I’ve been under the weather the past few days but this blurb on the taxpayers getting the billion dollar shaft courtesy of Tim Geithner and the CIT bankruptcy did not escape my notice. As a SBA loan recipient I can attest first hand my file literally employed 2 workers for 12 weeks while Uncle Sam took security interest in everything I owned but my left testes (I drew the line there as a guy has to keep some dignity) yet CIT manages to get signature only terms from Timmy Geithner on the billions in TARP funding they received.
It was while I pondered the discomfort from having our collective financial rear end gang raped without benefit of vaseline on this CIT deal that it struck me the reason for Timmy’s incompetence has been well documented once before several years back in the media. Luckily for the Slabbed Nation I was able to dig it up via youtube. Continue reading “CIT, Timmy and the Lords of the Underworld”
There have been a good number of news tidbits that do not necessarily constitute a post here on Slabbed on their own but when taken together tie up several loose ends and lend context to a story that does merit it’s own post in Mike Chaney’s recent insurance forum held last Thursday and Friday here on the coast. So let’s backtrack a week and shake us up slabbed insurance cocktail by beginning with Anita Lee’s coverage of day 2:
Gov. Haley Barbour joined the coastal insurance debate Friday, telling an audience he believes regional compacts would be the best way to regulate wind coverage in coastal zones from Texas to Maine.
Barbour introduced The Travelers Insurance Cos. president, Brian MacLean, to explain the company’s proposal for improving the coast insurance market. Insurers have pulled back from coastlines in recent years, leaving state-run wind pools to fill the void.
Wind pools were intended as insurers of last resort, but their market shares have grown to levels that experts agree are unsustainable. Insurance works by spreading risk, not concentrating it.
Haley has been conspicuously absent from the insurance scene refusing to comment on the litigation while offering cheap lip service to Gene Taylor’s multi peril bill. I suspect he and the State GOP has been searching for a way to throw a bone to the people on the coast that helped elect him while working hard to preserve GOP big business bonafides with the campaign money machine that is big insurance. Continue reading “Slabbed Daily July 22-24. Lets tie a few things together”
Regulate me, please, the opinion column written by Allstate CEO Tom Wilson, appeared in the April 15 NYT in the guise of Wilson’s on-going effort to garner support for national regulation of the insurance industry.
Calling it his CDS mea culpa, Option ARMageddon gave Wilson “kudos” for coming clean:
My company, Allstate, serves more than 17 million American households. While we played only a small role in unregulated insurance markets, we have a duty to help stabilize the financial system. It was, after all, an insurance product that contributed to the risk that almost brought down the global economy.
New York State’s Insurance Superintendent, Eric Dinallo, on the other hand, had no kudos to offer:
“While the credit default swap market is not regulated, insurance company use of credit default swaps is,” Mr. Dinallo said in a statement. “In New York, no insurance company can use credit default swaps except under very specific and limited ways and only with approval.”
Was Option ARMageddon spot on or was Wilson’s agenda to set up Dinallo and DOI to the advantage of his efforts to secure national regulation of the insurance industry? Dinallo’s press release suggests Wilson may have had another agenda – one that would lead to Hank Greenberg, AIG, and, perhaps, other insurers. Continue reading “kudos for Wilson – not yet”
We’re always happy to feature Sup here at Slabbed whenever he gets the urge to author a post. Unlike many in the insurance industry Sup isn’t afraid to engage us and we’re very happy to have his perspective. (Note I’ve “blogified” the text minimally to add the links inline)- sop
Two articles published last week at the New York Times and Tampa Tribune indicate the folks in charge in Florida may have gotten their heads out of the sand. Governor Crist and the Legislature seem to have come to the realization that Citizens Property Insurance Corporation is broke.
What does this mean to the citizens of the state of Florida? It means they will be paying higher insurance premiums and they all must pray the state escapes hurricanes for a few years. “Citizens’ life expectancy in a storm: ‘a few short hours’ “ is stated in the New York Times article. It is clear the politicians and regulators were playing politics with this issue and it has now backfired. What these folks have done is criminal and if they were a private organization they would be prosecuted for the sham.
The second article reflects the Feds are not going to help. This article states by state law the Cat fund should be able to cover up to $29 billion, but state officials say the fund could only cover about $11 billion. Continue reading “The Chickens are Coming Home to Roost in the Sunshine State: A Sup guest post”
Zero Hedge broke the story, we immediately recognized its importance and now the TARP Inspector General wants a looksie. Once again leadership on making certain the taxpayers are protected as much as possible is found in the House of Representatives. Bloomberg has the story: (h/t Zero Hedge)
The Treasury’s chief watchdog for the U.S. financial rescue program is probing whether American International Group Inc. paid more than necessary to banks including Goldman Sachs Group Inc. after the insurer’s bailout.
Neil Barofsky, special inspector general for the Troubled Asset Relief Program, opened an audit last week into whether there were attempts made by New York-based AIG or the government to reduce the payments, according to an April 3 letter to Representative Elijah Cummings. The Maryland Democrat had requested the probe last month along with 26 other members of Congress.
Lawmakers, frustrated with the cost of an AIG bailout that has expanded three times, have asked why about $50 billion was paid after the initial September rescue to banks that bought credit-default swaps from the firm. The audit will reveal who made “critical decisions” regarding the payments and provide an explanation for the actions, Barofsky said.
“To what extent did AIG pay counterparty claims at 100 percent of face value and was any attempt made to renegotiate and close out these claims with ‘haircuts?’” Barofsky wrote. “Questions concerning whether AIG paid more than necessary to counterparties and whether Treasury adequately monitored such payments are clearly relevant.” Continue reading “BREAKING: TARP IG Opens AIG Bank Payments Probe”
Congressional Oversight Panel to Call for Wiping Out Shareholders, Ouster of Top Brass at TARP Recipients from naked capitalism is a Monday morning wake-up call:
This is going to get interesting. The head of the Congressional Oversight Panel, Elizabeth Warren, is expected to issue a report this week calling on the Treasury to get much tougher with the big recipients of TARP funds. And if the report in the Guardian is right, the recommendations have been softened a tad so as not to be too hard on Treasury Secretary Timothy Geithner.
Elizabeth Warren, chief watchdog of America’s $700bn (£472bn) bank bailout plan, will this week call for the removal of top executives from Citigroup, AIG and other institutions that have received government funds in a damning report that will question the administration’s approach to saving the financial system from collapse. Continue reading “SLABBED Daily – April 6 (blow-out sequel to bail-out)”
Dr Ed Duett of Mississippi State has all the finest insurance crooks coming to speak at MSU’s annual insurance day set for April 23, 2009. Our readers may recall he brought in Rossie for I day 2008. This year’s list of crooks and charlatans is very impressive and includes a record number of participants with ties to companies under current federal investigation and/or hogs at the taxpayer TARP trough. The complete speaker list is here but I thought I’d summarize the various sessions for our reader’s convenience:
The Revolving Door Panel:
Mike Chaney, MS DOI
Jim Ridling, AL DOI
Scott Richardson, SC DOI
George Dale, Adams and Reese
Walter Bell, Chairman of Swiss Re America
What happened to Robert Wooley?
The White Collar Crime Panel:
Walter Bell, Chairman of Swiss Re America
Jay Barbour, Carroll, Warren & Parker
Lorrie Brouse, Regional Counsel, Allstate
Steve Iler, President, AIG Claims
Wade Sweat, Copeland, Cook, Taylor & Bush
The Policyholders, what policyholders? You mean those schmucks? Panel:
George Dale, Adams and Reese Continue reading “Be Sure to Mark Your Calendars….”
Song Jimmie Rodgers
Lyrics by Sop81_1
Performed by: Maurice “Hank” Greenberg, Ronald E. Ferguson, Robert D. Graham and Christopher P. Garand, and Christian M. Milton
Special Guest Yodelers: Warren Buffet, Tim Balducci, Steve Patterson, Joey Langston and Dick Scruggs
I had a friend named Ramblin’ Ron
Who used to steal gamble and rob
He thought he was the smartest guy in town
But I found out last Monday
That Ron got locked up Sunday
They’ve got him in the jailhouse way down town
He’s in the jailhouse now he’s in the jailhouse now
I told him once or twice quit playin’ cards and shootin’ dice
He’s in the jailhouse now Continue reading “Oh Insurer Where Art Thou Part 5: In the Jailhouse Now”
Zero Hedge may have found us the answer in the Q1 OCC reporting (h/t: Russell):
The OCC discloses the TCE/RBC ratio for the top five banks, and one name in particular jumps out.
Yep, Goldman Sachs… Looks like Blankfein’s minions went from a TCE/RBC ratio of 4% to 1,056% in the span of one quarter! In fact, Goldman is so enamored with Interest Rate Swaps that it has almost the same notional outstanding as Bank of America, and more than Citigroup.
The thing to note, is that unlike both Citi and BofA, which actually are real consumer banks with a depositor base, Goldman is a consumer bank only in name (when is the last time you deposited your cash in a Goldman retail branch?). Continue reading “A possible explanation why the policymakers have funneled so much ca$h to Goldman Sachs through AIG”