bank run blog

Before he was sworn in last week as the Secretary of the US Treasury, Timothy Geithner had to face down a handful of mildly skeptical Senators, who asked a few questions about his management of some personal accounting and childcare issues. It was good practice for Geithner’s main assignment in his new job: the coddling of the US financial sector, a chaotic romper room of billion dollar babies, noisily bawling for security blankets in the form massive TARPs. International economists who have been amazed at the obstinate refusal of the US government to confront and contain the insolvency and fraud on Wall Street will be equally impressed with the strategic continuity from the Paulson-Bernanke team to the stewardship of Geithner and Lawrence Summers.

More than any other component of the Obama administration, the president’s economic team stresses bipartisan consensus and continuity with the policies of the previous White House. Summers, the famously impolitic former Treasury Secretary under Bill Clinton, will oversee the administration’s economic and monetary policy and is expected to succeed Bernanke as Fed chief. Geithner was in charge of the New York Fed at the height of the bubble and can reasonably be said to have blown it. With their old friend and former partner Robert Rubin just a satellite phone call on a secure line away, the US has already enjoyed almost two decades of catastrophic stability at the highest levels of its economic policy.

Signals began to emanate from Chicago immediately after the election that the Obama team would follow the path sketched out by the intrepid Henry Paulson in his original three-page TARP bailout plan. Further evidence that the new administration hopes to keep rubber-stamping no-strings quarterly bailouts has continued to accumulate, with the new White House staff already preparing the public for another enormous “emergency” program at least as large as the $700 billion appropriated by Congress in September. With most world leaders acting to limit their own banking crises through intervention on the so-called “Swedish” model, the US remains the only developed country that seems determined to employ the alternative “Japanese” model, which has resulted in almost two decades of decline and stagnation while spawning the creatures known as “zombie banks”. Obama’s economic policy appears to favor more nourishment for the undead.

cross posted at

redstateupdate.net

Barack Obama may be the first president to own an MP3 player, but he likely will not be sharing tunes with two of his choices for top spots in his Justice Department.

Obama has appointed attorneys Tom Perrelli and Neil McBride to senior Justice Department spots. Both of these attorneys have worked over the past decade to limit file sharing between owners on digital music and are antagonistic to a broad interpretation of the fair use doctrine, which allows limited use of copyrighted material without the permission of the owner of the work.

Perrelli, who was appointed by Obama to be an associate attorney general, represented the Recording Industry of America in a string of lawsuits that have been viewed as aggressive and excessive against college students and others who used pier-to-pier file sharing services to download music off the Internet. Perrelli has argued in RIAA cases that internet service providers must divulge the identities of internet users on their systems who may be sharing computer files without a prior judicial review of evidence. Perrelli previously worked at Justice during the Clinton administration.

McBride worked for the Business Software Alliance in developing a program where employees are rewarded for calling in tips to report their employer’s use of non-copyrighted software. The “Know it, Report it Reward it” program offers “up $1 million in cash rewards” to snitches who turn in their employers who may be using bootleg computer software.

cross posted at

redstateupdate.net

Recognizing that his historic campaign deftly exploited a variety of innovative techniques, Advertising Age magazine has named President Barack Obama its 2008 Marketer of the Year. The editorial board specifically noted the wide range of cutting-edge technologies, including text messaging, social networking, and internet-based fundraising that helped the Obama team set new records for total receipts and volume of campaign donors. According to the magazine, Obama’s staff “had a firm grasp of branding, messaging, and old-fashioned political ground organization. It’s also been able to balance mass marketing with social media and niche marketing.”

Since the first term Senator swept to a decisive victory in November, marketing professionals and industry media outlets have become fixated on analyzing Obama’s celebrity and mass appeal. A piece in MarketingWeek magazine said the campaign “harnessed 21st century technology and communications tools in a way few commercial marketing campaigns have succeeded in doing.”

cross posted at

redstateupdate.net

Since early November, the Justice Department has announced that it has agreed to settlements in more than twenty business-related cases, many of which have been pending for years. The Washington Post recently reported details of several high-profile corporate settlements finalized over the Christmas holidays. Public interest groups have charged that the spate of settlement activity is being driven by a perception that the outgoing Bush administration is likely to offer more favorable deals than the Obama team led by Attorney General designee Eric Holder.

Among the influential corporations agreeing to settlements since the presidential election are AT&T, Siemens, Exxon Mobil, the Aibel Group, and Spartan Motors. The Justice Department announced three separate settlements totaling more than $15 million on December 23. Taxpayers Against Fraud spokesman Patrick Burns told the Post, “This is traditionally the time to ram a settlement through because no one notices. Putting it out between Christmas and New Year’s is brilliant.”

Law professor Ellen S. Podgor, who blogs on corporate fraud and white-collar crime, cited the Siemens settlement with the outgoing administration by giving it a “best timing in 2008&” award. The DoJ has continued to announce new settlements this month, as a number of senior government attorneys prepare to leave their posts.

cross posted at

redstateupdate.net

The San Diego Police Department has announced the purchase of a 25-foot armored mobile observation tower, to be used in crowd control and emergency relief situations. The device, manufactured by Arlington, Virginia-based ICx Technologies, has been customized to the Department’s specifications and will be delivered in February. The $120,000 tower was procured with assistance from the federal Department of Homeland Security after San Diego police tested a prototype for several months.

According to a report in the San Diego Union-Tribune, police have deployed the test version of the mobile observation tower over Labor Day weekend at a local beach, at shopping malls over the holidays, and at a regular season NFL game between the Chargers and the Oakland Raiders. Police Captain Shelley Zimmerman, who was involved in testing the device, told the newspaper, “It has assisted us in making arrests and has certainly been a huge deterrent.”

Local and state law enforcement agencies across the country are taking advantage of DHS grants to equip themselves with the latest paramilitary and surveillance technology, and the ICx Skywatch observation unit has become apart of public events in major cities such as Chicago, Seattle, and New York, which owns several of the mobile watchtowers, using them at sporting events and, recently, New Year’s Eve celebrations in Times Square. Protesters at immigration rights rallies have become familiar with the towers, which feature cameras, public address systems, bulletproof glass, and gun turrets.

cross posted at

redstateupdate.net