CNBC: Washington's Anti-Stock Agenda?

Um, no. Let's turn this around and how about we talk about Wall Street's anti-average-American investor agenda? If anything, Wall Street should be kissing the feet of the Obama administration who was much too kind to the financial industry. Despite massive profits by the leading bailed out financial organizations, normal investors haven't really seen the same kind of rewards. They're recovered from their lows but it's nothing like profits that Wall Street has experienced. For the health care industry, they too have been handsomely rewarded in the new legislation which is why they are able to give their CEOs over $100 million during the worst economic crisis in decades.

Be angry with the pampered lot in those industries who have barely been scratched in terms of financial reward but let's not get carried away and blame Obama for being anti-investments. Why aren't those companies trimming their costs? If they can afford to pump up these outrageous lifestyle salaries, maybe that's where blowhards like Cramer ought to be looking for answers. The stock prices are still overvalued and until there are some serious changes in the way those companies operate, blaming Obama is complete BS.

With multiples lower across the board, stocks might seem cheaper, Cramer said Monday, but they're actually just worth less for fear that future earnings will be "crimped" by the government.

The fear is widespread, Cramer said, as "it's impossible to find a company that isn't threatened by the dominant agenda in Washington."

Financial regulatory reform gave banks an earnings "haircut," Cramer said. The debate over health-care reform gave those stocks a similar cut a few months earlier. He thinks the ban on offshore drilling will crush oil-service companies along with the oil companies that need to find oil to keep their reserves up. Elsewhere in the energy space, natural-gas names are expected to get slammed by the Environmental Protection Agency investigations into hydraulic fracturing – a reason multiples are shrinking for Exxon Mobil, Chevron, Chesapeake Energy and Schlumberger.

Cramer said more damage will be done with forthcoming items on the Congressional agenda, including cap-and-trade on carbon emissions and “card check” unionization. Making it easier for workers to unionize would hurt Walmart, as well as big banks like Bank of America, Wells Fargo and JPMorgan Chase if their tellers were to join the union. Cap-and-trade will come down on "any industry that pollutes," as well as the utility companies, he said.

If anyone has been threatened here it's the average American. Asking for accountability by the corporate world is hardly threatening. Until they can give something back to the rest of the country besides the bill for gambles and environmental disasters, it's crazy to have such a discussion. But hey, we're talking about CNBC and Cramer, after all. Read the rest of this post...

BP Gulf research grants now being treated as pork

It seems the White House made things worse.

University professors in the gulf region responded with delight last month to BP's pledge to put up $500 million for academic research into the Gulf of Mexico's ecology over the next 10 years. With no significant federal grants on the horizon and an urgency to begin work, some of the academics had taken to using their own credit cards in hopes they would soon be reimbursed.

But their excitement at the windfall turned to chagrin last week after the White House ordered BP to consult with Gulf Coast governors before awarding research grants.

Elected officials in the region responded by demanding that the financial bonanza not spread beyond their own state universities, potentially leaving out such distinguished oceanographic institutions as Woods Hole in Massachusetts and Scripps in San Diego.

The political intervention has transformed the normally independent, merit-based process of matching grant money with researchers into a parochial tug-of-war for BP's millions. The imbroglio also has galvanized scientists who bristle at the notion that elected officials could direct sophisticated academic research.

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BP's bad science

I'm sure this story will surprise you. From Kate Sheppard at Mother Jones.

Rep. Lois Capps (D-Calif.) and Rep. Peter Welch (D-Vt.) are pressuring BP to ditch a private contractor, the Center for Toxicology and Environmental Health (CTEH), that it hired to do public health response in the Gulf. The company, they say, has been "cited in a long line of controversial cases" in which it has botched data collection methods and supplied bad data. These bad test results, Capps and Welch say, have served to promote the "corporate interests" of CTEH's employers over the protection of public health.

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White House blasts Boehner as out of touch with America

Good. Excellent, in fact. This is the kind of thing the White House should have been doing a year ago, but it's still excellent they seem to understand that now.

The White House harshly criticized Representative John A. Boehner of Ohio, the top House Republican, on Tuesday, calling him “completely out of touch with America” because of his opposition to new regulations on Wall Street.

People care about substance. They also care to see whether their politicians have balls. Read the rest of this post...

Boehner thinks the global financial crisis is 'an ant' in terms of its importance

More from the article Joe wrote about this morning. It seems the man who would be Speaker thinks the global economic crisis is not that a big deal. This is consistent with what Republicans were saying around the time of the stimulus. You'll recall that the GOP felt the stimulus wasn't necessary because America wasn't in that big a crisis, they claimed. So it's not surprising after the last year of economic hell, the Republican leader still thinks the economic crisis is akin to "an ant."

Boehner also thinks that Obama "over-reacted" to the oil spill in the Gulf. Now, many things have been said about the President's response to the spill, but "over-reaction" is not one of them. Yes, Boehner would have taken the spill as even less of a big deal.

The Democrats have been doing a poor job of arguing why they deserve re-election, while Boehner, on the other hand, makes the choice perfectly clear. The Republicans are still run by far-right nuts. They've learned nothing since the Gingrich years. Nothing. Read the rest of this post...

Scott 'Bankers gave me $450k in 6 days' Brown forcing Wall Street reform back to conference

Remember all the hoopla when the Wall Street reform conference committee reached a deal at 5:39 a.m. last Friday. Yeah, that was a big deal. Except, it wasn't. The Senate doesn't have the votes to pass the conference committee bill, so the House and Senate are going back to the negotiating table.

Chris Bowers has been tracking the developments.

Via The Hill, it's pretty clear that President Scott Brown (having usurped the title from President Olympia Snowe, for the time being anyway) is calling the shots:

Senate and House conferees on Wall Street reform are reconvening Tuesday because of Republican objections to $19 billion in fees that would be placed on big financial firms.

The meeting follows Sen. Scott Brown's (R-Mass.) letter to the chairmen of the conference committee on Tuesday, in which he said he would oppose the Wall Street overhaul bill as it stands.

Brown is the beneficiary of hundreds of thousands in campaign contributions from bankers. Money well spent by the bankers because he's doing their bidding.

It's classic. The anti-establishment teabaggers claimed to elect Brown -- but he's doing the work of the Wall Street establishment now that he's here in DC.

Brown, like most GOPers, is for sale to the highest bidder -- and Wall Street pays way more than the teabaggers. Read the rest of this post...

More 'Speaker' Boehner: GOP will cut Social Security benefits to pay for war

More of what America would get from Speaker Boehner:

Ensuring there’s enough money to pay for the war will require reforming the country’s entitlement system, Boehner said. He said he’d favor increasing the Social Security retirement age to 70 for people who have at least 20 years until retirement, tying cost-of-living increases to the consumer price index rather than wage inflation and limiting payments to those who need them.

"We need to look at the American people and explain to them that we’re broke," Boehner said. "If you have substantial non-Social Security income while you’re retired, why are we paying you at a time when we’re broke? We just need to be honest with people."

Did you hear that senior citizens? The GOP leader admitted he's going to cut your benefits to pay for the war. He's not threatening to end the tax cuts on the wealthiest Americans. You remember how Bush and the GOP cut taxes for the rich despite our engagement in two wars. Nope. He's coming for Social Security benefits.

You've been warned, senior citizens.

This is how the GOP will govern. Wall Street bankers will be coddled. Working Americans will get screwed (again.) Read the rest of this post...

First they came for the segregated swimming pools, and I did nothing...

John Boehner is worried that Democrats are "snuffing out" the America he grew up in. You know, the America where we had different drinking fountains for white folks and black folks. The America in which women were expected to be nurses and stewardesses instead of doctors and pilots. The America in which gay people shut up, hid themselves, and silently committed suicide when they became too old to hide it. This is what's underlying the ongoing GOP assault on Thurgood Marshall at Kagan's confirmation hearings. They long for an America that was once racist, sexist and homophobic. We already knew this, but it's rather remarkable to hear them admit it. Read the rest of this post...

Haley Barbour's lack of preparation now causing problems

So much for the old "it's not a problem" mentality. Because Barbour failed to take the spill seriously oil is washing ashore and Mississippi is scrambling for solutions including skimming equipment. Maybe he was waiting for the oil to self-regulate and take care of itself. Then again, he could have been praying with Sarah Palin and God simply wasn't listening to either of them.

Just weeks ago, Mississippi Gov. Haley Barbour claimed that oil was not a big threat to the people of the Gulf Coast. Now, with oil hitting his state's beaches for the first time since the start of the BP spill , the Republican governor says his state isn't prepared for the spill and needs more help.

Earlier in June, Barbour said, "Once [oil] gets to this stage, it's not poisonous," though he said it probably wasn't a good idea to brush one's teeth with it.

With black gobs of oil now sullying Mississippi's white beaches, the governor is taking a more serious tone, asking for more resources to combat the problem he had dismissed.

"We have to be honest with the public. Right now we don't have enough skimming capacity if everything that's off our shores continues going north," Barbour said.

On day 70 of the spill, local officials say they're sorely lacking in supplies to fight the oil. The mayor of Ocean Springs, Miss. told ABC News they're not seeing the response they need from state and federal officials to an urgent problem.

Read the rest of this post...

Boehner on Dems: 'They’re snuffing out the America that I grew up in'

Two words that should scare all of us: Speaker Boehner.

"They’re snuffing out the America that I grew up in," Boehner said. "Right now, we’ve got more Americans engaged in their government than at any time in our history. There’s a political rebellion brewing, and I don’t think we’ve seen anything like it since 1776."

And, he's unabashed about proclaiming his anti-health care reform and pro-Wall Street agenda:

If Republicans retake control of the House, Boehner promised a vote on a bill repealing the health care law and replacing it with a scaled-down package of tax breaks and court reforms. Democrats likely would maintain control of the Senate, and Obama could veto the proposal, all but eliminating its chances of succeeding.

"We are going to do everything we can to make sure that this law and this program never really takes effect," Boehner said. One option would be to repeal the $534 billion in Medicare cuts, which pay for more than half of the law’s provisions. "They’re going to need money from the Congress to hire these 20,000-plus bureaucrats they need to hire to make this program work. They’re not going to get one dime from us."

Boehner criticized the financial regulatory overhaul compromise reached last week between House and Senate negotiators as an overreaction to the financial crisis that triggered the recession. The bill would tighten restrictions on lending, create a consumer protection agency with broad oversight power and give the government an orderly way to dissolve the largest financial institutions if they run out of money.

That "political rebellion" of which Boehner speaks is allegedly about anger towards the establishment. Much of that anger has been aimed at Wall Street. Yet, you can bet Wall Street bankers are pouring money into the GOP's coffers. Wall Street bankers know they'll be the biggest beneficiaries of a GOP-controlled House. And, they're the ones who snuffed out the American dream for many families in this country. Read the rest of this post...

It sure does pay to be a health insurance CEO

There aren't many individuals who made over $100 million in 2009 but somehow, the UnitedHealth Group CEO Stephen Hemsley managed. With that kind of money being thrown around, it's pretty obvious why there was so much of a fight against reform. Read the rest of this post...

Mew heart wrenching video footage of the oil slick; dolphins try swimming through the oil

The video starts off depressing and gets worse as it approaches the seven minute mark. There you can see dolphins trying to swim through the oil as well as a sperm whale breaching the surface, covered in toxic oil. More fly-over videos of the oil leak on BP Slick. Read the rest of this post...

Tuesday Morning Open Thread

Good morning.

It's a busy day here in DC.

The President is meeting with 22 Senators this morning "to discuss passing comprehensive energy and climate legislation this year." Among the Senators expected at the White House are seven GOPers: Alexander (TN), Collins (ME), Gregg (NH), Lugar (IN), Murkowski (AK), Snowe (ME) and Voinovich (OH). They're always such a cooperative bunch. And, where's Lindsey? He's always in a snit about something.

Obama is also having lunch and a meeting with King Abdullah of Saudi Arabia today. Then, he's got a meeting with 22 members of the Congressional Hispanic Caucus. The CHC, comprised of all Democrats, has one Senate member: Robert Menendez (NJ).

Questioning from Senators starts today in the confirmation hearing for Elena Kagan. Yesterday, Supreme Court Justice Thurgood Marshall was the subject of derision by GOPers on the Senate Judiciary Committee. They're really a shameless, hate-filled bunch, those GOP Senators.

Also, today, the Senate Armed Services Committee holds a confirmation hearing for General David Petraeus. Now, this is a hearing where there should be some hard questions, but Senators won't challenge Petraeus. His confirmation will sail through. Very few members of Congress have asked any hard questions about the war in Afghanistan for the past nine years. That's one reason why we're still mired in that conflict.

And, what else? Read the rest of this post...

BP bet future of company on deepwater drilling

Even the warnings that were coming from the Macondo Deepwater drilling operation didn't make a difference. It's easy to see how they could ignore the warnings though because they were only doing what the rest of the corporate world had done quite (financially) successfully in the credit crisis. The deepwater drilling was Big Oil's answer to the casino culture that was and is so present on Wall Street. From Big Oil's perspective, they just watched Wall Street gamble and lose everything yet still get bailed out so how could they lose?

Much like Wall Street, sure, some companies may not make it beyond this gamble but they'll be paid handsomely on the way out the door. For the victor will be the reward of even larger than too-big-to-fail which will translate into even more money. Maybe BP will end up being the near term loser but they just as easily could have been the winner in this casino culture. The end result for everyone else is even greater reliance on fewer but even larger oil companies.

Obama has the misfortune of inheriting this mess from Bush and the GOP but it doesn't mean he should accept it and stay the course as he's done with Wall Street. A bit of change to the ridiculous self-regulation and economies of scale lies needs to addressed sooner than later. Bringing order to these gamblers needs to happen immediately.

BP staked its future on expanding offshore drilling a month before the catastrophic explosion on the Deepwater Horizon triggered the United States' worst environmental disaster, according to company documents revealed yesterday.

The investigative web site ProPublica published a March 2010 strategy document in which BP named "expanding deepwater" as its number one area for long-term growth.

But even as the document was drawn up, engineers were struggling to control the Macondo well in the Gulf of Mexico, which had already gained a reputation as a risky operation, according to industry sources.

The strategy paper claimed BP now held a global lead over its competitors in deepwater production – even though its costs were considerably lower. Earlier this month the executives of BP's rivals, including Exxon and Chevron, told a congressional hearing they would have taken more safeguards on the doomed Deepwater Horizon rig.

Read the rest of this post...

Report: Some governments may not be able to withstand another banking crash

As necessary as the bank bailouts were, maintaining the exclusive lifestyle of bankers was hardly necessary. If anything, propping up those least in need was rewarding bad behavior setting up this potentially difficult next phase of the economic cycle. In the case of the US, Obama has differed little from the Bush administration in its handling of the banks. Giving the banks a free ride by pushing out global regulation is indeed owned by Obama and the rest of the G20 leaders who failed badly on this issue, again. The Independent:

The BIS has previously said that the ultimate calamity - payments systems freezing and cash machines running out of money - was only narrowly avoided when the US investment bank Lehman Brothers collapsed in 2008. A deeper economic slump was averted by nationalising other banks and making loans amounting to $10trn (£6,620bn).

But the BIS report implies that governments may not be able to repeat such a bailout in the event of a second crisis, which some commentators fear could be triggered by another economic shock.

Despite the warnings, the G20 nations significantly eased the pressure on banks this week by delaying the introduction of tougher rules on the amount of capital they must hold to deal with potential crises. The new regulations were planned for the end of this year but are not now due until 2012. Countries will also be given far more leeway inhow the rules must be applied. Critics say this amounts to a watering down of the reforms needed to stave off the sort of disaster the BIS fears.

The BIS alsowarned that the "fragility" of public and private balance sheets in the UK,France, Germany, Spain and the US "severely limits the scope for fiscal policy intervention if another bailout is needed". It added: "The side effects of the financial and macro-economic supportmeasures, combined with the unresolved vulnerabilities of the financial sector,threaten to short-circuit the recovery; the reforms necessary to improve the resilience of the financial system [have] yet to be completed.

Read the rest of this post...

From CNBC to MSNBC

For those who haven't yet followed Dylan Ratigan here's a chance to learn a bit more about him. Ratigan worked at Bloomberg and CNBC before moving to MSNBC where he's been a vocal critic of the financial system and its coziness with Washington. It's an issue near and dear to my heart so I always find what he has to say interesting.

As someone who follows CNBC (where he used to work) closely, I'd have to agree with him that for the most part the network does more good than bad. I often disagree completely with their points though it's important that they raise so many points about what is happening on Wall Street. Other networks don't even cover most of the debate and that in itself if a problem.

Mr. Ratigan does not just have a point of view, he has a point — one that he repeats relentlessly and feverishly, sometimes with props like buckets and Monopoly money. To hear Mr. Ratigan tell it, the American people are being held hostage by a banking system that acts like a government subsidized casino. His analogy: “My mother is paying taxes to the government. The government is giving her money to the banks. The banks are gambling like they’re watching ‘Fast Money.’ But my mother didn’t sign up for that.”

Mr. Ratigan said flatly, “As long as there’s been banks and governments, banks and governments have been conspiring to take money from the people.” What has changed now, he said, is that “we have the ability to engage it directly,” through fair elections and a free press. The first step in his playbook, then, is to end the denial about it through his show.

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