I know this site may seem to be going hard and heavy after Romney in the last 24 hours, but truth be told, it’s just too much fun. And we’ve been shooting at Obama for so long that even this brief interlude of close scrutiny of Romney would not come close to achieving “balance” if “balance” as opposed to trying to get past the PR, were our objective.
Read more...Reader Deontos highlighted a post on Reuters by two Brooklyn Law School professors, Bradley Borden and David Reiss, on a subject near and dear to our hearts, the abject failure of the IRS to take interest in widespread, probably pervasive, violations of REMIC, the part of the Federal tax code that governs mortgage securitizations.
The reason this matters is that this situation belies on of the Administration’s pet claims, that its hands were tied as far as addressing the foreclosure mess was concerned because it had no leverage over servicers. As we’ll discuss, in fact the Administration has a nuclear weapon in its hands that it is simply refusing to use.
Read more...Yves here. Our next set of posts in our private equity series will provide background on how the industry operates
Read more...By Nanea, a private equity insider, and Yves Smith
Private equity practitioners, including most famously Mitt Romney, often depict their sector as the epitome of private enterprise. These claims are false. Private equity firms not only depend directly and substantially on government support, they have also actively cultivated links to the state.
Read more...Tax Notes has seen fit to put an informative article by Lee Sheppard about Mitt Romney’s tax returns outside its paywall. This piece shows that questions about what might lurk in the returns that Romney has withheld has diverted attention from some dodgy tax issues in the filings he has provided.
Read more...An interview on Real News Network with James Henry of the Tax Justice Network covers his newly released report “The Price of Offshore Revisited” in which he estimates the size of the “offshore” market as somewhere between $21 and $32 trillion as of December 2010. Note that this total includes only financial assets, and thus omits real assets (real estate, gold, artwork, yachts) that are held via trusts or corporate entities in tax havens.
If you are in finance, the broad outlines of this story are familiar.
Read more...Yves here. Big decision when Lambert and I are short on bandwidth, so this is just first impressions.
Read more...Wonder why states are broke? It isn’t just the global financial crisis induced knock-on effects of a plunge in tax receipts and a rise in social safety net payments. Nor is it just pension fund time bombs (note that despite the press hysteria, the problem is unmanageable only in a comparatively small number of states, with New Jersey way out in front, thanks to 15 years of the state stealing from the workers’ kitty, plus a decision to take big risk at exactly the wrong moment, in 2007, which resulted in large losses). A significant unrecognized culprit is companies managing to divert tax revenue from stressed states to their coffers.
Read more...Lately, the US has been winning the investment beauty contest among Cinderella’s ugly sisters. Europe’s addiction to austerity, rolling rescues, and inability to address internal imbalances means at best a wild ride and at worst a crisis resurgence. China still has its perennial fans, but long-standing bears like Jim Chanos have been joined more recently by Marc Faber, who foresees 3% growth, which is tantamount to a recession. Japan is struggling with a mile high currency. The US, by comparison, does not look too bad.
Or does it? One of the lurking worries in the background is the so-called fiscal cliff.
Read more...By Philip Pilkington, a writer and journalist based in Dublin, Ireland. You can follow him on Twitter at @pilkingtonphil
I seen a lot of rappers turn soft, I turn my TV off (uh)
And thugs got commercials (yea) thugs in commercials (uh)
And everybody’s chick turned gladiator and shit
No pimps, no hustlers, yo where’s your whips
No Maybachs, no Lambos on the field
Towncar, ridin Music Express
You the best example, yo the industry is whack yo
Now you can bet your label and your Phantom on that
– Kool Keith ‘Bamboozled’
Daily, megacorporations shovel crap into our eyes and ears. There is no worse indictment for the so-called ‘free market’ – which is really just a few giant bureaucratic institutions – than the suppression of creativity in favour of the commoditised effluent of the corporate culture industry.
Read more...By Philip Pilkington, a writer and journalist based in Dublin, Ireland. You can follow him on Twitter at @pilkingtonphil
We’ve already seen how, paraphrasing Archimedes, that financial instruments can move the world in a bad way. We have an opportunity to reverse that. Warren Mosler and I have just published a policy note at the Levy Institute that would, if implemented, bring an end to the Eurozone sovereign debt crisis.
Read more...One of the side effects of increased income disparity is the assumption in some circles that anyone who has a “big” job deserves a lot of money, whether or not the circumstances or their performance warrants it. It wasn’t all that long ago that the prevailing assumptions were radically different: CEOs (except maybe in the auto industry) did not see themselves as near royalty, and most well run businesses recognized that firing staff in downturns and rehiring was costly (search time and training are bigger costs than most top brass admit to themselves).
A great piece at the Village Voice, “The Nonprofit 1 Percent” describes how this logic plays out in the not-for-profit sector.
Read more...This Real News Network interview with professor of economics Jeffrey Thompson debunks the notion that increasing taxes on the well off is not a negative for employment.
Read more...Even though the mortgage settlement deal was without a doubt massively lawyered from the bank end, and should have received similar levels of scrutiny from the Federal and state officials, a major fly in the ointment may have been overlooked. The tax rule allowing a reduction in mortgage debt not to be counted as income expires at the end of this year. As the Seattle Times explains (hat tip Lisa Epstein):
Read more...Remember how peculiar it was that presidential candidate Mitt Romney refused to release his tax returns? That was predictably a non-starter. Most voters probably assume the reason he resisted was to avoid the controversy over his strikingly low tax rate.
Another factor appears to have played into this decision. The release of the tax returns shows Romney neglected to disclose some required financial information in his personal disclosure form filed with the Office of Government Ethics last year. His team apparently timed the release of his tax records with the hope that State of the Union hooplah would dominate news coverage and result in his finances getting less attention than they might otherwise. And that appears to been correct. His failure to divulge information about 23 investments, and more important his use of secret Swiss bank accounts, has been given a free pass. As Citizens for Responsibility and Ethics in Washington director Melanie Sloan observed, “Mr. Romney says the errors are minor, but then again he also claims earning $374,000 in speaking fees isn’t much money.”
Read more...