If Ben Bernanke thought he could keep the Fed (semi)-independent of the rest of Washington, he may get a rude awakening soon. Congress is looking to provide the GAO with the authority to audit all of the Fed’s activities. The thought of greater Congressional scrutiny has to make Bernanke reach for the Pepto and hope that he doesn’t wake up in a cold sweat haunted by the vision of Maxine Waters marching down the corridors of the Fed trying to fire every ex-Goldman employee herself. Best of luck Ben.
Congress seeks to open Fed actions to more scrutiny [FT]
Congress
Passing by almost unnoticed today is the news that the Greenbrier, the famous White Sulphur Springs resort retreat for Congress and whose Presidential Suite has been the host of every President since Dwight Eisenhower, has slipped quietly under the dark waves of insolvency.
The Greenbrier Hotel Corporation (GHC), owner of The Greenbrier resort in White Sulphur Springs, announced today that it has sought Chapter 11 protection to help ensure the viability of the resort.
The ordinary is made interesting when one realizes that the Greenbrier was for years the location of the secret Congressional emergency relocation facility. Complete with medical facility, meeting rooms, generators, cafeteria, long-term living quarters and the like, the underground bunker was designed to keep Congress alive and able to continue running the country into the ground long after a devastating nuclear attack (the ultimate sign of a failure in leadership).
No word on whether the bunker will now accept Marriott Rewards points.
The Greenbrier Files Chapter 11, Signs Agreement With Marriott Hotel Services, Inc. [PRNewswire] via Alea
That’s you, not the CEOs, by the way.
Since CSPAN has gotten back on the ball, and therefore we don’t have to watch CNBC to follow it, we continue our snide coverage:
Ok guys, who believes nicotine is not addictiveyou will pay back the TARP money and need no more funds?
[Everyone]: Yes, but we have no clue what the Geithner plan is so…
Rep. Ellison: Hey, Bank of America- The Huffington Post claims that your employee at the Financial Services Roundtable was advocating opposition to the Employee Free Choice Act? Is that true?
Lewis: I don’t go the roundtable.
Rep. Ellison: You don’t think you should be opposing union organization with TARP funds do you?
KL: Huh?
Rep. Ellison: So, are you guys solvent?
VP: Oh yes.
Rep. Ellison: What about you Bank of America?
KL: Since we made money last year, I am simply amazed you would even ask that.
Rep. Ellison: So, are you going to collapse?
K “De Niro” L: Are you talking to me?
Rep. Ellison: Yeah, you.
KL: Absolutely not. I don’t even know what the hell you are talking about or why you’d ask me that question. And why don’t you just go out back and pound salt you bank run creating public menace. (Ok, maybe we made that last part up).
Rep. Wilson: Why don’t banks want TARP funds, Mr. Lewis?
KL: Simple, we don’t want your dirty paws on your business. Duh.
Rep. Perlmutter: You guys are just big bloated bombs waiting to go off and blow up the system, right?
JM: No. G’z. We sold the credit card morass, what more do you want?
JD: No.
Rep. Biggert: If you guys are so healthy, why are were here? How can you help restore consumer and investor confidence?
JD: Doing the best we can, lady.
JS: How about you guys whack Mark-to-Market so we can report our assets at the marks we prefer?
Rep. Biggert: Who wants to nuke Mark-to-Market?
[Only JS raises his hand]
JS: Ok, let me clarify. I only really want to do away with Mark-to-Market when it results in marks that I don’t likewhen the market is irrational.
Rep. Donnelly: Will it play in Peoria?
[Deer. Headlights.]
Rep. Foster: Given 11% unemployment a 25% decline in residential real estate and similar problems in commercial real estate who of you is going to survive? Don’t point or anything.
[Everyone]
Rep. Foster: Have you ever seen a compensation restriction you couldn’t circumvent?
[Deer. Headlights.]
Chairman Franks: I really don’t want to see the eight of you singing “I Will Survive.”
Rep. Speier: What was your exposure to AIG? And were you present at the Fed meetings during the AIG collapse discussions?
LB: We had very little actual exposure to AIG because (we were hedged/we offset our risk).
Rep. Himes: When are you going to start eating your own cooking? Who here is going to set up strong long-term compensation structures?
[Everyone]
Rep. Himes: Let me start with Mr. Pond-it. Why aren’t you taking top-loss tranches on these complex issues?
VP: That’s not very traditional.
It’s Harry versus the SEC this morning, and there aren’t a lot of pulled punches.
Harry: I think the losses in Europe will be bigger. The European losses are often on unreported income and won’t likely be part of the history of the scam.
Harry: It took just a couple weeks for me to lose confidence in the New York Office of the SEC.
Harry: “In Wall Street there is a code of silence and when you live in a glass house you do not throw stones.”
Oh boy.
Is there a secret blacklist of fraudsters that the Wall Street code-of-silence keeps secret? Is there a list of these malefactors? (A more blatant attempt to justify subpoena power I have not lately seen).
Harry: Yep.
The secret cabal of fraud protectors. Wow.
Isn’t handing over documents wearing gloves [to avoid leaving fingerprints] a bit paranoid:
Harry: When Madoff attracts Russian mob money and drug cartel money, and with such a large fraud, I didn’t expect to be long for this world if my name got out.
Harry: Disband the SEC, zero out their budget and invest in the state regulators that, pitbull like, do more with less than the SEC.
What could be done to reform the SEC?
Harry: Put in experienced professionals. Give them Bloomberg. (They currently share one terminal per regional office).
What about auditing? What about rotating auditors?
Harry: SEC Auditors are not trained in human intelligence gathering. They come in, sit down, and are fed controlled pieces of paper. They need to be talking to everyone and interacting.
Should we (Lincoln Act like) give bounties for financial whistle blowers?
Harry: You bet.
Harry: We’ve had “zero enforcement” for the last 8 years.
Harry: I gave the SEC a drawing, a roadmap, pictures and a flashlight and they still couldn’t find anything.
Is Mr. Madoff confined right now?
Harry: Yes, he’s under Penthouse arrest.
We need thousands more like you out there.
Harry: Thank you.
You were dealing with a ruthless person, in bed with other ruthless people. These kind of characters are sure to make you concerned for your life. The American people need to know who you are! You aren’t a person off the street. You have credentials, baby! Won’t you please share some of your credentials with the public?
Harry: CFA, CFE, MSF, BA, CIO, Major in the Army, Reservist, in Special Operations….
(Not bad!)
Harry: The regulators need to earn their paycheck and the SEC needs to be swept with a very wide broom.
Who do you want to play you in the movie?
Harry: As long as it is a Red Sox fan.
Harry: Fairfield Sentry was getting $280 million a year in fees from Madoff.
Is it better to be corrupt (FINRA) or incompetent (SEC)?
Harry: FINRA gets an A+ for corruption and the SEC gets an A+ for incompetence.
Are you sure there is a Russian mob and organized crime connection?
Harry: We knew because of the offshore funds. The only reason to be offshore is to hide dirty money. Madoff’s success made it almost a sure bet there was dirty money in there.
This is the quote of the day:
Harry: To all the Russian mobsters and drug cartels out there, I am one of the good guys. I was looking out for your accounts. Just keep that in mind.
Sorry, I was wrong, this is:
Harry: If you flew the entire SEC staff to Boston, and sat them down in Fenway Park for the day, they wouldn’t be able to find first base.
It was pretty dull until just now:
Rep. Paul Kanjorski: Hey, Nardelli, why the hell isn’t Cerberus sending you any of the $24 billion they have if you have any chance of surviving? Corker had you people figured out yesterday. You can’t survive with your present balance sheets. So what’s the story?
Who dresses Nardelli? That pink tie is hurting me. Deep down and personally.
I love listening to Maxine Waters wax poetic on private equity, its role in society and internal economics.
Rep. Carolyn Maloney: Hey, jackasses, you keep suing us to lower state greenhouse gas requirements. Why should I give you any dough?
Remember, not too long ago, how much noise Congresscritters were making about “rewarding irresponsible investment bankers”? Well, CNBC has come full circle today. After The Beard was prodded after bailing out state and local governments, since we are in the bailout mood, you just knew that CNBC was going to ask why we are rewarding all those irresponsible state governments with bailouts.
Ah, the symmetry runs strong with that one.
You are certain that the credit crisis is cutting into normal life when you tune to CNBC and see Rosa DeLauro (D-CT) ranting from the podium of the House Committee on the Budget. You know that things are way off kilter because there simply must be a very severe shortage of lithium and chlorpromazine in the Northeast.
I mean it, what is wrong with this woman? It’s Dennis Hopper level mania.
One through nine, no maybes, no supposes, no fractions. You can’t travel in space, you can’t go out into space, you know, without, like, you know, uh, with fractions – what are you going to land on – one-quarter, three-eighths? What are you going to do when you go from here to Venus or something? That’s dialectic physics.
Sheesh.
UPDATE: CNBC has several video clips up of the hearing, but none at all featuring our favorite, lithium deprived servant of the people. It’s like someone just George Orwelled her entire psychotic rant into oblivion.
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