Here's another BOMBSHELL ...
(no link)
Treasury rumors focus on Corzine As secretary wavers, ex-governor is eyed
Star-Ledger, The (Newark, NJ) - Friday, August 5, 2011
Author: Ginger Gibson and Salvador Rizzo, Statehouse Bureau
As speculation about how long Timothy Geithner will remain as U.S. Treasury secretary simmered yesterday, former Gov. Jon Corzine ‘s name began to bubble up as a possible replacement.
Corzine , considered for the nation's top financial office after Obama was elected, has emerged on speculative short lists as someone who could take over if Geithner exited before the president's first term expires.
Several sources close to Corzine while he was still in public office said yesterday the former governor has always had an interest in holding the job.
But the political climate in Washington could make Corzine ‘s selection impossible, insiders said. The country faces dire economic prospects and a hyperpartisan divide in Congress.
The New York Times reported yesterday that Geithner will likely stay through the remainder of Obama’s first term, but hasn't made up his mind and could depart sooner because of family concerns and the strain of years in Washington. Media outlets from the Associated Press to the Los Angeles Times reported his departure was a possibility.
The uncertainty about Geithner ‘s future at the Treasury spurred speculation in media outlets ranging from CNBC and Reuters to Politico and MarketWatch that Corzine , a former U.S. senator and Goldman Sachs chairman, could replace him.
It was dismissed yesterday by Corzine spokesman Josh Zeitz.
“This has all been idle speculation,” he said. “It's just another example of how the 24-hour news cycle, when it has nothing else to report, finds a bunch of coincidental evidence.”
Since leaving public office, Corzine has worked at New York investment firm MF Global, a fledgling company he vowed to transform into a power player on Wall Street.
“All I understand and based on all his behavior, he has no intention to do anything other than invest his heart and soul into reinvesting MF Global into a world-class investment bank,” said Angelo Genova, a Newark attorney and Democratic backer.
But in a recent bond offering at MF Global, investors were told if Corzine left to take a federal appointed position before 2013, the interest rate in the payout would increase by 1 percentage point.
(snip)
Obama and Biden made several campaign visits to NJ for Gov C’s reelection effort.
Obama starred in ads for Corzine-—which ran relentlessly on pricey NY media.
Obama directed the WH take over Corzine’s campaign.
OBAMA WAS DESPERATE FOR CORZINE TO WIN. Obama was heavily invested in the NJ gubernatorial race—one of only two statewide races that were a test for Obama’s policies. Virginia also elected a Republican. Obama campaigned in NJ three times, Biden was there twice. Obama TV ads ran relentlessly on costly NY media.
Obama put the power of the WH political machine behind Corzine. The NY Times reported:
(a) every TV ad Corzine put on the air was being screened by Obama’s WH “geniuses.”
(b) Corzine’s aides gave the WH daily briefings.
(c) Obama’s pollsters took over for Corzine’s polling team, and,
(d) White House operatives were on the ground for internal strategy sessions.
(e) Obama sent NJ $17.2 billion “stimulus” which promptly disappeared.
All of it led to Corzine’s humiliating defeat at the hands of a conservative Republican with no war chest to match Corzine’s.
Just goes to show.
However, the potential of Corzine leaving MF Global spooked some investors and potential investors in MFGH bond issue.
Ironically, Corzine was deemed so essential to MF Global by potential investors that MFGH hired Jefferies and Co. team to structure a "key man insurance" policy that would compensate (in the event of Corzine leaving) and still attract potential customers, but which wouldn't cost them too much upfront. Hence, 1 percent premium payout in case of specific event occurring.
Nothing illegal or problematic about that, actually an elegant solution. It is, however, ironic that the "indispensable man" Corzine was the prime architect of the leveraged layered "repo-to-maturity" trading strategy that directly caused downfall of MFGH.
More details on specifics of this issue here:
Obamas Bad Bargain (the left is becoming unhinged) - FR, post #48, 2011 August 03