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Saturday, September 7, 2013

Double Dealin With The Government

Anyone who pays attention to the government, would know that the S&P suit, is 

retribution for the downgrade by the company of the US economy.  Our leaders 

(especially this administration) say one thing and do another. They want companies to be

upright and "do the right thing" however, when they do and it involves the government, 

as in this case, they become  unbridled.

When S&P downgraded the economy, we knew this would happen and it sent a shiver up 

our spine. We feared the use of government  power would telegraph a message to the 

rest of the industry. So far it has worked!

If a private company used the same technique against a rating agency, the government 

would jump down their throat in a nanosecond.  Why should the Administration be

treated any differently?  This double standard stinks, but so does this group of goofs

who want us to believe they are doing what is best for us.

As Sarah Palin asked "how's this hopey-changey thing working out for you?"  It isn't working

out for the US. She was so right!

Conservative Tom

S&P to Fight for Evidence U.S. Suit Was Political Payback

Standard & Poor’s is trying to show it was unfairly singled out in a $5 billion fraud lawsuit 18 months after it downgraded U.S. sovereign debt. Getting the government to provide supporting evidence will prove difficult.
McGraw Hill Financial Inc. (MHFI) and its S&P unit are seeking information from the Justice Department about the decision to target the company in the first federal case against a ratings firm for grades related to the credit crisis. S&P also wants a look at the government’s investigative files on other raters as part of a defense strategy to show it was unfairly sued.
Standard & Poor's signage is displayed outside of the company's building in New York. Photographer: Michael Nagle/Bloomberg
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S&P in the coming months will seek to defeat government attempts to shield internal discussions and evidence as the case heads for a first round of procedural deadlines that will determine what evidence eventually goes before the jury.
Even with the judge in the case sounding sympathetic in court to S&P’s desire to know why the U.S. sued it and not other ratings firms, it’s highly unlikely the government will be forced to reveal its internal discussions on the matter, said Wayne Gross, a former federal prosecutor now with Greenberg Gross LLP in Costa MesaCalifornia.
“It is important that the government be able to conduct investigations confidentially to protect the subjects of investigations who may never be charged,” Gross said in a phone interview.
Having lost a pretrial bid to get the case dismissed in federal court in Santa Ana, California, S&P now must prepare a defense that will persuade a jury to reject allegations that it defrauded investors by falsely claiming its ratings were independent and free of conflicts of interest.

Retribution Theory

U.S. District Judge David Carter hinted at a retribution theory at a July 29 court hearing, saying that S&P may seek to interview government officials about whether they sued because of the company’s downgrade of U.S. debt two years ago. While the judge described himself as a believer in transparency with a “pretty wide open” philosophy about pretrial evidence sharing, he made no promises S&P will get what it wants.
“You’re going to have a very difficult time with some of the government agencies,” Carter told S&P’s lawyers.
U.S. Attorney General Eric Holder said Feb. 5, the day after the complaint was filed against S&P, that it was unrelated to the downgrade. Holder made the comment in Washington as some financial professionals said publicly the targeting of S&P looked suspicious because the company’s two primary competitors, Moody’s Corp. (MCO) and Fitch Ratings, awarded the same top grades to troubled mortgage bonds and didn’t downgrade the U.S. debt.
“There’s no connection between the two,” Holder said. “They did what they did, assessing what the creditworthiness was of this nation. We looked at the facts, the law and the investigation” and determined the lawsuit was “appropriate.”

‘Slashing,’ ‘Smashing’

S&P lawyer John Keker, the founding partner of San Francisco-based Keker & Van Nest LLP, may not let Holder have the last word. Keker, whose self-described approach to white-collar crime trials and corporate litigation is “slashing and smashing,” said at the July 29 hearing the company’s legal team will eventually seek to question a number of high-level government officials at the Justice Department as well as at the U.S. Treasury and the Securities and Exchange Commission.
“We anticipate highly contentious motion practice,” Keker told the judge, adding that he would focus on getting documents first and interrogating officials later. “They’re going to fight like mad.”
The Justice Department is seeking as much as $5 billion in civil penalties for losses to federally insured financial institutions that relied on S&P’s investment-grade ratings for mortgage-backed securities and collateralized debt obligations.

Central Theme

It will be a central theme of S&P’s defense to convince jurors that the government isn’t acting as an advocate of the interest of the American people in this case, said John Hueston, a former federal prosecutor now with Irell & Manella LLP in Los Angeles.
Gathering evidence about the government’s motivation to bring the lawsuit might also put S&P in a better position to negotiate a settlement, Hueston said in a phone interview.
“It is a brilliant move to try to obtain documents that go as high as possible,” Hueston said. “If the government becomes uncomfortable and it becomes a trial of the Justice Department, it could be a highly effective leverage strategy.”
While the congressionally appointed Financial Crisis Inquiry Commission blamed all three of the leading U.S. credit raters for inflated ratings that helped cause the worst financial crisis since the Great Depression, Moody’s and Fitch said after the Justice Department filed its complaint against S&P that they had no reason to believe they would be sued too.

AAA Rating

S&P has said nothing in court filings drawing a link between the lawsuit against it and its August 2011 decision to downgrade the U.S.’s 60-year-running AAA credit rating to AA+ with a negative outlook.
S&P said at the time that the Obama administration and Congress failed to take sufficient steps to reduce the record budget deficit. Moody’s and Fitch the same month affirmed their AAA ratings. All three firms are based in New York.
The Treasury Department said S&P had made a $2 trillion error in its analysis. S&P said there was no mistake and the discussion hinged on which baseline assumption should be used from the nonpartisan Congressional Budget Office.
S&P’s move roiled the markets, contributing to a global stock-market rout that erased about $6 trillion in value from July 26 to Aug. 12, 2011. The firm changed its outlook for the U.S. to “stable” in June from “negative,” citing “tentative improvements” in the debt burden.

Credit Crisis

The government alleged in its Feb. 4 complaint against S&P that the firm knowingly downplayed the risk on securities before the credit crisis in a desire to win business from investment banks that sought the highest possible ratings to sell them.
In other probes of abuses that fueled the collapse of the U.S. housing market starting in 2007 and led global credit markets to freeze in 2008, the Justice Department and Securities and Exchange Commission this month sued Charlotte, North Carolina-based Bank of America Corp., the nation’s second-biggest lender, while New York-based JPMorgan Chase & Co. (JPM), the biggest U.S. bank, disclosed that it’s under federal criminal investigation for practices tied to to sales of mortgage-backed bonds.
S&P’s first line of defense failed when it asked Carter to dismiss the lawsuit on the grounds that its statements about the objectivity of its ratings were so generic that reasonable investors wouldn’t have relied on them.

‘S&P’s Objectivity’

“If no investor believed in S&P’s objectivity,” the judge wrote in a July 16 ruling, “is S&P asserting that, as a matter of law, the company’s credit ratings service added absolutely zero material value as a predictor of creditworthiness?”
The company also has argued that its ratings were the same as those of its competitors and that the government’s complaint failed to specify what the correct ratings should have been.
S&P said in a July 24 filing that it would seek transcripts of all testimony the government took in its investigation, all materials about interactions the Justice Department had with other federal and state agencies about its investigation, and about “the government’s decision to authorize the filing of this litigation.”
The Justice Department’s initial discovery will focus on identifying those CDOs and mortgage-backed securities that it believes were affected by the alleged fraud and that will serve best as evidence to present to a jury when the case goes to trial, government lawyers said in a July 27 filing. The judge gave the government a Nov. 18 deadline to complete that task.
Carter set a Dec. 16 hearing to determine how much additional time both sides need for discovery. The government has proposed a trial start date of Feb. 17, 2015.
Keker was asked by the judge at the July 29 hearing about the prospects for a settlement.
“The impediment is that the government has a view of this case that makes it impossible to settle,” Keker said.
The case is U.S. v. McGraw-Hill Cos., 13-cv-00779 U.S. District Court, Central District of California (Santa Ana).

Labor Dropouts--Not Just Dropouts Anymore

Here Are the Real Labor Force Dropouts

The dominant story about the job market is no longer the nation’s 11.3 million unemployed people or the painfully slow pace of hiring. It’s the growing portion of the working-age population that has dropped out of the labor force and isn’t even looking for a job.
The jobs report for August seemed upbeat on the surface, since the unemployment rate dropped by one-tenth of a point to 7.3%. But analysts have been quick to point out that the unemployment rate fell because the number of people looking for work -- part of the numerator in the equation used to determine the unemployment rate -- declined. That’s usually a sign of an ailing economy, not a recovering one.
Overall, the U.S. economy is being driven by a smaller portion of the population. The percentage of adults either working or looking for work peaked in the late 1990s, declined gradually until the recession began at the end of 2007, then began to fall more sharply, as this chart showing the labor-force participation rate chart reveals:
Bureau of Labor Statistics data
The labor force participation rate is now at the lowest level since 1978 -- before women flooded into the workforce, pushing the participation rate to record highs.
Ages and options
So who, exactly, is dropping out of the labor force? It’s well-known that male-dominated industries such as manufacturing and construction have endured painful and probably permanent shrinkage, which suggests a lot of middle-aged, blue-collar men are now sitting on the sidelines. Some analysts feel extended unemployment insurance has given a lot of laid-off workers a stronger incentive to collect a government check than look for a job. Then there are critics of the “47 percent” (now the 43 percent) of adult Americans who pay no income tax yet somehow eke out a living.
But the numbers tell a somewhat different story about who the labor force dropouts really are. Here are labor force participation rates for different age groups in 1990, 2000 and 2013:
Bureau of Labor Statistics data
The biggest drop-off has come among young workers. The recession and subsequent weak recovery have cut sharply into opportunities for entry-level workers, in virtually all industries. Some simply can’t find work. Others have chosen to go to college or graduate school instead of looking for a job.
The job woes of this “Millennial” generation have garnered plenty of attention. More twenty-somethings live with their parents these days, which has torpedoed the rate of new-household formation and left homebuilders and automakers anxiously wondering who will buy their products in five or 10 years. The amount of student debt has mushroomed, as many students pay for college with readily available (and often federally backed) loans. Many grads are starting their careers deep in the hole, since they can’t find jobs that pay enough to cover their loan payments while still allowing them to live independently.
Those are legitimate problems, but it’s also possible that a better educated workforce will pay dividends in a few years' time. College enrollment rates grew at a moderate pace until 1999, then began to increase more sharply. The recession lured even more people into higher ed, including a lot of older adults who attended community college to hone new skills. And sure enough, enrollment rates have begun to drift downward now that more young people sense an improving job market and feel they’re more likely to find work.
Potential benefits
That education bulge could give the economy a boost in the future, much as the G.I. Bill did in the 1950s and ‘60s. Consulting firm McKinsey, for instance, predicts that by 2020, the U.S. economy will face a shortage of about 1.5 million college-educated workers. If so, demand (and pay) will rise for those who do have a degree, turning at least some of today’s workforce dropouts into tomorrow’s productive workers. Also, more students have been choosing math and science majors, which seem more likely to lead to profitable work and perhaps a more innovative economy.
It also stands to reason that some dropouts in other age brackets will return to the workforce when, or perhaps if, the job market improves enough to make it worth their while. Some dropouts are still working plenty hard as stay-at-home parents or caregivers to their own elderly parents, having made a pragmatic decision that it’s not worth the trouble to work in an iffy economy while paying someone else to help with their family obligations.
Also notable is that the participation rate for men over 55 has gone up considerably. That makes sense, since those close to retirement may have the greatest need to pad their savings. Established workers are also in the best position to simply stay in their jobs instead of retiring, compared with younger workers who haven’t even found a job in the first place. If older workers gradually improve their finances and once again begin to retire earlier, that could open the door for younger workers to move into their jobs, which might improve hiring down the entire employment food chain.
The real question about labor force dropouts is whether there would still be an elevated number if the economy were as productive today as it was in the late 1990s or even the late 1980s. It might make sense to drop out when the rewards for your work are fairly low. But if workers leave even when the rewards of work go up, then something fundamental has changed. That could end up being the biggest threat to the nation’s future prosperity.

Beck Interview In New York Times--More Balanced Than Most Of Their News

Glenn Beck Wants to Know: Why Can’t We All Just Get Along?

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You left Fox News and started The Blaze, a TV station, Web site and subscription service. How is that working out? 
Check back with me in 10 years. I think we’re just now entering the fields that I was hoping we would enter.
Trevor Paulhus for The New York Times
Glenn Beck

Readers’ Comments

You’ve said The Blaze could put traditional TV news out of business. That’s a bold prediction.
I learned that when Barbara Walters came and did an interview with me. They had about 50 people in our studio for two days — more people in my offices than we had employees. All for an eight-minute segment.
But do you really think that will happen? 
The nightly news is doing a fine job of putting itself out of business. Who watches it? I mean really, besides my grandparents, who are both dead, who is watching the nightly news? I think we’ll be ready to put them out of business in the next three to five years.
Is it true that you expressed interest in buying Current TV? 
Yes. I didn’t speak to him, but I was told that Al Gore didn’t want to sell to me.
When you heard Al Jazeera was buying it, what did you think? 
I thought that Al Gore saw me more as an enemy of America than Al Jazeera, which I found fascinating coming from the former vice president. Or maybe he doesn’t believe a word he says. He sold for twice the amount of what it was worth.
How did your fans respond to your support of gay marriage? 
I don’t care. The point is that government shouldn’t be involved in marriage.
Did you hear any reaction? 
Can we stop dividing ourselves? Do racists exist? Yes. Do bigots exist? Yes. But most of us are not. Most Americans just want to get along. Why can’t we do that? What has happened to us?
I think there’s a misperception that your show is more political than it actually is. 
Unfortunately, because of the news of the day, we have spent most of our time on politics. What people don’t ever understand is this: I’m the guy who lives in Dallas who did not get an invitation to the George Bush Presidential Library opening. He didn’t like me. I had called for his impeachment. I didn’t call for Obama’s impeachment. People think I just hate this president. No, I hate power and those who do everything they can to hold onto it.
But you said you were going to hunt down progressives like an Israeli Nazi hunter. 
Oh, I will. I think these guys are the biggest danger in the world. It’s the people like Mao, people that believe that big government is the answer, it always leads to millions dead — always.
Sometimes when you give a speech, you hold up a napkin stained with Hitler’s blood. Why? 
It could be Hitler’s, I don’t know. It was from somebody present during the July assassination attempt. The point of it is: pay attention when the trouble is small. If you don’t pay attention to people who want to regulate every aspect of your life, it spirals out of control.
What was it like for you to live in New York? 
Sad, because I think New York is one of the greatest towns in the world. I love New York. I wanted to live in New York my whole life, and I find it so unbelievably closed-minded.
You must feel more comfortable living in Dallas. 
Yeah, but there are people that hate me all over the world. I went to South Africa, and people hate me there.
Why did you start your jeans company, 1791 Denim? 
I wore Levi’s my whole life. I think they’re great. They’re making them in China now. Fine, whatever. But when they branded themselves the uniform for the progressive movement, instead of complaining, I started my own company. I don’t care if you’re a liberal and you want to wear them. I hope they’re comfortable. If they’re not, return them to me.
Are you still in touch with Sarah Palin? 
No. In fairness, I don’t really stay in touch with really anybody. I’m a little busy.

Rush Believes Media Turning On Obama--Too Soon For Us To Believe That The Press Will Suddenly Find Their Impartiablility


Conservative radio host Rush Limbaugh on Friday said he is seeing a “tectonic shift in reporting” — even by the so-called “drive-by media — on the U.S. economy.
“You know, folks, even the drive-by media is starting to turn on Obama on the economy,” Limbaugh explained. “The economic news, the unemployment news, it went down 7.3 from seven-point whatever it was, but the media knows that that’s not because jobs are being created.”
He continued: “We’re witnessing a tectonic shift in reporting on the economy. We really are. And it’s all about politics. It’s not about the media trying to get it right. Obama and the Democrats and their minions are deathly afraid that the Federal Reserve is going to look at the lowering unemployment rate and end quantitative easing. They’re scared to death, this is an amazing thing, too, because the unemployment rate went down to 7.3% not because a bunch of new jobs are created; it’s because even more people left the workforce.”
Listen the segment via the Daily Rushbo:
“U.S. employers added 169,000 jobs in August, nudging the unemployment rate down from 7.4 percent to 7.3 percent, the U.S. Bureau of Labor Statistics reported Friday,” TheBlaze previously reported.
Further, the civilian labor force participation rate dropped down to 63.2 percent in August, the lowest percentage the U.S. has seen since 1978.

Obama: Learning On The Job. Was NOT Ready For Prime Time

Hoekstra to Newsmax: Obama's G-20 Debacle 'Clearly Demonstrates a Lack of Leadership'

Friday, 06 Sep 2013 06:56 PM
By Todd Beamon
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President Barack Obama's inability to build strong international support for military strikes against Syria at the Group of 20 summit in Russia "clearly demonstrates a lack of leadership," former House Intelligence Committee Chairman Pete Hoekstra told Newsmax on Friday.

"The president has four groups of people who he needs to convince that going into Syria is an absolute imperative — and one of those is the international community," Hoekstra told Newsmax in an exclusive interview.

"And, coming out of the G-20 summit, where he had the opportunity to personally make the case to many of our allies — and to come away pretty-much empty-handed — shows exactly where this president is right now.

"It's going to make it very, very difficult to get the votes next week" in Congress, he concluded. "It's going to make it much more difficult for the president to get the American people to be supportive of a move into Syria if we can't convince our allies."

Obama, who plans to address the American people on Syria on Tuesday, left St. Petersburg on Friday without a clear, unified message of support among allies despite the "growing recognition" that the world could not stand by and let the use of chemical weapons go unanswered.

“Failing to respond to this breach of this international norm would send a signal to rogue nations, authoritarian regimes and terrorist organizations that they can develop and use weapons of mass destruction and not pay a consequence,” Obama said at a news conference before leaving the Russian city.

His efforts at the summit were strongly countered by Russian President Vladimir Putin, who hosted the event and who remains Syrian President Bashar Assad's strongest ally.

Putin has challenged U.S. evidence that Assad's military was behind a chemical weapons attack last month — and he has blocked action against Syria at the United Nations.

He said at his own news conference on Friday that Russia would continue supporting Syria if the U.S. launches strikes.

“We are already helping them with weapons and we are cooperating in the economic and humanitarian spheres,” Putin said.

Hoekstra, who served eight terms in the U.S. House of Representatives before leaving office to run unsuccessfully for Michigan governor in 2010, said he was not surprised at Putin's heavy lobbying at the summit.

"The disappointing thing here was that, even though it appears relatively certain that Assad gassed and killed over 1,000 of his citizens, it shows the weakness of this president's case that he couldn't — even though Putin was lobbying as well — build a coalition. We haven't been able to do that in this case."

Obama sought diplomatic support from the United Kingdom, Australia, Turkey, and Saudi Arabia. He met with the leaders of France, China, Japan, Turkey, Brazil, and Mexico.

So far, the countries that have indicated a willingness to support an armed response include Canada, France, Saudi Arabia, and Turkey.

French President Francois Hollande said in St. Petersburg that his nation’s military would only hit targets in Syria in a U.S.-led coalition.

“A military strike would accelerate a political solution. That’s what people have to understand,” Hollande said. If Obama failed to get authorization for a military attack from Congress, he said he was willing to ship weapons to Syrian rebels.

Still, "you don't have the key one," Hoekstra told Newsmax, "which, from my perspective, is Great Britain. They're not there." The House of Commons has rejected military action in Syria.

"It’s always somewhat comforting when you want to engage and take a military action that you have a list of allies who are willing to go with you and who are willing to support that effort," he added. "And, right now, we don't have it."

Hoekstra, who chaired the House Intelligence Committee from 2004 to 2007 and currently serves on the Advisory Board for, noted that Secretary of State John Kerry told legislators that Arab nations had pledged to finance the cost of any U.S.-backed military effort in Syria.

"What the secretary fails to recognize or doesn't talk about is that our greatest treasure are not the cruise missiles, not the airplanes that we send, but it is our young men and women who we send out on the battlefield," Hoekstra said.

"There may not be boots on the ground, but they're going to be dealing with the missiles, getting them prepared to launch. They may be flying over the skies of Syria. They may be protecting the embassies or American assets throughout the Middle East.

"That's our most precious asset, and if we go into Syria, that's what we're putting on the line."

At his news conference, Obama three times declined to directly answer questions about whether he would take military action even if Congress rejected authorization.

“I put this before Congress for a reason,” Obama said, adding that the U.S. position is strengthened if the nation is unified. “I’m not going to engage in parlor games” by speculating about whether it’s going to pass while still negotiating with lawmakers.

To that, Hoekstra told Newsmax: "I hope that since the president has asked for Congress' input, that when he gets it, he will listen to it."

More broadly, however, the former congressman said that Obama's G-20 experience showed that "the president is learning the difficulty of being an international leader. He's going through on-the-job training.

"I'm glad the president is learning," Hoekstra added. "I'm glad that the president is using some of the tools that former presidents have used — and I hope that this president will also develop the kind of coalition that President [George W.] Bush did before he takes action."

Bloomberg News contributed to this report.

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