The
Paulson
Chain
Letter
September 29, 2008
With the latest bailout of the automakers, the entire scheme of handouts to incompetent firms and crooks is starting to resemble a chain letter from Nigeria trying to scam the rubes!
Dear American Taxpayer:
It is my great honor to ask you as a patriot to support an urgent secret business relationship with a transfer of funds of great magnitude.
I am Ministry of the Treasury of the United Socialist States of America . My country has had a crisis that has caused the need for a large transfer of funds of 700 billion dollars US. If you will assist me in this transfer, it would be most profitable to you.
I am working with Mr. Phil Gramm, lobbyist for UBS, who will be my replacement as Ministry of the Treasury in January. As a former Senator, you may know him as the leader of the American banking deregulation movement in the 1990s. This transaction is 100% safe.
This is a matter of great urgency. We need a blank check. We need the funds as quickly as possible. We cannot directly transfer these funds in the names of our close friends because we are constantly under FISA surveillance. My lawyer advised me that I should look for a reliable and patriotic person who will act as an intermediary so the funds can be transferred.
Please reply with all of your bank account, IRA, 401K, and college fund account numbers and those of your children and grandchildren, along with their social security numbers to wallstreetbailout@treasury.gov so that we may transfer your commission for this transaction. After I receive that information, I will respond with detailed information about safeguards that will be used to protect the funds, along with a generous commission of Washington Mutual stock. I can personally guarantee, as I have in the past, that like all financial stocks, this will increase in value over time.
But remember, YOU MUST ACT NOW! THIS IS A LIMITED TIME OFFER, BUT IF FOR SOME REASON YOU CHOOSE NOT TO ACT, WE WILL HAVE NO CHOICE BUT TO MOVE ON DOWN THE LIST OF PATRIOTS!
Yours Faithfully,
Comrade Mikhail Paulson
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As the deliberations raged last week over the Mother of All Bailouts, little attention was given to Washington Mutual. Oh sure, it was mentioned, but it was not the lead story - even the day the FDIC and the Federal Reserve arranged another forced sale to JP Morgan. Among little fanfare, WaMu was another one to bite the dust.
Seattle-based WaMu, which was founded in 1889, is the largest bank to fail by far in the country's history. Its $307 billion in assets eclipse the $40 billion of Continental Illinois National Bank, which failed in 1984, and the $32 billion of IndyMac, which the government seized in July. JPM was able to buy WaMu for just $1.9 billion.
Although it is alarming that another major firm has failed, it looks like it was inevitable given the size of its bad real estate loans. And the way WaMu was taken under by JPM; it didn't cost the taxpayer a penny or disrupt the markets, so I guess that's a positive way to view the demise of a huge bank.
The seizure by the government means shareholders' equity in WaMu was wiped out. The deal also leaves private equity investors including the firm TPG Capital, which gave WaMu a cash infusion totaling $7 billion this spring, empty handed wondering - Why did we buy into that Co?
Question: How did WaMu's shares go to zero while short selling was banned? The media, as well as long-only whiners, want you to believe these firms were being driven down because of some grand scheme of un-American short sellers, and not their fundamentals. WaMu and others are going down because of the decisions they made in the past - not because of short sellers.
By the way, another bailout flew under the radar last week: the automakers were given their $25-billion assistance check. Keep up the good work fellas.
by Larry Levin
