Now is when I remind you that not only does Obama have very strong ties to ACORN (he worked on their behalf as a lawyer at one point), and its sister organization, SEIU, and let’s not forget that Obama gave $832,000 to an ACORN affiliate to “get out the vote” during the Election Season. And ACORN, the alleged non-partisan organization, currently under investigation in at least 14 states for voter fraud, the organization that helped create the Fanne Mae/Freddis Mac fiasco, is receiving YOUR tax paying dollars, $53 million to date, and stands to receive $8.5 Billion in Stimulus money.

The aforementioned article? It is this: Former Leftist Activist, Turned FBI Informant, Pulls Back the Curtain On ACORN. Well, you know that caught my eye right away – this guy, Brandon Darby, was a leftie activist, like many of us were, but unlike most of us, worked with the FBI on terrorism. Here is Darby’s story:

I first experienced ACORN in post-Katrina New Orleans. I was part of a relief organization, Common Ground Relief, which had been delivering much needed aid to the 9th Ward, an area that had been hit especially hard by the flood waters and by neglect. Rumors immediately began surfacing, questioning our motives and intentions. I was very confused by these rumors. Who was behind them? How could anyone question the vital work we were doing in the community? We lived and worked in the 9th Ward. We suspended our regular lives and, in many cases, left our families to travel to New Orleans to help those affected by Katrina and poverty. We slept on dirty plywood floors and shared everything we had with the residents. Most of us were white. Was our skin color the issue? I knew from personal experience that the majority of the Black 9th ward residents didn’t care what color our skin was. It took me awhile to get over the hurt I felt at such allegations and to find out where they were coming from.

In the following weeks, I was made aware of the fact that ACORN had reopened its New Orleans office (several months after the storm). Various groups from around the city informed me that Acorn was upset with us because we were in “their” community and had not sought approval from ACORN to operate there. I was told that ACORN said that we were “privileged white people who had come to a Black community as saviors and we refused to work with local Black leadership.”

The more I pondered the matter, the more I realized what was happening. As usual in marginalized and impoverished communities, a small group of radical self-proclaimed leaders was insisting that all local aid and relief came through them—even if they were AWOL for several months. Though the majority of residents either hadn’t heard of ACORN or simply disagreed with their politics- ACORN insisted that they were THE Black leaders. This was upsetting to me. Sure, the local pastor we worked most closely with was Black; but that didn’t matter to ACORN. It was as if Pastor Johnson didn’t count because he didn’t evoke the name of Elijah Mohammed or Malcolm X. It was as if Pastor Johnson didn’t count because he didn’t submit to ACORN’s mandate that ACORN was the sole leadership of Black New Orleanians.

Am I reading this correctly? Only black people can work with black people as far as ACORN is concerned? Dang, I bet all of those organizations and churches who sent so many people and aid to New Orleans didn’t know the rules. I know I didn’t when I sent money, and took my niece and nephew there post-Katrina to spend tourism dollars as requested. I think we all thought we were helping our fellow Americans. This is a bit of a shock, I have to say.

Back to the article:

As then director of Common Ground Relief’s 9th Ward project, I was warned by many that ACORN would ruin me politically if I didn’t submit to their leadership. I believed in what I was doing and how I was doing it. I refused to submit. The political fallout was almost unbearable. I just kept my eyes on meeting the needs of the community. When confronted by adherents to ACORN’s brand of race analysis, I pointed out that ACORN was not there immediately after the storm, so I could not have sought their leadership even if I had wanted to.

Over the following years, that particular style of political attack was prominent in New Orleans. Anytime that ACORN was displeased, the other party was deemed a racist. If the other party disagreed with the label or with ACORN’s agenda- they were met with “of course you feel that way. You are a racist.” Though it is clearly woefully inaccurate and unethical to use such an accusation as a political attack and as a means of shutting down philosophical debate and discourse, some at ACORN didn’t let that stop them. I refused to submit to it. I believed in listening to the majority of the community, who were desperate for our help, and not only to the self-proclaimed leaders. I paid a dear price for it.

This is disturbing on so many levels, not least of which is the people there NEEDED this help. They still do. People who WANT to help, who take time to do this, are then treated shabbily, and labeled racist to boot. Wow. I can only imagine how that felt to Darby after all his work there on behalf of that community.

And where does the FBI fit into all of this? Here’s how:

I returned to Texas after a couple of years adminst the political quagmire of post-Katrina New Orleans. My experience there with various groups was educational and life-changing, though some of these groups concerned me. Eventually I began to see some of them as dangerous and deceitful about their missions. This, along with a growing appreciation of my country helped lead me to work with the FBI’s Joint Terrorism Task Force.

I was as proud of this new era in my life as I was of my time in New Orleans. I had the privilege of participating in efforts where lives were saved; both in the United States and in Israel. While working undercover with the FBI at the Republican National Convention in Minnesota, I helped to uncover a bomb plot. Two men had made firebombs with a homemade napalm mixture of gasoline and oil. Their initial targets were Republican delegates. These bomb-makers (domestic terrorists) later decided to attack a staging area for the Secret Service and other law-enforcement agencies. Fortunately, they were stopped and arrested.

I was asked, and agreed, to testify against them. As was expected, the more radical elements of the media began to attack both me as an individual and the FBI as a whole. One of the men accused plead guilty; the other hired an expensive defense attorney and concocted a story about the FBI building these bombs to “set up left-wing activists” and stop dissent. But once the facts became clear, the defense changed their story and instead tried to blame the FBI for ”influencing” the terrorists. Thankfully, after one hung jury and many months of intense media attacks against me, the other bomb-maker (domestic terrorist) decided to come clean and admitted to the judge that he had invented the whole story.

What does any of this have to do with ACORN? I wondered the same thing on January 31st of 2009 when I was reading an ACORN blog that is run by Wade Rathke (the man who claims credit for founding ACORN). He devoted an entire page to my work with the FBI. How did he describe the FBI’s effort and success in preventing innocent Americans, local police and federal agents from being burned, maimed and/or possibly killed by firebombs? He wrote that it’s “one thing to disagree, but it’s a whole different thing to rat on folks.” That is what ACORN’s founder had to say about my role in stopping a bomb plot.

I was even more shocked as I continued reading the article. ACORN’s “founder” went on to mention that another self-proclaimed “radical” activist who had worked closely with him was also involved in my story. Her name is Lisa Fithian. I first encountered Ms. Fithian in New Orleans. She came to town after Common Ground Relief had started operations. She assumed a position of prominence and continuously challenged my work and leadership. During the RNC bombing trial, she cooperated with the defense of the bomb plotters and led media attacks on me and the FBI.

Ms. Fithian has been quoted in various mainstream news articles as saying, “Nonviolence is a strategy. Civil disobedience is a tactic,” and “Direct action is a strategy. Throwing rocks is a tactic.” She is also quoted as stating that “When people ask me, ‘What do you do?’ I say, ‘I create crisis’, because crisis is that edge where change is possible.”

ACORN receives tens of millions of dollars from taxpayers to promote their agenda. Free speech is sacred, of course. However, it is clear that ACORN has made a practice of blurring the lines between free speech and tax-payer-funded activism. Fortunately, our federal government is adept at investigating and identifying the misuse of federal funds. It will be interesting in the near future to see how Mr. Rathke and his ACORN associates stand up to the same scrutiny they have focused on our military, the FBI and other governmental groups and agencies.

After the revelations exposed in the O’Keefe/Giles videos, maybe the FBI will get the hint and take a look into ACORN. If they need a reminder, they can go back and look at the testimony of ACORN Whistleblower, Anita Moncrief, who had PLENTY to say about how ACORN operates, and acknowledged the connections between ACORN and Obama. It is a shocking reminder of what the MSM let go by in order to carry water for Obama.

So, maybe it’s not too late? Maybe after all of these recent (and not so recent) revelations SOMEONE in law enforcement will do the right thing and go after ACORN? Make the connections, hold them accountable, and do it now? Heaven knows, there is enough information available, isn’t there?

MARK YOUR CALENDARS!!! Anita Moncrief, the ACORN whistleblower, is going to be on Paulie Abeles, Sins of Omission NQ radio show SEPTEMBER 21st at 9:00 PM (EST)!! WOW!!!! I cannot wait. I’ll be there – hope you will, too!

U.S. Rep. Barney Frank (D-MA), House Financial Services Committee Chairman

As the Wall Street Journal reports in Finance Lobby Cuts Spending as Feds Targeted Wall Street:

Wall Street’s spending on efforts to influence policy making diminished at the start of this year as the image of financial institutions has suffered with lawmakers and the public. Some of the sector’s major advocate groups lost funding and staff. Their spending declined just as the administration was hammering out its proposal for the biggest reorganization of financial-market oversight since the 1930s, details of which the White House released last month.

Industry lobbyists met last week to craft a response to the White House’s draft regulatory overhaul, particularly its creation of a consumer-oriented regulator for financial products, which could force major changes in how financial instruments are created and marketed. Whether or not the industry can influence this top administration priority, now that the plan is in the hands of Congress, will be a big test of its remaining clout.

The gig is up!!

Washington and Wall Street are finally starting to appreciate that America is getting wise to their incestuous relationship. Washington and Wall street are waking up to the waste that they have made of the American economy. Washington and Wall Street now realize that the mainstream media is being overwhelmed by independent citizens with strong voices demanding to be heard.

While politicians from both sides of the aisle are enmeshed in this incestuous relationship and culpable for our current fiscal condition, in my opinion, no single politician epitomizes it more than the Congressman from Taxachusetts, Barney Frank. Can we ever forget how Barney wanted to “roll the dice” on sub-prime lending? The WSJ reports that Barney told John Courson, new president of the Mortgage Banker’s Association:

“Everybody hates you, and now they’re starting to hate me for hanging out with you.”

Starting? Perhaps Barney believes America is merely “starting” to hate him for hanging out with mortgage bankers but it runs much deeper than that.

America hates all politicians and bankers who have sold out our country.

For those who care to fully understand why and how this level of hatred has gotten to this level, please review:

Barack and Barney Look to Further Plunder Freddie and Fannie

BREAKING NEWS 7-1-09 > Barack and Barney did it as Bloomberg just reports, Fannie, Freddie to Refinance Larger Underwater Loans.

Barney Frank: Twenty Years and Hundreds of Billions Later on Private Profit/Social Loss

Don’t Be Downwind From Barney Frank

How Wall Street Bought Washington

Legalized Bribery

If after all this, the residents of Taxachusetts remain enamored with Barney Frank, on behalf of America make him your own. How so?

Now that Deval Patrick has been exposed as a political lightweight, throw him out and make Barney governor.

You’d be doing America a huge favor.

LD

In a similar fashion, the American public should prepare itself for a continued plundering of the portfolios and balance sheets of Freddie Mac and Fannie Mae by our leading housing finance gurus, Barack Obama and Barney Frank.

The scene is already set for our dynamic duo to pile an ever increasing amount of risk onto these “wards of the state.” How so?

1. While Freddie and Fannie are very much the responsibility of Uncle Sam, their balance sheets are not technically on Uncle Sam’s roll. That ‘cover’ provides a convenient disguise, but the fact is these ‘foster children’ are now nothing more than receptacles for more of Uncle Sam’s risky undertakings.

2. Neither the media nor the political opposition truly call them on these financial charades.

We learn today that both Barack and Barney have grand visions to add more high risk loans at mispriced rates onto Freddie and Fannie’s books.

The Wall Street Journal offers, Changes Urged to Rules on Condo Loans:

Two Democratic lawmakers are calling on Fannie Mae and Freddie Mac to relax recently tightened standards for mortgages on new condominiums, saying they could threaten the viability of some developments and slow the housing-market recovery.

In March, Fannie Mae said it would no longer guarantee mortgages on condos in buildings where fewer than 70% of the units have been sold, up from 51%. Fannie Mae also won’t purchase mortgages in buildings where 15% of owners are delinquent on condo association dues or where one owner has more than 10% of units, which the firm sees as signals that a building could run into financial trouble. Freddie Mac will implement similar policies next month.

In a letter to the chief executives of Fannie and Freddie, Reps. Barney Frank, the Massachusetts Democrat who is chairman of the House Financial Services Committee, and Anthony Weiner (D., N.Y.) warned that the 70% sales threshold “may be too onerous” and could lead condo buyers to shun new developments. The legislators asked the companies to “make appropriate adjustments” to their underwriting standards for condos.

What does Barney Frank truly know about housing finance? This assessment is an elongated statement similar in style to Frank’s now famous approach to sub-prime lending back in September, 2003. Barney proposed, “I want to roll the dice.” America crapped out on that roll. Now in the height of hypocrisy, Barney is still providing insights and recommendations on mortgage topics. What’s wrong with this picture?

Not to be outdone by his Democratic Congressional colleague, President Obama also has no problem plundering Freddie and Fannie via another redistribution program. Bloomberg highlights, Obama’s Mortgage Refinancing Program May Be Expanded:

Fannie Mae and Freddie Mac may get permission to begin refinancing mortgages with loan-to-value ratios above 105 percent as the Obama administration seeks to boost participation in its anti-foreclosure programs.

“We’re actively considering how to structure a program that makes sense over 105 percent,” Federal Housing Finance Agency Director James Lockhart said yesterday. He said a ratio of 125 percent “is a number” that’s on the table, though “not necessarily the number we’re going to end up with.”

Make no mistake, each of these programs would entail adding signifcant risk to Freddie and Fannie’s portfolios at rates not reflective of that risk. Who will pay for the higher than expected losses? American taxpayers.

Mispricing mortgage risks while trying to produce a citizenry that leads financially responsible lives are not consistent initiatives!

Throwing good money after bad is also no way to fix a financial hole.

Somebody please leave a light on and lock that door!!

LD

And that is why I took particular delight in Andy Borowitz’s most recent piece, “Obama Quits While Ahead; Prez Resigns After Hundred Days: “It’s All Downhill From Here.” Oh, if only:

In a move that stunned both political allies and foes alike, President Barack Obama resigned today after serving 100 days in office, telling the White House press corps, “It’s all downhill from here.”

The reporters seemed stunned by the President’s decision in light of the fawning media coverage he received during his first 100 days, but the hyperbolic nature of that reportage, ironically, may have been the prime motivator behind Mr. Obama’s shocking move.

“Let’s face it, I’m not going to get better coverage than I have to date,” he said. “The only guy with a higher approval rating is that dude who landed the plane on the Hudson – or maybe that other dude who escaped from those pirates.”

Click HERE to read the rest – it is pretty funny, especially to see who has higher poll numbers than Obama!

Sigh. I guess it is easy for him to have slightly better than half approval ratings when liberals and progressives ignore: expanded faith-based initiatives, a program we detested under Bush; keeping No Child Left Behind intact, a program we have all widely decried, especially teachers; and Obama’s EXPANSION of warrantless wire-tapping on American citizens. For added irony, here is a video from Keith Olbermann, of all people, on this very thing:

Then there is the attempt to nationalize our banks, firing the CEO of a private company, and the list goes on and on. These are just off the top of my head. I am sure there are more – feel free to add them!

The point is, someone who was inexperienced and unqualified was elected president as the result of the best marketing ploy I have ever seen. His connections to: Tony Rezko; Jeremiah Wright; Bill Ayers; Khalid Rashidi; Kwame Kilpatrick; Louis Farrakhan; and James Meeks, to mention a few, all ignored. Also ignored was his massive contributions from Fannie Mae and Freddie Mac, as was his his dearth of a record, both as an IL state senator and a US senator (or how he got to either one of those positions – getting the qualified people kicked off with the very thinnest of reasons). His sexist behavior, and his homophobic associates, all ignored by the MSM and his followers, people who ordinarily would never give quarter to such a person (and about which I have written extensively here. To find those posts, and other related articles by fellow No Quarter writers on those issues, and Obama’s associates, feel free to do a Search at No Quarter.).

Oh, what might have been. Below are a few very good videos on Hillary Clinton, the one who received the most votes in a Primary EVER, despite being outspent at every turn, and having the MSM expose its Clinton Derangement Syndrome at every turn. Still, STILL, she received the most votes of anyone EVER. That says something, both about her, and about the DNC’s choice to pick Obama over her, for all of their concocted reasons and unethical machinations to make it so. In recognition, then, of Obama’s 100 Days in the White House, I hope these will bring a smile to your face (though they also brought tears to my eyes):

House Financial Services Committee hearing, Sept. 10, 2003:

Rep. Barney Frank (D., Mass.): I worry, frankly, that there’s a tension here. The more people, in my judgment, exaggerate a threat of safety and soundness, the more people conjure up the possibility of serious financial losses to the Treasury, which I do not see. I think we see entities that are fundamentally sound financially and withstand some of the disaster scenarios. . . .

Tension? Threat of safety and soundness? Financial losses? Fundamentally sound? Disaster scenarios? With a “watchdog” like Barney is there really any surprise how and why Freddie and Fannie were plundered by their own executives and the sub-prime lending industry? It is not a stretch in stating that Barney had the welcome mat out and held the door open. Note: There are two great video clips after the fold.

I am not stating that Barney was directly complicit in the fraudulent sub-prime lending, but he certainly defines naivete and incompetence on this front. His Democratic sidekicks – Dodd, Schumer, and Waters – were complicit and also drinking from the same punch bowl.

What about Barney’s comment regarding oversight of Freddie and Fannie:

House Financial Services Committee hearing, Sept. 25, 2003:

Rep. Frank: I do think I do not want the same kind of focus on safety and soundness that we have in OCC [Office of the Comptroller of the Currency] and OTS [Office of Thrift Supervision]. I want to roll the dice a little bit more in this situation towards subsidized housing. . . .

Again in 2005, Barney continued to stand his ground on the housing front despite rampant signs at that point of irresponsible lending and incipient fraud:

Well now that Barney and our entire country have “crapped out” on his roll of the dice, Barney decides homeownership may not be the best thing for all concerned. In a height of pandering well beyond the Washington norm, Barney offers the following in this excerpt from an interview on the Tavis Smiley show on PBS on April 20, 2009:

Is there any doubt that the burgeoning wind power industry in our country should engage Barney as their spokesperson? In so doing, Barney’s hot air may actually become a source of revenue for our great country rather than such an enormous expense.

Barney’s hot air should come with a warning, though, “Don’t Be Downwind!!”

LD

I was struck a month ago by the incriminating statements put forth by Senator Chuck Hagel and CIA head Leon Panetta, which I highlighted on February 16th in Legalized Bribery. Those statements bluntly indict our massive system of lobbying, political fundraising, and the quality of those running for elected office! In light of that article, I am more and more convinced that our elected officials have turned their offices into massive for profit machines at the expense of our public well being.

I commend the authors of this report, Roger Weissman and James Donahue, for taking the time and making the extensive effort to expose the truth. The full report, 231 pages in length, spares no detail. In studying it, I found the information and analysis riveting. Let me try to summarize it for you.

The report chronicles in real detail how Wall Street showered Washington with $1.7 billion in campaign contributions and $3.4 billion upon lobbyists over the last ten years. That money went from the lowest members of Congress to the President of the United States. 55% of the contributions went to Republicans and 45% went to Democrats. Yes, a truly bipartisan effort.

The authors are beyond thorough in laying out how the . . .

financial sector showered campaign contributions on politicians from both parties, invested heavily in a legion of lobbyists, paid academics and think tanks to justify their preferred policy positions, and cultivated a pliant media — especially a cheerleading business media complex.

The report highlights the electricity crisis in California in 2000 and the Enron debacle as precursors of our current situation.

They quote FDR in his statement, “our enemies of today are the forces of privilege and greed within our own borders.” The same clearly holds true today.

Where were our leaders with the vision and foresight to protect the public? Feeding at the Wall Street trough!! Let’s review what the $5.1 billion bought Wall Street and who in Washington facilitated the process. Later I will highlight a number of politicians who collected substantial amounts of these dollars.

Part I : What Did the Money Buy?

1. the repeal of the Glass-Steagall Act which separated commercial and investment banking activities. This act came out of the Great Depression. Former Fed chair Paul Volker supported Glass-Steagall in the late 90’s and still does today. The expected repeal of this Act allowed for the merger of Citibank and Travelers Insurance even before the formal repeal. President Clinton, Treasury Secretary Robert Rubin, Congressman Phil Gramm, and Fed Chair Alan Greenspan were the primary supporters of this repeal.

2. the allowance of off-balance sheet accounting which promoted the increased leverage in banks.

3. the executive branch rejects financial derivative regulation. The CFTC (Commodities Futures Trading Corp), led by Brooksley Born’s effort, sought to exert regulatory control over derivatives. The CFTC was squashed by Robert Rubin and Alan Greenspan. Then Deputy Treasury Secretary Larry Summers told Congress that CFTC proposals would cast regulatory uncertainty over a thriving market. Aside from Rubin, Greenspan, and Summers, Senator Richard Lugar and SEC Chair Arthur Levitt also supported the Clinton administration’s lack of regulatory oversight.

4. Congress also blocked financial derivative regulation through legislation engineered by Senator Phil Gramm.

5. in 2004, the SEC succumbed to massive lobbying by Wall Street allowing for voluntary regulation. This acquiescence is the grossest example of the inmates running the asylum. In 1975, the SEC ruled that debt to net capital ratios had to be less than 12 to 1. This “voluntary regulation” led by Goldman Sachs and then CEO Henry Paulson allowed investment banks to develop their own net capital requirements. Merrill Lynch went to a 40:1 ratio. Then SEC chair Chris Cox acknowledged this voluntary regulation was a complete failure!

6. the bank self-regulation goes global.

7. the total failure to police the mortgage banking industry and its predatory lending. People may never have heard of outfits such as Aames Financial, Delta Funding, Ameriquest, Long Beach, and many more. These firms propagated massive frauds in lending to unqualified borrowers. They need to be brought to justice.

8. the federal government preempted a number of state consumer protection laws which would have mitigated a lot of the predatory lending.

9. the government allowed for purchasers of loans to escape accountability. Only the original mortgage lender would be liable for the predatory and illegal features embedded in the mortgages. This immunization of the investment banks eliminated their legal exposures and facilitated the continuation of fraudulent lending practices.

10. Fannie Mae and Freddie Mac expand their footprints into the non-prime mortgage market. Many politicians fed from the Freddie and Fannie troughs, but nobody more than Chris Dodd and Barack Obama.

11. the merger mania in the banking industry has led to institutions now deemed “too big to fail.” This report believes these institutions should now be treated like highly regulated public utilities.

12. the debacle that played out with the rating agencies only further facilitated this mess. These agencies were and still are massively conflicted.

Part II: Who Paid What and Who Collected How Much 1998-2008?

– Commercial Banks spent $154 million in campaign contributions and $383 million on lobbyists.

— Accounting Firms spent $81 million in campaign contributions and $122 million on lobbyists.

— Insurance Companies spent $220 million in campaign contributions and $1.1 billion on lobbyists!!

— Investment Banks spent $512 million in campaign contributions and $600 million on lobbyists.

A very large percentage of the lobbyists were former government officials!!

While the report makes a number of recommendations, a few strike me as self-evident and vitally necessary:

1. derivatives must be regulated.
2. limited leverage within financial institutions
3. revise the compensation system for financial institutions so timing of reward is linked to elimination of risk
4. consumer advocacy groups

The list of politicians receiving the largesse runs approximately 80 pages and covers the Presidency to seemingly every member of Congress. I was also struck by the consistency of contributions received during each election cycle by Senators Schumer (D-NY) and Dodd (D-CT). Schumer represents the Wall Street territory while Dodd has been a longtime senior ranking official on the Senate Banking committee.

As I perused the financial data specifically for 2008, I paused and reflected on the fact that these institutions were, and to a large extent still are in dire financial straits. While in the process of receiving government support, they had made or were making campaign contributions. As the government has haphazardly reviewed expenditures at these organizations, let’s shed the floodlight right back on these campaigns. It is not difficult to track campaign contributions to politicians back to taxpayer funds injected into these firms. In light of that, I know it will never happen but I believe the political campaigns should return those dollars to the public. Who received how much money in 2008? While not totally comprehensive, my back of the envelope analysis shows the following:

Barack Obama: $3.9 million
John McCain: $2.1 million
Hillary Clinton: $2.5 million
Rudolph Giuliani: $1.1 million
Chris Dodd: $650k
Mitt Romney: $1.060 million
Rham Emanuel: 160k

President Obama, Madame Secretary and gentlemen, please make those checks payable to “American Taxpayer” and let’s begin to return some integrity to our political process.

Where’s the media to shed light on this travesty? Oh yes, they are compliant and cheerleading.

Robert Rubin, he’s our man, if he can’t do it, Greenspan can,
Alan Greenspan, he’s our man, if he can’t do it, Paulson can,
Henry Paulson, he’s our man, if he can’t do it, Dodd can,
Chris Dodd, he’s our man, if he can’t do it, Gramm can,
Phil Gramm, he’s our man, if he can’t do it, Obama can…

Uh, oh!! We got real problems!!

LD

**Cross-posted from my blog, Sense on Cents. Come by and visit!

Well, if misery loves company, it has a solid partner in the person of Warren Buffett because 2008 was Berkshire Hathaway’s worst year ever. In reviewing Buffett’s letter, allow me to offer some highlights. For those who have an even passing interest in the markets and investing, reading this letter is akin to attending an opera by Pavarotti.

I beg your indulgence as I attempt to be the opening act and provide an overview of the “Oracle of Omaha’s” thoughts on the markets and economy:

1. Berkshire’s 4th quarter 2008 generated net income of $117 million, a mere 96% decline vs 2007!!

2. The results suffered primarily due to significant exposure to insurance companies, Coca-Cola, and American Express.

3. The stock, down 32% for all of 2008, marginally outperformed the major indices. The stock is down 19% for 2009, in line with the market.

4. In regard to the economy, Buffett forecasts it will be in a shambles throughout 2009 — and for that matter probably well beyond.

5. “The U.S. Treasury bubble of late 2008 may be regarded as almost equally extraordinary” to the internet bubble of the 1990’s and the housing bubble of the 2000’s.”

6. He is humble enough to highlight some investment mistakes made in Conoco Phillips and Irish banks.

7. Buffett repeats his railing on derivatives as too complex so that auditors can’t audit and regulators can’t regulate. He specifically calls out the Office of Federal Housing Enterprise Oversight for its failure to properly regulate Freddie Mac and Fannie Mae.

I do know at one point that Berkshire held a major stake in at least one, if not both, of these agencies as he highlighted them as the closest thing to a monopoly in American business. I am gathering he liquidated those holdings or otherwise the press would have made more of it.

8. Buffett also points out the impending problems in municipal finance with major concerns on the funding of pension obligations by municipalities. In speaking with a professional in this space, he highlighted the exact same point. Municipalities will have to pay higher rates to borrow money and municipal insurers will be hit with increased charges.

Read all of what the oracle has to say along with a whole host of other info as Berkshire Hathaway Reports Worst Year Ever.

LD