The Securities and Exchange Commission today charged Goldman, Sachs & Co. and one of its vice presidents, Fabrice Tourre, for defrauding investors by misstating and omitting key facts about a financial product tied to subprime mortgages as the U.S. housing market was beginning to falter.

MSNBC's Dylan Ratigan has the story broken down in the clearest terms possible, explains the Goldman deal with a colorful metaphor, and analyzes it and the SEC lawsuit in discussion with former Goldman Sachs Managing Director and author of "It Takes a Pillage: Behind the Bonuses, Bailouts, and Backroom Deals from Washington to Wall Street" Nomi Prins, and Connecticut Attorney General Richard Blumenthal...

Watch:

FOR IMMEDIATE RELEASE
2010-59

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Wednesday's report from the Congressional Oversight Panel makes it very clear that while things may feel relatively stable right now on the commercial real estate front, the real bomb hits in 2011. Banks could lose $200 - $300 billion, and 'every American' could be affected:

The full force of the commercial real estate problem will be felt over the next three years and beyond, according to the panel's February assessment, which means it starts to get worse starting today.

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Digby observes that the American economy is essentially in the hands of the High Priests of the Federal Reserve, who do not answer to anyone, least of all to the great unwashed masses who allegedly aren't equipped to handle something so important as money.

Considering the fact that America’s banking system has become the Clusterfuck of All Time, it seems to me that the High Priests of the Temple of Bernanke are the ones who can’t handle money. Or keep track of it. Or reveal how many trillions of dollars they’ve printed and who they’re handing all those trillions of dollars to.

Congressman Grayson:

The Federal Reserve has refused multiple inquiries from both the House and the Senate to disclose who is receiving trillions of dollars from the central banking system. The Federal Reserve has redacted the central terms of the no-bid contracts it has issued to Wall Street firms like Blackrock and PIMCO, without disclosure required of the Treasury, and is participating in new and exotic programs like the trillion-dollar TALF to leverage the Treasury’s balance sheet. With discussions of allocating even more power to the Federal Reserve as the ‘systemic risk regulator’ of the credit markets, more oversight over the central bank’s operations is clearly necessary.

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Edward M. Liddy grew up in New Brunswick, New Jersey, earned a bachelor's degree from Catholic University of America in 1968 and a master's in business administration from George Washington University in 1972.  He then began a long career in corporate America, including stops at the Ford Motor Company in Detroit, drug maker G.D. Searle & Co in Skokie, Illinois, and Allstate Corporation in Northbrook, Illinois.

During Edward Liddy's apprenticeship in the buccaneering life he was exposed to the most influential teachers and lasting experiences.  While at Searle, Liddy who was CFO worked for a CEO , Donald Rumsfeld, who has always epitomized the height of arrogance as demonstrated by a successful buccaneer.   When he was at Allstate, Liddy presided over the company during and after hurricane Katrina, and Liddy observed first hand the effects of over exposure to risk and subsequent loss of trust when Allstate was faced with the massive losses suffered by homeowners in New Orleans, and Allstate subsequently canceled insurance policies and exited the business of insuring homeowners against casualty, lucrative as the business might have once been and could be.

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(noon - promoted by Edger)

Arguably America’s greatest trial lawyer, Clarence Darrow, famously once said,

"First and last, it's a question of money. Those men who own the earth make the laws to protect what they have. They fix up a sort of fence or pen around what they have, and they fix the law so the fellow on the outside cannot get in. The laws are really organized for the protection of the men who rule the world. They were never organized or enforced to do justice. We have no system for doing justice, not the slightest in the world."

Reading this morning’s headlines about A.I.G. utilizing $165 million of their $170 billion tax payer financed bailout for bonuses, reminded me of Darrow’s insight. The excuse being offered after all is that a “contract is a contract” and A.I.G. must fulfill their obligations.

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