MID-DAY UPDATE: AIG and Goldman execs unapologetic before crisis commission
The Mid-Day Update is a five-day-a-week podcast from the Marketplace Morning Report co-hosted by Bill Radke and Steve Chiotakis that wraps up the morning news in a fun little package. Listen here every day at 10 a.m. PT or download it to your iPod by subscribing to the Morning Report Podcast:
From the Marketplace world headquarters in Los Angeles, it’s the Mid-day update.
Joseph Cassano is testifying to the Financial Crisis Inquiry Commission today. This is the guy who headed up AIG’s Financial Products division, which blew up and cost taxpayers more than $100 billion. He walked away with more than $300 million in salary and bonuses. This morning, he defended his buildup of risky mortgage-backed securities. Said he genuinely thought they were going to pay off — even when he said that in August of ’07. Goldman Sachs President Gary Cohn is also testifying about Goldman getting a so-called “backdoor bailout” when the government rescued AIG. He also offered no apology, saying considerable shareholder money was spent to insure against the risk that AIG would not pay Goldman in the event of a default
This morning the payroll company ADP said private employers added only 13,000 jobs this month — most experts were predicting 60,000. We talked about how this affects the Congressional argument over extending unemployment benefits. The government’s unemployment report comes out Friday. That’s expected to be bad, mainly because a lot of temporary government census workers have had their jobs end. If Congress ends unemployment benefits, the unemployment rate could go down in the future just because there’s less incentive to tell the government you’re looking for work.
Congressional conferees have now scrapped the $19 billion fee on banks as a way to pay for overhauling financial regulations. Now the measure would be paid for by 1) an increase in the fee banks pay the FDIC to insure their deposits… 2) money from the Troubled Asset Relief (bailout) Program. TARP was scheduled to run until October, so the politicians said they’ll end the program early, and they called that a $12 billion savings — savings that will pay to implement the new financial rules.
Interest rates may be low, but this morning the Mortgage Bankers Association said demand for loans sank last week toward 13-year lows. Those are new home loans — refinances are up.
The Chicago Purchasing Managers Index came out less bad than expected.
The European Central Bank today offered to refinance the debt of a bunch of big banks in Europe. The amount of money those banks asked for turned out to be less than expected. Our Stephen Beard told us this is being taken as a hopeful sign that European banks may not be as strapped as we feared.
We got a report from the BBC on that giant upcoming stock offering from the Agricultural Bank of China. This is the last of China’s big state owned banks to go public.
As a nonprofit news organization, our future depends on listeners like you who believe in the power of public service journalism.
Your investment in Marketplace helps us remain paywall-free and ensures everyone has access to trustworthy, unbiased news and information, regardless of their ability to pay.
Donate today — in any amount — to become a Marketplace Investor. Now more than ever, your commitment makes a difference.