Loose Lips Sink..... Economies

Washington Times - Geithner gaffe roils markets

The dollar plummeted by as much as 1.3 percent against the euro within 10 minutes of his remarks. But then the greenback quickly recouped most of its losses after Mr. Geithner retracted his statement and said, "I think the dollar remains the world's dominant reserve currency." Later in the day, as concern weighed down the dollar again, White House spokesman Robert Gibbs chimed in to the now universal chorus from top officials that the administration expects the dollar to be the world reserve currency for "a long, long time."

But the damage may already have been done. By afternoon, a poor showing of buyers at a Treasury bond auction sent interest rates sharply higher, raising fears about the U.S. ability to sell a massive load of $2.5 trillion of debt this year. Buyers may have been spooked not only by the Treasury secretary's remarks but also by the unveiling of budget plans on Capitol Hill that would double the amount of debt the Treasury has to sell in the next five years to nearly $12 trillion.

"They are opening the spigots and flooding the market, and there is no end in sight to the deluge of supply" of Treasury bonds, said Louise Purtle, analyst at CreditSights.

"The poor communication from the Treasury Department has complicated the market for Treasuries," said Jeffrey Caughron, chief market analyst at the Baker Group investment firm.

EU Presidency: Obama Plans 'a Way to Hell'

FOXNews.com - EU Presidency: Obama Plans 'a Way to Hell' - International News | News of the World | Middle East News | Europe News:

"STRASBOURG, France — A top European Union politician on Wednesday slammed U.S. plans to spend its way out of recession as 'a way to hell.'

Czech Prime Minister Mirek Topolanek, whose country currently holds the EU presidency, told the European Parliament that President Barack Obama's massive stimulus package and banking bailout 'will undermine the stability of the global financial market.'"

Washington Times - WH cleared way for AIG bonuses

Washington Times - WH cleared way for AIG bonuses

The Obama administration and one of its key allies in Congress belatedly acknowledged Wednesday that they were responsible more than a month ago for clearing the way for large bonuses to be paid inside taxpayer-supported companies like AIG, undercutting the White House's attempts to distance itself from a growing political embarrassment.

Meanwhile, fresh evidence emerged that more largesse was about to be doled out to the government's hand-picked executives running the troubled mortgage giant Fannie Mae.

As outrage grew on Capitol Hill and among the public, President Obama tried to deflect blame while conceding "the buck stops" ultimately with him in ensuring future bonuses aren't paid at taxpayers' expenses. Lawmakers on Capitol Hill unleashed their fury on Edward Liddy, chief executive of American International Group Inc., for allowing $165 million in new bonuses to be paid to executives of the bailed out insurer.

...Pants on Fire

And the Democrats said the Republicans couldn't be trusted. This really puts the GOP in the bush leagues.

Sen. Dodd Admits Adding Bonus Provision to Stimulus Package - First 100 Days of Presidency - Politics FOXNews.com:

"In a dramatic reversal Wednesday, Sen. Chris Dodd, D-Conn., confessed to adding language to a spending cap in the stimulus bill last month that specifically excluded executive bonuses included in contracts signed before the bill's passage.

Dodd told FOX News that Treasury officials forced him to make the change.

"As many know, the administration was, among others, not happy with the language. They wanted some modifications to it," he said. "They came to us, our staff, and asked for changes, and the changes at the time did not seem that obnoxious or onerous."

But the provision has become a flash point for criticism amid the controversy over $165 million in bonuses given out by AIG after securing more than $170 billion in federal aid. The language in the stimulus bill wasn't specific to AIG, but some have expressed outrage that it appears to have created a loophole.

...On Tuesday, Dodd told FOX News that he didn't add the exemption."

Will it End?

Bernanke: Fed will spend another $750 billion on mortgage-backed securities

"The Fed also said it will buy more mortgage-backed securities guaranteed by Fannie Mae and Freddie Mac to help that battered market. The central bank will buy an additional $750 billion, bringing its total purchases of these securities to $1.25 trillion. It also will boost its purchase of Fannie and Freddie debt.

In addition, the Fed said a $1 trillion program to jump-start consumer and small business lending could be expanded to include other financial assets."

Another Stimulus, Pelosi Says

Jesus H, the last round hasn't even been distributed!

Congress May Need to Fund Another Stimulus, Pelosi Says - washingtonpost.com:

"House Speaker Nancy Pelosi said yesterday that the federal government may have to spend even more money to shore up the nation's ailing economy, on top of the more than $1.6 trillion so far approved by Congress."

A Rocky Start for Obama's Broadband Push - BusinessWeek

A Rocky Start for Obama's Broadband Push - BusinessWeek:

"No Hard Answers

And so it went again and again. At the first public discussion of the Obama Administration's much heralded broadband plan, government officials offered virtually no hard answers to the hundreds of people who gathered in person and the 2,500 more who participated via live Web video. For almost every substantive question about how the billions will be allocated, officials said they're looking for guidance from the public. Bernadette McGuire-Rivera, NTIA associate administrator, said the government is seeking input on 'nearly every facet of the program.'

The lack of answers proved frustrating for some participants. Charlie Mattingly, chief executive of a small Internet service provider in Texas called Broadband Rural, was taken aback that the meeting wasn't more productive. 'I had no idea how full of themselves they are in Washington,' he said. 'If we had half the money that the government spent to put on this meeting today and half of the money that people spent to attend it, we could have put 1,000 people online,' he said."