BREAKING: The CITI Never Sleeps….Government takes larger stake in CITI….

Between AIG and CITI, damn right they are Zombies, they keep coming back for more…

CNBC:

Citigroup and the U.S. have reached a deal to give the government a bigger stake in the troubled banking giant, by converting its preferential shares to common stock, a Treasury official tells CNBC.

The agreement will see the Treasury’s Citi stake rise to between 30 to 40 percent and in return, the government is demanding a boardroom shakeup. The exact details of this shakeup are not known. However, CEO Vikram Pandit is expected to keep his job under the agreement.

The Treasury official also said the government will be offered the lowest price given to any private investor to convert preferred shares into common equity. The Treasury will match the private investors’ conversions dollar-for-dollar up to $25 billion.

Like Tom (and Stevie!!) says, Hey! Dont Come Around Here No More !!!

Other key details of the Citigroup-U.S. pact remain unclear.

As previously discussed, when comparing Citigroup’s market capitalization with the number of preferred shares the government currently owns, if these shares were converted right now to common stock, they would worth more than 100 percent of Citi’s total market capitalization.

Our previous posts on Geithner and the troubled CITI bailout here and  here and here and here and here and even here ….

February 26, 2009. Tags: , , , , , , , , , , , , , , , . CITI, citigroup, Economy, Finance, Music, Obama Administration, Politics, TARP, Uncategorized, Wall St. 1 comment.

Tapper summarizes Obama Budget changes on income and business taxes…

Excellent summary by Jake Tapper:

1) On people making more than $250,000.

$338 billion – Bush tax cuts expire
$179 billlion – eliminate itemized deduction
$118 billion – capital gains tax hike

Total: $636 billion/10 years

2) Businesses:

$17 billion – Reinstate Superfund taxes
$24 billion – tax carried-interest as income
$5 billion – codify “economic substance doctrine”
$61 billion – repeal LIFO
$210 billion – international enforcement, reform deferral, other tax reform
$4 billion – information reporting for rental payments
$5.3 billion – excise tax on Gulf of Mexico oil and gas
$3.4 billion – repeal expensing of tangible drilling costs
$62 million – repeal deduction for tertiary injectants
$49 million – repeal passive loss exception for working interests in oil and natural gas properties
$13 billion – repeal manufacturing tax deduction for oil and natural gas companies
$1 billion – increase to 7 years geological and geophysical amortization period for independent producers
$882 million – eliminate advanced earned income tax credit

Total: $353 billion/10 years

February 26, 2009. Tags: , , , , , , , , , , . Economy, Obama Administration, Politics, Uncategorized, Wall St. 1 comment.

Tea Party Update: Friday Events….

MM update:

***Update: DC Tea Party moved to Lafayette Park across from the White House. They just got permit***

Also added NYC Tea Party info below. Plus: Pittsburgh Tea Party postponed due to weather/permit issues.

NYC:
Saturday, NYC City Hall Park, 2 PM-3PM

via Ace and Beth:

boston_tea_party

Tea Parties are planned in 20 cities across the country this weekend. The weekend tea party schedules are below, thanks to Little Miss Attila.

Weekend Tea Party Schedules

Washington, D.C. Tea Party
Friday, February 27, 2009
12:00pm – 2:00pm
LAFAYETTE PARK

Chicago Tea Party
Friday, February 27, 2009
11:00am – 12:20pm
Daley Plaza Civic Center
50 W Washington St.
Contact Info:
312-282-9310
info@officialchicagoteaparty.com

NORTHEAST:

NYC:
Saturday, NYC City Hall Park, 2 PM-3PM

Philadelphia, PA
Friday, February 27, 2009
12:00pm – 1:00pm
Liberty Hall, Philadelphia
Devon Generally, 215-259-3868
Generallyforsenate@gmail.com

Pittsburgh, PA Tea Party
February 27, 2009
12pm – 1pm
Point State Park
Pittsburgh
hlskittypryde@yahoo.com

honk

SOUTHEAST:

Jackson, Mississippi Tea Party
12:00am-1:30pm (meet and greet from 11-12)
Where: On the steps of the Capital Building in Jackson

Atlanta Tea Party
Friday, February 27, 2009
12:00pm – 1:00pm
Georgia State Capitol Building ~ Downtown Atlanta
206 Washington St SW
Atlanta, GA
Contact Info:
770-878-0024
atlantateaparty@gmail.com

Fayetteville, NC
Friday February 27, 2009
12:00pm – 1:00pm
Liberty Point Resolves Marker
Downtown Fayetteville, Hay St.
Ralph Reagan

Shelby County, AL
Friday, February 27, 2009
12pm to 1pm
Hwy 280 at the beginning of the crest going into Chelsea
at entrance to Eagle Point Neighborhood

Calera, Alabama Tea Party
12:00 pm – 1:00 pm
Where: Hwy 280 at the entrance to Eagle Point, 1/2 mile south of Hwy 119
Calera, AL
Contact: abish1@email.phoenix.edu

Greenville, SC
Friday, February 27, 2009
6:00pm – 7:30pm
Reedy River Park – Banks of the Reedy River
West of Main Street, behind the Peace Center

Columbia, SC
Statehouse
no add’l details available at this time
Pls follow link for up-to-the-second
developments.

Tampa, Florida Tea Party
12:00pm – 1:00pm
Where: Federal Courthouse
801 N. Florida Ave.
Tampa, FL
Contact: John Hendrix : mobile: 803 571 1153

Orlando, FL Tea Party
Friday, February 27, 2009
12:00pm – 1:00pm
Lake Eola (across from Panera Bread)
Lake Eola
Orlando, FL
OrlandoTeaParty@MyAmericanism.com

(more…)

February 26, 2009. Tags: , , , , , , , , , , , , , . Economy, Finance, Foreclosures, Housing, Obama Administration, Politics, Popular Culture, Uncategorized. 1 comment.

Obama Budget: Suprise! That Small Business Tax Cut on capital gains doesn’t kick in until …2014!!

Good Grief. This was the centerpiece of the last Presidential debate, a broken promise by Team Obama..

Ben Smith:

Obama’s budget plan closes the deficit in part by postponing a promised tax cut well into his second term. (MiM here: getting ahead of yourself there Ben!)

The focus on tax cuts was central to Obama’s campaign against John McCain, and his surprising strength in polls on the question of taxes.

One of those promised cuts — the second bullet point in his campaign economic planwas a pledge to “eliminate all capital gains taxes on startup and small businesses to encourage innovation and job creation.”

That cut has been deferred, a Republican source notes: The elimination only begins phasing in, according to the budget overview (page 122) in 2014, well into Obama’s second term.

February 26, 2009. Tags: , , , , , , , . Economy, Finance, Music, Obama Administration, Politics, Uncategorized. 1 comment.

Housing Cram Down Bill : House vote pushed to next week…

housesforsale

From HousingWire:

The bill had potentially been slated for possible vote today, but various media reports as well as sources that spoke with HousingWire have suggested that negotiations over the hot-button issue are yet continuing. Read the full legislation.

“To allow time for more discussion, I expect to complete consideration and vote on the bill likely Tuesday of next week,” House majority leader Steny Hoyer (D-MD) told MarketWatch Thursday.

Some of those discussions include linking any bankruptcy cramdowns to the Obama administration’s newly-announced mortgage modification plan, as well as potentially limiting cramdown authority (at least initially) to subprime mortgages only. Marketwatch reported Thursday afternoon that a group of 67 centrist House Democrats are pushing for an explicit loan modification-cramdown link, meaning that no mortgage could see its principal balance reduced by a bankruptcy judge unless the borrower had first sought out relief under the terms of the administration’s loan modification guidelines. See earlier coverage of the Homeowner Affordability and Stability Plan.

Senator Richard Durbin (D-IL), the lead sponsor of the cramdown legislation, suggested to American Banker on Tuesday that Democrats might be willing to limit cramdown authority to just subprime mortgages, in an effort to quell industry unrest and long-standing opposition to the proposal. Subprime loans are not available for modification under the administration’s HASP.

February 26, 2009. Tags: , , , , , , , , , . Foreclosures, Housing, Obama Administration, Politics, Uncategorized. 1 comment.

Market Update: Averages Drop on Budget Details and FDIC update….

DOW down 90 to 7181, S & P down 13 to 751, NASDAQ down 33 to 1393 man the markets are bouncing everywhere no one knows wth is coming next DOW now down 40-

DOW closes down 89 to 7182 S & P down 12 to 752, NAS down 34 to 1391

urgent-budget-choices-taxes

FDIC UPDATE: FDIC ‘problem list’ is up 50% and includes 252 banks (unnamed) with assets of 159 billion .

The nation’s banks lost $26.2 billion in the last three months of 2008, the first quarterly deficit in 18 years, as the housing and credit crises escalated.

The Federal Deposit Insurance Corp. said Thursday that U.S. banks and thrifts also more than doubled the amount they set aside to cover potential loan losses, to $69.3 billion in the fourth quarter from $32.1 billion a year earlier.

Bair said it was unfortunate that some banks paid dividends in 2008 despite being unprofitable. At a news conference to release bank industry results and trends for the fourth quarter of 2008, she urged all banks to review their dividend policies.

The Office of Thrift Supervision, meanwhile, announced a loss of $3 billion in the fourth quarter and a record $13 billion annual loss for savings and loans last year.

The FDIC now believes U.S. bank failures will cost the deposit insurance fund more than $40 billion over the next four years amid the ravages of rising unemployment and falling home prices that have sent loan defaults soaring.

Budget Details Include (CNBC):

WH budget forecasts 2009 GDP at 1.2%

WH budget forecasts unemployment peaking at 8.1% in 2009

WH budget requests 75.5 billion war cost supplemental for 2009

WH budget estimates FiscalYear 2010 war costs at 130 billion

WH indicates more action to boost financial system ‘likely’, sets aside 250 billion for further bank aid if needed

WH projects deficit will hit 1.75 trillion in FY09; 1.17 trillion in FY10

WH projects 10yr note averaging 2.8% in 2009

Budget creates National Infrastructure Bank

Budget increases defense spending 4% to 533.7 billion, excluding war spending

3.6 trillion in spending in FY10

635 Billion for healthcare

Tax Proposals:

Increase for households making 250k+ (rollback of Bush tax cuts)

Higher taxes for ‘carried interest’, (taxed as income not as capital gain)

Reduce value of some deductions (to me insanely they reduce value of charitable and housing interest deductions just when we need them most, oy!)

That whopping $400 a yr tax cut to ‘Make Work Pay’ is continued (so you can go ahead and buy that cup of coffee every week and get used to it, one a week mind if you like Starbucks!)

And don’t even think about those gas savings, Energy Plans include carbon taxes and Oil is up, they found a way to make energy more expensive even when there is a global recession, way to go!

February 26, 2009. Tags: , , , , , , , , , . Economy, FDIC, Finance, Politics, Uncategorized, Wall St. 1 comment.

Update 2: Centrist Dems argue over bill changes as Durbin tries to limit cramdowns to ‘exotic subprime loans” only at banks request…..Housing: House Bankruptcy Cramdowns/judicial modification bill

UPDATE: AP and El Rushbo just reported Moderate Dems having closed door dispute with Speaker and Bill Sponsors over how this cramdown legislation will affect currently struggling homeowners..if this doesnt help anyone but  EXOTIC Subprime loans, then it is a STUPID people rescue or the Irresponsibility Act of 2009 and really if you listen to things Robert Reich said about making sure the stimulus jobs dont go to white engineers, then you start to question what social engineering they are doing here…

CALL YOUR CRITTERS FOLKS

A dispute among House Democrats stalled legislation Thursday to let bankruptcy judges reduce the principal and interest rate on mortgages for debt-strapped homeowners.

It hit a snag after a group of moderates expressed concerns in a closed-door meeting of House Democrats about how the bill would affect homeowners who are still struggling to make their mortgage payments.

The banking industry has lobbied hard against the measure, mounting a successful multimillion-dollar effort last year to kill it.

This year, mortgage industry players who are scrambling to narrow the scope of the measure to reduce its potential cost for banks have won some key concessions. House Democrats agreed to limit the measure to existing loans made before the bill is enacted and to borrowers who can show they tried other ways of modifying their home loans before resorting to bankruptcy, among other changes.

But banks want to go much further, restricting the bill only to subprime or other exotic loans.

Centrist House Democrats who have been working closely with the financial services industry to scale back the bill balked at supporting it on Thursday after a news report suggested that Sen. Dick Durbin, D-Ill., the lead sponsor of the bankruptcy measure in the Senate, was willing to limit it only to subprime mortgages. The Senate is expected to take up the legislation within two weeks.

In the House, Rep. Ellen Tauscher, D-Calif., the head of the business-minded New Democrat Coalition, raised concerns during the private session that the measure omitted help for homeowners who aren’t staring at bankruptcy but are buckling under burdensome mortgage payments.

House leaders said they had postponed a vote until Tuesday to give Democrats time to meet with Obama’s housing secretary, Shaun Donovan, about how the measure fits with his housing plan.

“There’s an equity question here,” said Rep. Ed Perlmutter, D-Colo., another member of the coalition. “The discussion has got to be, what’s the benefit to the guy next door who is struggling to pay the bills, is paying the bills and isn’t filing for bankruptcy?”

More clips from the Speaker

LIVE ON CSPAN

Expected to vote on this today

Here is what the Critters have been up to this morning:

Continues after the break

(more…)

February 26, 2009. Tags: , , , , , , , , , , , , , , , , , . Economy, Finance, Foreclosures, Housing, Music, Obama Administration, Politics, Uncategorized. 4 comments.

UPDATE: Some Market moves on budget…..Kennedy/Baucus OpEd in WSJ on Healthcare Reform…

Update: Here is something good , the budget healthcare portion has reimportation of prescription drugs allowed, yay! Hey imagine how pixxed Blago will be, he was impeached in part on allowing IL to do that!

also Santelli reporting those earning under 250k will not be hit by raised dividend cap gains taxes in 2011, of course this assumes anyone is still paying a dividend in 2011, lol!

Sallie Mae TANKING on news of elimination of fees to private lenders for student loans…

Do you think they talk about the elimination of subsidies for RURAL providers in the Medicare program?

Do they mention the elimination of the HMO Medicare benefits for RURAL areas? NO!! They have the utter GAUL to talk UP the need for rural care even as Obama’s Budget  is cutting it!

The cost-effective tests  for treatment to come, should be fun once they combine their Database with actuarial tables on life expectancy….Gawd help us if they get genetic screening in there, can you imagine? I am sorry Mrs MiM but since you are over 40 and your father’s family has such a terrible history of heart disease and early death, the government has determined you are not eligible for that bypass, it isn’t cost-effective…..

WSJ:

In his address to the joint session of Congress on Tuesday night, President Barack Obama declared that health-care reform “cannot wait, it must not wait, and it will not wait another year.” He is right….ow, it is imperative that we turn our attention to comprehensive health-care reform and move quickly with President Obama to fix our broken system.

Yes ,yes. Everything quick quick before anyone reads it or thinks too hard. WIKI WIKI!

If our initial efforts to restore American prosperity are ever to bear true fruit, Congress must follow up by creating a high quality, universally accessible, and cost effective health-care system….There is also a moral imperative to follow economic recovery efforts with health reform. If Congress can bail out the nation’s banks, surely we can help families get the quality, affordable health care they deserve.

Continues after the break

(more…)

February 26, 2009. Tags: , , , , , , , , . Economy, Entertainment, Healthcare, Music, Obama Administration, Politics, Popular Culture, Uncategorized. Comments off.

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