Better Hope those Treasury Dudes are Right

Bloomberg has some potential famous last words as CIT awaits its fate from its bondholders:

The U.S. spurning of CIT Group Inc.’s aid request suggests officials are betting they’ve fixed the financial system enough to withstand the bankruptcy of a mid-sized lender. “I hate to say this, but it was probably expendable,” said Dennis Santiago, chief executive officer of Institutional Risk Analytics, a Torrance, California, research firm that studies systemic risk. “It may have just missed the boat” on federal rescues, Santiago said. [Empahsis ours]

Doesn't mean people, ahem, and voters won't be pissed:

There will be “a lot of disruption and anger among voters, particularly among people who rely on firms such as CIT for funding,” said Sean Egan, head of Egan-Jones Ratings Co. in Haverford, Pennsylvania, which rates CIT below investment grade. “A major provider of capital in the middle market is likely to be out of business in the near future,” and investors will be concerned, at least in the “short run” about CIT, Egan said. [Emphasis ours]

See you on the other side.

Treasury Bets U.S. Financial System Can Weather CIT Collapse [Bloomberg] Sphere: Related Content

Tell Us How You Really Feel: Goldman Sachs/Tim Geithner Conspiracy Edition

We'd like to give Maxine Waters credit for spawning the whole Goldman Sachs-running the universe conspiracy theory but we simply can't give her credit for a number of reasons that we won't get into here (okay, one: she's incapable of forming a coherent sentence).

Matt Taibbi is getting lots of attention for his "vampire squid on the face of America" analogy etc. etc. Hyperbole? Poss.

But when you have old Reagan soldiers calling you out...hard to say...is thing gaining real traction? Is Maxine Waters a benefactor of "better to be lucky than good"? We won't believe it...

Former US Assistant Secretary Of The Treasury: "Geithner Works For Goldman" [Zero Hedge] Sphere: Related Content

Reuters: Regulation Not Really On the Fast Track

This may come as some surprise to some of you but there are plenty of lobbyists banks opponents to the Obama Administration's plan to overhaul the regulatory system that will be rolled out next week.

Reuters:

"Targeting not only banks and markets for change, but also executive pay, hedge funds and so-called "systemic risk" to the economy, the Obama plan has been evolving for six months."

Don't you love how Reuters questions the whole notion of systemic risk? We should have just the chips fall and maybe we'd all be bartering for our groceries. Yeah, that sounds awesome.

"Regulatory reform will center mostly on turf fights and political infighting," said Jaret Seiberg, financial services policy analyst at research firm Concept Capital. "The odds are less than one-in-five that a massive financial reform bill will be enacted."

What the dude is trying to say is that the bureaucracies are going to get into some dick-measuring contests and Obama will get a watered down reform bill. Okay, so normal politics. Moving on...

*BTW, doesn't BO look like he's relishing in Timmy's cologne? Possibly Antidote? Discuss.

Steep climb ahead for U.S. financial reforms [Reuters] Sphere: Related Content

June 17th: Super Regulatory Friends Roll Out

The date is set people! The plan to fix everything once and for all will be given to us, courtesy of the Obama Administration, on June 17th, according to Reuters.

T to the mother f'n G will testify on June 18th in order to stammer through everything in painfully gruesome detail.

Long story/short. The Fed is going to make anything and everything its bitch, since it will be the "systematic risk regulator", Office of Thrift Services will merge with the Office of Comptroller Currency to oversee banks and the FDIC will be the Fed's right hand, having the superpower to unwind the AIG's of the world.

The Fed will still be the puppet master overseeing hedge funds, private equity, derivatives, and broker dealers, since they could all fall under "systematic risk". Me thinks that term is going to come in awful handy...

U.S. to unveil regulatory reform plan June 17: source [Reuters]

Sphere: Related Content

FROM THE NOT-SO-SURPRISING DEPARTMENT: Maxine Waters Doesn't Make a Damn Bit of Sense

Maxine Waters is doing her constituents proud again today folks. In today's version of AIG crucifixion, she's throwing out the whole Goldman Sachs conspiracy theory as it relates to the eventual dismantling of the entire economy so that GS can be the supreme ruler of the universe. This is sure to fly with the likes of T. Geith and Ben.

Can't BFrank put a stop her batshit insane rambling? I mean, the 5 minutes (or wtf it is) allotted to each member of the subcommittee is one thing but if a committee member can't form a clear and coherent question that is of some relevance to the hearing in under 30 seconds, the chairperson should have the power to call a forfeit for the rest of the time and the cost to the taxpayers of said time should be tracked. Maxine Waters (and reps like this) have clearly done more damage to the poor saps at CSPAN than can possibly be quantified.

Maxine Waters Puts On Her Goldman Sachs Conspiracy Hat [Clusterstock via Daily Intel] Sphere: Related Content