Week 8 Print

March 19, 2009 -As Federal Reserves declared today that in order to boost up economy, it would buy $300 billion of long-term U.S. Treasury securities in the next six months and a hundred million dollars more in mortgage backed securities. The rate for credit worthy mortgage customers fell to 4.75% today, and the value of U.S. currency continued to reach the floor.
Federal Reserves Chairman, Ben Bernanke hope this move will push down long-term borrowing rates benchmarked to treasury bonds, but can also backfire and fuel fear that the Feds, by using their power to print money to help government's finances are kindling inflation, according to Wall Street Journal.

Some top employees of American International Group Inc (AIG) have agreed to pay back some the retention bonuses (amounting $165 million)they received, due to public outrage. Lawmakers of from both parties questioned Treasury Secretary Timothy Geithner did not do more to derail the bonuses and two Republicans called him to resign. However, President Obama expressed his confidence in Geithner. "He is making all the right moves in playing a bad hand." The president took the ultimate responsibility saying, "I am the president, I'll take responsibility. The buck stops with me."
Surprisingly, some to the biggest critics were those who received the most campaign contributions from AIG, including President Obama ($104,332), Senate Banking Chairman Christopher Dodd (103,900).
Among Republicans, former President George W. Bush received the most from AIG in the amount of $200,000.

March 20, 2009 -House passed a bill that would impose a 90% surtax on bonuses paid this year to executives of Wall Street firms getting more than $5 billion in bailout.
A 90% surcharge on bonuses on top of other income taxes will be imposed on those who received bonuses after Dec.31, 2008 and those who make $250,000 or more in gross income.

President Barack Obama appeared on the Tonight Show with Jay Leno and discussed current AIG and financial crisis on Wall Street. "...it took us a while to get into this mess, and it will take us a while to get out. [The American people] will give us time," said the president. President Obama is the first president to appear on a late night show, according to NBC.

March 23, 2009 - Two Obama cabinet members will be working at home and abroad to alleviate concerns regarding the drug wars along the Mexican borders. Homeland Security Secretary, Janet Napolian will address the crisis for the first time on Capitol Hill on Wednesday. Secretary of State, Hillary Clinton will visit Mexico the same day. The Obama administration has expressed constant support of Mexican President, Felipe Calderon's crackdown on drug lords who are warring the nation and fighting over territory to sell drugs and export them into the U.S.

March 24, 2009 -President Obama tried to ease tension and woes to Wall Street after weeks of outrage and criticism. The Obama administration is trying to work with top bankers on Walls Street on a bailout plan which will rely on public-private investments to soak up toxic assets.

March 25, 2009 - President Barack Obama held a press conference last night and did not shy away from answering questions and did not hold back on delivering his message. The president used prime-time news conference to defend his $3.6 trillion budget plan and tax proposals, one day before the plan begins to move in Congress. He pressed for renewable-energy development, education and health-insurance renovation for when the economy is healed. He called for new authorities to cease and dismantle non-bank financial institutions such as AIG. When questioned about his economic plans President Obama was firm on his stance. "The alternative is to stand pat, and to simply say we are just going to not invest in health care; we're not going to take on energy, we'll wait until the next time that gas gets to $4 a gallon; we will not improve our schools, and we'll allow China or India or other countries to lap our young people in terms of their performance," he said. The president does not have a detailed plan as how to bring down the deficit, however he said the key will be controlling health-care costs. President Obama's spending plan is under attack by many Republicans as well as some Democrat leaders. Many are attacking the president's proposal to limit charitable deductions. "I'm assuming that [the deduction] shouldn't be the determining factor in as to whether you're giving that hundred dollars to the homeless shelter down the street," said the president. When the president was asked why he took so long to react to the AIG retention bonuses, the president snapped, "because I like to know what I am talking about." President Obama also expressed his optimism between the Israel and Palestinian state and insisted on persistence.

March 26, 2009 -President Obama holds the first ever virtual web-hall meeting. President Obama discussed healthcare, education reform and discussed ways to create jobs for Americans. "No dream is beyond our reach."

Sources
Los Angeles Times http://latimesblogs.latimes.com/money_co/2009/03/obama-stocks-us.html
New York Times http://topics.nytimes.com/topics/reference/timestopics/people/o/barack_obama/index.html
The Wall Street Journal http://online.wsj.com/article/SB123808005152848441.html