Friday, March 25, 2011

More Lunacy, More Deceit

The lunacy and deceit simply continues.

I came across an interesting piece out of The NY Times on GE called GE's Strategies Let It Avoid Taxes Altogether. In the piece the Times reports that"

"The company reported worldwide profits of $14.2 billion, and said $5.1 billion of the total came from its operations in the United States.

Its American tax bill? None. In fact, G.E. claimed a tax benefit of $3.2 billion."

Lovely.
Remember now this is the same GE that has it's CEO Jeff Immelt who is chair of the President's Council on Jobs and Competitiveness.

The only thing GE's Mr. Immelt understands is how to obtain the best government money can buy or like Abraham Lincoln once said "government of the people, by the people, for the people". Does anyone think that's what he meant. This all too funny.

Forget about that, lets focus on important things like Katie Couric's job status.
Better yet, let's focus on Jersey Shore. That's it.

How ironic that this piece on GE comes out just as we learn about General Electric's Harlem Horse Trade with the always entertaining Charlie Rangel.

Yes GE covers all its bases. Now I know what a bought and paid for dirt bag Rangel is. Yes I know he was censured by congress, kinda like being to to hush, pretty please, with sugar on top.

You and me do what Rangel did we go to jail. Guys names Sarducci and Bonello do what Rangel did they go to jail. Politicians of either party do what Rangel did and, well, they get censured, schools named after them, and a cush job lobbying for the same firms that lobbied them when they were in congress. How wonderful is this system of democracy?

Land of laws and rules huh?
Sure.

But put all that aside for a moment.

"In May 2008, while Rangel still held his chairmanship, he met with GE tax chief and former U.S. Treasury official John Samuels. Samuels dropped to one knee and begged Rangel to extend a tax break that is especially important to GE, according to the report, which notes that a GE spokeswoman said Samuels was joking.

Rangel was presumably not joking, however, when he changed his position on the issue, known as "active financing," the same day. The chairman's reversal allowed GE and other companies, including Caterpillar, JPMorgan Chase, Ford and IBM to save an estimated $4 billion annually in taxes.

A month later, Rangel and Immelt were together in Harlem announcing a $30 million donation to benefit New York City schools, $11 million of which would go to institutions in Rangel's district."


What was that Lincoln quote again?

What does one say about this?

I have a word for you and it is not censure. It is called bribery plain and simple. Guess they don't teach that to anyone from the Ivy League or at the Justice Dept.
Actually lets discuss something important like what Natalie Portman wore to the Oscars. Because we sure as heck don't want to discuss something important like mark to market. It seems the push for mark to fantasy is gaining new found steam as now we learn that Four States Consider Legislation Barring Distressed Sales from Comparables.

"Four states - Illinois, Maryland, Missouri and Nevada - are considering legislation that would prohibit or restrict the use of 'distressed sales," such as foreclosures and short sales, as comparable sales as a part of a residential real estate appraisal.

Homebuilders, and real estate agents are concerned that the prevalence of distressed sales, and their subsequent use as comparables, is resulting in the appraised value of residential properties not matching the contract sales price, or in the case of new construction, the cost to build."

Can you imagine that? With this type of thinking, maybe they will classify a stock trader who gets a margin call and is forced to liquidate the position (re:sold out) as a distressed sale and not have to include that on the tape.

I am sure cats banking industy water boy Bill Isaac are just loving this.Yes, Let's all stick our heads under the covers and hide pretend the bogeyman is not there. That'll work great.
Better yet let's click our heels and repeat there's no place like home 3 times. What is with these people? Are these people sober. Did these people read and sanely consider what it is they are proposing? To ignore and pretend that that which is undeniably in front of you is simply not there?
Breathtakingly ignorant they truly are.

If you think it's happening only you need to think again as it is an epidemic across the globe as this Bloomberg piece indicates. The insolvency crisis is spreading across Europe we now see the spotlight on Spain. In the Bloomberg piece Bank of Spain Underestimates Funding Gap Faced by Lenders, Idealista Says. The article outlines more of the same game of charades going on over here.

Spanish lenders face a capital shortfall that’s “substantially” higher than an estimate by the Bank of Spain because they haven’t accounted for all of their real-estate losses, according to Jesus Encinar, founder and chief executive officer of Idealista.com.

“Property portfolios are still mostly valued at prices dating from the boom, rather than current values,” Encinar said during an interview at his office in Madrid. Home prices in some parts of Spain have dropped about 40 percent since the market’s peak in 2007, according to his 10-year-old company, the country’s largest property website.

Savings banks alone have taken on land worth 23 billion euros after borrowers defaulted on their loans, according to data from the Bank of Spain. Land prices have fallen as much as 80 percent in the past four years and the valuations used by lenders are “pure fantasy,” Encinar said.

Jesus Encinar couldn't possibly know what he is talking about, right?. I expect a disinformation and smear campaign to commence against him shortly by the Spanish banking lobby.

Encinar knows what is going on. I know what is going on and you know what's going on..... The Great Ponzi is unravelling.

And THEY ALL KNOW IT !

Bill Isaac knows it better than anyone else which is why he is so vehement in his opposition to mark to market accounting for the banks and financials. I have news for cats like Bill Issac and his ilk, the laws of physics apply in finance. These rules will assert themselves no matter how much you pretend you can circumvent them.

Have a great weekend.

1 comment:

Maria das Dasntos said...

Here in ga ga land of the ever so well connected Oxbridge elite,UK to others,we have draconian laws preventing free speech(libel)yet freedom of mark to market has been hidden.House prices must never fall as our glorious banks have pedicated growth on housing and the great lie of house shortage is paraded as truth.In the North of England vast swaths of cities like Liverpool,are being bulldozed to hide the over supply of real houses,whilst the city is swamped in apartments which few want.Yet London seems to free of this,not quite.Huge swaths of Docklands are effectively dark,as they are bank owned,and no local taxes are being paid.Yes the lie is the world over.
Tracks of beautiful beach side houses are for sale not only in mainland Spain,but also on the Balearics and Tenerife,but censure is assured if you wish to report this.
As the European Parliament asserts we are indeed "post-democratic".
Of course this ended well the last time we all tried this.