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The revolving door keeps spinning…

Class war

George Soros is worried:

Soros doesn’t make small bets on anything. Beyond the markets, he has plowed billions of dollars of his own money into promoting political freedom in Eastern Europe and other causes. He bet against the Bush White House, becoming a hate magnet for the right that persists to this day. So, as Soros and the world’s movers once again converge on Davos, Switzerland, for the World Economic Forum this week, what is one of the world’s highest-stakes economic gamblers betting on now?

He’s not. For the first time in his 60-year career, Soros, now 81, admits he is not sure what to do. “It’s very hard to know how you can be right, given the damage that was done during the boom years,” Soros says. He won’t discuss his portfolio, lest anyone think he’s talking things down to make a buck. But people who know him well say he advocates making long-term stock picks with solid companies, avoiding gold—“the ultimate bubble”—and, mainly, holding cash.

He’s not even doing the one thing that you would expect from a man who knows a crippled currency when he sees one: shorting the euro, and perhaps even the U.S. dollar, to hell. Quite the reverse. He backs the beleaguered euro, publicly urging European leaders to do whatever it takes to ensure its survival. “The euro must survive because the alternative—a breakup—would cause a meltdown that Europe, the world, can’t afford.” He has bought about $2 billion in European bonds, mainly Italian, from MF Global Holdings Ltd., the securities firm run by former Goldman Sachs head Jon Corzine that filed for bankruptcy protection last October.

Has the great short seller gone soft? Well, yes. Sitting in his 33rd-floor corner office high above Seventh Avenue in New York, preparing for his trip to Davos, he is more concerned with surviving than staying rich. “At times like these, survival is the most important thing,” he says, peering through his owlish glasses and brushing wisps of gray hair off his forehead. He doesn’t just mean it’s time to protect your assets. He means it’s time to stave off disaster. As he sees it, the world faces one of the most dangerous periods of modern history—a period of “evil.” Europe is confronting a descent into chaos and conflict. In America he predicts riots on the streets that will lead to a brutal clampdown that will dramatically curtail civil liberties. The global economic system could even collapse altogether.

Mortgage settlement kabuki

No, Mr. President, you’re trying to stack the deck and we won’t accept it.

President Obama,

you’re right, critics of yours from the left – people like me – love the idea of NY Attorney General Eric Schneiderman chairing a “special unit to investigate misconduct and illegalities that contributed to both the financial collapse and the mortgage crisis” that would be “part of a new Unit on Mortgage Origination and Securitization Abuses.” But that’s not what you’re announcing, at least as described by Sam Stein for the HuffPo.

Schneiderman isn’t chairing anything. He’s Co-Chairing. That’s a huge difference. If he’s Chair he’s in charge. If he’s Co-Chair he needs consensus. And who is he Co-Chairing with? Lanny Breuer. That’s unacceptable.

The reason we want Schneiderman in charge of prosecuting is because Breuer, who heads the Justice Department’s Criminal Division, hasn’t done his job. If he had pursued these prosecutions we’d have a lot more justice in this country right now than we do. Why has Breuer failed to go after the people who committed “misconduct and illegalities that contributed to both the financial collapse and the mortgage crisis”? Is it because he’s an ex- (and likely future)Covington & Burling partner? Doesn’t matter. His track record speaks for itself. There is only one reason to have him co-chair with Schneiderman, and that’s to rein Schneiderman in.

Second, Khuzami’s SEC can be called aggressive only when measured against Breuer’s Criminal Division. Having Khuzami on the committee gives the weak-enforcement lawyers two people to Schneiderman’s one. And Khuzami is deeply conflicted because he was Deutsche Bank’s CDO lawyer in 2006 and 2007, peak shadiness times.

Both have to go.

UPDATE: David Dayen checks in on this.

I’d really like to be wrong about this. But this just reads like a gambit, a fix, a charade.


Also coordinating with the CIA on “terrorism.”

Simple song

The Shins:

The way I am

Ingrid Michaelson:

Murder, he says

Betty Hutton:

It’s oh so quiet


Justin Townes Earle:

Adviser to warlords

I take it back: The NYT is interested in at least part of this story.

Does this surprise me? Of course not. Neither does the fact that the media is not all that interested in this story:

Walid Phares, the recently announced co-chair of GOP presidential candidate Mitt Romney’s Middle East advisory group, has a long résumé. College professor. Author. Political pundit. Counterterrorism expert. But there’s one chapter of his life that you won’t find on his CV: He was a high ranking political official in a sectarian religious militia responsible for massacres during Lebanon’s brutal, 15-year civil war.

During the 1980s, Phares, a Maronite Christian, trained Lebanese militants in ideological beliefs justifying the war against Lebanon’s Muslim and Druze factions, according to former colleagues. Phares, they say, advocated the hard-line view that Lebanon’s Christians should work toward creating a separate, independent Christian enclave. A photo obtained by Mother Jones shows him conducting a press conference in 1986 for the Lebanese Forces, an umbrella group of Christian militias that has been accused of committing atrocities. He was also a close adviser to Samir Geagea, a Lebanese warlord who rose from leading hit squads to running the Lebanese Forces.

Since fleeing to the United States in 1990, when the Syrians took over Lebanon, Phares has reinvented himself as a counterterrorism and national security expert, traveling comfortably between official circles and the GOP’s anti-Muslim wing. In a little over two decades, he’s gone from training Lebanese militants to teaching American law enforcement and intelligence officials about the Middle East, and from advising Lebanese warlords to counseling a man who could be the next president of the United States.

“I can’t think of any earlier instance of a [possible presidential] adviser having held a comparable formal position with a foreign organization,” says Paul Pillar, a 20-year veteran of the CIA and a professor at Georgetown’s Center for Peace and Security Studies. “It should raise eyebrows any time someone in a position to exert behind-the-scenes influence on a US leader has ties to a foreign entity that are strong enough for foreign interests, and not just US interests, to determine the advice being given.”

Phares has long faced questions about his background with the Lebanese Forces. As sketchy details have trickled out, he’s tried to downplay his involvement, claiming that he was “politically in the center” of Lebanese Christian politics and that he “was never a military official.” But a Mother Jones investigation has found that he was a key player within the Lebanese Forces when it was involved in a bloody sectarian conflict.

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