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Paulson to outsource the bailout to contractors


The Treasury Department this week plans to start outsourcing the management of up to $700 billion in troubled securities, using special contracting authorities that enable it to retain private portfolio managers, custodians and other financial services consultants without following standard acquisition procedures.

The department's quick turn to the private sector will help it prepare for the massive task of overseeing mortgages and other financial assets to be acquired by the government as part of the Emergency Economic Stabilization Act that was approved by Congress and signed by President Bush last Friday.

But it means that the government has little time to assess the companies that will be partners in what could become one of the largest public sector funds in American history. Some of the same firms that have played roles in the rise and collapse of the mortgage-backed securities market may end up guiding the government as the bailout unfolds, department officials said.

What could go wrong?

Give the Bush administration one thing: They are absolutely, utterly consistent.

Presumably when Obama was whipping the Dems, he knew that Paulson was going this route?

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Submitted by lambert on

You forgot massages, though.

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

Submitted by jawbone on

Lambert, others here, are you familiar with Antonia Juhasz, whose newest book is "The Tyranny of Oil."

"She was interviewed on Fresh Air this afternoon--very lefty, riveting, precise--and damning of Phil Gramm, his last minute slipped in clause in a huge omnibus bill in '99 which permitted the Enron scandals and now allows oil trading in totally unregulated ways.

She posits that the volatility in oil prices is due to the ability of Big Oil to now trade in sort of private exchanges, totally unregulated by any governments. They've been joined by Big Banker Boiz, especially Goldman-Sachs and Morgan Stanley, who saw commodites, especially oil, as a way to make money when they realized the clever financial instruments might not make it long term (not sure of the timeline on this). Then, they began to get into buying and owning oil fields, pipelines, tankers--and owning those allows them to trade even more secretly.

I'm going to listen to the audio on web and if there's enough there add more info. Just wondering if you're familiar with her (last name pronounced like "you' house).

Goldman-Sachs--into everything....

Submitted by jawbone on

she speaks in these complete paragraphs, with clear exposition, topic sentences, followed by examples to support her contentions. Very impressive. Googled for some info, found some articles which I'll read--soon as my DSL stops delinking every 15 minutes or so. (Verizon says I need a new modem.)

She is very impressive. But she did turn off some Fresh Air listeners, per comments, bcz she called Bush the "selected" president. Whoohooo!

Fredster's picture
Submitted by Fredster on

Just go back to the track record of FEMA, post-Katrina when they were letting contracts left and right with no oversight.

Gawd, this will be a cluster fuck.