Do you ever feel like you’re in the Twilight Zone?

Financial news is getting more bizarre by the day. Take today’s new for example.

Citibank’s stock price soared over news that it didn’t lose as much money Wall Street expected it to. The quarterly loss was only $966 million and revenue doubled to $24.79 billion.

Is the $45 billion we gave them since October counted in this?

I know it includes the 13,000 jobs cut in the first quarter and the dumping of $116 billion of assets.

The more entertaining part of this news, was their decision to “delay a proposed exchange of billions of dollars of preferred shares into common stock until the U.S. government completes its “stress tests” of large banks to gauge which might need more aid,” as reported by Reuters.

That seems kind of underhanded to me or am I just being sensitive.

Wasn’t the point of the stress tests to identify banks who will be in more trouble if the economy worsens? How can it be a valid test if they are delaying a major exchange of stocks?

Then there’s the report that the Senate candidates are still raising tons of money for the 2010 campaigns.

Now this is a good one, because despite the horrifying economic situation, the candidates last year raised enough cash to bail out at least one bank.

Are institutions getting bailout money allowed to contribute? I don’t see why they should be able to.

Reid has already raised $2.2 million, several Democratic candidates, according to Reuters, have already raised over $1 million, Spector raised almost $2 million and already has 6 million in the bank. Clinton’s replacement has raised over $2 million, but the Reuters story
didn’t total all the millions.

We’re getting thrown out of our homes, dumped from our jobs, surviving without health care and unable to educate our children, yet these people “governing” us, have millions in their campaign “war chests.”

What’s wrong with this picture?

The final irony to today’s news, is the story that “Steven Rattner, the leader of the Obama administration’s auto task force, was one of the investment firm executives involved with payments now under scrutiny in a state and federal investigation into an alleged kickback scheme at New York state’s pension fund,” reported Reuters.

The Treasury Department, when asked if they knew about this when Rattner was appointed, said that Rattner informed them about the pending investigation but refused to comment further.

One would think that treasury would be reluctant to put someone with an investigation into kickbacks, at the head of such a high profile and crucial task force. But no, they apparently saw no problem with it because there he is.

The scarier thought is that maybe Geithner, the tax cheat, has a suspicion that no matter who you appoint from the investment bank industry, they are likely to come under scrutiny for one shady practice or another, and therefore you hire either the one with the least chance of an investigation or the one who is most likely to survive the investigation without being imprisoned.

Either way, I am leaning more and more towards the folks that chant HEY HEY HO HO THE FEDERAL RESERVE HAS GOT TO GO!

Add to that the investment banks, nationally chartered banks, etc. etc. etc.

New York Attorney General Andrew Cuomo has his work cut out for him.

I now have to wonder if it was the New Yorkers that were the frauds and the Chicago financial institutions were all above board, or if Cuomo is a pro-active Attorney General and Lisa Madigan is simply remiss in not investigating the Chicago Board of Trade, Mercantile Exchange and the Board of Options Exchange.

Time will tell.

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3 Responses

  1. AG Madigan does not have jurisdiction over CBOT, the Merc and CBOE. NY is unique in that constitutionally their AG can bring action against those institutions in their state.

    • Thanks for the info. Yet another reason we should have had a Constitutional Convention. So does that mean we must rely on the Feds? Patrick Fitzgerald seems awfully busy these days.

  2. OHH Every now and again I find a web site that is a real source of useful information and content. This is one of those. A rare beast indeed. Keep up the good work. Kind regards

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