News reports of British Petroleum's (BP) CEO Tony Hayward being fired circulated the newswires over the weekend. As of this writing, BP has not yet made it official.
I've been wondering under what authority our President believes he has this power or moral authority.
Hayward is the latest in a pretty high level list of CEO's and executives to cross the increasingly authoritative Obama Administration. If Hayward is truly out, he joins General Motors's (GM) Rick Waggoner and Lehman Brothers' Richard Fuld. Fuld was not technically fired, but Lehman was allowed to go bankrupt, which eliminated Fuld's existance.
Of course, our president has spared EVERYONE at his pet firm, Goldman Sachs (GS), aka "Government Sachs". So what if they were central to the ruination of the global economy? They admitted no wrongdoing. Why jump to conclusions?
Let's not forget the "shotgun wedding" of Bank of America and Merrill Lynch. Was Kenneth Lewis pressured to acquire Merrill? Nah! Lewis clearly WANTED to overpay.
Don't get me wrong. All of these executives had a lot to answer for. However, these matters were best addressed by the companies' respective board of directors and shareholders, not by presidential dictum.
My question concerns exactly what gives our President either legal authority, moral authority or the basic qualifications to be making these uni-lateral decisions.
President Obama has NEVER held a private sector job. President Obama despises capitalism. President Obama has NEVER run a company, nor created a single job except at government expense. What makes him qualified to stuff his political views down corporate America's throat?
It's easy to demonize these companies. NO company in the America exists to benefit either consumers or environmentals or regulators. Their mission is to benefit shareholders. The interest of shareholders may be at odds with a political agenda. If you want social responsibility, better you turn to the many 501c3s.
If we extrapolate, we can conclude that NO CEO has any job security. If you run a company involved in tobacco, alcohol, fast foods, munitions, gaming, pharmaceuticals, finance, banking, or just about anything else, you are at grave risk. If you kowtow to Obama, your shareholders will be upset. If you protect your shareholders, Obama will be upset. Sounds like a pretty bad recipe to me.
Of course, if you're a racist, like Sherry Sherrod, you get an apology. Last Wednesday, White House Press Secretary Robert Gibbs apologized to Shirley Sherrod, fired the day before from her job as Georgia Director of Rural Development for the Department of Agriculture. Ms. Sherrod's blatantly racist comments would have gotten virtually anyone else run out of town. Trust our President. He can separate right and wrong.
You get Obamacare whether you want it or not. Never mind that he exempted Congress and himself from the legislation that was touted as so good for America. Oh, and you're not paying enough in taxes. Just because your small business is the only driver of the economy. Pay more in taxes and let Uncle Sam spend the money that they believe was never yours in the first place. Only by their good graces do they allow you to keep any of it. Be grateful.
The press told us that Richard Nixon was an imperial president. I don't recall Nixon firing CEO's. Nor Reagan, nor Kennedy, nor Johnson, nor Ford, nor Carter nor Clinton nor either Bush. In fact, has ANY CEO being fired by a sitting president? Isn't the private sector supposed to be PRIVATE?
Obama has a legal background. Has he read the Constiution?
Marko's Take
Showing posts with label Lehman Brothers. Show all posts
Showing posts with label Lehman Brothers. Show all posts
Monday, July 26, 2010
Thursday, February 25, 2010
California Crisis Deepens... Part 7
California's plan to raise $2 billion in General Obligation bonds has been temporarily shelved as a result of ongoing legislative hurdles.
The bond sale was scheduled to begin next week and price on March 4, but state Treasurer Bill Lockyer postponed the deal for a week. He said the delay was required because the state legislature hadn't voted on a cash-management bill that would make California debt more appealing to investors and ratings firms.
California has the lowest credit ratings of any state. Moody's Investors Service rates the state's general-obligation bonds Baa1, Standard & Poor's ranks them A-minus and Fitch Ratings rates them BBB.
But John Flahive, director of fixed income at BNY Mellon Wealth Management, said that because of the delay and the size of the deal, the bonds may come around 20 basis points over where existing debt trades, which means the yields would be in the range of 5.875% to 6%.
Meanwhile, Governor Schwarzenegger continues to search for ways to close the budget gap which is projected to be $20 billion.
In low-key votes, lawmakers slashed nearly $1 billion from the state’s prison system, chiefly from inmates’ medical care and approved a $540 million reduction in state workers’ paychecks. The state Senate had approved those measures last week and on Monday they passed the Assembly on party-line votes.
Any tax increases remain "off the table". A spokesperson for Schwarzenegger said the Governor “would veto any plan that includes suspending a tax break.”
Especially hard-hit thus far has been the California State educational system. The Cal State University system, that great bridge between working-class California and its middle class, is under threat. Tuition has been going up at a head-spinning rate -- 32% this year! Faculty is being cut, financial aid is disappearing and many key classes are impossible to get.
If that weren't enough, the 2008 collapse of Lehman Brothers has hit some communities especially hard.
San Mateo, a scenic swath of peninsula between the Pacific Ocean and San Francisco Bay, saw $155 million evaporate when Lehman Brothers went bankrupt in September. On top of deep budget cuts brought on by California's fiscal crisis, the loss on Lehman securities means San Mateo's 735,000 residents are taking a hit.
Public schools here have laid off dozens of teachers and delayed or canceled renovations. Local community colleges are slashing classes and scrapping new facilities, even as enrollment surges because of the bad economy. The county trimmed its commuter rail service and shelved plans to build a new women's jail to alleviate overcrowding.
The biggest factor behind San Mateo's trouble is California's spending cuts. But its Lehman losses have made a bad situation worse.
San Mateo County's loss was the biggest of any municipality. Under state rules, the county government, city governments and area school districts hold their operating funds, reserves and bond proceeds together in an investment pool that lost about 6% of its value when Lehman went under.
The investment pool owned highly rated Lehman bonds and notes, which currently trade around 20 cents on the dollar. Any recovery from the bankruptcy process will take at least another year. A recovery of 20 cents on the dollar would leave the pool with a loss of roughly $125 million.
By far the biggest hindrance toward a solution is the stalement between Governor Schwarzenegger, who adamantly opposes tax increases and the Democratic-controlled legislature, which is equally adamant in its opposition to further spending cuts. It appears that this stalement will keep California "on the brink" until the very critical 2010 election tips the scales either more toward Republicans or Democrats.
As the world's ninth largest economy, California's fortunes are critical to the United States and the entire world. Sadly, the crisis threatens to get worse unless unemployment should miraculously diminish or an economic recovery gains momentum. Readers of "Marko's Take" know that neither of these outcomes is likely in the near future. Thus, California's prospects are likely to reach a crisis level by the end of the year.
Think I'm off the mark? TAKE ME ON!
Marko's Take
Our second installment on YouTube, "What Exactly Is Peak Oil?.. Part 1" is now posted at http://www.youtube.com/markostaketv. Please stop in, feel free to leave comments and enjoy the excellent film-making care of Phoenix Film Group. (http://www.phoenixfilmgroup.com/)
Part 2 of the "Peak Oil" series will be posted in the next 48 hours!
The bond sale was scheduled to begin next week and price on March 4, but state Treasurer Bill Lockyer postponed the deal for a week. He said the delay was required because the state legislature hadn't voted on a cash-management bill that would make California debt more appealing to investors and ratings firms.
California has the lowest credit ratings of any state. Moody's Investors Service rates the state's general-obligation bonds Baa1, Standard & Poor's ranks them A-minus and Fitch Ratings rates them BBB.
But John Flahive, director of fixed income at BNY Mellon Wealth Management, said that because of the delay and the size of the deal, the bonds may come around 20 basis points over where existing debt trades, which means the yields would be in the range of 5.875% to 6%.
Meanwhile, Governor Schwarzenegger continues to search for ways to close the budget gap which is projected to be $20 billion.
In low-key votes, lawmakers slashed nearly $1 billion from the state’s prison system, chiefly from inmates’ medical care and approved a $540 million reduction in state workers’ paychecks. The state Senate had approved those measures last week and on Monday they passed the Assembly on party-line votes.
Any tax increases remain "off the table". A spokesperson for Schwarzenegger said the Governor “would veto any plan that includes suspending a tax break.”
Especially hard-hit thus far has been the California State educational system. The Cal State University system, that great bridge between working-class California and its middle class, is under threat. Tuition has been going up at a head-spinning rate -- 32% this year! Faculty is being cut, financial aid is disappearing and many key classes are impossible to get.
If that weren't enough, the 2008 collapse of Lehman Brothers has hit some communities especially hard.
San Mateo, a scenic swath of peninsula between the Pacific Ocean and San Francisco Bay, saw $155 million evaporate when Lehman Brothers went bankrupt in September. On top of deep budget cuts brought on by California's fiscal crisis, the loss on Lehman securities means San Mateo's 735,000 residents are taking a hit.
Public schools here have laid off dozens of teachers and delayed or canceled renovations. Local community colleges are slashing classes and scrapping new facilities, even as enrollment surges because of the bad economy. The county trimmed its commuter rail service and shelved plans to build a new women's jail to alleviate overcrowding.
The biggest factor behind San Mateo's trouble is California's spending cuts. But its Lehman losses have made a bad situation worse.
San Mateo County's loss was the biggest of any municipality. Under state rules, the county government, city governments and area school districts hold their operating funds, reserves and bond proceeds together in an investment pool that lost about 6% of its value when Lehman went under.
The investment pool owned highly rated Lehman bonds and notes, which currently trade around 20 cents on the dollar. Any recovery from the bankruptcy process will take at least another year. A recovery of 20 cents on the dollar would leave the pool with a loss of roughly $125 million.
By far the biggest hindrance toward a solution is the stalement between Governor Schwarzenegger, who adamantly opposes tax increases and the Democratic-controlled legislature, which is equally adamant in its opposition to further spending cuts. It appears that this stalement will keep California "on the brink" until the very critical 2010 election tips the scales either more toward Republicans or Democrats.
As the world's ninth largest economy, California's fortunes are critical to the United States and the entire world. Sadly, the crisis threatens to get worse unless unemployment should miraculously diminish or an economic recovery gains momentum. Readers of "Marko's Take" know that neither of these outcomes is likely in the near future. Thus, California's prospects are likely to reach a crisis level by the end of the year.
Think I'm off the mark? TAKE ME ON!
Marko's Take
Our second installment on YouTube, "What Exactly Is Peak Oil?.. Part 1" is now posted at http://www.youtube.com/markostaketv. Please stop in, feel free to leave comments and enjoy the excellent film-making care of Phoenix Film Group. (http://www.phoenixfilmgroup.com/)
Part 2 of the "Peak Oil" series will be posted in the next 48 hours!
Subscribe to:
Posts (Atom)