Treasury Department Statement Regarding Leadership of the International Monetary Fund

Treasury Department Statement Regarding Leadership of the International Monetary Fund

WASHINGTON – Today, the U.S. Department of the Treasury issued the following statement from Secretary Tim Geithner following the resignation of Dominique Strauss-Kahn as Managing Director of the International Monetary Fund (IMF).

"As Acting Managing Director, John Lipsky will provide able and experienced leadership to the Fund at this critical time for the global economy.  We want to see an open process that leads to a prompt succession for the Fund's new Managing Director."​

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M&T Bank Corporation Returns $700 Million in TARP Funds, Providing Additional Positive Return for Taxpayers on TARP Bank Programs

M&T Bank Corporation Returns $700 Million in TARP Funds, Providing Additional Positive Return for Taxpayers on TARP Bank Programs

WASHINGTON – The U.S. Department of the Treasury announced that M&T Bank Corporation of Buffalo, New York has now repaid more than $700 million in Troubled Asset Relief Program (TARP) funds to taxpayers.

Today, M&T Bank repurchased TARP Capital Purchase Program (CPP) preferred shares from Treasury totaling $370 million. Additionally, last week, in connection with its acquisition of Wilmington Trust Corporation, M&T Bank purchased CPP preferred shares totaling $330 million that had been issued to Treasury by Wilmington Trust.

In March, Treasury announced that the Troubled Asset Relief Program's (TARP) investments in banks turned a profit. Since that time, all further repayments and income through TARP's bank programs, such as those announced today, provide additional positive returns for taxpayers.

With today's proceeds, taxpayers have now recovered more than $252 billion from TARP's bank programs through repayments, dividends, interest, and other income. That exceeds the original investment Treasury made through those programs ($245 billion) by approximately $7 billion. Treasury currently estimates that bank programs within TARP will ultimately provide a lifetime positive return of approximately $20 billion to taxpayers.

Treasury currently expects that TARP investment programs taken as a whole – including financial support for banks, other financial institutions, and the domestic auto industry; as well as targeted initiatives to restart the credit markets – will result in relatively little cost to taxpayers. The lifetime cost of TARP is likely to be predominantly limited to funds disbursed for Treasury's foreclosure prevention programs, which were not intended to be recovered.

Also today, Sterling Bancorp of New York City repurchased warrants to purchase common stock received in consideration for investments made under TARP's Capital Purchase Program. Further details on today's TARP repayments are included below:

• M&T Bank Corporation (Buffalo, NY): Repurchased CPP preferred shares totaling $370 million and paid accrued dividends totaling $154,167. After this transaction, Treasury holds remaining outstanding M&T Bank Corporation CPP preferred shares totaling $381.5 million.  (Total Proceeds Today for Taxpayers: $370.2 million) ​
• Sterling Bancorp (New York, NY): Repurchased 516,817 warrants to purchase common stock of Sterling Bancorp. (Total Proceeds Today for Taxpayers: $945,775)​

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Administration Takes Additional Steps to Hold the Government of Syria Accountable for Violent Repression Against the Syrian People

Administration Takes Additional Steps to Hold the Government of Syria Accountable for Violent Repression Against the Syrian People

WASHINGTON – Today, President Obama signed an Executive Order (E.O.) imposing sanctions against Syrian President Bashar al-Assad and six other senior officials of the Government of Syria in an effort to increase pressure on the Government of Syria to end its use of violence against its people and begin transitioning to a democratic system that protects the rights of the Syrian people.

Also today, the U.S. Department of the Treasury announced the designation of 10 individuals and entities pursuant to E.O. 13572 – signed by President Obama on April 29, 2011 –targeting Syrian officials and others responsible for human rights abuses, including repression against the Syrian people, as well as a set of companies tied to Syrian corruption.

The United States continues to strongly condemn the Syrian government's use of violence and intimidation against its people and urges President al-Assad and his regime to answer the calls of the Syrian people for a more representative government and embark upon the path of meaningful democratic reform.

"The actions the Administration has taken today send an unequivocal message to President Assad, the Syrian leadership, and regime insiders that they will be held accountable for the ongoing violence and repression in Syria," said Acting Under Secretary for Terrorism and Financial Intelligence David S. Cohen.  "President al-Assad and his regime must immediately end the use of violence, answer the calls of the Syrian people for a more representative government, and embark upon the path of meaningful democratic reform."

New Executive Order

In signing this Executive Order, the President has provided the United States with additional tools to pressure senior Syrian government officials and has imposed sanctions on the following individuals listed in the Annex to the Order:

• Bashar al-Assad: President of the Syrian Arab Republic
• Farouk al-Shara: Vice President of the Syrian Arab Republic
• Adel Safar: Prime Minister of the Syrian Arab Republic
• Mohammad Ibrahim al-Shaar: Minister of the Interior of the Syrian Arab Republic
• Ali Habib Mahmoud: Minister of Defense of the Syrian Arab Republic
• Abdul Fatah Qudsiya: Head of Syrian Military Intelligence
• Mohammed Dib Zaitoun: Director of Political Security Directorate

As a result of this action, any property in the United States or in the possession or control of U.S. persons in which the individuals listed in the Annex have an interest is blocked, and U.S. persons are generally prohibited from engaging in transactions with them.

The President has authorized the Secretary of the Treasury, in consultation with the Secretary of State, to take actions to block the property and interests in property of senior Syrian Government officials; agencies and instrumentalities of the Syrian Government, persons owned or controlled by the Syrian Government, or by officials of the Syrian Government; persons that have provided material support to those blocked pursuant to this Order; and, those that are owned or controlled by, or that have acted for or on behalf of persons pursuant to in this Order. 

Executive Order 13572 Designations

Exposing further the complicity of Syrian government officials in the human rights abuses and repression of the Syrian people, Treasury designated today the following individuals and entities pursuant to E.O. 13572:

• Hafiz Makhluf: a cousin of President al-Assad and senior official of the Syrian General Intelligence Directorate (GID), the overarching civilian intelligence service in Syria listed in the Annex to E.O. 13572.   Makhluf was given a leading role in responding to protests in Syria, and was heavily involved in the Syrian regime's actions in Dar'a, where protesters were killed by Syrian security forces.  Makhluf was previously designated by Treasury in November 2007 pursuant to E.O. 13441, which targets persons undermining the sovereignty of Lebanon or its democratic processes and institutions.
• Syrian Military Intelligence (SMI):  One of the four major branches of Syria's security forces. During the recent civil unrest in Syria the SMI has used force against and arrested demonstrators participating in the unrest.
• Syrian National Security Bureau (NSB): An element of the Syrian Ba'ath Party. The Syrian National Security Bureau (NSB) directed Syrian security forces to use extreme force against demonstrators.
• Syrian Air Force Intelligence (SAFI):  In late April 2011, security forces including personnel from SAFI fired tear gas and live ammunition to disperse crowds of demonstrators who took to the streets in Damascus and other cities after noon prayers, killing at least 43 people.
• Qasem Soleimani: Commander of the Iranian Islamic Revolutionary Guard Corps-Qods Force (IRGC-QF), the conduit for Iranian material support to the GID. The IRGC-QF was listed in the Annex to E.O. 13572.  
• Mohsen Chizari:  A senior IRGC-QF officer who serves as the Commander of IRGC-QF Operations and Training.

E.O. 13572 authorizes the United States to sanction any person that is owned or controlled by, or acts for or on behalf of any person designated pursuant to E.O. 13460. Included in today's action are three companies and one corporate official for ties to public corruption in Syria.  The targets are Cham Holding and its Chairman Nabil Rafik al Kuzbari, Bena Properties, and Al Mashreq Investment Fund, all of which are owned or controlled by, or acting for or on behalf of Rami Makhlouf. Makhlouf, a powerful Syrian businessman and regime insider, was designated by Treasury in February 2008 under E.O. 13460 for improperly benefitting from and aiding the public corruption of Syrian regime officials.  ​

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World News!

China

• In "You forgot to mention the prospect of an impending zombie apocalypse" news, a statement from China's State Council acknowledged that a number of serious problems have occurred in the wake of the construction of the Three Gorges Dam.  "At the same time that the Three Gorges project provides huge comprehensive benefits, urgent problems must be resolved regarding the smooth relocation of residents, ecological protection, and geological disaster prevention," says the statement.
• Gen Chen, chief of the General Staff of the People's Liberation Army, has assured the United States that China is not trying to match US military power.  "Although China's defense and military development has come a long way in recent years, a gaping gap between you and us remains," he said at the National Defense University. 

Iran

• President Mahmoud "the Holocaust never happened" Ahmadinejad, in an attempt to dethrone Hugo "US scalar weapons caused the Haiti earthquake" Chavez as reigning lunatic statement champion, has stated in an interview on Iranian television that "I have exact information that bin Laden was held by the American military for sometime... until the day they killed him he was a prisoner held by them.  Please pay attention.  This is important.  He was held by them for sometime.  They made him sick and while he was sick they killed him."

Japan

• Japanese Q1 GDP fell 0.9% (with a year over year decline of 3.7%), officially marking the entry of the Japanese economy into a recession.  The Bank of Japan expects things to improve in Q3 and Q4.
• Japanese engineers have entered the Fusushima reactor number 3 on an inspection tour, the first to enter the building since the hydrogen explosion that blew the roof off the building on March 11.

Syria

• The United States has imposed sanctions against Syrian President Bashar "We're not suppressing protestors, just the armed terrorist gangs hiding behind the protesters" al-Assad and six senior Syrian officials for human rights abuses.  All of their assets have been frozen, and it is now illegal for Americans to do business with them.  President al-Assad's response was to condemn the sanctions as part of a US effort to impose its policies on the region, and assured anyone who believes him that the crisis is coming to an end.  As he was delivering those remarks, reports came in to the BBC of the Syrian army bringing 27 protesters in Tal Kalakh to an end through the use of batons and bullets.

United States

• In "I thought you weren't supposed to be evil" news, California State Senator has introduced a Social Networking Privacy Act (SB 242), which would require "a social networking Internet web site to establish a process for new users to set their privacy settings as part of the registration process that explains privacy options in plain language, and to make privacy settings available in an easy-to-use format".  Coming out in opposition to this proposed state law is Facebook and Google (among others), who jointly state that plain language privacy settings "would significantly undermine the ability of Californians to make informed and meaningful choices about use of their private data", claim that it "would impose a duty on social networking sites difficult or impossible to discharge using existing technologies", and assure us that it "would notably interfere with the right to freedom of speech enshrined in ...the First Amendment to the United States Constitution."
• After a three day, 2000 mile drive from California to Tenseness, Antonio Carranza was arrested and held on a $300,000 bond for driving while intoxicated, failing to heed police lights and sirens, and possession of 91 pounds of cocaine.  He was released four days later after sheriff's deputies discovered that the "cocaine" was 91 pounds of cheese, shrimp, and tortilla and tamale dough.  His truck and dog, confiscated at the time of his arrest, have not been returned.
• In "Can you say conflict of interest?  Good, I knew you could" news:  Fur months after helping to approve a merger between Comcast and NBC Universal, Meredith Attwell Baker has left the FCC to take a job as a Washington lobbiest for Comcast.

First Time Jobless Claims

It's Thursday!  And if it's Thursday, it's time for unemployment insurance claims!

 

Last week, the figures for the week ending 5/7 came in pretty much in line with expectations.  The first time claims for 4/30 were revised downwards to 473,000, and the advance figure for initial claims for the week ending 5/7 came in at 434,000 - which actually missed expectations, but only by 4000 (a veritable drop in the bucket).  Unadjusted initial claims for 5/7 came in at 394,583, and the total number of people claiming benefits in all programs fell to 7,983,672 ( a decline of 31,247 from the previous week).

 

Now, for the week ending 5/14, the Econoday-surveyed analysts are feeling even more optimistic.  They're calling for the number of new claims for the week to fall to 425,000.

 

Are they even remotely accurate?  To find out we turn to the US Department of Labor's Unemployment Insurance Weekly Claims Report, where we see that....

 

Wow.

 

So, first of all, the initial claims figure for 4/7 was revised upwards to 438,000.  Not great, in and of itself, but it's this week's figures that drive the "wow".  For the week ending 5/14, the advance figure for seasonally adjusted initial claims was 409,000.

 

Repeat after me:  wow.  Expectations have been beaten like a Syrian pro-Democracy protester.

 

The unadjusted initial claims figure for 5/14 comes in at 357,872 (down 36,711 from last week), and the total number of people claiming benefits in all programs was - for the week ending 4/30[1] -  7,936,548 (a decline of 47,124).

 

Overall, that's pretty good news for the week.  The markets should like this.

 

[1]  Yeah, there's a bit of a delay in that figure.

World News!

Israel

• Israeli troops used live ammunition to suppress Palestinian protesters attempting to enter Israel from Lebanon.  The protesters were there to commemorate Nakba Day, by throwing rocks at the soldiers.  Reports are that 10 Palestinians died and 112 were wounded.  Syria, winning the chutzpah award for the day, condemned Israel's "criminal activities".

Japan

• With the Fukushima nuclear plant still in meltdown, Japan has expanded the evacuation zone around the plant from 20km to 30 km.

Libya

• Luis Moreno-Ocampo, International Criminal Court prosecutor, asked for warrants for the arrest of Muammar Gaddafi, Saif al-Islam, and Abdullah al-Senussi on charges of war crimes - suppressing protests using live ammunition and heavy artillery, deploying snipers to kill civilians leaving mosques, and attacking civilians at home.

North Korea

• The land of the furry hat of power is back!  North Korea Crazy[1] has, according to a leaked UN report, been exchanging ballistic missile technology with Iran.  The exchanges have taken place through "a neighboring third country" identified as China.

Syria

• Syria suppressed pro-democracy protests in Talkalakh on Sunday with live ammunitiion and heavy artillery.  So far there is no word as to whether Luis Moreno-Ocampo will seek warrants for the arrest of "President" Saleh and his key government officials, who have had over 700 civilians killed in the past two months.

United States

• In "the Singularity is coming" news Google (yes, that Google) is lobbying the state of Nevada for legislation that would make it legal to operate self-driving cars on public roads.
• The Walt Disney Company has trademarked the name "Seal Team 6"[2].  I can't wait for their next animated movie:  "Disney's The War or Terror", with 3 new songs by Phil Collins.
• Pepsico will be test-marketing a soda bottle made from 100% PET plastic, which is a plastic made out of plant matter.  It uses no petroleum (yay!), is 100% recyclable (yay!) but, despite it's source material, is not compostable or biodegradable (boo!).  But hey, it's a good start.  Coca-Cola's response was to pout and sullenly mutter "we've been using plastic bottles with PET content since 2009".
• With no agreement yet on raising the debt ceiling, Treasury Secretary Timothy Geithner has announced that he will be suspending investments in two government retirement funds[3], which he calculates will free up $147 billion in additional borrowing capacity by not allowing Federal pension money to be invested in Treasuries until August 2nd.
• Dominique Strauss-Khan, the current Managing Director of the IMF, was arrested Sunday for the alleged attempted rape of a Manhattan hotel maid.  He is appearing in court today, where he plans to plead not guilty to charges of a criminal sexual act, attempted rape, and unlawful imprisonment.  If convicted, he faces 15 to 20 years in prison.
• The Nasdaq OMX Group Inc has withdrawn its hostile bid to take over NYSE Euronext.  "The acquisition would have substantially eliminated competition for corporate stock listing services, opening and closing stock auction services, off-exchange stock trade reporting services, and real-time proprietary equity data products," stated the Justice Department, whose opposition is credited with ending the bid.
• The space shuttle Endeavour has launched today for its final mission.  Once it returns to earth, and the Atlantis completes it's final mission in July, the United States will be without any orbit-capable launch vehicles.

 

[1]  Hitting the charts with their new single "Japan Is My New Yeongpyong".

[2]  To look at the actual applications, go to the United States Patent and Trademark Office's Trademark Electronic Search System.  You can just search for "Seal Team 6",  They've got serial numbers 85310970, 85310966, and 85310957.

[2]  Specifically, the Civil Service Retirement and Disability Fund (CSRDF) and the Government Securities Investment Fund ("G Fund").  The CSRDF is invested in special-issue Treasury securities, and the "G Fund" is a money market that uses special-issue Treasury securities.  The Treasury Department has put out an FAQ on the matter, if you're interested.