If That Don't Beat All

Okay, now here's something for you to chew on today (go ahead, spit out that tobacco). Not only are our tax dollars being spent on bailing out the big boys on Wall Street, but also on financing their lobbying efforts to keep the government regulators out of their hair so they can continue to do with our money what they want.

From Robert Reich:

Yet what's happened to the Wall Street campaign contributions and to the lobbyists? They're still going strong. We now know that many of the financial giants that have been bailed out by taxpayers continue to finance a platoon of Washington lobbyists, who are at this moment trying to influence TARP II and the next attempt to regulate Wall Street. In effect, your money and mine, and that of all other taxpayers, is paying these lobbyists to push Congress in a direction we have every reason to believe is not in our interests but in the continued interests of Wall Street. Citigroup, the recipient of $45 billion of taxpayer money so far, is still fielding "an army" of Washington lobbyists, according to the New York Times. Its lobbyists are working on a host of issues, including the bailout. In the fourth quarter of 2008, when it got its first infusion of bailout money, Citi spent $1.77million on lobbying fees. During the last three months of 2008, at least seven other firms receiving bailout funds (American Express, Capital One, Goldman Sachs, KeyCorp, Morgan Stanley, PNC and Bank of New York Mellon) lobbied the government about the bailout.

And you want to know what they are doing with that money, besides paying millions for lobbying efforts? Not loaning to you and I, that's for sure.

As Grandma used to say, "If that don't beat all..."

Don't Bank on the Bank

So you thought the bank bailout would provide some financial relief for average America? Well, don't bank on it.

Back in November, while most American families were struggling to put food on their tables, bailed out bank executives were conferring on their plans for the $700 billion dollars of our taxpayer money. The first $350 billion received, no strings attached, with no requirements to disclose what the money is used for. At a conference held at the Palm Beach Ritz Carlton, an oceanfront luxury hotel, the bankers were wined and dined by investment analysts and enjoyed "evening cocktails by the pool and a golf outing at a nearby country club." (Price of a one night stay at the Ritz Carlton? Anywhere from $399 to $1149.) Interestingly enough, the conference was sponsored by the New York City based investment banking firm, Sandler O'Neill & Partners.

Among the bankers plans for the money? Not likely increased loans to consumers, but plans requiring the services of investment bankers. As reported by Mike McIntire in The New York Times:

Mark Fitzgibbon, research director at Sandler O’Neill & Partners, which sponsored the Palm Beach conference, said banks seemed to be allocating the bailout money for four general purposes: increased lending, absorbing losses, bolstering capital and “opportunistic acquisitions.” He said those approaches made sense from a business perspective, even though they might not conform to popular expectations that the money would be immediately lent to consumers (emphasis added).

Well, of course those approaches make sense to Mr. Fitzgibbon. If the banks immediately lend to consumers, they don't need his services.

And keep in mind it is not only troubled banks receiving bailout money, but healthy banks catering to the wealthy:

Speaking at the FBR Capital Markets conference in New York in December, Walter M. Pressey, president of Boston Private Wealth Management, a healthy bank with a mostly affluent clientele, said there were no immediate plans to do much with the $154 million it received from the Treasury.

“With that capital in hand, not only do we feel comfortable that we can ride out the recession,” he said, “but we also feel that we’ll be in a position to take advantage of opportunities that present themselves once this recession is sorted out.”

Happy New Year!

Just a quick post to say "Happy New Year" and share our plans for 2009. As my husband's pay continues to decrease each pay period, I'm still jobless after almost a year. We've tapped out borrowing from family and resorted to taking out a loan against my husband's dwindling 401K to be able to survive. We made the house payment for December, but not sure whether or not we can make the January payment. We've begun boxing up for the eventual move from our home, as we know we won't be here much longer. "Quit thinking so negatively," our daughter admonishes us. I try to explain there is a difference between negative thinking and realistic thinking.

As we prepare for our move, we daily scan the "For Rent" section of the local newspaper. Lots of rentals in today's market, but the rent in our area is astronomical, normally running about the same amount as our current unaffordable house payment. Looks like we will be moving to an area where we really don't want to live, you know, what we think of as an "undesirable area". I don't want to do that to my son, have him move away from his friends, have to change schools, but we have to do what we have to do. The important thing, after all, is that we remain together as a family and I have faith we will survive our move intact. We do count our blessings and know there are much worse things that could befall us.

If you are facing foreclosure, here is a great source of ideas on how to avoid it.

God Bless in 2009!