It’s no longer about profit: Oz shows the way! - National Social Equality/Unity

In a show of solidarity highly respected fire fighters stripped down to their underwear in Melbourne yesterday and joined workers protesting the removal of an Oz icon brand, and its manufacturing base to China.

In true ‘American style’ executives of this company, Pacific Brands, paid themselves millions in bonuses while workers survived on subsistence wages. The last straw came with the sacking of over 1800 workers after $17 million in government/taxpayer subsidies had been injected into the company in order to maintain local production and jobs!

I do not wish to wax lyrical over this show of solidarity, camaraderie and the re-emergence of the Australian SPIRIT, ‘onya Oz, but I can barely contain myself. Call me sentimental but I detest cringing conservatives and their lack of national identity. I have fond memories wearing my blue worker’s singlet to classes at uni and watching middle class kids also adopt the wearing of the iconic Oz singlet!

In these failed capitalist times every effort must be made to restore national pride and values, as it is these values that forged our great nation – AND FUCK HOWARD and all his cringing conservatives! Have we arrested that lying, little, racist rodent for war crimes yet?

Howard and his government attempted to colonise us to the mass murdering yanks but they (like their American masters) FAILED! The next knock on your door might be me with a warrant for your arrest, Johnny, you despicable, TRAITOROUS, piece of shit!

March 5 (Bloomberg) -- The Federal Reserve Board of Governors receives daily reports on bailout loans to financial institutions and won’t make the information public, the central bank said in a reply to a Bloomberg News lawsuit.

The Fed refused yesterday to disclose the names of the borrowers and the loans, alleging that it would cast “a stigma” on recipients of more than $1.9 trillion of emergency credit from U.S. taxpayers and the assets the central bank is accepting as collateral.

Fed secrecy was the focus of a Senate Banking Committee hearing today in which the panel’s top two members said the central bank’s reluctance to identify companies benefiting from the American International Group Inc. bailout risks undermining public confidence in the government.

“If the American taxpayer’s money is at stake, and it is, big time, I believe the American taxpayers, the people, and this committee, we need to know who benefited, where this money went,” said Senator Richard Shelby of Alabama, the committee’s top Republican. “There is no transparency here. We are going to find out.”

The bank provides “select members and staff of the Board of Governors with daily and weekly reports” on Primary Dealer Credit Facility borrowing, said Susan E. McLaughlin, a senior vice president in the markets group of the Federal Reserve Bank of New York in a sworn statement. The documents “include the names of the primary dealers that have borrowed from the PDCF, individual loan amounts, composition of securities pledged and rates for specific loans.”

The Board of Governors contends that it’s separate from its member banks, including the Federal Reserve Bank of New York which runs the lending programs. Most documents relevant to the Bloomberg suit are at the Federal Reserve Bank of New York, which isn’t subject to FOIA law, according to the Fed. The Board of Governors has 231 pages of documents, which it is denying access to under an exemption under trade secrets.

“I would assume that information would be shared by the Fed and the New York Fed,” said U.S. Representative Scott Garrett, a New Jersey Republican. “At some point, the demand for transparency is paramount to any demand that they have for secrecy.”

Bloomberg sued Nov. 7 under the U.S. Freedom of Information Act, requesting details about the terms of 11 Fed lending programs.

The Bloomberg lawsuit said the collateral lists “are central to understanding and assessing the government’s response to the most cataclysmic financial crisis in America since the Great Depression.”

Fed Vice Chairman Donald Kohn told the Senate panel today that revealing the names of AIG’s counterparties would make companies less likely to do business with any recipient of government aid, risking further turmoil at the insurer and financial markets.

“I don’t consider that an adequate” response, “to put it mildly,” Committee Chairman Christopher Dodd, a Connecticut Democrat, told Kohn at the hearing. “The public is deeply, deeply troubled.”

Shelby told the Fed vice chairman that “your answer here is very disturbing.”

Kohn said the Fed wouldn’t reveal the counterparties in Maiden Lane III, a company formed by the central bank to purchase collateralized debt obligations on which AIG’s financial products unit had written credit-default swaps.

“The Fed and the Treasury can be secretive for a while, but not forever,” Shelby said.

The Fed stepped into a rescue role that was the original purpose of the Treasury’s $700 billion Troubled Asset Relief Program. The central bank’s loans don’t have the oversight safeguards that Congress imposed upon the TARP.

Total Fed lending exceeded $2 trillion for the first time Nov. 6 after rising by 138 percent, or $1.23 trillion, in the 12 weeks since Sept. 14, when central bank governors relaxed collateral standards to accept securities that weren’t rated AAA. Fed lending as of Feb. 25 was $1.92 billion.

On Feb. 23, the Fed disclosed a breakdown by broad categories for $1.81 trillion of collateral pledged by banks and bond dealers as of Dec. 17 after Congress demanded more transparency from the central bank.

The largest portions of collateral being held by the Fed at that time were $456 billion in commercial loans, $203 billion in consumer loans and $159 billion in residential mortgages, according to the central bank’s Web site. It didn’t identify any loans or provide their credit ratings and said it will update the figures about every two months.

Government loans, spending or guarantees to rescue the country’s financial system total more than $11.7 trillion since the international credit crisis began in August 2007, according to data compiled by Bloomberg. In return, banks left collateral with the central bank that effectively acts as a credit line that lenders can draw on without posting additional assets.

Bloomberg News, a unit of New York-based Bloomberg LP, on May 21 asked the Fed to provide data on collateral posted from April 4 to May 20. The central bank said June 19 that it needed until July 3 to search documents and determine whether it would make them public. Bloomberg didn’t receive a formal response that would let it file an appeal within the legal time limit.

Taxpayers face huge bailout to absorb toxic bank debts

TAXPAYERS of the US and Europe will have to bail out their nations' tottering banks after a weekend meeting of G20 finance ministers agreed that governments must absorb toxic debts to kick-start the stuttering global economy.

But banks rescued from collapse under the plan will have to agree to strict conditions, including limits on dividends to shareholders and caps on salaries of their executives.

Finance ministers of the world's 20 biggest economies meeting in Britain at the weekend agreed credit flows had been frozen because large and globally important banks were holding huge parcels of bad debts, preventing them from lending to businesses and households.

The ministers and central bank governors agreed governments must assume or underwrite some of the liabilities to allow banks to resume lending and drive economic activity.

The agreement came as the G20 nations also vowed to inject hundreds of billions of dollars of new emergency funding into the International Monetary Fund to help it prop up vulnerable economies in eastern Europe and elsewhere.

Negotiators will decide before a G20 leaders summit in London on April 2 whether they should double or triple the IMF's $US250 billion ($380 billion) rescue funds but they have already confirmed that voting rights in the IMF will be broadened to reflect the rise of China and other powers.

Creating a framework for dealing with toxic debts - thought to be worth as much as $US3.6 trillion - has been a key aim of Kevin Rudd, who has described the debts as "poison in the bloodstream" of the global financial system.

While the US and Europe were focused on regulatory reform and extra spending to stimulate the economy at the meeting, all ministers also agreed to a basic framework on dealing with toxic assets.
An annex to the main communique did not stipulate how governments should deal with the debts, but floated options including direct government guarantees to banks, direct injections of capital and weeding out impaired assets.

"Our key priority now is to address the uncertainties around the value of assets held on banks' balance sheets, which are significantly constraining banks' lending," the statement said.

"This uncertainty, and the extent to which banks are holding capital to protect themselves from further potential extreme losses, is preventing them from restoring lending to business and households with damaging consequences to our economies."

It said that where banks were to receive assistance, governments must "stress test" them to ensure their viability and ensure they maintained a level playing field.

"Banks' shareholders should be required to contribute to the maximum extent possible to loss or risk coverage prior to government intervention," the statement said.

"Government support is a privilege and must come with strong conditions, such as a commitment to continue providing credit to appropriately meet demands according to commercial criteria, improving governance, dividend policy restrictions and executive remuneration caps."

Wayne Swan emerged from the meeting saying there was a strong resolve among the G20 to take whatever action was necessary to deal with the global recession.

"Everybody agreed its fiscal stimulus plus," Mr Swan said. "We've got to do something about the flow of credit in the financial system. We've got to reform our international financial institutions."

The meeting also consolidated the dramatic shift towards a new power structure for running the global financial system, which offers a greater role for Australia and fast-developing countries such as China and Brazil.

The US, Japan and European countries vowed to share control of the global financial architecture with a broader group of nations, prompting Mr Swan to welcome the growing influence of the G20.

"Hopefully, we are seeing the eclipse of the G7 and the rise of the G20," he told The Australian. "That is a change that is good for Australia and good for the world because it reflects the fact that the G20 is where the growth in the world economy is happening, in places like China and India."

His comments came as US President Barack Obama said in Washington that the solution to the recession would involve fiscal stimulus and financial regulation.

Asked whether he favoured stimulus over regulation, Mr Obama said all nations must spend to compensate for the "drastic contraction" in global demand.

"We're not unique in that position," Mr Obama said. "Gordon Brown feels the same way, as does President Hu in China. Kevin Rudd has taken similar steps in Australia."

The power shift to the G20 was symbolised by the US surrendering its traditional power to appoint the president of the World Bank, and Europe giving up its monopoly on the top job at the IMF.

The memberships of two lesser-known financial groupings, the Financial Stability Forum and the Basel Committee, were broadened to give Australia and developing nations such as China and India greater roles in developing new regulations and redesigning the financial structure of recent decades.

"Seeing these other institutions ... now move to a more G20 representative style is really important in cementing the future of the G20 as opposed to the G7", which excludes Australia, Mr Swan said.

The G20, whose members make up 85 per cent of the world's GDP, was formed a decade ago as a forum for finance ministers and central bank governors and held its first summit of government leaders only last November in Washington in response to the economic crisis.

But the Obama administration yesterday displayed a new US willingness to share power in response to the global recession. The host, British Chancellor Alistair Darling, said: "We cannot carry on as if the world hasn't changed in the last 60 years."

US Treasury Secretary Tim Geithner said he was delighted with the agreement at the meeting that trade protection should be resisted and that monetary policy and tax-and-spend powers should be used to fight the recession.

© 2009 News Limited

[It's enough to turn your blue eyes brown. Ed]

Troubled US insurance giant AIG has sparked fury by paying its executives big performance bonuses at a time when it is relying on taxpayer money to stay afloat.

[Failed insurer] AIG is paying out more than $250 million in annual bonuses to 400 of its top executives. [Emphasis added]

Since nearly collapsing late last year, the insurer has received nearly $300 billion in government bailout money, and just weeks ago it posted the worst quarterly loss in US corporate history.

President Barack Obama's top economic adviser, Larry Summers, says the payment of the bonuses is outrageous.

"Every legal step possible to limit those bonuses is being taken."

AIG chief executive, Edward Liddy, says while he finds the large bonuses distasteful, he insists the insurer is legally obliged to pay them.

US lawmakers say it is unclear what, if anything, the government can do to recover the bonus money from the insurance giant or cut the bonuses since the contracts seem legally binding.

They say, however, that plenty of questions need to be answered and some AIG officials may need to be ousted, adding that legislation may be needed to avoid a repeat of such action and retain public confidence in federal bailouts.

Despite paying the bonuses, AIG will sharply cut remaining 2009 salaries for top executives of its AIG Financial Products unit and realign 2008 bonuses to tie them to restructuring and repayment targets, Mr Liddy said.

AIG had promised to pay about $1.5 billion in retention bonuses over a period of several years, half of which has already been paid.

AIG Financial Products was the unit that made bad bets on toxic mortgages and credit default swap contracts that led to the company's near collapse - and the first of a series of taxpayer-funded bailouts in mid-September.

- ABC/Reuters

© 2009 ABC

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