Wednesday, September 24, 2008

Emboldened Looters - Major Ripoff

Bush's Treasury Secretary Henry Paulson, formerly CEO of Goldman Sachs, is preparing to loot the US Treasury. He wants US$700 billion to spend as he sees fit, without oversight.

The money could be distributed overseas, to prop up anything.

Paulson divested himself of a personal half-billion dollars stake in Goldman Sachs stock when taking his present government job. Bloomberg reported "He was exempted from paying capital gains tax on the sale of those stakes under a rule meant to avoid penalizing wealthy people who take government jobs and are forced to sell assets." The Treasury Secretary job itself pays $191,300 (or $478,250 over his expected 30 month term), but there were thus hundreds of millions of dollars of benefits. Sweet!

Of course, those $100 millions of capital gains taxes thus don't go to the Treasury, but instead are in Paulson's pocket.

Today, wonder of wonders, Paulson's reportedly got a new friend:
"Berkshire Hathaway, the company owned by US investment guru Warren Buffett, has bought ... $5bn of Goldman Sachs preferred stock bearing a 10% annual interest rate. It could increase its holding of Goldman shares as under the terms of the deal, it has the option of buying $5bn of common stock for $115 per share at any time in the next five years." Sweet deal!

Available for Financiers Only!

Beware especially the bailout's proposed Section 8 -- almost unbelievable: "Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency. " Wow! Looters Seek Prior-Immunity. Very bold. But it's a 'big bucks' play...