Will There Be Cuts to Medicare and Medicare in Obama’s Deficit Plan? UPDATED with Carville
September 15, 2011 No CommentPresident Obama’s jobs speech was pretty good for the most part except when he brought up the part about reforms to Medicare and Medicaid: I’m not sure if this article in FT (which is behind firewall) is accurate, but if it is then I’m getting very nervous and so is the Democratic party. Obama to propose Medicare and Medicaid cuts : Barack Obama is expected to lay out a plan next week that would cut several hundred billion dollars from Medicare and Medicaid, the large government healthcare schemes for the elderly and the poor, as part of a pitch to cut future deficits by more than $1,500bn. Senior White House officials said the US president would base a detailed blueprint for fiscal reform, which is to be delivered on Monday, on an earlier speech he delivered in April on deficit reduction.. The announcement could create tensions within the Democratic party, which has traditionally staunchly defended Medicare. Mr Obama’s fiscal proposal will be released just one week after the president unveiled a separate plan to raise more than $450bn to pay for a jobs bill that senior officials said would be the president’s singular focus in coming weeks. The NY Times writes: Democrats See Perils on Path to Health Cuts As Congress opens a politically charged exploration of ways to pare the deficit, President Obama is expected to seek hundreds of billions of dollars in savings in Medicare and Medicaid , delighting Republicans and dismaying many Democrats who fear that his proposals will become a starting point for bigger cuts in the popular health programs. The president made clear his intentions in his speech to a joint session of Congress last week when, setting forth a plan to create jobs and revive the economy, he said he disagreed with members of his party “who don’t think we should make any changes at all to Medicare and Medicaid.” Few Democrats fit that description. But many say that if, as expected, Mr. Obama next week proposes $300 billion to $500 billion of savings over 10 years in entitlement programs, he will provide political cover for a new bipartisan Congressional committee to cut just as much or more. And, they say, such proposals from the White House will hamstring Democrats who had been hoping to employ Medicare as a potent issue against Republicans in 2012 campaigns after many Congressional Republicans backed a budget that would have substantially altered Medicare by providing future beneficiaries with a subsidy to enroll in private health care plans. Representative Emanuel Cleaver II , Democrat of Missouri and chairman of the Congressional Black Caucus , said: “Ninety-eight percent of the president’s speech was excellent. The Democratic caucus and the black caucus are fired up. But you will find that we have some differences with the president’s plan as it relates to Medicare and Medicaid. We would rather see some kind of increase in revenue as opposed to cutting these programs.” By offering such proposals, Mr. Cleaver said, the president “cancels out any bludgeoning that Democrats might give the Republicans over Medicare and Medicaid.” This grand bargain fetish while pleasing to the Villagers will haunt him and the rest of the Democratic party in 2012 if they actually go through with it. A new poll by Bloomberg bares this out : Support for one of the party’s central tenets is declining, with just 34 percent of the country now favoring repeal of President Barack Obama’s health-care overhaul, down from 41 percent six months ago. Republicans support repeal, while political independents and Democrats don’t. A 51 percent majority says a special congressional committee considering how to reduce the federal deficit by $1.5 trillion should opt to raise taxes on higher-income earners before curbing entitlements such as Medicare or Social Security, rejecting Republican pledges against tax increases. Almost six of 10 say the panel must do one or the other to meet its deficit-cutting goal. “Taxes are at the heart of the controversy because Americans hold two conflicting views,” said J. Ann Selzer, president of Selzer & Co. “In the abstract, they’d rather cut than raise taxes. But in the context of near-term goals to cut the deficit, they prefer raising taxes to cutting entitlements.” And Republican ideas are dropping like a rock: Rejecting Republican Plans—Majorities reject many specifics of Republicans’ long-term plan to balance the budget. More than three-quarters oppose cuts to Medicaid, the federal-state health-insurance program for the poor, and almost 6 of 10 reject replacing the Medicare plan for the elderly with a private voucher system. A 54 percent majority would raise taxes on families earning more than $250,000 per year, a measure that Republican leaders oppose. As Digby notes , there’s a little chatter out there that some Democrats are being softened up for reasons I don’t understand, but it should be a complete non-starter for any Democratic president. It’s pure folly. The Democrats seized momentum from the passing of Paul Ryan’s Medicare Destruction Plan. Aren’t they getting the message that these trial balloons are a flop? All the polls say the same things. Don’t cut benefits and really, there isn’t any reason to. We have a revenue problem, not an austerity or tax problems. Let’s wait and see shall we? UPDATE: Carville has the right idea. I’ve been terribly angry with the WH’s strategy for a long time and have written about it just as long. 1. Fire somebody. No — fire a lot of people. This may be news to you but this is not going well. For precedent, see Russian Army 64th division at Stalingrad. There were enough deaths at Stalingrad to make the entire tea party collectively orgasm. Mr. President, your hinge of fate must turn. Bill Clinton fired many people in 1994 and took a lot of heat for it. Reagan fired most of his campaign staff in 1980. Republicans historically fired their own speaker, Newt Gingrich. Bush fired Defense Secretary Donald Rumsfeld. For God’s sake, why are we still looking at the same political and economic advisers that got us into this mess? It’s not working. Furthermore, it’s not going to work with the same team, the same strategy and the same excuses. I know economic analysts are smart — some work 17-hour days. It’s time to show them the exit. Wake up — show us you are doing something. 2. Indict people. There are certain people in American finance who haven’t been held responsible for utterly ruining the economic fabric of our country. Demand from the attorney general a clear status of the state of investigation concerning these extraordinary injustices imposed upon the American people. I know Attorney General Eric Holder is a close friend of yours, but if his explanations aren’t good, fire him too. Demand answers to why no one has been indicted. Mr. President, people are livid. Tell people that you, too, are angry and sickened by the irresponsible actions on Wall Street that caused so much suffering. Do not accept excuses. Demand action now. 3. Make a case like a Democrat. While we are going along with the Republican austerity garbage, who is making the case against it? It’s not the Democrats!
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Peter Bryan, who smashed fellow patient’s head on floor because ‘he wanted to eat him’, not adequately assessed A man who attacked and killed a fellow patient at a high-security psychiatric hospital because he “wanted to eat him” was not being watched properly, and had not been adequately assessed, an inquest jury ruled on Thursday. Peter Bryan “smashed” Richard Loudwell’s head on the floor at Broadmoor hospital and tied a ligature around his neck on April 25 2004, an inquest at Berkshire coroners court heard. Loudwell, 60, who was admitted to Broadmoor in January that year, was taken to Frimley Park hospital in Surrey but died 41 days later, never having regained consciousness. The jury was told Bryan had attacked a 21-year-old woman, hitting her on the head around six times with a claw hammer in 1993. He later pleaded guilty to manslaughter on grounds of diminished responsibility. Bryan spent eight years at Rampton hospital and was eventually allowed back into society, but later attacked and killed a man, named in reports as Brian Cherry on February 17 2004. The victim had been dismembered and officers found a frying pan on the stove with tissue from the dead man’s brain. Bryan told officers: “I ate his brains with butter. It was really nice.” The killer was admitted to Broadmoor’s Luton ward on April 15 2004, after a stay at Belmarsh prison where he was described as “unpredictable”; presenting a “grave risk to others” and “extremely dangerous”. He was put in seclusion but four days after his arrival was allowed to mingle with patients under “general observations” or 15-minute checks, the inquest was told. But just after 6pm on April 25 he attacked Loudwell in the dining room of Luton ward. At the conclusion of the inquest, the jury ruled Loudwell died of bronchopneumonia, a hypoxic brain injury, ligature strangulation and blunt trauma to the head. Recording a narrative verdict, the jury said the dining room was not adequately observed by nursing staff at the time of the attack. Jurors also found Bryan’s mental state had not been adequately examined before his release from seclusion on April 19, or between that date and the attack on April 25. “Until such a mental state examination was completed, Peter Bryan should have been on higher observations than the general level. Such failure may have contributed to Richard Loudwell’s death.” The verdict said the absence of one or more of several factors may have contributed to Loudwell’s death. These included a pre-admission nursing report, a clinical team meeting, an adequate mental state examination, a formal written risk assessment and medical staff regularly seeing Bryan when he was out of seclusion. The inquest was told there were 19 patients in Luton ward on the day of the attack on Loudwell. Nine members of staff were present for the afternoon shift. Joanne Fisher, registered mental nurse and team leader on the ward, described finding Loudwell with head injuries on the floor of the ward dining room. In a statement read by Berkshire coroner Peter Bedford, she said Bryan told her: “I got him from behind, I put a ligature around his neck so that he wouldn’t make a noise, and I smashed his head.” She added: “Mr Bryan said he had been thinking about it for a few days. He also said: ‘I wanted to eat him.’” From Fisher’s statements, the inquest heard Loudwell was “hard to work with”, “generally unco-operative” and had complained of bullying. He had gone against advice from staff not to disclose the offence for which he was in Broadmoor, the inquest heard, and one senior member of nursing staff described him as the “most unpopular patient I have ever met”, saying it was “inevitable” that “sooner or later” he would be assaulted. But according to Fisher’s statement, he had started to “interact” more and shortly before he was attacked was seen playing cards with patients. She said she was not aware of Bryan being involved in bullying Loudwell. In the jury’s narrative verdict, they said staff should have known both men were in the dining room, but “having regard to Peter Bryan’s presentation whilst in Broadmoor”, it should not have caused concern that they were in the room together. Crime guardian.co.uk
Continue reading …Silvio Berlusconi faces fresh claims over parties, prostitutes and pay-outs
September 15, 2011 No Comment
Wiretap transcripts, including alleged blackmail risk, could further damage standing of Italy’s prime minister Silvio Berlusconi was on Thursday braced for a tidal wave of new and reportedly compromising allegations about his private life as prosecutors confirmed the conclusion of an investigation into the supply of prostitutes and other women for parties at his Rome residence. Court papers included a claim that the man who provided women for the parties had offered a well-known Italian actor the chance to present the annual San Remo song contest if she agreed to sleep with the 75-year-old prime minister. Manuela Arcuri, the star of a string of TV dramas, said she refused. But Berlusconi’s associates fear far more damaging material is contained in 1,000 or so wiretap transcripts made during the inquiry that could now leak to the media. The prime minister, who is not a suspect in the investigation, is already under huge pressure from several quarters. Against a background of concern that Italy risks being dragged into a Greek-style debt crisis, rumours have been circulating that investigators recorded the prime minister as he made a grossly obscene reference to the German chancellor, Angela Merkel. The chancellor’s co-operation is vital to resolving the debt crisis on the euro zone’s southern flank. Interviewed on radio, a former Berlusconi minister, Rocco Buttiglione, said he did not know if the rumour was true, but if it were “how could someone in a situation like that lead the government?” he suggested. He added: “Does he not realise that he is dramatically damaging Italy?” His was not the only voice calling on Berlusconi to step down. In a front-page editorial, Italy’s top-selling daily, Corriere della Sera, said Italy was in “a situation at the limits of sustainability”. And it asked “how long it can go on without provoking serious damage?” Police this month arrested the alleged purveyor of women for Berlusconi’s parties, Giampaolo Tarantini, and his wife, on suspicion of blackmailing the prime minister through an intermediary. In a deposition, Berlusconi insisted he made voluntary payments to the couple because they were in a “very difficult situation”. The prosecutors believe more than €500,000 (£438,000) was handed over. According to leaked wiretap transcripts published on Thursday, after it was reported that an investigation had been launched, Berlusconi told the intermediary he should stay abroad. He reportedly added: “I will of course exonerate everyone.” Prosecutors in Naples have said they believe the money was paid to prevent Tarantini contradicting the prime minister’s insistence that he was unaware the women, some of whom spent the night, were paid. The prosecutors want to question Berlusconi, but he has avoided an encounter. This week they announced that, if he continued dodging them, they would ask a judge to order the police to bring him in. The prime minister’s vulnerability to blackmail is central to another evolving scandal. It was reported this week that a witness had told prosecutors in Milan that Berlusconi was, as he once claimed, in a long-term relationship. The witness, a Moroccan belly dancer, named his live-in girlfriend as a Montenegrin, named Katarina. The weekly L’Espresso identified her as Katarina Knezevic, 20, a former “Miss Montenegro”. It said she had a twin sister, and that in 2009 the pair, both of whom are models, had been photographed in Sardinia in the company of Madonna’s former husband, Guy Ritchie. Berlusconi mentioned an unidentified lover to rebut claims of wild parties at his home outside Milan. But the witness, who said she was a reluctant participant in “Bunga Bunga” sessions, confirmed the claims, adding that, jealous of the other women present, Knezevic had thrown herself down the stairs of the prime minister’s mansion. The Moroccan woman also described how a female associate of the prime minister, who is now a member of the regional parliament of Lombardy, had been one of two who dressed as nuns before stripping down to G-strings while pole dancing. The regional lawmaker denied the claim, but was embarrassed on Wednesday when she was photographed in the Milan fashion district while wearing a top emblazoned with the words: “I’m even better without the T-shirt.” Silvio Berlusconi Italy Europe corruption index Angela Merkel John Hooper guardian.co.uk
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enlarge Credit: Washington Post It comes as no surprise that Congressional Republicans are balking at President Obama’s $447 billion program forecast to produce as many as 1.9 million jobs . But while the GOP has opposed Obama’s calls for new tax revenue from the wealthiest Americans to pay for it, most of the Republican presidential field wants to give them yet another trillion dollar tax cut payday by eliminating the capital gains tax . With U.S. income inequality at its highest level in 80 years and the total federal tax burden at its lowest in 60, the last thing America needs to do is further reduce the capital gains tax. As a decade of data shows, the Treasury-draining Bush capital gains and dividend tax windfall for the wealthy not only failed to produce employment gains from America’s so-called ” job creators .” As the Washington Post detailed, “capital gains tax rates benefiting wealthy feed [the] growing gap between rich and poor.” Nevertheless, most Republicans are calling for a new capital gains tax rate: zero . As the Post explained, for the very richest Americans the successive capital gains tax cuts from Presidents Clinton (to 20 percent) and Bush (to 15 percent) have been “better than any Christmas gift”: While it’s true that many middle-class Americans own stocks or bonds, they tend to stash them in tax-sheltered retirement accounts, where the capital gains rate does not apply. By contrast, the richest Americans reap huge benefits. Over the past 20 years, more than 80 percent of the capital gains income realized in the United States has gone to 5 percent of the people; about half of all the capital gains have gone to the wealthiest 0.1 percent. The convenient chart above tells the tale. And as the Washington Post suggests elsewhere in its jaw-dropping series ” Breaking Away ,” plummeting tax rates overall and on capital gains in particular have been widening the chasm between the rich and everyone else in America: Nevertheless, the same Republicans digging in their heels against President Obama’s latest proposed middle tax relief in the form of a continued payroll tax holiday want to gut the capital gains tax or eliminate it altogether. In 2008, Republican presidential nominee John McCain called for halving the rate to 7.5 percent, a move which would have earned him and his beer heiress wife tens of thousands of dollars annually. This year’s crop of GOP White House hopefuls is little different. While Newt Gingrich long ago echoed Alan Greenspan’s demand that “the appropriate capital gains tax rate was zero,” Jon Huntsman reversed course to take the same position. (For his part, Mitt Romney wants to end capital gains taxes for that small group earning under $200,000 a year.) And as ThinkProgress reported, they have a lot of company from Michele Bachmann, Herman Cain and Ron Paul among Republican presidential candidates looking to drain $1 trillion from the Treasury over the next decade. Of course, given the massive giveaway of the past 10 years, yet another capital gains bonanza for the gilded-class will only serve to empty Uncle Sam’s coffers while doing little to benefit the economy overall. Back in May, John Boehner explained to CBS News who Republicans would be trying to protect during the debt ceiling negotiations with President Obama: “The top one percent of wage earners in the United States…pay forty percent of the income taxes…The people he’s talking about taxing are the very people that we expect to reinvest in our economy.” If so, those expectations were sadly unmet after the tax cuts of George W. Bush. After all, the last time the top tax rate was 39.6 percent during the Clinton administration , the United States enjoyed rising incomes, 23 million new jobs and budget surpluses. Under Bush? Not so much. On January 9, 2009, the Republican-friendly Wall Street Journal summed it up with an article titled simply, ” Bush on Jobs: the Worst Track Record on Record .” (The Journal’s interactive table quantifies his staggering failure relative to every post-World War II president.) The meager one million jobs created under President Bush didn’t merely pale in comparison to the 23 million produced during Bill Clinton’s tenure. In September 2009, the Congressional Joint Economic Committee charted Bush’s job creation disaster, the worst since Hoover: As David Leonhardt of the New York Times aptly concluded last year: Those tax cuts passed in 2001 amid big promises about what they would do for the economy. What followed? The decade with the slowest average annual growth since World War II. Amazingly, that statement is true even if you forget about the Great Recession and simply look at 2001-7. The data are clear: lower taxes for America’s so called job-creators don’t mean either faster economic growth or more jobs for Americans . But while Boehner’s job creators didn’t create any jobs after the top rate was trimmed to 35 percent and capital gains and dividends taxes were slashed, they did enjoy an unprecedented windfall courtesy of the United States Treasury. For Republicans, this predictable result of the Bush tax cuts was a feature, not a bug. As the Center for American Progress noted in 2004, “for the majority of Americans, the tax cuts meant very little,” adding, “By next year, for instance, 88 percent of all Americans will receive $100 or less from the Administration’s latest tax cuts.” But that’s just the beginning of the story. As the CAP also reported, the Bush tax cuts delivered a third of their total benefits to the wealthiest 1 percent of Americans . And to be sure, their payday was staggering. The Center on Budget and Policy Priorities showed that millionaires on average pocketed almost $129,000 from the Bush tax cuts of 2001 and 2003. As a result, millionaires saw their after-tax incomes rise by 6.2 percent, while the gain for those earning between $40,000 and $50,000 was paltry 2.2 percent. And as the New York Times uncovered in 2006, the 2003 Bush dividend and capital gains tax cuts offered almost nothing to taxpayers earning below $100,000 a year. Instead, those windfalls reduced taxes “on incomes of more than $10 million by an average of about $500,000.” As the Times explained in a shocking chart: “The top 2 percent of taxpayers, those making more than $200,000, received more than 70% of the increased tax savings from those cuts in investment income.” It’s no wonder that between 2001 and 2007- a period during which poverty was rising and average household income had fallen – the 400 richest taxpayers saw their incomes double to an average of $345 million even as their effective tax rate was virtually halved. As the Washington Post noted, “The 400 richest taxpayers in 2008 counted 60 percent of their income in the form of capital gains and 8 percent from salary and wages. The rest of the country reported 5 percent in capital gains and 72 percent in salary.” As ThinkProgress demonstrated, historically lower tax rates for the richest Americans did not produce either more job creation or faster economic growth . (In fact, the Bush years produced what the Times’ Leonhardt rightly labeled as “The decade with the slowest average annual growth since World War II.”) But what the conservative cornucopia for the gilded-class does reliably produce is unprecedented income inequality . (It’s worth noting that the changing landscape of loopholes, deductions and credits, especially after the 1986 tax reform signed by President Reagan, makes apples-to-apples comparisons of effective tax rates over time very difficult. For more background, see the CBO data on effective tax rates by income quintile.) At the end of the day, cutting capital gains taxes like the estate tax ultimately produces just another payout for many who have already won life’s lottery. As Warren Buffett once suggested, it’s time for Washington to stop “giving incredible head starts to certain people who were very selective about the womb from which they emerged.”
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Click here to view this media Following a Thursday speech unveiling his plan to “liberate” the economy, House Speaker John Boehner (R-OH) was asked if he enjoyed his job. “Hell, no!” he exclaimed. “I’m not having any fun.” “But I am glad I’m there… I wanted to be Speaker because I wanted to lead an effort on behalf of our country. And it’s that mission that drives me every day… But I like to accomplish my mission and get the hell out of there.” Boehner later added that he never aspired to be a politician. “I always wanted to be a salesman. And eventually that’s what I did. I was in the sales and marketing business in the packaging and plastic industry. And I thought I was going to do that the rest of my life but along the way, I got involved in my neighborhood homeowners association and I ended up in the United States Congress.” UPDATE: John Amato: John Boehner threw down the tea party gauntlet this morning and said it’s his way or the highway in response to Obama’s jobs bill and what the Super Committee will be allowed to do. He dismissed tax breaks for corporations (which is a long standing ideal of conservative policy) and labeled them as gimmicks and then said only federal spending cuts (not the military of course) and attacks on our social safety nets will be permitted to move forward in his vision to help our struggling economy. It’s a destructive philosophy as the facts have bared out and the president must not buckle again to the GOP or the Villagers’ bipartisan shared sacrifice fetish. If he does offer up social safety net reforms that include benefit cuts, the 2012 elections will be a complete disaster .
Continue reading …Ah, this would explain the blood on his hands. Rachel Maddow continues her yeoman's work as propagandist for Democrats, dishonestly attributing power over sentencing in Texas murder cases to Gov. Rick Perry instead of with juries where it actually resides. (video after page break) Here's Maddow on her MSNBC show Tuesday night, all but accusing Perry of single-handedly dispatching death-row inmates — Texas is killing two more of its prisoners this week, including one that was killed already today. Thirty-one-year-old Steven Michael Woods Jr. was killed at 6:22 p.m. local time in Huntsville tonight. That's the 235th person Rick Perry has put to death in his time as Texas governor , more than any other governor in modern US history. Not only does Perry lack the authority to execute by decree as suggested by Maddow, he cannot grant clemency without approval from the state's Board of Pardons and Paroles. Woods was convicted for murdering two people — in May 2001, more than a decade ago. In the spirit of giving credit where credit is due, Maddow did refrain from describing the case as a rush to judgment, so there's that. As Perry stated in the tea party debate, Texas has an appellate process after convictions for murder. What Perry did not mention is that this process is automatic. That's why it routinely takes a decade or longer for convicted murderers to be put to death, even in law-and-order bastions such Texas. For example, the second death-row inmate to be executed in Texas this week, Duane Buck, committed his crimes — another double murder — back in 1995. I can't help but wonder how many of the survivors of Buck's victims have already died before he suffers the consequences of his actions. To paraphrase Brian Williams's question to Perry during the debate, has Maddow ever struggled to sleep at night in anguish over victims of violent crime — or only for its perpetrators?
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Kweku Adoboli, a UBS investment bank trader remains in police custody amid allegations that he cost the Swiss bank £1.2bn Pressure to accelerate reform of the banking industry is mounting as a star trader at the UBS investment bank remained in police custody in London amid allegations that he was at the heart of a rogue trading incident that has cost the Swiss bank about $2bn (£1.2bn). Kweku Adoboli, 31, faced a night of questioning by officers from City of London police after being arrested at 3.30am when his managers became suspicious about his trading activities and alerted police and financial regulators. Police said he was being held on suspicion of “fraud by abuse of position”. Adoboli’s father, a retired United Nations employee from Ghana, told Reuters in Accra that his “Godfearing family” was “heartbroken because fraud is not our way of life”. John Adoboli, who had worked in trouble spots around the world, said his son’s girlfriend had confirmed his arrest. Adoboli Sr said he was calling his son’s phone and he hoped he would “be granted bail soon so I can hear his side of the story”. The Nottingham University graduate’s arrest coincided with the third anniversary of the collapse of Lehman Brothers and sparked a 10% fall in UBS’s shares as it warned it might make a third-quarter loss. Days after the government pledged to endorse ringfencing ideas put forward by Sir John Vickers’s Independent Commission on Banking, senior political figures used the UBS incident as ammunition to encourage reform. Lord Oakeshott, the former Lib Dem Treasury spokesman in the Lords, said it exposed the “toxic banking risk” still in the system. Lord Myners, Labour’s City minister during the banking crisis, warned taxpayers were still on the hook should a UK bank fail. UBS, which had been fighting to restore its reputation after it became one of the biggest continental European casualties of the 2008 banking crisis, alerted City of London police at 1am on Thursday after it uncovering alleged “unauthorised trading” in the late afternoon and embarked on a wide-ranging internal investigation. City of London police arrested Adoboli at the sprawling UBS office complex near Liverpool Street in central London, where around 6,000 people are employed. “The man was taken to a City of London police station for questioning and he remains in custody while officers are continuing to investigate this matter,” police said. The allegations facing Adoboli follow a series of rogue trading incidents in the financial markets. Nick Leeson is perhaps the highest profile after he was jailed in Singapore for bringing down Barings Bank in 1995 but there have been many others, including Yasuo “Mr Copper” Hamanaka and Jérôme Kerviel, a trader at Société Générale, whom the French authorities sentenced to three years in prison last year after he ran up losses of €4.9bn. Kerviel is appealing against the sentence. Adoboli now risks entering that list if charges are brought against him. The bank would not confirm his position at the bank but his entry on LinkedIn, the social networking site, described him as director of exchange traded funds (ETF) and delta one trading at UBS. This operation, in the equities division on the third floor of the UBS head office, was known internally as a profitable – and risk free – area of business. But it is understood that the trading desk was largely silent on Thursday Staff were said to be stunned as Adoboli and his colleagues were regarded as “stars” by their colleagues and top management.ETFs are complex financial instruments that comprise a basket of investments intended to mimic a market’s movements. They have become an area into which firms have expanded since the subprime mortgage crisis. Traders on so-called delta one desks try to make huge profits on tiny differences between prices. The Financial Services Authority, the City regulator, is understood to have been alerted in the early hours and Swiss regulators were watching the situation closely. The Serious Fraud Office may also become involved after it said it was “seeking discussions” with the bank, the City of London police and the FSA about how to proceed if fraud needed to be investigated. The SFO had already issued a warning about the “inherent dangers” of ETFs because of their complexity. UBS is expected to reveal more details on Friday about the allegations facing Adoboli but the City was rife with speculation that he had been caught out by the sudden move by the Swiss National Bank last week to lower the rate of exchange of the Swiss franc. On 6 September, the Swiss National Bank warned that it would no longer allow one Swiss franc to be worth more than €0.83 – equivalent to SFr1.20 to the euro. “The Swiss currency moved by 8% straight away which is a huge move for foreign exchange markets. Probably a good guess as to where the loss came from, but at the moment we do not know,” said Louise Cooper, analyst at BGC Partners. Amid concerns about the health of Europe’s banking system, Oakeshott told a debate on the Vickers reforms in the Lords that “this reminds us how much toxic banking risk remains in the system, and how urgent radical reform is”. He added: “The problem is that big investment banks are full of rogue traders: it is what they do.” Lord Myners, Labour’s City minister at the time of the banking crisis, told the Guardian: “Until this government does something – either Vickers or Vickers ‘plus’ – the taxpayers remain on the hook.” UBS Banking European banks Financial Services Authority (FSA) Regulators Financial sector Europe Jill Treanor guardian.co.uk
Continue reading …Kweku Adoboli, a UBS investment bank trader remains in police custody amid allegations that he cost the Swiss bank £1.2bn Pressure to accelerate reform of the banking industry is mounting as a star trader at the UBS investment bank remained in police custody in London amid allegations that he was at the heart of a rogue trading incident that has cost the Swiss bank about $2bn (£1.2bn). Kweku Adoboli, 31, faced a night of questioning by officers from City of London police after being arrested at 3.30am when his managers became suspicious about his trading activities and alerted police and financial regulators. Police said he was being held on suspicion of “fraud by abuse of position”. Adoboli’s father, a retired United Nations employee from Ghana, told Reuters in Accra that his “Godfearing family” was “heartbroken because fraud is not our way of life”. John Adoboli, who had worked in trouble spots around the world, said his son’s girlfriend had confirmed his arrest. Adoboli Sr said he was calling his son’s phone and he hoped he would “be granted bail soon so I can hear his side of the story”. The Nottingham University graduate’s arrest coincided with the third anniversary of the collapse of Lehman Brothers and sparked a 10% fall in UBS’s shares as it warned it might make a third-quarter loss. Days after the government pledged to endorse ringfencing ideas put forward by Sir John Vickers’s Independent Commission on Banking, senior political figures used the UBS incident as ammunition to encourage reform. Lord Oakeshott, the former Lib Dem Treasury spokesman in the Lords, said it exposed the “toxic banking risk” still in the system. Lord Myners, Labour’s City minister during the banking crisis, warned taxpayers were still on the hook should a UK bank fail. UBS, which had been fighting to restore its reputation after it became one of the biggest continental European casualties of the 2008 banking crisis, alerted City of London police at 1am on Thursday after it uncovering alleged “unauthorised trading” in the late afternoon and embarked on a wide-ranging internal investigation. City of London police arrested Adoboli at the sprawling UBS office complex near Liverpool Street in central London, where around 6,000 people are employed. “The man was taken to a City of London police station for questioning and he remains in custody while officers are continuing to investigate this matter,” police said. The allegations facing Adoboli follow a series of rogue trading incidents in the financial markets. Nick Leeson is perhaps the highest profile after he was jailed in Singapore for bringing down Barings Bank in 1995 but there have been many others, including Yasuo “Mr Copper” Hamanaka and Jérôme Kerviel, a trader at Société Générale, whom the French authorities sentenced to three years in prison last year after he ran up losses of €4.9bn. Kerviel is appealing against the sentence. Adoboli now risks entering that list if charges are brought against him. The bank would not confirm his position at the bank but his entry on LinkedIn, the social networking site, described him as director of exchange traded funds (ETF) and delta one trading at UBS. This operation, in the equities division on the third floor of the UBS head office, was known internally as a profitable – and risk free – area of business. But it is understood that the trading desk was largely silent on Thursday Staff were said to be stunned as Adoboli and his colleagues were regarded as “stars” by their colleagues and top management.ETFs are complex financial instruments that comprise a basket of investments intended to mimic a market’s movements. They have become an area into which firms have expanded since the subprime mortgage crisis. Traders on so-called delta one desks try to make huge profits on tiny differences between prices. The Financial Services Authority, the City regulator, is understood to have been alerted in the early hours and Swiss regulators were watching the situation closely. The Serious Fraud Office may also become involved after it said it was “seeking discussions” with the bank, the City of London police and the FSA about how to proceed if fraud needed to be investigated. The SFO had already issued a warning about the “inherent dangers” of ETFs because of their complexity. UBS is expected to reveal more details on Friday about the allegations facing Adoboli but the City was rife with speculation that he had been caught out by the sudden move by the Swiss National Bank last week to lower the rate of exchange of the Swiss franc. On 6 September, the Swiss National Bank warned that it would no longer allow one Swiss franc to be worth more than €0.83 – equivalent to SFr1.20 to the euro. “The Swiss currency moved by 8% straight away which is a huge move for foreign exchange markets. Probably a good guess as to where the loss came from, but at the moment we do not know,” said Louise Cooper, analyst at BGC Partners. Amid concerns about the health of Europe’s banking system, Oakeshott told a debate on the Vickers reforms in the Lords that “this reminds us how much toxic banking risk remains in the system, and how urgent radical reform is”. He added: “The problem is that big investment banks are full of rogue traders: it is what they do.” Lord Myners, Labour’s City minister at the time of the banking crisis, told the Guardian: “Until this government does something – either Vickers or Vickers ‘plus’ – the taxpayers remain on the hook.” UBS Banking European banks Financial Services Authority (FSA) Regulators Financial sector Europe Jill Treanor guardian.co.uk
Continue reading …Republicans Trying to Gut NLRB to Defend Boeing and Other Corporations
September 15, 2011 No CommentRepublicans are trying to pass legislation in the House of Representatives that would prevent the National Labor Relations Board from enforcing the law and protecting workers. H.R. 2587 would prevent the NLRB from remedying unfair retaliation against workers by corporations. The bill is a response to a recent punishment handed down to Boeing, who allegedly attempted to move a plant from Washington state to right-to-work state South Carolina after the workers attempted to strike. AFL-CIO President Richard Trumka condemned the bill: If a group of workers walk out of a plant because of unsafe working conditions, the company could decide to move the work and the jobs rather than fix the problem, and the NLRB would be powerless to protect the workers and their jobs. If a group of women or African Americans joined together to protest race or sex discrimination by their employer, the company could simply transfer the work somewhere else, and the NLRB would be powerless to protect the workers. Mitt Romney has jumped on board with the legislation and the attacks on the NLRB , calling its members “labor stooges.” Conservatives from the National Federation of Independent Business are launching an online campaign to defend the legislation, with a series of Google ads: The ads take to this propaganda page .
Continue reading …ABC Breaks, Then Ignores Own Scoop on Obama Administration and Solyndra
September 15, 2011 No Comment
On Tuesday and Wednesday's World News, reporter Brian Ross exposed e-mails indicating that the Obama administration gave a $535 million loan to the green company Solyndra, despite deep
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