I received the following email from a source on the Hill who has a lot of knowledge about foreclosures.Attached is a court order quashing a case because of a counterfeit court summons. Apparently what’s happening is that private process servicer com…
Posts Tagged ‘Barney Frank’
Wall Street bonuses criticised
July 31st, 2009 |
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Wall Street banks that were bailed out by the government gave executives bonuses regardless of performance, it has been suggested in a report.
The report by New York Attorney Andrew Cuomo’s office said there was "no clear rhyme of reason" for pay and it had been disconnected from performance.
Controversially, Congress is seeking to give government a direct say in what bank bosses are compensated.
Top US banks paid out huge bonuses despite gaining taxpayer bail-outs.
"Compensation for bank employees has become unmoored from the banks’ financial performance" said the report.
The report – prepared over nine months – argues that some banks paid out larger bonuses than their profits, while simultaneously taking exceptional state emergency funds.
Difficult year
Ten banks were given money as part of the government’s $700bn financial stimulus plan.
In 2008 Goldman Sachs paid $4.8bn in bonuses, representing more than twice its income. Similarly Morgan Stanley awarded bonuses of $4.475bn while earning just $1.7bn.
The government provided both firms with $10bn, as part of the its wider Troubled Asset Relief Program (Tarp). Goldman recently reported a better-than-expected net profit of $3.44bn for the three months to June.
Citigroup and Merrill Lynch paid bonuses of $5.33bn and $3.6bn respectively while seeing losses of more than $27m each, said the report.
"Other banks, like State Street and Bank of New York Mellon, paid bonuses that were more in line with their net income, which is certainly what one would expect in a difficult year like 2008".
The proposal in Congress has been opposed by many Republicans who think it gives the state too much control over private firms’ pay.
"The problem with executive compensation is essentially, from the systemic standpoint, that it gives perverse incentives" said Barney Frank, chairman of the House Financial Services Committee.
He said the lack of penalties meant "heads you win, tails you break even".
This article is from the BBC News website. © British Broadcasting Corporation, The BBC is not responsible for the content of external internet sites.
US interest rates to ‘remain low’
July 21st, 2009 |
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Ben Bernanke, head of the US Federal Reserve, has defended the central bank’s policy in addressing the recession, including its stimulus plan.
Testifying before the House Financial Committee in his twice-yearly report on monetary policy, he said the focus was to foster "economic recovery".
He sought to reassure markets that government intervention could be withdrawn in a "smooth and timely" way.
Interest rates were likely to remain low for some time, he added.
He said economic conditions meant rates would be kept at exceptionally low levels for "an extended period", between 0% and 0.25%.
‘Persuaded’
Congress approved a $787bn economic stimulus plan in February, aimed at saving or creating 3.5 million jobs and encouraging consumer spending and rebuilding infrastructure.
The plan included tax breaks and money for social programmes.
"Although the recession in the rest of the world led to a steep drop in the demand for US exports, this drag on our economy appears to be waning"
Ben Bernanke, chairman, US Federal Reserve
"It is important to assure the markets that the extraordinary policy measures we have taken in response to the financial crisis and the recession can be withdrawn in a smooth and timely manner as possible," said Mr Bernanke.
Barney Frank, the head of the committee highlighted concerns over inflation. "If people think there’s going to be inflation, then that’s inflationary."
He said Mr Bernanke had addressed such concerns, adding that he was "persuaded by the chairman and others that we are able, in an orderly way, to undo what we had to do so that there will not be that inflationary impact".
Analyst Hugh Johnson, chief investment officer at Johnson Illington Advisors, said Mr Bernanke’s remarks showed that if the job market improved, the Fed would not hesitate in changing its policy.
The Fed is saying it has "the tools for preserving price stability, which effectively means that they have the tools to reduce the levels of liquidity in the financial system before inflation takes hold", said Mr Johnson.
Recovery
Mr Bernanke cited signs that the financial markets had improved, and so had the US economy.
"Although the recession in the rest of the world led to a steep drop in the demand for US exports, this drag on our economy appears to be waning," he said.
However, he cautioned that the unemployment rate remained high and job insecurity, coupled with a fall in home values and limited credit, meant gains in consumer spending would be restricted.
Looking ahead, Mr Bernanke said the central bank expected output to improve in slightly in the rest 2009, with 2010 seeing a gradual recovery.
Rudy Narvas, an analyst at 4Cast in New York, said: "[Mr Bernanke] is still pretty dovish on the economy. He still believes that slack is going to remain at least through 2011."
But he added: "He is saying that they can raise rates even though the unwinding of the balance sheet hasn’t finished yet, which is kind of important, because it suggests to us that they could begin raising rates by as early as 2011."</p
This article is from the BBC News website. © British Broadcasting Corporation, The BBC is not responsible for the content of external internet sites.