New York Attorney General Andrew Cuomo’s office is at it again. They’ve been investigating the circumstances that led to the merger of Bank of America and Merrill Lynch and the subsequent bonus payments to executives. In a letter to Senator Chris Dodd (D-CT), chairman of the Senate Banking Committee, Cuomo quotes Bank of America CEO Ken Lewis as saying that former Treasury Secretary Hank Paulson threatened him with removal from his position and mass firing of the board and senior management if he didn’t allow the merger to go through.
The bailed-out banks have found a new way to annoy the government, according to the Congressional Oversight Panel, the body named by Congress to oversee the federal bailout. Chair of the committee and friend of the blog, Elizabeth Warren, is concerned that the same people who are subsidizing the banks are being targeted by abusive lending practices, says the Wall Street Journal
Merrill Lynch CEO: "Nothing Happened In The World Or The Economy" That Would Justify Suspending Bonuses
New York Attorney General Andrew Cuomo wrote a letter yesterday to Rep. Barney Frank (D-Mass.), head of the House Financial Services Committee, (which is currently holding hearings Washington on how banks are spending bailout funds.) In the letter, Cuomo expresses concern that Merrill Lynch moved up their bonus schedule so that they could make sure that taxpayers would get the bill.
Should bailout out banks be buying naming rights? Dennis Kucinich doesn’t think so, and last week he urged the Treasury department to cancel one such deal between Citibank and the New York Mets. Now Bloomberg says that seven more bailed out banks are spending money on stadium rights.
Bonuses are for a job well done, right? Well, despite the economic disaster, it seems that the folks on Wall Street rewarded themselves with $18.4 billion in bonuses in 2008, which is around the same amount as they received in 2004 — when the Dow was “flying above 10,000, on its way to a record high,” says the New York Times.
Over 100,000 people have been laid off by banks, but 9 in 10 executives at banks that accepted bailout money are still working says the Associated Press.
It seems that Bank of America didn’t really appreciate that unexpected $15.4 billion dollar 4th quarter loss by Merrill Lynch — because its former CEO, John Thain has been shown the door.
Federal Reserve chairman Ben Bernanke said that the $800 billion stimulus plan being discussed by the new administration might “provide a significant boost to economic activity,” but that it wouldn’t work without more bank bailouts.
A while back the New York Times was concerned about the cost of the Iraq War and published some estimates of what else we could have bought with that money. We didn’t find that very interesting at the time, but now, while trying to wrap our minds around just how effing huge the $700 billion proposed bailout of Wall Street really is, we decided to revisit that article. Here’s what you can buy for less than $700 billion, according to the New York Times.