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Remarks by the First Lady at Virginia Tech Commencement

Blacksburg, Virginia

12:49 P.M. EDT

MRS. OBAMA:  Thank you all.  Thank you so much.  Well, hello, Hokies!  (Applause.)  I like saying that.  It is such a pleasure and an honor to be here today to celebrate the Virginia Tech class of 2012.  Way to go.  Way to go.

I want to start by thanking President Steger for that very kind introduction, as well as the faculty, the staff, the board.  I also want to thank Senator Warner for his wonderful remarks, especially the "call your mom" part.  I like that.  I want to thank him for his outstanding service and leadership on behalf of this state.  And Senator, I accept your challenge — (laughter) — but you've just got to know, I play to win.  (Laughter.)  All right?  I also want to recognize Governor McDonnell and Mrs. McDonnell, who are here not just as Virginia’s Governor and First Lady but as proud parents.  Congratulations to both of you and your family.

And graduates, I have to join in in taking a moment to thank those extraordinary people up in the bleachers with the cameras and the beaming smiles on their faces.  Yes, I’m talking again about your families — the folks who pushed you and believed in you; the folks who always picked up the phone when you called, even when you were just calling to ask for money.  (Laughter.)  Their love and support has sustained you every step of the way, so, again, let’s give them another round of applause, right?  (Applause.)

And finally, to the class of 2012, you all — congratulations.  Congratulations.  We are so proud of you for making it to this day.  We are so proud of what you’ve achieved and who you’ve become.  And I know that as one of your commencement speakers today, I’m supposed to offer you all kinds of wisdom and advice and life lessons.  But the truth is, like so many people across this country and around the world, I have been following the journey of this school.  I have witnessed the strength and spirit of the Hokie Nation.  And I think that you all already learned plenty of lessons here at Virginia Tech.

In fact, I feel like all of you have so much to teach all of us.  And that’s really what I want to talk about today.  I want to talk about the lessons that all of us in this country can learn from this university.  I want to talk about what we can learn from the community you’ve built, from the service you’ve performed, and from the future that you all are inventing together.

And I want to start with the lesson that you all have taught us about the power of community.  As you all know and was mentioned earlier, the very first student at this university walked 26 miles just to enroll here.  Now, to normal people that might seem a little excessive, but to anyone who knows anything about Hokie pride, it's that level of enthusiasm that's pretty much par for the course here, right?  Whether you’re walking around campus decked out in your maroon and orange or cheering your hearts out to the opening beats of "Enter Sandman," few can match the school spirit on display here at Virginia Tech.

I even hear that you’ve bred your own variety of flower — a maroon and orange daylily known as the “VT Spirit.”  And during your first days at this school you learned that when someone asks you “What is a Hokie?” — what’s your answer?

AUDIENCE:  I am!

MRS. OBAMA:  What is a Hokie?

AUDIENCE:  I am! 

MRS. OBAMA:  And when someone says “Let’s go,” you answer –

AUDIENCE:   Hokies!

MRS. OBAMA:  They told me you’d do that.  (Laughter.)  That's very cool.

And whether you’re celebrating your triumphs or coming together in times of tragedy, what is clear is that you all didn’t just choose to attend a school, you chose to be part of a community.  And that feeling of belonging, those connections to your classmates and professors, I know for so many of you that’s what has made your time here so special.

And I know that some of you might be feeling a little sad about leaving the community that you’ve found here in Blacksburg.  But here’s the thing, graduates, the Hokie community didn’t just happen.  It didn’t just exist on its own.  All of you created it.  You worked hard for it.  You nurtured it every step of the way.  And I want you to know that you can do that again wherever your journey may take you.

Now, it’s going to be a little harder when you’re working a job and raising a family, juggling all the responsibilities of being adult.  But I promise you that no matter where you wind up, you can create a thriving community of your own if you’re willing to put in the same kind of energy and effort that you invested here at Virginia Tech.  

So that means continuing to show up -– but instead of showing up to games and extracurriculars, it might mean attending those town hall meetings, or going to that school assembly, or those neighborhood picnics.  It means reaching out like you did to your classmates here at Virginia Tech -– stopping by to welcome a new neighbor to your block, or bringing over a hot meal for someone who’s going through a hard time.  And it means continuing to serve -– volunteering in your local school, cleaning up your local park, doing your part to help others in need.

And that brings me to the second lesson all of you at Virginia Tech have taught us -– and that is the power of service.  Service is truly at the core of the Virginia Tech experience.  It’s in your motto -– Ut prosim, “That I may serve.”  It was your founding purpose as a land grant school designed to open the doors of higher education to people from all walks of life.  It’s the mission of your Corps of Cadets, men and women who have served this country in every armed conflict right from the beginning.

And every year, Virginia Tech students do tens of thousands of hours of community service here in Virginia and around the world.  I understand this year, through the Relay for Life, you’ve raised more than half a million dollars to fight cancer.  (Applause.)  And at this year’s Big Event, more than 6,800 people volunteered on 990 different projects.  And one of today’s graduates, a young man named Justin Graves, has committed himself to helping at least one person every single day.  Way to go.  As he put it, and these are his words — Justin said, “Life is all about what you have done for other people.”

And you all haven’t just taught us about the power of service to lift up our families and heal our communities.  You’ve also shown us that through service, we can heal ourselves.  Over the past five years, students here have run memorial projects, building houses, hosting dance workshops, teaching French and German in local schools.  You’ve created a fund to honor the sacrifice of Officer Deriek Crouse.  And through these and so many other acts of service, large and small, you all have helped this community heal.

And years ago, I went through a similar process in my own life.  It was back when I wasn’t much older than all of you.  I had graduated from college and law school, and then I was — like many of you will be — up to my ears in debt.  So I went out, and I got a job at one of the largest law firms in Chicago.  And for a while, I was doing everything that I thought I was supposed to do.  I had a fancy office, a big fat paycheck, and a really impressive line on my resume.

But then, when I was 26 years old, one of my best friends from college in the world died of cancer suddenly.  She was gone.  Less than a year later, my father passed away after battling multiple sclerosis for years.  And just like that, I had lost two of the people I loved most in the world.  That was it.  And for months, I felt like I couldn’t breathe.  I had this almost physical sense of loss, this gaping emptiness in my life — and I couldn’t figure out how to fill it.  I spent a lot of time mourning and questioning and reflecting.  And I thought a lot about everything my dad had done for me during his life.  I thought about how hard my dad worked to provide for our family.  I thought about how, no matter how sick my father was feeling, he still woke up every morning and he did his job at the city water plant, and he did it without complaint or regret. 

And you see, as I tell many people, my dad did not have the chance to attend college himself, but he and my mom they saved and they sacrificed.  They poured everything they had into me and my brother because they wanted us to get an education they could only dream of.  And while pretty much all of my college tuition was covered from loans and grants, my dad still paid a small portion of that tuition himself.  And let me tell you, every semester, he was determined to pay his little contribution right on time.  He was so proud to be sending his kids to college, and he couldn’t bear the thought of me or my brother missing that registration deadline because his check was late.

And as I grieved, I came to realize that the best way for me to honor my dad’s life was by how I lived my own life.  I realized that the best way to fill the hole he had left was to do for other young people what he had done for me.  So I left that fancy law firm, and I wound up ultimately running a non-profit organization that trained young people for careers in public service.  Yes, I took a pay cut that made my mother cringe, and my new office wasn’t nearly as nice as the old one.

But with every student I mentored, with every service project I organized, I felt my grief recede just a little bit.  I still miss my dad, and I always will.  But slowly, I felt myself beginning to heal.  I felt myself becoming whole again.

And all of us go through periods of sadness like this.  All of us do.  We all feel, at times, a little bit lost.  And we all have some kind of emptiness that we’re searching to fill.  And often, it is only through serving others that we find what’s been missing in our own lives.  And like so many of you, through service I was able to find what I needed and carve a path for my life that truly felt like my own.

And that brings me to the final lesson that all of you have taught us -– and that is the power of inventing the future.  And I know you hear this phrase all the time here at Virginia Tech, but today, I just want to pause for a moment on the word “invent.”  Because the phrase isn’t “succeed in the future,” it’s not “plan for the future” or “do the best you can in the future.”  It’s “invent the future.”  And with those three words comes a simple message:  a call to chart your own course and live life on your own terms.  And that’s a lesson that I first learned back when I was a teenager.

And some of you may have grown up like I did — in neighborhoods where kids had — very few of them had the chance to go to college; where being teased for doing well in school was just a fact of life; where well-meaning but misguided folks questioned whether a girl with my background could get into the kinds of colleges I dreamed of attending.  But I worked hard, and I did my best to tune out those voices of doubt, including the ones inside my own head.  And eventually, I was accepted to Princeton, and I got that education that my dad had always dreamed of.

But the truth is, graduates, there will always be folks who make assumptions about you based on superficial things like where you’re from, or what you’re wearing, or how you look.  There will always be folks who judge you based on just one thing that you say or do; folks who define you based on one isolated incident.  And here at Virginia Tech, I know you all know a thing or two about what that’s like. 

But you also know that in the end, people can only define you if you let them.  In the end, it’s up to each of us to define ourselves.  It’s up to each of us to invent our own future with the choices we make and the actions we take.  That’s why Norris Hall is now the home of the Center for Peace Studies and Violence Prevention, and West Ambler Johnston Hall will soon be reopened as a new residential college.  That is why this year, on April 16th, you started attending class again, choosing to honor their lives by moving forward with your own.

And that is why, when you all are out there in the world and you meet someone and you tell them that you’re from Virginia Tech, and they say, “Huh, isn’t that the school where” — I want you to interrupt them right there and say, “Yes, it is the school where we have some of the best academic programs and professors in the country."  That’s what you tell them.  (Applause.)  You tell them, "Yes, it is the school where students are passionate about serving their country and supporting each other.  And by the way, which also has the best campus food you’ll ever eat."  (Applause.)  Who can say that?

You tell them, “Yes, it’s the school where we produce graduates who are leaders in their industries, and pillars of their communities, and who carry their Hokie pride with them every day for the rest of their lives."  You say, “Yes, that is the school I attend.  That is Virginia Tech.”

Graduates, that is who you are.  That is what it means to be part of the Hokie Nation.  And let me just tell you, we are all so proud of you.  And we are all so inspired by you.  And we are all determined to live up to the example you have set.  And in those ways and so many others, yes, we are all still Hokies.

Congratulations again on everything that you’ve achieved.  Thank you all.  God bless you.  (Applause.)

END                    
1:05 P.M. EDT

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Remarks by the President on Helping Responsible Homeowners

Private Residence
Reno, Nevada

12:00 P.M. PDT

THE PRESIDENT:  Well, good afternoon, everybody.  (Applause.)  And thank you for arranging a beautiful day.  This is just a spectacular afternoon and I’m thrilled to be here.

We all know how difficult these past few years have been for this country, but especially for this state.  After the worst recession in our lifetimes — a crisis that followed the collapse of the housing market — it’s going to take a long time for the economy to fully recover.  More time than any of us would like.  But there are plenty of steps that we can take to speed up the recovery right now.  There are things we can do right now to help create jobs and help restore some of the financial security that too many families have lost. 

Now, I have to say that there are a few too many Republicans in Congress who don’t seem to be as optimistic as we are.  They think that all we can do are try the things that have been done in the past — things that they’ve tried in the past.  So they want to cut more taxes, especially for the wealthiest Americans.  They want to cut back on the rules that we put in place for banks and financial institutions.  They’ve said that they want to let the housing market hit bottom, and just hope for the best.  That’s it.  We’ve heard those ideas before.  That’s their economic agenda.  And I’ll be honest with you, I don’t buy it.  I think they’re wrong. 

We tried their ideas for nearly a decade and they didn’t work.  And I refuse to sell this country short by going back to the exact same ideas that helped to get us in this mess in the first place.  Our goal is to build an economy where hard work and responsibility are rewarded — where you can find a good job, make a good wage, own your own home, maybe start a business, send your kids to college.  Hopefully, their lives will be even better than ours.  That’s what I wish for Malia and Sasha, and I know you guys feel the same way who have kids.  

And that’s where we need to go.  I’ve been pushing Congress to help us get there by passing a few common-sense policies that we’re convinced will make a difference.  We even made a handy “To-Do” list for Congress so they can just check them off — it’s a list like Michelle gives me.  (Laughter.)  I know Paul is familiar with that list.  He gets it from Val.

Now, there are only five things on this list — because I don’t want to overload Congress with too much at once.  But they’re ideas that will help create jobs and build a stronger economy right now. 

So first up on the list — it makes absolutely no sense that we actually give tax breaks to companies that ship jobs and factories overseas.  That doesn’t make any sense at all.  (Applause.)  So we told Congress it’s time to end the tax breaks for companies that ship jobs overseas, and use that money to cover moving expenses for companies that bring jobs back to America.  (Applause.)

Second, instead of just talking about job creators, Congress should help small businesses and help small business owners who create most of the new jobs in America.  So we want to give them a tax break for hiring more workers and paying them higher wages. 

The third thing on our “To-Do” list — Congress should extend tax credits that are set to expire for our clean energy companies.  These businesses are putting folks to work here in this state of Nevada.  Last time I was here, in fact, I went to see a huge solar plant, solar energy plant.  A lot of folks are working both in the construction of it and maintaining it.  That’s happening all across the country.  And so we’ve got to make sure that we are helping those folks, because that helps us break our dependence on foreign oil.  Over the long term that will help drive down gas prices and it puts people to work right now.  It’s the right thing to do.  (Applause.)

Fourth, Congress should create a Veterans Jobs Corps so that we can help communities hire returning heroes — our veterans — as cops and firefighters and employees at national parks — because nobody who fights for this country should ever have to come home and fight for a job or fight for a roof over their heads.  (Applause.)       
                     
All right, so that’s four — which brings me to the fifth.  The fifth thing on the list, and that’s why I’m here today.  I’m calling on Congress to give every responsible homeowner the chance to save an average of ,000 a year by refinancing their mortgage.  It’s a simple idea.  (Applause.)  It makes great sense.  And I know it will have an impact.  

Last October, I was in Clark County, where I announced new steps to help responsible homeowners refinance their homes.  And at the time, Congress wasn’t willing to act, so we did.  We went ahead and did what we could do administratively, without a new law being passed.  And as a result, Americans who were previously stuck in high interest loans have been able to take advantage of these lower rates.  And they’ve been able to save thousands of dollars every year.

And it turns out that two of those people are your neighbors, Paul and Valerie Keller.  (Applause.)  So I just had a chance to visit with Paul and Valerie and look at their beautiful home and check out the grill out back.  (Laughter.)  Valerie says Paul is a pretty good cook, so I’m going to take her word for it.

The Kellers have lived in this house for 14 years.  Val works nearby, helping secure loans for farmers and ranchers.  Paul is a retired electrical contractor who started a family business with their son.  Last year, with mortgage rates at historic lows, the Kellers decided it would make sense for them to refinance.  They thought it would be easy, since they’re current on their mortgage, they make their payments on time.  So this is an example of responsible homeowners doing the right thing.

But when they tried to refinance, they were told they couldn’t do it.  Because the Kellers’ house, like thousands of others in this state and probably some of the neighbors here, their house is underwater, which means that the price is currently lower than what they owe on it.  So they were hit — you were hit with a historic drop in housing prices which caused the value of the homes in their neighborhood to plummet.  And a lot of banks historically have said, well, we’re not going to refinance you if your home is underwater.

Now, luckily, the Kellers saw my announcement that I had made down in Clark County.  So I’m assuming it must have been Val because whenever something smart is done, it’s usually the wife in the house.  (Laughter.)

So they called their lender, and within a few months, within 90 days, they were able to refinance under this new program that we set up.  Their monthly mortgage bill has now dropped 0 dollars a month, and that means every year they’re saving close to 00.  (Applause.)

Now, Val says that they’ve been talking to some of their neighbors — maybe some of you are here today — and you’re saying, well, that sounds like a pretty good idea.  And a lot of folks across the country recognize this is a smart thing to do not only for homeowners but for our economy, because if Paul and Val have an extra 0, 0 a month, then they might spend it on the local business.  They might go to a restaurant a little more often.  They might spoil their grandkids even more.  (Laughter.)  And that means more money in the economy, and businesses do better, and slowly home prices start rising again.  So it makes sense for all of us.

And the good news is, since I’ve made this announcement, refinancing applications have gone up by 50 percent nationwide and 230 percent here in Nevada alone.  That’s the good news.  People are taking advantage of this.  (Applause.)  That's what we want to see. 

But here's the only catch — and this is where you come in, because you're going to have to pressure Congress:  The pool of folks who can refinance right now, when their homes are underwater, is still too small.  The reason the Kellers were able to refinance is because the only thing that we could do without congressional action was to give opportunities for refinancing for folks with a government-backed loan, an FHA-backed loan.  But in order to expand that opportunity — we want to include everybody; people whose mortgages aren't government-backed.  (Applause.)  And in order to do that we've got to have Congress move. 

There’s absolutely no reason why they can’t make this happen right now.  If they started now, in a couple of weeks, in a month, they could make every homeowner in America who is underwater right now eligible to be able to refinance their homes — if they're making their payments, if they're responsible, if they're doing the right thing.  And think about all those families saving ,000 on average a month year– that's a huge boost to our economy.  And for some of you who are underwater, you might say, instead of spending that money I can plow that back into equity in my home, and build that back up, which would further strengthen housing prices here in Nevada and around the country. 

So it's the right thing to do.  There's already a bill in the works.  It's supported by independent, nonpartisan economists.  It's supported by industry leaders.  Congress should pass it right now.  (Applause.) 

And let me just say this — maybe there are some members of Congress watching.  (Laughter.)  If you need some motivation to make this happen, then you should come to Reno and you should visit with folks like the Kellers.  (Applause.)  I'm not saying the Kellers want all these members of Congress up in their house.  (Laughter.)  It's bad enough having me and Secret Service in there.  (Laughter.)  But at least they — they probably wouldn't mind saying hello and talking to them here in front of their house.  (Laughter.)  But they should talk to people whose lives are better because of the action that we took. 

All over the country, there are people just like Paul and Val, folks just like you, who are doing everything they can to do the right thing — to meet their responsibilities, to look after their families, to raise their kids right, give them good values.  You're not looking for a handout.  You just want to make sure that somebody is looking out for you, and that when you do the right thing that you're able to keep everything that you’ve worked for.  That’s what folks are looking for, and that’s what they expect from Washington:  to put the politics aside and the electioneering aside, and just do what’s right for people.  (Applause.)

So I need all of you and everybody who’s watching to push Congress on their “To-Do” list.  Nag them until they actually get it done.  We need to keep moving this country forward.  Send them an email.  Tweet them.  Write them a letter if you’re old-fashioned like me.  (Laughter.) 

But communicate to them that this will make a difference.  It’s one small step that will help us create the kind of economy that all Americans deserve.  And that’s an economy that’s built to last.  An economy where everybody has a fair shot, everybody gets a fair share, everybody is playing by the same set of rules.  That’s what made us great in the past.  That’s what’s going to make us great in the future.

All right.  Thank you, everybody.  God bless you.  God bless America.  And give Paul and Val a big round of applause.  (Applause.)

END               
12:11 P.M. PDT 

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Janet Tavakoli: Jamie Dimon’s SNAFU: JPMorgan’s Other Derivatives’ Losses

In an August 2010 commentary about JPMorgan’s losses in coal trades I wrote: “The commodities division isn’t the only area in which JPMorgan is vulnerable. Credit derivatives, interest rate derivatives, and currency trading are vulnerable to leveraged hidden bets. Ambitious managers strive to pump speculative earnings from zero to hero.”

At issue is corporate governance at JPMorgan and the ability of its CEO, Jamie Dimon, to manage its risk. It’s reasonable to ask whether any CEO can manage the risks of a bank this size, but the questions surrounding Jamie Dimon’s management are more targeted than that. The problem Jamie Dimon has is that JPMorgan lost control in multiple areas. Each time a new problem becomes public, it is revealed that management controls weren’t adequate in the first place.

JPMorgan’s Derivatives Blow Up Again

Jamie Dimon’s problem as Chairman and CEO–his dual role raises further questions about JPMorgan’s corporate governance—is that just two years ago derivatives trades were out of control in his commodities division. JPMorgan’s short coal position was over sized relative to the global coal market. JPMorgan put this position on while the U.S. is at war. It was not a customer trade; the purpose was to make money for JPMorgan. Although coal isn’t a strategic commodity, one should question why the bank was so reckless.

After trading hours on Thursday of this week, Jamie Dimon held a conference call about billion in mark-to-market losses in credit derivatives (so far) generated by the Chief Investment Office, the bank’s “investment” book. He admitted:

“In hindsight, the new strategy was flawed, complex, poorly reviewed, poorly executed, and poorly monitored.”

But lets get back to commodities. For several years, legendary investor Jim Rogers has expressed his concern to me about JPMorgan’s balance sheet, credit card division, and his belief that Blythe Masters, the head of JPMorgan’s commodities area, knows so little about commodities. Jim Rogers is an expert in commodities and is the creator or the Rogers International Commodities Index. He also sells out-of-the-money calls on JPMorgan stock. So far, that strategy has worked out well for him. (Rogers gave me permission to publicly reflect his views and his trades.) Moreover, JPMorgan is still grappling with potential legal liabilities related to the mortgage crisis.

Is Jim Rogers justified in his harsh view of JPMorgan’s commodities division? After he expressed his concerns, JPMorgan’s coal trade made the news, and it appeared to me that Jim Rogers is on to something. For those of you who missed it the first time, my August 9, 2010 commentary is reproduced below in its entirety. Dawn Kopecki at Bloomberg/BusinessWeek broke the story wherein Blythe Masters’ quotes first appeared:

JPMorgan’s Losses from Indecent Overexposure – August 9, 2010

JPMorgan Chase’s fixed-income revenue fell almost 28% to .6 billion in the second quarter, down from .5 billion in the first quarter, and down from .9 billion for the same period last year. JPMorgan blamed an interest rate squeeze and bad results in the credit markets and the commodities markets.

There were no details of its significant loss from unwise, gigantic, wrong-way wartime coal bets. The bank took a short position so enormous that it was oversized relative to the global coal market, and second quarter losses reportedly were in the hundreds of millions of dollars.

Financial Reform Failure

Blythe Masters, managing director in charge of JPMorgan’s global commodities group, spent time lobbying in Washington to dilute financial reform. By her own admission, JPMorgan’s recent speculation in coal wasn’t client driven; the risk was taken on JPMorgan’s behalf. The Dodd-Frank Financial Reform Bill does nothing to prevent a repeat — or even a potentially worse — debacle.

The commodities division isn’t the only area in which JPMorgan is vulnerable. Credit derivatives, interest rate derivatives, and currency trading are vulnerable to leveraged hidden bets. Ambitious managers strive to pump speculative earnings from zero to hero.

Instead of transparent and regulated markets, we have dark markets, hidden leverage, proprietary speculative trading, lax regulation and oversized risks.

“Scared Sh*tless” 1

Blythe Masters told her remaining employees that competitors are “scared sh*tless” of JPMorgan’s commodities division. She claimed the layoffs of 10% of front office staff are not a sign of JPMorgan “panicking” and called the risk taking in coal trading that left JPMorgan wide-open to a massive short squeeze a “rookie error.”

For individual traders, JPMorgan doesn’t follow the Wall Street maxim: He who sells what isn’t his’n, must buy it back or go to pris’n. The U.S. can count on JPMorgan to continue both long and short market manipulation and take its winnings and losses from blind gambles. Shareholders, taxpayers, and consumers will foot the bill for any unpleasant global consequences.

Physical oil traders from JPMorgan’s brand new RBS Sempra Commodities LLP acquisition (JPMorgan paid .7 billion) left of their own accord to join smaller firms with less capital. Masters said these were “very interesting career decisions.”

The defections were all the more interesting, because Masters began her career as a JPMorgan commodities trader. RBS Sempra’s oil traders gave Masters a vote of no confidence. Their flight was a loss of “key people,” whom she said she needs to replace.
Masters is poised for more debacles:

“All it’s going to take is a little pop to the upside. We could be producing a 30 to 35 percent ROE and looking like gods.”

Good luck with that. Masters also noted that this potential windfall might come at the expense of others:

“We’ve got too many banks chasing too little volume and margins have compressed.”

The United States is trying to pull out of the greatest financial tailspin in its history. Dice-rolling braggadacio by a key officer at one of the nation’s largest banks is exactly the kind of thing Congress, taxpayers, and voters should find scary. Arianna Huffington explains the consequences for middle class Americans, who pay a disproportionate share of the bill in her upcoming book, Third World America. 2

Ramp up Risk and Cross Your Fingers

Big unanticipated market moves always result in big winners and big losers among big gamblers. After the fact, most winners claim they were smart–not just lucky.

When bank managers take a big gamble and lose hundreds of millions of dollars, they don’t call it reckless; they spin it as an error of “judgment.” The directive is to “put on risk” and “generate results.” This may be why Masters cautioned employees:

“I don’t want us talking to the outside world, neither about successes nor about failures.”

JPMorgan is making big bets and crossing its fingers in a dangerous and volatile market.
Masters takes “pleasure” in the “ballsiest” business, and she wants her traders to get lucky. Moreover, she’s engaged in internal spin control and plans a “deep dive” with the Board and the CFO. This may reduce her chances of walking Wall Street.

No one should be concerned for the job security of managers like Masters at JPMorgan, and that is precisely the problem. Delusional risk-taking and lack of transparency at Too-Big-To-Fail banks — especially in the areas most vulnerable to rampant speculation — were ignored by so-called financial reform.

1 All words in this article in quotation marks are from Business Week’s (Bloomberg News) major scoop after the leak of a tape of an internal JPMorgan July 22 conference call: “Blythe Masters Says ‘Don’t Panic’ as Commodities Slip,” by Dawn Kopecki, August 3, 2010.

2 Based on my reading of an advance copy of Arianna Huffington’s new book: Third World America: How Our Politicians Are Abandoning the Middle Class and Betraying the American Dream, Crown Books, September 2010.

Endnote: Jane Wollman Rusoff interviewed me for Research Magazine‘s May cover story, “Finding the Culprits of the Crisis,” about the deep monetary connections of Wall Street and Washington and the corrosive effect it has had on the economy and the Republic.

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Weekly Address: Congress Must Act on “To-Do List”

In this week’s address, President Obama called on Democrats and Republicans to come together and act on his Congressional “to-do list,” which will create jobs and help restore middle class security. In this make-or-break moment for the middle class, these five initiatives have bipartisan support and will help create an economy that is built to last.  While some believe we should return to the same policies that led to the worst recession since the Great Depression, the President believes we must take action to speed up the recovery and ensure that our economy once again rewards hard work and responsibility as we keep our country moving forward.

Remarks of President Barack Obama
Weekly Address
The White House
May 12, 2012

We all know the past few years have been difficult for this country.  After the worst recession of our lifetimes, it will take longer than any of us would like for the economy to fully recover.  But there are plenty of steps we can take to speed up the recovery.  There are things we can do – right now – to help create jobs and restore some of the financial security that so many families have lost. 

Now, the other side isn’t so optimistic.  They think all we can do is cut taxes – especially for the wealthiest Americans – and go back to letting banks and corporations write their own rules again.  That’s their plan. 

But I think they’re wrong.  We tried their ideas for nearly a decade, and it didn’t work out so well.  We can’t go back to the same policies that got us into this mess.  We’ve got to move forward.  We need to build an economy where hard work and responsibility are rewarded – where you can find a good job, own your own home, maybe start a businesses, and give your kids the chance to do even better. 

That’s where we need to go.  And I’ve been pushing Congress to help us get there by passing a few common-sense policies that would make a difference.  Democrats and Republicans have already done some important work together – from passing tax cuts for workers, to opening up new markets for American products, to reforming our patent system.  But now we need to do more. 

That’s why we made Congress a handy “To-Do” list – just like the kind I get from Michelle.  It’s short, but each of the ideas on this list will help create jobs and build a stronger economy right now. 

First, Congress should stop giving tax breaks to companies that ship jobs overseas, and use that money to cover moving expenses for companies that bring jobs back to America. 

Second, Congress should help the millions of Americans who have worked hard and made their mortgage payments on time refinance their mortgages at lower rates and save at least ,000 a year.  

Third, Congress should help small business owners by giving them a tax break for hiring more workers and paying them higher wages.  Small businesses are the engine of economic growth in this country.  We shouldn’t be holding them back – we should be making it easier for them to succeed.  

Fourth, if Congress fails to act soon, clean energy companies will see their taxes go up and could be forced to lay off employees.  These companies are putting Americans to work and helping break our dependence on foreign oil.  Congress should extend these tax credits.  

And finally, Congress should help our veterans returning from Iraq and Afghanistan by creating a Veterans Job Corps.  Our men and women in uniform have served this country with honor.  Now it’s our turn to serve them.  

So that’s Congress’s “To-Do” List.  But now we need them to start crossing things off.  I need you to call your Members of Congress, write an email, tweet, and let them know we can’t afford to wait any longer to get things done.  Tell them now is the time to take steps we know will grow our economy and create jobs. 

You’re working harder.  You’re meeting your responsibilities.  Your representatives in Washington should do the same.  Let’s push Congress to do the right thing.  Let’s keep moving this country forward together. 

Thanks, and have a great weekend. 

###

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For Your Own Good: Debt Collectors Say They Help Hospital Patients By Demanding Money

Accretive Health, a debt-collection company under fire from Minnesota and federal officials for aggressive tactics to squeeze money from hospital patients, is striking back at critics.

In a rebuttal to accusations made by Minnesota Attorney General Lori Swanson (D), Accretive Health flatly denied it has violated federal or Minnesota laws governing debt collection and patient privacy and said its role in hospitals is to help patients find ways to pay for their medical care. “We are proud of what we do,” the company said in 29-page report issued Friday evening. “Patients appreciate the education, expertise, and compassion that we provide.”

Accretive Health has been battered in Minnesota, Washington, and on Wall Street since Swanson published a six-volume report on her website last month alleging that the Chicago-based company demanded that emergency room patients pay before receiving medical care, that collectors visited patients’ bedsides asking for money, and that collectors employed harsh and deceptive tactics. Democratic lawmakers and federal agencies have made inquiries and Accretive Health shares lost more than half their value before rebounding after the company reported positive earnings Thursday.

The Friday report is the latest salvo in Accretive Health’s counteroffensive. A week ago, Chicago Mayor Rahm Emanuel (D), an ex-congressman and President Barack Obama’s former White House chief of staff, came to the defense of the company , asking Swanson to ease off. Accretive Health hired well-connected Washington lobbyist Heather Podesta to “educate policymakers” about its services, according to a disclosure form filed with the Senate in March. In addition, Accretive Health has engaged a crisis public relations firm and its attorneys have hinted that the company may sue Swanson.

Accretive Health acknowledged that its employees or those of hospitals operated by Fairview Health Services in Minnesota spoke to nearly every patient about money during the appointment-making process, at registration, or in their hospital rooms. But the company said Swanson misrepresents these discussions. Emergency room patients were screened and stabilized first and no one was denied care, the company said. Accretive Health said the consultations have resulted in more than 250,000 people obtaining health coverage since 2003.

Swanson characterized these activities differently and said patients were made to think they wouldn’t be treated if they didn’t pay, which would violate federal law. Her reports alleged Accretive Health employees and hospital staff routinely badgered patients because they were under pressure from managers to collect the most money and were rebuked when they failed to meet targets.

Accretive Health also failed to protect confidential patient information, Swanson said. The attorney general sued Accretive Health in January over a case in which an employee’s laptop computer, which contained information about more than 23,000 patients, was stolen from a parked car. Employees of Accretive Health’s Medical Financial Solutions division also threatened to report patients to credit agencies, which isn’t permitted, the attorney general said. The New York Times first reported Swanson’s allegations.

The company may seek to contract the debt-collection work among the most criticized to other firms, Accretive Health CEO Mary Tolan said during a conference call with investors Wednesday.

Neither Friday’s report nor any change in Accretive Health’s business model is likely to end the controversy as federal agencies and lawmakers have taken an interest.

The Department of Health and Human Services, the Federal Trade Commission, Sen. Al Franken (D-Minn.), and Rep. Henry Waxman (D-Calif.) have joined Swanson in questioning whether Accretive Health goes too far in efforts to make sure hospital clients get paid. Accretive Health’s report is in response to questions from Franken, who has scheduled a Senate committee hearing in St. Paul on May 30.

“It seems to me a new, aggressive way of approaching patients,” Waxman said. “This is part of an ongoing concern we’ve had about hospitals charging more to uninsured patients.” The federal health care reform law says nonprofit hospitals can only charge uninsured people the “amounts generally billed to individuals who have insurance,” according to the Internal Revenue Service. Minnesota law requires hospitals to charge uninsured people the same rate as the insurance company that covers the largest number of their patients, Swanson’s reports said.

Investigators from the federal Centers for Medicare and Medicaid Services visited one of Fairview’s hospitals last week to follow up on Swanson’s report, the St. Paul Pioneer Press reported Friday.

The head of that agency, Marilyn Tavenner, wrote hospital industry groups this week to remind them of their obligations to patients and federal law. “We would have serious concerns with the legality of any hospital policy or procedure that may discourage individuals from seeking emergency care,” Tavenner wrote to the American Hospital Association, the Federation of American Hospitals, and the Association of American Medical Colleges on Wednesday.

The Federal Trade Commission in March began looking into whether Accretive Health has violated federal debt-collection and credit-reporting laws, the company disclosed in its quarterly report Wednesday.

The American Hospital Association revised its guidelines on hospital billing and collection practices last week in response to the controversy surrounding Accretive Health and to incorporate new requirements from health care reform. “America’s hospitals are committed to doing everything possible to better serve patients and to treat them equitably, with dignity, compassion and respect from the bedside to the billing office,” the document said. “Hospitals exist to serve. Their ability to serve well requires a relationship with their communities built on trust and compassion.”

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Presidential Proclamation — Mother’s Day, 2012

MOTHER'S DAY, 2012
- – - – - – -
BY THE PRESIDENT OF THE UNITED STATES OF AMERICA
A PROCLAMATION

Mothers are cornerstones of our families and our communities. On Mother's Day, we honor the remarkable women who strive and sacrifice every day to ensure their children have every opportunity to pursue their dreams.

Our Nation first came together to celebrate Mother's Day on May 11, 1913, with the introduction of a House Resolution requesting President Woodrow Wilson, Members of Congress, and officials across the Federal Government wear white carnations in honor of America's mothers. Today, we continue to mark Mother's Day by paying tribute to the women who shape our characters and set our families up for success. Through their example, our children learn the principles of hard work, compassion, service, and personal responsibility. Through their encouragement and unconditional support, they instill the confidence and values so vital to our children's success.

Mothers raise children under an array of circumstances, and many work long hours inside and outside the home balancing myriad demands. Mothers are leaders and trailblazers in every part of our society — from classrooms to boardrooms, at home and overseas, on the beat and on the bench. We celebrate the efforts of all our Nation's mothers, and we recognize that when more households are relying on women as primary or co-breadwinners, the success of women in our economy is essential to the success of our families, our communities, and our country. That is why I created the White House Council on Women and Girls as one of my first acts in office — to ensure we integrate the needs of women and girls into every decision we make. I was proud to sign the Lilly Ledbetter Fair Pay Act, which continues to help women secure equal pay for equal work, and my Administration continues to promote workplace flexibility so no mother has to choose between her job and her child. And because of the Affordable Care Act, women finally have more power to make choices about their health care, and they have expanded access to a wide variety of preventive services such as mammograms at no additional cost.

Today, let us pay respect to mothers across America by embracing the women who continue to guide and inspire us, and by holding fast to the memories of those who live on in our hearts.

The Congress, by a joint resolution approved May 8, 1914 (38 Stat. 770), has designated the second Sunday in May each year as "Mother's Day" and requested the President to call for its appropriate observance.

NOW, THEREFORE, I, BARACK OBAMA, President of the United States of America, do hereby proclaim May 13, 2012, as Mother's Day. I urge all Americans to express love and gratitude to mothers everywhere, and I call upon all citizens to observe this day with appropriate programs, ceremonies, and activities.

IN WITNESS WHEREOF, I have hereunto set my hand this eleventh day of May, in the year of our Lord two thousand twelve, and of the Independence of the United States of America the two hundred and thirty-sixth.

BARACK OBAMA

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Top 10 Biggest Trading Losses in History

On May 10,  JPMorgan Chase admitted a “grievous” failure in their trading operations that led to a billion loss for the storied investment bank in the past six weeks alone. How does the latest money mismanagement stack up against history’s biggest losses?
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