fantasy land valuations that they will never receive in the open market, courtesy of FASB. This event was a non-event to me because it merely continued the process known as the Enronization of America. This event, the systemic injection of fraud and deceit into nearly every aspect of American life, has been unfolding for decades, even prior to the Enron...

wary of the troubled US economy, has already "canceled America's credit card" by cutting down purchases of debt, a US congressman said Thursday. China has the world's largest foreign reserves, believed to be mostly in dollars, along with around 800 billion dollars in US Treasury bonds, more than any other country.

WASHINGTON – The Treasury Department said Monday it will need to borrow $361 billion in the current April-June quarter, a record amount for that period. It's the third straight quarter the government's borrowing needs have set records for those periods. Treasury also estimated it will need to borrow $515 billion in the July-September quarter, down slightly from the $530 billion borrowed during the year-ago period. The all-time high of $569 billion was set in the October-December period.

Earlier this month, the Treasury Department quietly hired three law firms and a consulting firm for advice on restructurings and potential bankruptcies in the auto industry. Treasury did not issue a press release announcing the hirings, even through the contracts with the law firms were among the biggest yet for work on the government's $700 billion Troubled Asset Relief Program. The deals drew scant coverage beyond trade publications. Cadwalader Wickersham & Taft LLP, Sonnenschein Nath & Rosenthal LLP and Haynes and Boone LLP got six-month contracts worth as much as $8.59 million each, or $25.8 million total. Reports that the...

Local banker Bill Cooper, who runs TCF Bank in the Twin Cities, has established himself as a tough-as-nails businessman and has won the admiration of many in this area. Today’s announcement exemplifies why. Cooper has repaid the TARP funds in order to get Treasury off his back, even though he had to pay a premium to do so:TCF Financial Corporation announced Wednesday that it had completed the repurchase of its TARP preferred stock from the U.S. Treasury. It paid a redemption price of $361.2 million plus accrued dividends of $3.4 million.TCF Chairman and CEO William A. Cooper said the bank...

WASHINGTON -- The government has completed the transaction providing nearly $30 billion more in support to American International Group Inc., minus $165 million in controversial bonus payments. The Treasury Department also says it added Bank of America Corp. and Countrywide Home Loans Servicing to its mortgage relief program. That means a total of nine companies are participating in the $75 billion effort. The department also approved the applications for six more banks to participate in the $700 billion financial rescue program, bringing the total number of banks being helped to 553.

Just when you think the political class may have learned something in months of trying to fix the banking system, the ghost of Hank Paulson returns to haunt the Treasury. The latest Beltway blunder -- and it would be a big one -- is the Obama Administration's weekend news leak that it may insist on converting its preferred shares in some of the nation's largest banks into common equity. The stock market promptly tumbled by more than 3.5% yesterday, with J.P. Morgan falling 10% and financial stocks as a group off 9%, as measured by the NYSE Financials index. Note...