What kind of a rotten place is corporate America and DC these days

Martin Armstrong the Hedge Fund manager but actually more prominent for his outstanding market predicting computer model which hr refused to sell to the CIA sits in prison for 9 years now - 8 of them without any court ruling. He was accused of things which were never proven and basically he was punished for not joining the 'club'. Madoff who screwed up to 50 bil - imagine that number is bankrupt since years is facing up to 5 years. Thats what you get when you even steal a car I guess something is rotten in the US law system as its a 2 class system where the buddies or members of the 'secret club' get a different treatment, since he is an ex chairman of the Nasdaq. What is the SEC, FED and whoever has to have oversight of this things doing all day long as this man was able to do that for at least a decade. What brought the truth out was the simple fact the clients seeked to withdraw 7 bil due to the financial crises otherwise he would have kept going on - thats the irony of the story.

Excerpt from WSJ

Sons Turned In Madoff After He Allegedly Told Them His Investment-Advisory Business for the Wealthy Was 'Giant Ponzi Scheme'

Bernard L. Madoff, a former chairman of the Nasdaq Stock Market and a force in Wall Street trading for nearly 50 years, was arrested by federal agents Thursday, a day after his sons turned him in for running what they said their father called "a giant Ponzi scheme."

Image from Madoff.com

Bernard Madoff

The Securities and Exchange Commission, in a civil complaint, said it was an ongoing $50 billion swindle, and asked a judge to seize the firm and its assets. "Our complaint alleges a stunning fraud that appears to be of epic proportions," said Andrew M. Calamari, associate director of enforcement in the SEC's New York office.

In a separate criminal complaint, Federal Bureau of Investigation agent Theodore Cacioppi said Mr. Madoff's investment advisory business had "deceived investors by operating a securities business in which he traded and lost investor money, and then paid certain investors purported returns on investment with the principal received from other, different investors, which resulted in losses of approximately billions of dollars."

....

Both complaints say Mr. Madoff told his sons he believed losses from his fraud exceeded $50 billion. That figure couldn't be confirmed. But such a loss is plausible, had money been flowing in and out for years: At the beginning of 2008, according to the SEC filing, his operation had more than $17 billion under management.

Such a scheme would dwarf past Ponzi schemes. It would also be nearly five times larger than the accounting fraud that drove telecom company WorldCom into bankruptcy proceedings in 2002.

Excerpt from CNBC

Bernard Madoff Arrested Over Alleged $50 Billion Fraud

Bernard Madoff, a longtime fixture on Wall Street, was arrested and charged Thursday with allegedly running a $50 billion Ponzi scheme, U.S. authorities said.

The former chairman of the Nasdaq Stock Market who remains a member of Nasdaq OMX Group's nominating committee, is best known as the founder of Bernard L. Madoff Investment Securities, the closely-held market-making firm he founded in 1960.

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But the alleged fraud involved a hedge fund he ran from a separate floor of the building where his brokerage is based.

Madoff told senior employees of his firm on Wednesday that ''it's all just one big lie'' and that it was ''basically, a giant Ponzi scheme,'' with estimated investor losses of about $50 billion, according to a criminal complaint against him.

A Ponzi scheme is a pyramid-type swindle in which very high returns are promised to early investors, who are paid off with money put up by later investors.

Prosecutors charged Madoff, 70, with a single count of securities fraud. They said he faces up to 5 years in prison and a fine of up to $5 million.

GE got special treatment by the FED and Treasury to keep their freaking triple A and because Buffett invested there and they refuse to help out the car industry with 14 bil. - what kind of evaluation system is that which puts up to 3 mil. workers into jeopardy over Christmas (actually 10 mil with family members) as this bunch of rotten politicians which threw over a tril to the financial industry without making sure they lend this money to the industry or even more importantly ease the distressed mortgage owner conditions. Especially the Reps are even vicious idiots or stupid morons to start getting smart over 14 bil they should do a little math how much it cost to create 3 mil jobs - Obama plans to spend up to a tril to achieve that and that takes much time to do. Its unbelievable how cynical this corrupt bunch of people are who had over 8 years to fix the obvious and inevitable - everyone knew they were heading for bankruptcy for the last 2-3 years. They should be charged and prosecuted for their irresponsibility and misconduct of their office including the most disgraceful president ever. He leaves with an unbelievable negative track record. He doubled US debt brought a recession and a depression to his country just to name a few obvious ones not to mention the lies he had fabricated to start a pathetic war.

Auto Bailout Fails, White House Weighs Options
A proposed bailout of U.S. automakers failed in the Senate on Thursday night, raising the specter of an industry collapse that sent Asian markets reeling and sparked fears it could deepen the recession.

"It's over with," Senate Majority Leader Harry Reid said of congressional efforts this year just before the Democratic proposal to extend up to $14 billion to the stricken industry fell short of the needed votes on a procedural motion.

Pressure immediately shifted to the White House, with calls for President George W. Bush to consider intervening with emergency financing.

General Motors [GM 4.12 -0.48 (-10.46%) ] and Chrysler have warned of near-term collapse if they did not receive a government bailout.

"I dread looking at Wall Street tomorrow. It's not going to be a pleasant sight," Reid said.

Markets across the Asia-Pacific region fell more than 3 percent on the development, with Japan's Nikkei average and Hong Kong's Hang Seng both down more than 5 percent.

U.S. crude prices fell by nearly $2 to $46.11 a barrel.

Because of their shared suppliers and vendors, industry observers fear the failure of one Detroit manufacturer could drag down the other two as well as other businesses.

Bankruptcy Concern

"It's going to be very difficult for them not to file for bankruptcy," Erich Merkle, consultant at Crowe Chizek in Grand Rapids, Michigan, said of the carmakers if they do not get help.

"GM has probably got until January and I would suspect the next step would be that GM will provide a date and say that at this date we will file," Merkle said.

GM, Ford Motor [F 2.90 -0.35 (-10.77%) ] and Chrysler employ nearly 250,000 people directly, and 100,000 more jobs at parts suppliers could hang on their survival. The companies say one in 10 U.S. jobs are tied to the auto sector.

The White House called congressional inaction a breakdown and said it would evaluate its options.

"It has now fallen to the president to take action," said Sen. Carl Levin, a Michigan Democrat who has spearheaded efforts for a month to get help for Detroit.

Bush should "move now," said Republican Sen. George Voinovich of Ohio, adding, "The dominoes are already falling" throughout the United States."

Reid and House Speaker Nancy Pelosi called on Bush to immediately explore short-term financial help, including tapping a $700 billion fund created in October for the Treasury Department assist the financial services industry.

The Bush administration has so far resisted Democratic appeals to take that step. Treasury declined to comment.

Especially Paulson is again showing is ruthless face as he threw 25 bil. each at Goldman (his former post) and JPM and Wells Fargo who were perfectly healthy and the rest of the 275 bil. TARP without making sure it was used to ease the stress in the mortgage markets. He is working on a hidden agenda as it is absolutely obvious.

Lets have a look on Mr Shelby and some other Rep. Senators who have an hidden agenda as well - I do think that stupid mistakes of managers are not to be paid for by taxpayers. In general therefor laws should be much tougher with managers deliberate mistakes as they got paid handsomely or even insane amounts if they are lucky to do well but if their choices turn out to be wrong the workers and taxpayers pay the bill - that has nothing to do with capitalism at all. Its more like a get a member of the club and even if you screw up you do well society for a little elite.

Shelby, South Lead Resistance to Rescue

By NAFTALI BENDAVID

WASHINGTON -- Sen. Richard Shelby, a jut-jawed lawmaker embodying the hostility many in Congress feel toward the Big Three auto makers, has emerged as the face of the opposition during the debate over aiding the industry.

Mr. Shelby's objections are rooted in the interplay of long-held principle and home-state interest. The Democrat-turned-Republican has always been opposed to bailouts and big government. At the same time, his state of Alabama is home to manufacturing outposts of several foreign auto makers -- including Toyota Motor Corp., Honda Motor Co., Hyundai Motor Co. and Daimler AG's Mercedes-Benz -- that have competed successfully with U.S. auto companies.

Getty Images

Sen. Richard Shelby, left, speaks as Sen. David Vitter listens during a news conference on the auto bailout Dec. 10.

"It's a situation where the senator does not have to worry about cognitive dissonance," said David Lanoue, head of the political-science department at the University of Alabama. "Obviously this is one of those situations where you can follow your philosophy and the interests of your constituents at the same time."

The band of mostly Republican Southern senators who form the heart of the opposition -- it also includes Senate Minority Leader Mitch McConnell of Kentucky and Sen. Bob Corker of Tennessee -- share Mr. Shelby's principle and circumstances. Kentucky is home to a major Toyota factory. The corporate headquarters of Nissan Motor Co.'s North American operations are located in Tennessee, and Volkswagen AG recently announced plans for a $1 billion, 2,000-worker plant in Chattanooga, Tenn.

Foreign auto makers have favored the South in part because of its nonunion, low-wage tradition, and these senators argue that if the Big Three's labor relations more closely resembled those of the Southern plants, they wouldn't be in such trouble.

Mr. Shelby held a news conference Wednesday to call the $14 billion plan a "travesty." It was just a "down payment" on what would probably become billions more in taxpayer-funded aid, he predicted, and without major restructuring, the Big Three would fail anyway.