The assault on private equity firms (aka LBOs) is a strangely well timed campaign to make Mitt Romney into a villain and Wall Street into the New Axis of Evil. Will it convnince the critical EV states of NM, NV, CO, IA, that Obama is the Chicago cop on the beat who (Chicago Rules) can defend the women and children from outlaws? It is wonderful to consider that the 2012 election will give the American electorate a referendum on Wall Street. Do the Independents vote thumbs down out of fear of worse? Or will the Indies vote thumbs up out of envy, greed, affection, respect, recognition, comprehension (chose one)? The Obama re-elect in Chicago jumps on board with an assault on Bain down to the testimonials of the displaced and disaffected:
When asked by TIME Magazine whether Mitt Romney is a job creator or destroyer, Warren Buffett said that while businesses shouldn't hang on to people they don't need, "I don't like what private-equity firms do in terms of taking out every dime they can and leveraging [companies] up so that they really aren't equipped, in some cases, for the future." Voters need to understand the kind of economy Mitt Romney's experience entails - and it doesn't sound like the kind of economy that's built to last.
Gasparino Speaks to Daley
How will Romney respond? Does not signify in the end. This remains a contest about POTUS Obama's performance in office. The Bill Daley exit from the White House is the critical tell. Spoke Charlie Gasparino, FBC, re the Daley tour of duty at WH. Gasparino wrote a column last September that identified how Valerie Jarrett had elbowed him out of the way and made it unlikely he would gain access to POTUS ear re the rift with Wall Street and American business. Daley called Gasparino to complain, however when Gasparino quizzed him about what was true or not, Daley returned non-denial denials. One fact did emerge that Daley and FLOTUS had called Geithner to ask him to remain Treasury, and to to believe the rumours that Daley was about to take SecTreasury. Gasparino says that Daley left when it became clear that Obama was going hard left anti-Wall Street, pro-OWS. Daley family opinion is that Obama is hurting the down tickey and the party -- that a win as aan anti-Wall Street reformer will leave the Democratic Party adrift, perhaps for a generation.
TAKE YOUR PICK WHAT OBAMA WILL DO:
1) Attack Romney via Bain;
2) Attack Romney as a flip- flopper;
3) Attack Romney as a moderate: e.g. You want x & y policies? Well, Romney has done it, but Obama can do it better.
No doubt, these and other attacks will be researched up the gazoo. Each one will be used -- it's just a question of where.
I, personally, see nothing wrong with being a flip-flopper, especially because I'm one. If you flip to the right, it just means you've seen the light. If you flip to the left, it just means you're an idiot. If you stay in the middle and turn yourself around, you're doing the hokey-pokey -- and Lou will hate you. That's what it's all about.
Also, Romney will be endlessly 'thanked' for providing the blueprint for ObamaCare.
And Wall Street will be vilified, prosecuted and convicted.
Let the show trials begin!
How about have the economic statistics cooked between now and election day so as to make people think things are better than they are?
I'm fine with Romney as the Republican candidate and think he will make a good President. He's not everything I want in a President, but he sure beats the heck out of the current one.
Mike, when I said I hated flip-floppers, I meant all flip-floppers except you. (That's the ugliest hat I've ever seen - ah, but it looks good on you! - Al Czervik to Judge Smails, Caddyshack)
When Ron Paul is President, I will write to him and ask him to please specifically not send troops to defend ________ (Fill in your hometown here.)
"When Ron Paul is President"
California dreamin'?
Private equity firms don't "leverage companies up to the hilt". What a crock. Warren Buffet is on the take, in one way or another. He is a paid performer in all this.
Also, it seems curious that he supports Keynesianism, which involves leveraging the country to the hilt, but professes to be critical of the leveraging of private companies.
I'm in kind of a sour mood tonight because I got home and started reading both the LA Times and Daily News and just about every story had the most ridiculously simple-minded leftward bias. I contented myself with thinking that these newspapers may very soon be out of business. The leftward bias is everywhere. It's really pervasive. Yet, somehow in this blizzard of misinformation and propaganda, the silent conservative majority is going to have to find its way to the polls in November and vote Romney into office.
I sometimes think that JB and his listeners are "too intelligent". People here tend to overthink things. Look: Obama bad. Any Republican candidate: Better. We all want to see the end of Obama (as far as I can tell.) So, there shouldn't really be much if any discord or disagreement amongst us. This should be a cheerleading site for Romney or whomever the Republican candidate is. Even if whoever that is turns out to be a child molester, at least he'll be our child molester.
IRAN: A FOURTH-RATE POWER?
Maybe, so. But I remember a video/photo from several years ago, probably on this website, that was taken by an Iranian sub. It showed the bottom of a US aircraft carrier going through the Strait of Hormuz that was relayed to the carrier in real time. In other words, that carrier could easily have been toast, as it had no knowledge of the sub.
The silent sub technology is German. Also, Iran has some of the fastest attack craft in the world that can easily carry explosives and ram the side of a carrier. Remember the Cole? When you consider the Strait is only about 22 miles wide -- with a very small channel in the middle deep enough to take a carrier -- it means that any carrier going through the Strait is only about 11 miles from the Iranian coast. Then there are islands off the coast that make the distance even less for an attack boat.
You don't have to be a great power to take out a slow carrier that was never meant to maneuver in such small waters. I don't think the Twelvers will have any trouble finding suicide bombers -- by air or by sea -- do you? Of course, many different missiles coming from many different locations can also be highly effective -- even if not the most advanced missiles.
Who says Iran has to mine the Strait to close it? Mining an open waterway is an act of war. If Iran wants to risk war by closing the Strait, it can simply sink a carrier.
I think Volcker eventually realized he was being played as a sucker by BHO and drifted away.
WB used to give the impression of intellectual integrity. I enjoyed his shareholder letters. But this stuff is really shameful. He knows what he says will be distorted into nonsense but he seems willing to keep feeding the beast.
There are many ways of financing deals for control of private companies. Buffett uses an insurance company/conglomerate. VC's use equity funds. Private equity guys use a mix of debt and equity, with the mix varying depending on the characteristics of the company.
For Buffett to prefer his style is coherent but no deeper than a preference for French cooking. Perhaps his favorite tool is a hammer.
Note that Buffett only buys companies that are already healthy and well managed ... and cheap enough. He buys companies that he intends to run as they have been running in the belief that they will become more valuable over time. And he buys them only when he thinks they are cheap on their fundamentals (hence all the Graham/Dodd mysticism).
PE firms look for companies that are underperforming and hence are valued more cheaply than they would be if they were being run right. The fact that this doesn't much appeal to Buffett is at most of biographical significance. He is like a guy who will only keep company with healthy people. PE firms look for the sickly and out of shape and try to get them healthy because then they become much more valuable.
If a PE firm puts too much debt on an otherwise healthy company, there is a simple fix - Ch 11 reorg. The company continues to operate but its creditors become the new owners, and the old owners get wiped out. The PE owners get wiped out but the company continues to operate. The most common cause of this kind of situation is that the PE guys overpayed in the acquisition. That happened frequently in the late 80's when the LBO art was being defined.
Viable companies don't get liquidated. The reason is simple. A healthy viable company is worth much more than the physical assets will bring in liquidation (absent some special facts that make asset conversion attractive). Maybe it needs a new capital structure. That is what Chapter 11 is designed for - to make a new capitalization of a viable company in a process that is fair, with an elaborate and well conceived definition of fairness and the power of the courts to cut the baby in half as needed.
Bankruptcy of a healthy but overlevered company doesn't create layoffs; layoffs come when a company's operations are dying in whole or in part, with bankruptcy merely an orderly way of burying the corpse.
I want a guy who knows how to handle both healthy and sick companies. Buffett can stay in Nebraska. Give me Romney.
"I contented myself with thinking that these newspapers may very soon be out of business."
In Blue Lotusland (Lou excepted)? Surely you jest!
"an act of war."
America's enemies are in luck! Democrats, the cretins now runing the government, don't recognize the concept. I wish we had just a little of the Russians' spine in dealing with thugs like the Iranians.
Needless to say, the internet has taken a huge bite out of all dead tree publications, but newspapers in California have also been hard hit by the Hispanic colonization of that no-longer-golden state.
The LA Times has been consistently pro-Mexican immigration. How advocating the replacement of their subscriber base by Third Worlders who never graduated from high school, whose native language isn't English, and who don't like to read could have seemed like a sound business model is something that their editorial staff will have plenty of time to contemplate about as they stand in the unemployment line.
In other news, Mitt Romney has unveiled his first Spanish-language campaign ads. Does anyone care to bet on how that will work out for him?
Should be "plenty of time to contemplate as they stand," not "contemplate about."
America's enemies are in luck!
Indeed.
Carl Schmitt teaches us that the first task of politics is to distinguish between friends and enemies, something at which we failed utterly when we attempted to set up an unsustainable overseas empire instead of guarding our Mexican frontier.
"an act of war."
On the JBS last night, the scenario was given that AFTER Iran mined the Strait of Hormuz -- since it was an act of war -- the US would be free to attack Iran by air, which would destroy a good deal of its military. I just gave a counter scenario. Sinking an aircraft carrier would be a 9/11 equivalent.
Q: Do any Gulf countries have the ability to tow a sunken aircraft carrier out of the Strait? A sunken carrier can stop marine traffic as well as any mine can.
Q: Wasn't the Viet Cong a forth-rate military power, as well?
Below, good analysis, if true:
"Obama seemed to suspect that Israel staged the killing [of Iran's nuclear scientist] to torpedo yet another US secret effort to avoid a military confrontation with Iran through back channel contacts with Tehran, while the administration's extreme condemnation [of the killing] is seen as tying in with its all-out campaign to hold Israel back from a unilateral strike."
http://www.debka.com/article/21650/
Mr. Boo-fay is a Clever Democrat Operative (CDO). He has said things in the past a classically trained economist would cringe at. But to a Big Government elitist, he is one of the boys.
Big Finance makes money at the pleasure of the regulators, who tend to be Democrats. How many in Commerce or Treasury or SEC studied Finance or Macroeconomics? GOP has never gone after the agencies like Energy, Commerce, and Enviroment that do more to hinder job creation, and are a drain on the economy.
Bain is disturbing, management consultants are good at generating piles of paper and recommendations, and telling companies who to fire; but do they add value for their clients in the long term?
There are decades of email from Romney at Bain, we can only hope Mitt knew when to not put something in writing!
Gingrichian blink: this will pit Romney well into the 30s.
http://blogs.wsj.com/washwire/2012/01/13/gingrich-calls-on-pac-to-alter-film/
Newt Gingrich is calling on a political group backing his campaign to revise or withdraw a documentary attacking Mitt Romney’s work at Bain Capital.
The political action committee Winning Our Future created the 28-minute documentary, “King of Bain,” and is running ads based on it in South Carolina ahead of that state’s Jan. 21 primary.
The Gingrich statement came after Washington Post columnist Glenn Kessler this morning gave “King of Bain” his four-Pinocchio rating. Mr. Kessler accused the film makers of using “manipulative interviews” and other tactics to create a “highly misleading portrayal of Romney’s years at Bain Capital.”
In his statement, Mr. Gingrich says: “I am calling for the Winning Our Future super PAC supporting me to either edit its ‘King of Bain’ advertisement and movie to remove its inaccuracies, or to pull it off the air and off the Internet entirely.”
Mr. Gingrich said Mr. Romney should also ask super PACs backing him to remove any ads that contain inaccuracies. Mr. Romney has said that he isn’t responsible for the ads of pro-Romney super PACs, which by law can’t coordinate with the candidate.
Winning Our Future’s Rick Tyler said earlier this week that while some Republicans had approached him expressing concerns about the move against Mr. Romney, “no one has told me to knock it off.”
Agree with most of your post, but regarding "... and Environment", wanted to point out that the GOP has been all over the EPA recently, and with some success.
What Obama seems not to understand, or intentionally ignore, is that it is not the billionaires or even multi-millionaires that are the primary job-creating engine. It's the people who aspire to be millionaires someday that are the engine. And the class warfare is killing the American Dream. What, I should work myself into an early grave just so that I will have the privelege of donating more money to the welfare state? I don't THINK so.
I've said this before and I'll say it again: It's not the extra tax money they're asking me for that bugs me so much. It's the fact that they lie, cheat and manipulate the voters to get it.
Also, a million bucks isn't what it used to be. Not even enough to comfortably retire on, in some places, for a married couple.
Romney could turn this Bain thing to his advantage with the following tack, and also perhaps get some Tea Partiers on board:
"Yes, the companies Bain financed had to lay off some unprofitable divisions and trim the fat. That's how you turn a profit, and if those people hadn't been laid off, eventually the entire company would have gone bankrupt. The needs of the many outweighed the needs of the few. Thus it will be when I'm President. I know how to trim the dead weight off of a body in order to revitalize it, and I will start with the Department of _______"
Remember, this is supposed to be the REPUBLICAN candidate. One of the big planks in the platform is cutting waste out of big government. So, Romney's company has a proven track record of cutting waste. He should be wearing this like a badge. And Newt's an .... err... Independent for attacking him on it. Hope they pull that attack infomercial or whatever it is.
"There are decades of email from Romney at Bain..."
I think the Leftys have something on Romney -- possible something left over from the Ted Kennedy commercial -- and they are grinning like the cheshire cat.
"Gingrichian blink: this will pit Romney well into the 30s."
Maybe not. Romney can still be attacked on his record as Governor -- a much better way for Newt to have gone all along.
The Bain/Romney attack was poorly thought out and poorly executed. The Leftys won't make this same mistake. Meanwhile it shows the problems that arise when things are done too quickly w/o enough planning.
Gingrich's biggest mistake was not being able to answer the Freddie Mac charge which, I believe, was a 'gotcha' question from one of the debates. The debates, structured the way they were, were a huge error by the GOP as they allowed 'gotcha' moments to run rampant which could be used later by Obama in attack commercials.
Another attempt at 'gotcha' was Stephanopoulos asking Romney about contraception. Even though Stephanopoulos doesn't have it on his CV, he worked w/ Obama at Harvard.
The Abrupt departure of White Irish Catholic Mayor Daley will let loose the crazies at EPA. COS Daley was the only person in 1600 keeping EPA at bay.
Firing Daley immediately after the Michelle Obama "too many white Irish Catholics in power" quote does not bear well for the Catholic swing voters in the midwest.
"The Abrupt departure of White Irish Catholic Mayor Daley will let loose the crazies at EPA. COS Daley was the only person in 1600 keeping EPA at bay."
Wow! Who knew?! EPA seemed to run up and down the field at will since 21 Jan 09, especially since they seem to own Interior lock stock and barrel as well as their own insanely expanded fiefdom.
from Political Wire
Romney Expanding Lead in South Carolina
A new Reuters/Ipsos poll in South Carolina shows Romney leading with 37%, followed by Ron Paul at Rick Santorum at 16% and Newt Gingrich dropping back to 16%.
A New Frontier Strategy poll shows Romney leading with 32%, followed by Gingrich at 23%, Santorum at 14%, Paul at 10%, Perry at 6% and Huntsman at 4%.