Sneak attack: Stimulus bill, just passed, sparks fears of internet monitoring

The Senate just passed an $789 billion stimulus package, but parts of it are already scaring hell out of web users.

The devil may or may not be in the details, as explains:

Consumer advocate group Public Knowledge issued an alert saying that Democrat Dianne Feinstein was trying to sneak copyright filters into the bill (it’s not clear if she was successful).

Consumer advocate group Free Press issued a statement applauding the fact that grant money in both bills [the House and Senate versions] still requires carriers to hold fast to network openness.

Anyway, the gigantic bill passed, 61-37.



Nissan crashes; hedge funds lick chops; incoming Israel govt. may take ‘harder line’


Plans are moving apace to purposely set up a “toxic bank” full of poisonous assets to further bail out those banks that had greedily and recklessly accumulated them.

Call it Shitibank. And give it the naming rights to the new baseball stadium for the New York Mets, taking the moniker away from toxic Citibank.

No joke. As Ground Zero reminds us of 9/11, ShitiField would serve as a monument to the global financial meltdown caused by New Yorkers. ShitiField would remind us to burst any future Wall Street bubbles before they blow up in our faces.

And, once the toxic bank is up and running, we proles can move our non-existent pension money to it. But don’t count on driving a new Nissan to the new bank: Even if you could afford to buy one, Nissan can’t afford to keep its factories open to manufacture one.

What’s really going to happen this week sounds just as far-fetched, but it’s not: Many investors on Wall Street don’t want the market to recover. They want it to hit bottom so they can start buying shares and companies again.

Bigwig Ray Dalio of the hedge fund Bridgewater Associates tells Barron’s:

“Buying equities and taking on those risks in late 2009, or more likely 2010, will be a great move because equities will be much cheaper than now. It is going to be a buying opportunity of the century.”

Meanwhile, corporate welfare is humming along, as government’s sudden socialists are coming to the rescue of capitalism. Heartwarming, especially for the likes of Nissan, which, as the Wall Street Journal reports, plans to “seek government assistance from Japan, the U.S. and elsewhere.”

And now the rescue plan for America calls for a combination of the toxic bank and encouragement by the government for hedge funds to profit from the grief by expanding their investments (instead of the government’s clawing back ill-gained profits from hedge funds). And don’t worry about Wall Street’s top execs: All the scoldings by President Barack Obama won’t stop them from making their big bucks. See? The free-market system does work.

At least we know that defense contractors will make it through the depression in good shape. Bibi Netanyahu is about to reclaim control of Israel, and that will signal that, as the BBC reports, “Israel is shifting to the right” and, as the Daily News says, “a harder line is coming with Israel’s Arab neighbors.”

Could the line get any harder, you ask?

While you’re investing in weapons makers or just waiting to pour your money back into the market or snap up some ailing companies, click on these…


Seeking Alpha: ‘U.S. Government vs. the Stock Market’

This week we’ll see a knock-down, drag-out battle between Obama, Geithner and the Senate who want to keep the market from falling, and the market itself which wants to drop precipitously.

Gawker: ‘Top Five Kellogg’s Recipes For Stoners’

As Seth Meyers pointed out on Saturday Night Live, Kellogg Company’s image is closer to that of bong-smoking Olympian Michael Phelps than the cereal maker likes to admit.

Kellogg’s Keebler Elves, after all, “live together in a treehouse and do nothing all day but think of new things to put cheese on.”

N.Y. Times: ‘U.S. Bank Bailout to Rely in Part on Private Money’

Wall Street helped produce the global financial and economic crisis. Now, as the Obama administration prepares to unveil a revised bailout plan for the banking system, policy makers hope Wall Street can be part of the solution.

Administration officials said the plan to be announced Tuesday was likely to depend in part on the willingness of private investors other than banks — like hedge funds, private equity funds and perhaps even insurance companies — to buy the contaminating assets that wiped out the capital of many banks.

N.Y. Times: ‘Applications Surge at Cooper Union’

For many high school seniors who are applying to college in the midst of an economic meltdown, Cooper Union’s commitment to full scholarships — regardless of need — has given the institution an almost mythic allure….

While many of the nation’s elite colleges underwrite the education of poor students, Cooper is among a handful of private colleges that are tuition-free for everyone (it does not, however, pay for room and board, though financial aid is available for living expenses).

Newsday: ‘Explore LI: Pamper your pooch’

Wall Street Journal: ‘Bailout Revamp Could Use Private Bank for Bad Assets’

Seeking Alpha: ‘Investors Staying Away from Banks; Gold Attempts to Break Downtrend’

Another Bank Bailout: On Monday, Treasury Secretary Geithner is due to announce the next phase in a long series of government bailouts for banks. The leaks about the plan thus far have indicated a hybrid approach using elements of a “bad bank” and more government guarantees on bank assets. The price action of Bank of America and Citigroup does not inspire confidence in the market’s reaction to previously announced government guarantees of toxic bank assets.

If the regulators hope to bring stability to the markets, they might want to consider leaving the rules unchanged for more than two weeks at a time.

N.Y. Times: ‘Leader of Afghanistan Finds Himself Hero No More’

Fox: ‘Australian PM: “It’s Mass Murder”‘

Officials believe arson may be behind nation’s worst-ever wildfires as entire towns burn.

Wall Street Journal: ‘Bank Bailout Plan Revamped’

Geithner is considering a plan to help purge banks of their bad bets by partnering with the private sector to buy troubled assets.


A 21-year-old autistic man perished and his grandmother was left fighting for her life as flames engulfed their 17th-floor East Harlem apartment yesterday morning, police said.

Forbes: ‘Nissan To Ax 20,000 After Loss Warning’

Wall Street Journal: ‘Saks Upended Luxury Market’

Saks’ decision to cut prices by 70% on designer clothes in mid-November set off a domino effect in the luxury goods business.

Fox: ‘Stimulus Plan Includes Billions for Colleges and Students’

The stimulus plan emerging in Washington could offer an unprecedented, multibillion-dollar boost in financial help for college students trying to pursue a degree while they ride out the recession.

N.Y. Times: ‘In Congress, Aides Start to Map Talks on Stimulus’

N.Y. Daily News: ‘One BIG question remains: Who ratted out Alex Rodriguez?’

N.Y. Daily News: ‘Netanyahu: the Golan Heights ‘will remain in our hands’

Former Prime Minister Benjamin (Bibi) Netanyahu, who is poised to be swept back into power Monday, declared Sunday he would not give up the strategic Golan Heights, signaling a harder line is coming with Israel’s Arab neighbors.

Fox: ‘Octuplets’ Grandmother Calls Daughter’s Actions ‘Unconscionable”‘


N.Y. Daily News: ‘GOP’s losses just might save party, says Lazio’

Bloomberg: ‘MGM Doubles Down on Lobbying as U.S. Senators Work on Stimulus Measure’

Casino operator MGM Mirage says a tax break for forgiven debt is a good way for Congress to stimulate the U.S. economy; Granite Construction Inc. favors more money for roads and bridges; General Motors Corp. wants incentives for car buyers.

Jewish Daily Forward: ‘Jewish Charities Look to Stimulus Bill To Stave Off Cuts’

Onion: ‘Per Tradition, Ex-Presidents Watch Obamas Christen White House Bed’

Crain’s New York Business: ‘Parents question mayor’s math’

Critics are skeptical of gains cited by school officials at an Assembly hearing Friday on whether mayoral control of the school system should continue.

Wall Street Journal: ‘U.S. Weighs Fed Program to Loosen Lending’

The Obama administration is considering turning to a new program run by the Fed that depends heavily on hedge funds to jump-start the financial system.

N.Y. Daily News: ‘Mike to GOP: Miss me, baby?’

Mayor Bloomberg came to a Queens banquet hall Sunday like a man looking to woo a lover he once spurned, sweet-talking a roomful of Republicans to take him back. It didn’t work.

N.Y. Times: ‘2008 Taxes: Big changes may come in expanded tax breaks to the less wealthy’

CNN: ‘Man, 47, marries girl, 8’

The debate over the controversial practice of child marriage in Saudi Arabia was pushed back into the spotlight this week, with the kingdom’s top cleric saying that it’s OK for girls as young as 10 to wed.

“It is incorrect to say that it’s not permitted to marry off girls who are 15 and younger,” Sheikh Abdul Aziz Al-Sheikh, the kingdom’s grand mufti, said in remarks quoted Wednesday in the regional Al-Hayat newspaper. “A girl aged 10 or 12 can be married. Those who think she’s too young are wrong and they are being unfair to her.”…

Late last month, a Saudi judge refused to annul the marriage of an 8-year-old girl to a 47-year-old man.

The judge, Sheikh Habib Abdallah al-Habib, rejected a petition from the girl’s mother, whose lawyer said the marriage was arranged by her father to settle a debt with “a close friend.” The judge required the girl’s husband to sign a pledge that he would not have sex with her until she reaches puberty.

Wall Street Journal: ‘Pay Collars Won’t Hold Back Wall Street’s Big Dogs’

While a pay cap for financial executives punishes yesterday’s fools, it may inadvertently create tomorrow’s culprits.


More than 70 percent of firefighters who retired in the past five years did so on disabilities – hiking the cost of taxpayer-funded FDNY pensions to nearly $1 billion a year, a Post analysis shows. At the same time, a rise in final-year overtime racked up by firefighters – even those retiring on disabilities – has boosted pension costs…

N.Y. Daily News: ‘Bloody mob chop shop could become school bus depot’


Wall Street Journal: ‘Soaring Job Losses Drive Stimulus Deal’

Bloomberg: ‘U.S. Said to Hire N.Y. Bankruptcy Lawyers to Advise on Automakers’ Bailout’

A law firm with bankruptcy expertise, three capital-markets lawyers and an investment bank are advising the U.S. government on how to restructure General Motors Corp. and Chrysler LLC, two people involved in the work said.

New Yorker: ‘Can We Transform the Auto-Industrial Society?’

The present and impending disorder of the automobile companies is a reminder, even more than the decline of the housing and banking industries, of the desolation of the Great Depression. It is a reminder, too, of economic history, or of the rise and decline of industrial destinies.

N.Y. Daily News: ‘Final nails in coffin for city welfare burial fund’

Wall Street Journal: ‘Railing Against the Rich: A Great American Tradition’

The Great Depression of the 1930s created hardship and suffering among millions of Americans. It also created populist resentment of elites. Among the many signs of this anger was the astonishing popularity of Huey P. Long, governor of Louisiana and then U.S. senator, a figure so dominant in his own state that his enemies called him a dictator. But to the ordinary people of Louisiana — and later to millions of ordinary people across the U.S. — Mr. Long was a heroic figure, fighting for the “common man” and challenging the right of elites to monopolize power and wealth….

Crain’s New York Business: ‘NYC, London vie for the bottom’

Bloomberg: ‘Fed Calls Emergency Consultants to Triage and Treat AIG, Stricken Markets’

Every Sunday night, New York bankruptcy lawyer Marshall Huebner spends a 13-hour shift on call as an emergency medical technician. His day job involves work on another sort of rescue: The government’s $152.5 billion bailout of American International Group Inc.

Wall Street Journal: ‘Summers Crafts Broad Role in Reshaping Economy’

Onion: ‘Liberals Horrified By Lack Of Inexperience Among Obama Appointees’

Bloomberg: ‘Notre Dame Cathedral, Louis XIV Chateau Reap Bonanza From France’s Crisis’

For Paris’s Notre Dame Cathedral, the economic crisis is turning into manna from heaven.

Bloomberg: ‘India Bucks Global Auto Trend After Rate Cuts Spur Record Sales at Suzuki’

After six months of deliberating whether to buy a car, Mumbai real-estate agent Abraham Mathew took out a 300,000 rupee ($6,200) loan to buy a Suzuki Motor Corp. sedan. The clincher: a 20 percent drop in interest rates.

IRIN: ‘Homeless Gazans struggle to find shelter’



New York City’s jobless rate soars; Toyota drives off a cliff; Sullenberger lands in limelight

Heaven can wait: Chesley Sullenberger live, in “US Airways Flight 1549 Full Cockpit Recording”

To try to counter the sickening economic news, remember another horror story that actually had a happy ending.

Sully Sullenberger knows what “sickening” feels like, although his voice in the above cockpit recording doesn’t reveal it. Now, Sully is talking in detail about his astounding, life-saving jet landing on January 15 in the Hudson River, as the Post reports this morning:

First came the bird strike. Then everything went dead silent.

“It was the worst, sickening, pit-of-your-stomach, falling-through-the-floor feeling I’ve ever felt in my life,” hero pilot Chesley B. “Sully” Sullenberger III told CBS’s 60 Minutes, according to excerpts released yesterday.

“I knew immediately it was very bad,” he said in the interview, set to air Sunday at 7 p.m.

When asked if he wondered how he could get the crippled plane down safely, Sullenberger said he was just stunned.

“My initial reaction was one of disbelief,” he said.

And now for some bad news that only seems unbelievable…



N.Y. Daily News: ‘Bronx teen missing for a month spent it misidentified in city morgue’

N.Y. Times: ‘In the Red, Toyota Sees Loss Tripling’


N.Y. Daily News: ‘N.Y.C. so costly you need to earn six figures to make middle class’

N.Y. Times: ‘As Layoffs Surge, Women May Pass Men in Job Force’

N.Y. Daily News: ‘More soldiers committed suicide in January than killed by Al Qaeda’

N.Y. Times: ‘Violence and Abuse at City-Run Psychiatric Unit’

N.Y. Daily News: ‘Butt-grabbing pervert strikes for 5th time in Gramercy Park’

N.Y. Times: ‘U.N.’s Gaza Refugee Director Criticizes Israel and Hamas’

Wall Street Journal: ‘Anti-Arab Israeli Party Surges’

Polls Show Avigdor Lieberman’s Far-Right Platform Gaining Ahead of Vote

N.Y. Observer: ‘New York’s Stimulus Take: At Least $41 Billion’

Newsday: ‘Ruth Bader Ginsburg hospitalized with pancreatic cancer’


N.Y. Times: ‘Pakistani Nuclear Scientist Set Free’

A Pakistani court declared disgraced nuclear scientist Abdul Qadeer Khan free on Friday, ending five years of house arrest for the man at the center of the world’s most serious proliferation scandal.

Khan, lionized by many Pakistanis as the father of the country’s atomic bomb, confessed to selling nuclear secrets to Iran, North Korea and Libya in 2004, but was immediately pardoned by the government, although his movements were restricted to effective house arrest.

N.Y. Daily News: ‘Does New Jersey smell? Just ask the folks who live there…’


New uniforms for everyone!

The massive $900 billion stimulus bill making its way through Congress would require the feds to purchase up to 100,000 uniforms for the Transportation Security Administration and other Department of Homeland Security workers — a provision critics say won’t do anything to spark the economy.

ChannelWeb: ‘Privacy Group: Google Latitude Could Track Unsuspecting Users’


Wall Street Journal: ‘When People Stop Moving, So Do Congressional Seats’

Seeking Alpha: ‘The Next American Revolution: Main Street vs. Wall Street’

Wall Street Journal: ‘Toyota Flags $3.84 Billion Full-Year Loss’

Seeking Alpha: ‘Stimulus Watch: How the Devil Are They Going to Finance All of It?’

N.Y. Times: ‘Sales Fall Sharply for Retailers Not Named Wal-Mart’


Wall Street Journal: ‘Deutsche Bank Fallen Trader Left Behind $1.8 Billion Hole’

The fall of Boaz Weinstein, once one of Wall Street’s hottest traders, speaks volumes about why financial firms still are reeling from the shattered global markets.

N.Y. Daily News: ‘Octuplet mom Nadya Suleman released from hospital — to what kind of future?’

N.Y. Times: ‘In New York City, an Aromatic Mystery Solved’

N.Y. Daily News: ‘Judge might toss damning evidence against Barry Bonds’


A Manhattan judge has thrown out a $50 million lawsuit against 50 Cent by the baby mama who said he’d promised to always take care of her.

Bloomberg: ‘Fertility Drugs Don’t Raise Ovarian Cancer Risk, Study Shows’

N.Y. Times: ‘A Diverse Group of Senators at Center Stage in Economic Debate’

Seeking Alpha: ‘Why Are the Fed and Treasury Working Against Each Other?’

Seeking Alpha: ‘Sleepwalking to Economic Oblivion’

Wall Street Journal: ‘Nations Rush to Establish New Barriers to Trade’


Wall Street Journal: ‘Obama Turns Up Heat, Slams GOP Ideas’

Wall Street Journal: ‘Panetta Hearing Focuses on Bush-Era CIA Challenges’

Pick to Run Agency Calls Waterboarding Torture, but Says Employees Following U.S. Lawyers’ Opinions Shouldn’t Be Prosecuted

Wall Street Journal: ‘U.S. Presses Europe for Aid in Afghanistan Amid Political Chill With Russia’



Obama’s scolded for picking Larry Summers; Abe Foxman’s scolded for picking at Bill Moyers

Bill Moyers talks with two Times reporters last September about Wall Street’s meltdown.

Almost lost amid the usual knee-jerk preaching to the choir that is the 21st century Nation are a couple of excellent stories — one of them scolds Barack Obama for relying on such dubious characters as economist/erstwhile Harvard prexy Larry Summers, and the other roasts Abe Foxman of the Anti-Defamation League.

In “Never Say You’re Sorry,” Christopher Hayes points out the clay feats of Obama economic-world appointees Summers and Gary Gensler.

In “The Defamation League,” Eric Alterman takes Foxman to task for the latter’s astonishing blast at Bill Moyers, who had the audacity to suggest that Palestinians are people, too. (See Foxman’s rip and Moyers’s response.)

Really juicy in Alterman’s piece is this passage:

What’s more, the defamation of Moyers escalated further. Following Foxman’s fusillade, New York Times neocon William Kristol inserted in a regular column–yet another devoted as usual to the majesty of George W. Bush‘s leadership–an attack on Moyers for allegedly “lambast[ing] Israel for what he called its ‘state terrorism,’ its ‘waging war on an entire population’ in Gaza.” Like Foxman, Kristol also implied that Moyers was guilty of racism.

Again, read the text of Moyers’s remarks. Neither Kristol nor Foxman notes his stated belief that “every nation has the right to defend its people. Israel is no exception, all the more so because Hamas would like to see every Jew in Israel dead,” or his deep concern about the growth of “a radical stream of Islam [that] now seeks to eliminate Israel from the face of the earth.”

Yet despite the fact that Bill Moyers is, well, Bill Moyers, the Times editors not only allowed Kristol to deliberately distort and decontextualize his remarks; they would not allow Moyers to defend himself in his own words in response. After the PBS journalist submitted a letter to the editor, he was told, “We will not print that ‘William Kristol distorts or misrepresents,’ and the editors will not budge.” They insisted that the letter be changed for publication to read, “I take strong exception to William Kristol’s characterization,” and they truncated much else.

Hmmm…Kristol has exited the Times‘s op-ed page. He probably wanted to pursue other opportunities.

Hayes’s lively piece on Obama’s appointees even throws in a couple of apt sports metaphors. More importantly, Hayes dredges up some valuable history regarding both Gensler and Summers.

In doing so, he doesn’t spare the Clinton Administration from its disastrous destruction of the Glass-Steagall Act, a strict banking law from the last Depression that, had it remained in place, would probably have prevented Wall Street from creating the current Depression.

I’ve harangued about Glass-Steagall’s repeal many times, but Betsy L. Angert said it more gracefully in an item last year:

Softly swayed by seemingly selfless actions, those charmed by the Clinton charisma do not recall that the Clintons helped to create the financial debacle the electorate now experiences. An audience content with celebrity, dazzled by a drama, and grateful for fiscal favors sees no reason to reflect upon what might have been had the Clintons not repealed the Glass-Steagall and Bank Holding Company Acts.

Also see Frontline‘s “The Long Demise of Glass-Steagall.”


Yo! Bernie Madoff’s victims: the full list — so far.

You may have seen the PDF version of the latest list of Bernie Madoff’s human and corporate victims. If not, check it out.

See my colleague Roy Edroso‘s riff on the list. I’m trying to post a text version of the entire roster of willing suckers, but our server is gagging on the size. Anyone have a Bloomberg machine? May I borrow it? May the SEC borrow it?


Fossils still bite: Bernie Madoff and prehistoric snakes

Good for the New York Times! Always trying to take a broad view (even when one doesn’t exist, as Jack Shafer often points out), the paper weighs in on how the plight of Bernie Madoff‘s white-haired victims gives us valuable insights about the global meltdown with this morning’s “Fossils of Largest Snake Give Hint of Hot Earth.”

Good info that the “prehistoric snake” was “a giant relative of today’s boa constrictors.” The elderly Madoff wasn’t the first, nor will he be the last, snake to swallow your money. Wall Street is really is a dangerous place, even for celebrities — see the latest list of Madoff’s victims.

Madoff whistleblower Harry Markopolos‘s testimony yesterday on Capitol wasn’t quite as colorful, but the bookish-yet-tigerish accountant was pretty damn intense, as I previously noted.

Among other fascinating details, Markopolos told the dazed House members that he planned to deliver to the SEC today a “mini-Madoff.” The agency is sure to accept this silver platter with respect and care.

President Barack Obama, on the other hand, is showing me no respect with his $500,000 limit on CEO pay ( VIDEO). To get a bailout, I have to limit my pay? I don’t think so.

While I wait for my manservant to dress me, I’ll also point out that the Times story “Daschle’s Ambitions Collided, Friends Say” does little more than say what I already said yesterday. The Times was more polite.

Please click on these items. Pretty please…


CNN: ‘Toyota shuts down all but one assembly line’


New York’s top banking firms went on a multimillion lobbying spree late last year — just as the feds were crafting a $700 billion rescue plan for struggling banks.

The banks got an extraordinary return on their investment, as they got federal cash injections that were thousands of times larger than what they spent trying to influence Congress and the administration – which doled out the cash.

Newsday: ‘Drilling leases on Utah land scrapped’

In a high-profile reversal of the Bush administration, Interior Secretary Ken Salazar said yesterday the government is scrapping the leases of 77 parcels of federal land for oil and gas drilling in Utah’s redrock country.

N.Y. Daily News: ‘Twins’ rage: Coward could never face our father’

N.Y. Times: ‘Senate Adds Homebuyer Tax Credit to Stimulus Bill’


Wall Street Journal: ‘Forget Golf: Street Junkets Get Junked’

CNN: ‘Overseer calls for bank bailout makeover’

Special inspector general for Treasury’s $700 billion financial sector bailout said program needs tighter regulation and a better investment strategy.

Financial Crisis Update: ‘SEC Official Endorses Central Counterparty for Credit Default Swaps as Global Consensus Grows’

N.Y. Times: ‘Daschle’s Ambitions Collided, Friends Say’

N.Y. Times: ‘Science Found Wanting in Nation’s Crime Labs’


Wall Street Journal: ‘Study: 9/11 Lung Problems Persist Years Later’

N.Y. Daily News: ‘Cops on hunt for suspect in brutal rape in East Harlem laundromat’

N.Y. Times: ‘Boo Hoo in the Boardroom’

Wall Street Journal: ‘Faith-Based Program Gets Wider Focus’

When President Barack Obama launches his version of the faith-based initiative Thursday, he will expand the mission to include abortion reduction and outreach to the Muslim world. He will also try to avoid the thorniest constitutional issues that beset the program for years under his predecessor.

Mr. Obama’s approach to the federal faith office reflects his search for common ground on contentious social issues, and his willingness to dial back some of his campaign positions.


N.Y. Daily News: ‘Cheney: Beware nukes’

Wall Street Journal: ‘Gaza’s Isolation Slows Rebuilding Efforts’

N.Y. Times: ‘Societal Cost of Meth Use Is Gauged in New Study’

Bloomberg: ‘”Failed” Wall Street Forces Biggest Rewrite of Rules’


N.Y. Daily News: ‘The great Big Apple sports broadcaster debate’


N.Y. Daily News: ‘Lehman judge charged with hitting wife gets lawyer’

A federal judge charged with slapping his wife hired a big shot defense attorney as he faces a misdemeanor charge that could land him in the clink.

James Peck, 63, the bankruptcy judge overseeing the breakup of Lehman Brothers, hired Barry Bohrer, a prominent criminal defense lawyer whose clients have included Sam Israel, the hedge fund swindler who went on the lam last summer after faking his own suicide to avoid a 20-year jail term.

Peck, who was briefly assigned to handle the Bernard Madoff bankruptcy until he recused himself in December, told cops when they came to his Park Ave. apartment Saturday afternoon that “I was defending myself.”

He said his wife, Judith Peck, 64, was late in returning to the city from their home in the Hamptons and then they argued over a ladder that she had put in his closet.

“I was moving the ladder out. She slapped me in the face,” he told cops. “I put the ladder down and slapped her back. We slapped each other back and forth.”

Bloomberg: ‘Soros Imitators Reap Riches in Financial Whirlwind on Global Macro Funds’

Forbes: ‘Buffett Sinks Billions Into Swiss Re’

‘Sandy Koufax, John Malkovich among Bernie Madoff victims as court filings are released’

From the Daily News:

…Other victims were identified as Ground Zero developer Larry Silverstein, the estate of late singer John Denver, actor John Malkovich, former Mets second baseman Tim Teufel and even Madoff’s lawyer Ira Sorkin. The 163-page list also includes hundreds of trust funds, charities, pension plans and unions, as well as entries for Madoff’s grandchildren. [FULL LIST]

Boston Globe: ‘The whistleblower: Dogged pursuer of Madoff wary of fame’

U.S. News & World Report: ‘5 Things to Know About Whistleblowing’

Bloomberg: ‘Madoff Said Only Brother Could Do Audit, Witness Tells Congress’

Whistleblower Lawyer Blog: ‘Whistleblower Protections Added to Economic Stimulus Bill Passed by House’

N.Y. Daily News: ‘Photo gallery: Madoff’s victims’


Whistleblower Lawyer Blog: ‘Hedge Funds Face Regulation & Oversight by SEC–Will There Be Another Compliance Tool in Addition to IRS Whistleblower Program?’

Fortune: ‘Did Madoff’s feeder fund shop for friendly audits?’

Whistleblower Harry Markopolos testifies that Fairfield Greenwich switched auditors three times in three years.

AP: ‘[Massachusetts] pension fund fires 2 managers’

Two managers of the Massachusetts state pension fund have been fired for poor performances, including one who lost $12 million investing with accused Ponzi scheme mastermind Bernard Madoff.

N.Y. Daily News: ‘$1B of swindled funds uncovered, Madoff’s alleged vics to get paid “in the near future”‘


N.Y. Daily News: ‘Car dealer hopes to say, “I Madoff with 100G”‘

N.Y. Daily News: ‘GM Omar Minaya says Mets will not go after Manny Ramirez’

Chief operating officer Jeff Wilpon computed the Mets’ 2009 payroll at $143 million when factors such as Freddy Garcia‘s probable salary with bonuses, the $1.6 million owed to the Diamondbacks for Scott Schoeneweis and $2.25 million owed to Willie Randolph are included. Wilpon handed Minaya that budget early in the offseason, before Wilpon learned his family had lost money in the Bernie Madoff scandal. Wilpon declared that the Mets had accomplished their winter objectives, mentioning the acquisitions of Francisco Rodriguez and J.J. Putz and “addition by subtraction” with trades that shipped out players such as Aaron Heilman and Schoeneweis.



Markopolos bombshells: ‘I’ll deliver a mini-Madoff tomorrow!’ and ‘Arm SEC with Bloomberg machines!’

After only part of this morning’s House hearing starring Harry Markopolos, there’s little doubt that Bernie Madoff‘s true identity is Dr. Evil.

What else can one think when House members wondered aloud whether there are “mini-Madoffs” or “medium-size Madoffs” lurking in the Wall Street wastelands.

Markopolos answered in the affirmative and said he plans to “deliver a mini-Madoff to the SEC tomorrow,” adding, “Hopefully they listen to me this time.”

The House Financial Services Committee members agreed that this time the SEC will probably listen to Markopolos. There’s no hint, however, of who Markopolos is talking about.

A mini-Madoff! Like Mini-Me! Cool!

But speaking of Dr. Evil, Markopolos also pointed out (as I and some others have) that Wall Street’s fraudsters couldn’t pull off their schemes without Mayor Mike Bloomberg‘s proprietary sophisticated hardware/software machines.

There’s no other way, many say, to conjure up the increasingly sophisticated financial instruments that ruined Wall Street and will no doubt ruin it again during the next bubble.

Bloomberg is supposedly the biggest philanthropist in America; he got the money from the sale of his machines on Wall Street.

Which leads to the question: How could Mayor Bloomberg not have known the various nefarious uses to which his machines could be put? Of course he knows.

Which leads to this: Wall Street’s meltdown happened on his watch, and it was created by his pals — his customers — at the Street’s big banks. So why didn’t he stop it or at least see the signs of an impending disaster?

If not him, who? If not then, why not?

And now he wants another mayoral term to keep our streets supposedly safe when the only street he knows — Wall Street — has become the most dangerous stretch of pavement in the country?

Just wondering.

Markopolos didn’t make that point, but he did say that the SEC operates at a tremendous disadvantage in trying to understand the complex schemes of the Street’s white-shoed gangsters by not having nearly enough Bloomberg terminals. Give the SEC more Bloomberg terminals, he told the House panel, because the fraudsters and scamsters have them.

Wild-eyed Harry also has a beef with the press: He contended that a Wall Street Journal reporter (whom he didn’t name) was very interested three years ago and was willing to fly to Boston to meet with Markopolos but that the reporter’s editors were scared off by Madoff’s power and reputation and nixed it. (For more on that, see Gary Weiss‘s post on Seeking Alpha.)

Treated with extreme deference, Markopolos is surely one of the most brash witnesses to testify on Capitol Hill in quite a while. And well-prepared — browse his lengthy (but entertaining) written testimony if you can’t wait for the sound bites later today.

Of course, he can back it up, having warned a decade before Madoff confessed to his sons that Bernie was a fraudster.

At least, Markopolos can back it up for now. His hubris, his zealotry, his sense of certainty — they make you wonder whether Markopolos, like Madoff’s scheme, is too good to be true.

Anyway, Markopolos’s halo — or is it his intense eyes? — cast an eerie glow for now on the scene of perhaps capitalism’s all-time worst disaster.

California Democrat Brad Sherman noted that Markopolos isn’t just some “wild-eyed populist.” Sherman was half-right. Markopolos is definitely wild-eyed — he has the look and tone of a zealot — but he’s also the staunchest defender of capitalism one could imagine, and that includes Ayn Rand.

And imaginative, too. Markopolos raised the intriguing notion that retired Wall Street bigwigs, people with little or no hair, as he put it, should be hired by the SEC to replace the young whippersnappers who now infest the agency’s lower ranks.

Markopolos reasons that veterans won’t have to do it for the money, because they’ve already made theirs and that they would be foxes able to sniff out the rotten eggs in the henhouse.

This probably won’t happen, unless these Wall Street veterans are suddenly imbued with that sense of civic responsibility that Barack Obama mentioned in his inaugural address.


The stadium-naming deal? Make Citigroup and the New York Mets bail the public out for a change.

In what’s obviously a P.R. move, Citigroup says it’s looking into pulling out of a $400 million marketing deal with the New York Mets.

Here’s the current situation: Citigroup is supposedly on the hook to pay $400 million to the Mets for the naming rights to the unwarranted new stadium. Meanwhile, Citigroup, which has reported $28.5 billion in net losses since 2007, according to the Wall Street Journal, received a $45 billion bailout last fall from Henry Paulson‘s Wall Street giveaway TARP program.

Here’s a better idea: Make the bank stay in the ill-fated scheme it can no longer afford, but force it pay the $400 million to the public — not the Mets — to help offset the billions in bailout money the public’s already given the bank.

You’re going to point out that the Mets would howl at having to give up that $400 million? Of course, but the team should have no reason to bitch. As my indefatigable stadium-expert colleague and Field of Schemes author Neil deMause pointed out January 14 on Runnin’ Scared, the public’s paying for $371.5 million of the new stadium.

So make the team give us back our money.

Of course, neither the team nor Citigroup will reimburse us. But it doesn’t hurt to suggest it.

And don’t think it’s cynical to call this Citigroup maneuver to supposedly try to pull out of the naming deal a P.R. move. This morning’s Journal story starts off with the idea that the bank is “eager to quell the controversy over how lenders are using government bailout money.” The story adds:

In a statement Monday, Citigroup said that “no TARP capital will be used” for the stadium — referring to government funds from the Troubled Asset Relief Program. But as it revisits the pact, Citigroup is essentially acknowledging that the volatile political climate could make it untenable for the bank to proceed with the deal.

Such liars the bank officials are. Technically they wouldn’t be directly transferring TARP money to the Mets to pay for the stadium rights, but so what? Same public funds, different pocket.

Meanwhile, what a shrewd marketing move for the Mets: Name your team after the bank that’s laying off thousands of people and getting bailed out by taxpayers who are so beleaguered that they can’t even afford tickets to the games.

Speaking of naming rights that didn’t cost us anything (at least for the names): Paulson’s top aide at handing out the bailout money, Neel Kashkari, and the scamster named Bernie who made off with billions of other people’s money.



The mark of cane: Governor Paterson keeps getting blindsided by personal shots

From the New Yorker‘s “Your Eustace, 2009,” the mag’s annual contest for the best new version of Rea Irvin‘s classic cover, this entry (one of 12 winners — and my favorite) is “Eustace, the Undead New Yorker,” by David Cook of Suwanee, Georgia.

Further proof of the schizophrenic media culture: Despite the widespread political correctness that infects discourse on numerous topics, Governor David Paterson keeps getting hammered because his eyes don’t work right.

Israel’s ever-increasing crackdown on Arabs (the most ludicrous new idea is an Israeli-controlled 30-mile-long tunnel connecting Arab enclaves ) is the
apartheid that dares not speak its name — at least most of the U.S. media don’t dare speak of it.

But Paterson continues to get blistered because of his bad eyesight, which he can’t help and which, after all, doesn’t make him a more hapless and mediocre accidental governor.

As the Post says this morning:

A hospital trade group and a health-care union yesterday released a bizarre new attack ad — using a sightless man wearing sunglasses to slam legally blind Gov. Paterson for budget cuts.

“Why are you doing this to me?” the unidentified patient asks Paterson halfway through the 30-second spot, funded to the tune of $1 million a week by the Greater New York Hospital Association and Local 1199 of the Service Employees International Union.

To some observers, the blind man’s role in the statewide attack ad against Paterson’s plan to cut health care by $3.5 billion seems too personal by even Albany’s standards for no-holds-barred budget battles.

On the other hand, Paterson does seem to have blinders on when it comes to the outrageous Wall Street bonuses. As the Gothamist noted in mid-December, before Barack Obama scolded Wall Street:

In what continues to be a familiar story of cat and mouse in politicians pointing the finger as to where funds aren’t coming from, Governor Paterson yesterday claimed the state lost hundreds of millions in tax revenue because less big Wall Street bonuses are being given out this year.

Nothing personal, but what Paterson fails to see is that the state loses far more gelt by not taxing hedge fund goniffs’ pay.

Check out “NYC hedge fund profits show tax system flaw–study,” a Reuters story from last April that noted:

New York City hedge funds earned $20 billion to $39 billion last year, far outstripping the profits of Wall Street banks and demonstrating how outdated the city’s tax system risks becoming, a new study said on Tuesday.

Now see these stories…



A hospital trade group and a health-care union yesterday released a bizarre new attack ad – using a sightless man wearing sunglasses to slam legally blind Gov. Paterson for budget cuts.

“Why are you doing this to me?” the unidentified patient asks Paterson halfway through the 30-second spot, funded to the tune of $1 million a week by the Greater New York Hospital Association and Local 1199 of the Service Employees International Union.

N.Y. Daily News: ‘Sky dive horror for newbie as instructor dies mid-jump’


Gov. Paterson yesterday warned that the politically popular plan to impose higher income taxes on the wealthy would cost New York jobs and drive people out of the state.

Bloomberg: ‘Macy’s Slashes 7,000 Jobs’

N.Y. Daily News: ‘President Obama: If stimulus fails, I’m out in 4 years’

Crain’s New York Business: ‘Longer notice now needed for layoffs in NY’

Tougher new law requires 90 days notice before layoffs or closings – up from 60 days.

Bloomberg: ‘Obama’s Foreclosure-Relief Plan May Offer Government Guarantees for Loans’

The Obama administration is considering government guarantees for home loans modified by their servicers, seeking to stem the record surge of foreclosures that’s hammering U.S. property values.


New Yorker: ‘The Financial Page
Hazardous Materials?’
(James Surowiecki)

Wall Street Journal: ‘Shoe Thrower Targets Wen At Cambridge’

A protester threw a shoe at China’s Prime Minister Wen Jiabao on Monday while he was giving a speech at the University of Cambridge, police said.

New York: ‘Trouble in Stuy Town: The crash of a real-estate Utopia’

Harper’s: ‘News From Nowhere: Iceland’s polite dystopia’

Bloomberg: ‘UBS Lures Brokers From Goldman, Morgan Stanley With “Super-Sized” Bonuses’

UBS AG, the Swiss bank under investigation for allegedly helping wealthy Americans evade taxes, hired more than 200 brokers in the U.S. in the fourth quarter as it sought to counter client defections.

Wall Street Journal: ‘Citi Explores Mets Deal Exit’

Citigroup is considering the possibility of backing out of its marketing deal with the New York Mets amid concerns about how recipients are using TARP funds.

Wall Street Journal: ‘Policy Makers Weigh Derivatives Oversight’

Onion: ‘Cheney Dunk Tank Raises $800 Billion For Nation’

New York Review of Books: ‘Pakistan in Peril’ (William Dalrymple) [PODCAST]

The relative calm in Iraq in recent months, combined with the drama of the US elections, has managed to distract attention from the catastrophe that is rapidly overwhelming Western interests in the part of the world that always should have been the focus of America’s response to September 11: the al-Qaeda and Taliban heartlands on either side of the border of Afghanistan and Pakistan.

Atlantic: ‘The Man in the Middle’

What Chuck Schumer thinks he knows about the middle class; a profile

Wall Street Journal: ‘Lobbyists Raise Stimulus Price Tag’

Lobbyists are gearing up to add costly proposals to the Senate’s $885 billion economic stimulus plan, likely boosting the package’s overall cost.


Time: ‘The Tide Shifting Against the Death Penalty’

Wall Street Journal: ‘Iraq Waste Repeated in Afghanistan’

Waste and corruption that marred Iraq’s reconstruction risks being repeated in Afghanistan, government watchdogs warned.


Jewish Daily Forward: ‘Barak: Build Tunnel Linking West Bank and Gaza’

Defense Minister Ehud Barak on Monday proposed the construction of a 30-mile tunnel that would connect the northern Gaza Strip with the southern West Bank, thus enabling freedom of movement between the two disjointed Palestinian territories.

While stumping on the campaign trail before students at Ben-Gurion University in Be’er Sheva, Barak said it was possible to dig the tunnel, which would remain under Israeli sovereignty while the Palestinians would maintain authority over the corridor’s traffic.

New York Review of Books: ‘Google & the Future of Books’

How can we navigate through the information landscape that is only beginning to come into view? The question is more urgent than ever following the recent settlement between Google and the authors and publishers who were suing it for alleged breach of copyright.


The ringleader of a gang of racist thugs that went on an election-night rampage on Staten Island pleaded guilty to federal charges yesterday and told a judge he was drunk and angry about President Obama’s victory.

Salon: ‘The Leaderless GOP: Sorry, Republican bosses, Sarah Palin and Rush Limbaugh are in charge. And there’s nothing you can do about it.’

New York Review of Books: ‘How We Were Ruined & What We Can Do’

Bloomberg: ‘Netanyahu Gains as Lieberman Makes Him Appear ‘Less Hawkish”‘

Israeli Arabs committed treason by protesting the country’s offensive in the Gaza Strip last month. Hamas should be dealt with the way the U.S. handled Japan in the last days of World War II. Egypt, at peace with Israel since 1979, actually plans to attack.

These are just some of the recent comments made by Avigdor Lieberman, whose party could become the third-largest bloc in parliament following Israel’s Feb. 10 elections, polls show.

Lieberman’s jump in popularity may boost the coalition- building efforts of front-runner Benjamin Netanyahu‘s Likud, while undermining prospects for peace with the Palestinians. Netanyahu’s lead over Foreign Minister Tzipi Livni‘s ruling Kadima party has grown as Israel’s war in Gaza raised voter concern about security.

‘A Lonely Lament From a Whistle-Blower’

From the Wall Street Journal:

Harry Markopolos, the Boston-based investor-turned-investigator who for years warned regulators that Bernard Madoff was running a huge Ponzi scheme, has received pitches to appear on television shows, make movies and write books elaborating on his experience.

But rather than enjoy a sense of vindication, Mr. Markopolos says he is miserable. He has trouble sleeping and is haunted by the apparent suicide of Thierry Magon de La Villehuchet, a French money manager found dead shortly after Mr. Madoff’s Dec. 11 arrest on fraud allegations.

Although a colleague of Mr. de La Villehuchet’s says he doesn’t know of any warning, Mr. Markopolos says he told Mr. de La Villehuchet as well as investors at other firms that he thought Mr. Madoff was a fraud. He regrets that he couldn’t persuade many of them.

Part of the reason he didn’t press his warnings: Fear of retribution by Mr. Madoff, says Mr. Markopolos. A lawyer for Mr. Madoff declined to comment.

Wall Street Journal: ‘Aggrieved Investors Turn Sights to Banks’

Madoff-hit investors are suing big banks over their custodial services, contending they should have known about the alleged fraud.

Wall Street Journal: ‘Madoff Victims Find Support’

Investors who say they were burned by Bernard Madoff are turning to the only people who seem to understand their predicament: each other.



Obama to bankers: ‘It’s a shonda!’ (Or words to that effect.)

You won’t see edgy Bernie Madoff-related work like this in U.S. mainstream papers, but New York’s own Jewish Daily Forward, as always, is up to the task of covering Jewish politics and news with a minimum of politically correct tiptoeing.

Above, an excerpt from Eli Valley‘s “The Shonda!” in the Forward.

Valley, sort of the Jewish version of R. Crumb, touts his work as “Ethnocentric Parochialism for the Whole Family!”

See Valley’s profile on, where I just discovered that, like me, he’s a huge fan of noir-era cinematographer John Alton. No wonder I like Valley’s work so much.

For more Madoff-related news that’s not of the cartoonish persuasion, go to the end of this post for my daily Gelt Trip aggregation.

But first, please note that Barack Obama isn’t being so politically correct either. Now in charge of a generally conservative country long dominated by profligate financiopaths, the nation’s first black president is chewing out Wall Street bankers and generally acting like some kind of goldurned liberal.

Watch your back, my brother. And tell the Secret Service to do the same.


N.Y. Times: ‘Senators Approve Health Bill for Children’

A newly empowered Democratic majority brushed aside objections with a bill to insure four million children.

N.Y. Daily News: ‘23,000 JOBS FACE AXE’

15,000 teachers? Gone. Rebates for homeowners? Forget ’em. And that’s just the tip of Mayor Bloomberg’s shocking cuts.

Bloomberg: ‘Hidden Bonuses Enrich Government Contractors as Taxpayers Pay $100 Billion’

N.Y. Daily News: ‘Not again! 4-year-old disabled boy abandoned on bus’

A driver and matron were arrested Thursday after failing to drop a disabled child at school and then leaving him on the bus.


President Obama delivered a blistering message to Wall Street yesterday, blasting the big-bucks bonuses doled out to fat-cat execs…

N.Y. Daily News: ’15 yrs. for ma who killed, dumped baby’

N.Y. Times: ‘Few Ways to Recover Bonuses to Bankers’

Wall Street Journal: ‘U.S. Eyes Two-Part Bailout for Banks’

Top economic officials are discussing new efforts to help banks while trying to mitigate the cost to taxpayers. Obama stepped up his attacks on these banks, calling Wall Street bonuses “shameful.”

Bloomberg: ‘Investors May Pour Billions Into Tide Power as Obama, EU Push Green Energy’

Three decades ago, engineer Peter Fraenkel created an underwater turbine to use river power to pump water in Sudan, where he worked for a charity. Civil war and a lack of funding stymied his plans. Now, his modified design generates electricity from tides off Northern Ireland.



N.Y. Daily News: ‘Workers waste no time erasing Blagojevich pictures, name from Capitol’

N.Y. Times: ‘On His Way Out, Blagojevich Makes a Day of It’

On his final day as governor of Illinois, Rod R. Blagojevich was, by turns, furious, morose and full of gallows humor.

N.Y. Times: ‘Suicides of Soldiers Reach High of Nearly 3 Decades’

At least 128 soldiers killed themselves last year, as the Army suicide rate surpassed that for civilians for the first time since the Vietnam War, according to Army statistics.


A former cop seeking line-of-doody disability pay for breaking a finger on an overflowing toilet is spit out of luck, an appeals court ruled yesterday.

Reuters: ‘Peres Says Israel’s Ties With Turkey Unaffected by Erdogan Spat’

CNN: ‘Alaska volcano “more energetic,” scientists say’



Three workers accused of raping underage girls at an acclaimed upper Manhattan psychiatric treatment center have pleaded guilty to misdemeanor endangering charges and will do no prison time…

Brooklyn Paper: ‘City budget whiz says Bruce’s Yards deal needs retooling’


He chased down a lunatic serial stabber in Times Square, and lived to tell a jury about it yesterday.

“I don’t know if it was more heroic or stupid,” former W Hotel doorman Adam Szpiler, 32, said of his bravery after testifying against accused knifeman Kenny Alexis, charged with attempting to murder three tourists and a cook in a 13-hour rampage in the summer of 2006.

Wall Street Journal: ‘Gaza Tensions Erupt At Davos Session’

Bloomberg: ‘DVD Plunge, Viewer Shift to NetFlix May Force Studios to Write Down Films’

N.Y. Times: ‘U.S. Says Jailed C.I.A. Mole Kept Spying for Russia’

Bloomberg: ‘Citigroup Guarantees Test Obama Pledge to Tell Public More on Bailout Risk’

U.S. government guarantees on securities totaling $419 billion for bank bailouts provide an early test of President Barack Obama’s pledge to be open with taxpayers about what they have at risk in the credit crisis.

N.Y. Times: ‘Bloomberg Will Seek Increase in Sales Taxes’

N.Y. Times: ‘M.T.A. Planning to Spend Stimulus on Fulton St. Hub’

The M.T.A. expects to spend $497 million in federal stimulus money to complete the stalled and over-budget Fulton Street Transit Center in Lower Manhattan.

N.Y. Times: ‘”Mourning” the M and R Subway Lines’

Transit advocates held a mock funeral to protest proposed service reductions on the M and R subway lines.

Wall Street Journal: ‘Europe Basks as U.S.-Style Capitalism Draws Fire’

Add another voice to the chorus of city officials who say that the city should renegotiate its deal with developer Bruce Ratner, whose Atlantic Yards mega-project is in jeopardy due to the economic crisis.

N.Y. Times: ‘Debate on Mayoral Control of Schools Is Renewed’

Onion: ‘Blagojevich Claims Behavior Was Just Elaborate Plan To Surprise Patrick Fitzgerald With Senate Nomination on His Birthday’

N.Y. Times: ‘Springsteen Promises High-Energy Halftime Show’


From the Post:

Start packing, Bernie.

Accused Ponzi schemer Bernard Madoff‘s luxurious penthouse apartment — where he currently whiles away the hours under house arrest — could soon be up for sale, the Post has learned….

[Real-estate] brokers have been invited by lawyers working for Irving Picard, the trustee appointed by a federal bankruptcy-court judge to oversee the liquidation of Madoff’s Manhattan investment firm.

Picard presumably would use any sale proceeds to help pay back, at least somewhat, Madoff’s creditors.

Because he must remain inside the two-story apartment as a condition of his $10 million bail, Madoff will be in awkward proximity to brokers when they eyeball its four bedrooms, at least five bathrooms, kitchen and library.

N.Y. Times: ‘2 Banks to Send Madoff Trustee $535 Million’

Vos Iz Neias?: ‘Manhattan Banks Find $500M in Madoff Accounts’

Jewish Daily Forward: ‘Madoff’s Lawyer Plays Both Sides of the Court’

Wall Street Journal: ‘Ex-Merrill Executives Got Burned by Madoff’

Bloomberg: ‘Madoff `Dull But Steady’ Returns, Internal Probe Didn’t Alarm Notz Stucki’

Notz, Stucki & Cie., a Swiss money manager, probed and later dismissed concerns about Bernard Madoff investments, which offered “dull but steady” returns.