Lawrence Kotlikoff - The Fed And Treasury's Actions Are Equivalent To Child Abuse

http://www.zerohedge.com/article/lawrence-kotlikoff-fed-and-treasurys-actions-are-equivalent-child-abuse


A few months ago we linked up to a Bloomberg interview with Boston professor Lawrence Kotlikoff who provided his justification for why the US is currently bankrupt (something about a few hundred trillion in off-balance sheet liabilities). Back then Koltikoff, aiming squarely at a specific NYT Op-Ed columnist, said "some doctrinaire Keynesian economists would say any stimulus over the next few years won’t affect our ability to deal with deficits in the long run. This is wrong as a simple matter of arithmetic. The fiscal gap is the government’s credit-card bill and each year’s 14 percent of GDP is the interest on that bill. If it doesn’t pay this year’s interest, it will be added to the balance. Demand-siders say forgoing this year’s 14 percent fiscal tightening, and spending even more, will pay for itself, in present value, by expanding the economy and tax revenue. My reaction? Get real, or go hang out with equally deluded supply-siders. Our country is broke and can no longer afford no- pain, all-gain 'solutions'." And just because nothing has changed, the professor is back to the crime scene this time making an even stronger case of bashing America's oligarchy for not daring to set off on the much needed path of austerity, something even the stereotypically more "fear-prone" French are willing to do (and strike every day along the way). Kotlikoff says: "This massive Ponzi scheme is turning the American Dream into the American Nightmare" adding that what the Fed is doing now is equivalent to "child abuse" and adding "If things continue as we adults have planned, our nation’s debt, measured as a share of gross domestic product, will reach Greek levels just when the grandkids start heading to work. At that point, simply stabilizing the debt-to-GDP ratio will require raising taxes by 50 percent, thereby lowering the grandkids’ living standard from 74 to 61." And it gets much worse. Read on for Kotlikoff's view on why the Fed should be banned by the Geneva Convention

Fraud Task Force Starts Criminal Investigation of Mortgage Servicers

http://www.loansafe.org/fraud-task-force-starts-criminal-investigation-of-mortgage-servicers

What a fucking joke!
Where were the banking regulators for the past 10 years?
The Justice Dept has been proven corrupt.
The US Treasury is in collusion to cover up the Banking fraud that has sucked this country dry!
Everyone of these corrupt entities will say
Nothing to see here
All is well on the foreclosure front!


With some of the nation’s biggest mortgage servicing entities facing allegations that they blatantly ignored procedures while processing thousands of unsubstantiated foreclosure documents, criminal indictments could be just around the corner. Per the Washington Post, people, “familiar with the matter,” report pending investigations of potential criminal violations by President Obama’s Financial Fraud Enforcement Task Force. At least five mortgage servicers are said to be under serious scrutiny.

Comprised of more than 20 federal agencies, namely the Justice Department, the U.S. Treasury, HUD and all national banking regulators, the task force is reviewing whether servicer’s reports of documentation errors indicate systemic abuse and misrepresentation. Having potentially broken federal law, and misled federal housing agencies such as the FHA (Federal Housing Administration,) wire and mail fraud are also being considered, according to the Post.

Watchdog: Treasury outsourced most bailout work

http://seattletimes.nwsource.com/html/businesstechnology/2013154724_apusbailoutwatchdog.html

Conflict of interest
Yes I can see where that might be a problem.
It wouldn't behoove the banks to modify because they themselves would have to eat that loss and make up the difference to the investors.
But that's who Treasury put in charge to negotiate the issue of loan modification with.
In other words Treasury made sure that the loan modification programs had no chance of hindering the banks ultimate goal, in not being stuck making up the difference to the MBS investors, by employing the very same companies, that mismanaged the crisis into becoming a reality, in the first place.
In other word, those that applied for mortgage modification, never had a shot in hell of obtaining one.


"These private businesses do not take an oath of office, nor do they stand for election," the report says. "They may have conflicts of interest, are not directly responsible to the public, and are not subject to the same disclosure requirements as government actors," it says.

Treasury Girds for Debt-Ceiling Fight

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http://online.wsj.com/article/SB125270970074004941.html


The Obama administration, concerned about the possibility of a big political fight over the national debt, is looking at how it can continue funding the government in the event that Congress hinders its ability to borrow money.

Treasury Department officials are examining tools employed by previous administrations, including disinvesting government retirement funds and suspending interest payments to federal accounts, according to people familiar with the matter. They are also looking at what to do in the unlikely event of a government shutdown.

View Full Image

Associated Press

The Lincoln Memorial in Washington, shown on Dec. 16, 1995, when a partial federal government shutdown caused the temporary closure of visitor services at the monument.
.At issue is the debt ceiling, a dollar limit controlled by Congress that dictates how much the U.S. can borrow. Treasury Secretary Timothy Geithner told the Senate in a letter last month that the $12.1 trillion ceiling could be hit as early as mid-October, and said it needs to be increased so the U.S. can continue funding operations and making debt payments. Mr. Geithner didn't indicate the increase he was seeking.

With the U.S. borrowing about $30 billion a week, some economists say the Treasury will need an increase of as much as $1.5 trillion if it wants to avoid another request before the 2010 midterm elections. The U.S. could default on its debt if Congress doesn't raise the debt ceiling, but it is a remote scenario.

Postal Accountability and Enhancement Act

http://www.usps.com/communications/news/press/2006/pr06_pmg1209.htm

I personally am thinking test..no, more like Oh my God.
How much more money does Timmy really need?


Statement of Postmaster General John E. Potter
Passage of the Postal Accountability and Enhancement Act
The Congress is to be congratulated on the passage of the Postal Accountability and Enhancement Act of 2006. I would single out for extraordinary effort Senators Susan Collins, Joseph Lieberman and Thomas Carper and Representatives Thomas Davis, Henry Waxman, John McHugh and Danny Davis for making reform a reality.

We are grateful that the funding for USPS retiree military service obligations will be borne by the Treasury.

This, combined with release of the escrow funds, will be used for retiree health benefits. We look forward to working with the mailing community, USPS employees, the Postal Regulatory Commission and the Treasury on implementation of the pending legislation and delivery of affordable universal service to all Americans for many years to come.

http://georgewbush-whitehouse.archives.gov/omb/legislative/sap/109-1/hr22sap-h.pdf

The substantial pension savings from P.L. 108-18 provide an excellent
opportunity to transition to a financially self-sufficient USPS. The President's FY 2006
Budget proposes to use the amounts that would otherwise be held in escrow to enable
USPS to contribute $42.5 billion over the next 10 years toward paying down its
substantial retiree health benefits liability. If these unfunded retiree health benefit
liabilities are not fully addressed now, unnecessarily large spending will be needed in the
future to pay these health benefits costs as they come due.
The President's Budget proposal would allow the elimination of the statutory escrow
requirement to be accomplished in a manner that would have no adverse budget impact.
However, H.R. 22 would allow USPS to use a portion of the escrow as a subsidy for
current operations, and thus would have an adverse budget impact.
Treatment of Military Service Obligations. The Administration believes that USPS must
continue to be responsible for pension costs connected with military service credits for
postal employees under the Civil Service Retirement System (CSRS) and opposes
provisions in the current version of H.R 22 that would grant USPS a subsidy with a net
present value of $27 billion by transferring all of these military service pension credit
obligations to the General Fund of the Treasury. USPS's responsibility for paying this
military service pension credit obligation is a cost of doing business, and USPS should
not be absolved of its responsibility to pay for these unfunded liabilities

Consequently, we will simply not have the means to meet all of our required obligations as we close the fiscal year. This will have a direct effect on our ability to meet the scheduled payment of $5.4 billion to the Postal Service Retiree Health Benefit Fund, which is required on September 30, by the Postal Accountability and Enhancement Act of 2006