Clem Lane here-Our nightly editorial note done just for you.
MADOFF-Ah the Metropolitan Correctional Facility. I understand they have a tremendous liquid beef surprise on Thursday nights. Who’s the lucky felon beginning his jail stay on such an auspicious night? Bernard Madoff, or as Jim Avila called him on WORLD NEWS, “the new face of American greed”. Today was the day SO MANY people have been waiting for, Bernard Madoff’s judgment day in federal court. Avila picks up the story: “Once in court amidst the harsh looks from his victims, Madoff’s infamous smirk finally seemed to melt away as he entered 11 guilty pleas and then read a 6 page confession beginning with ‘I am so deeply sorry and ashamed’. Madoff came clean (maybe) on his scam, telling the assembled throng how he would take money from clients and not invest it at all-just deposit it in a Chase Manhattan account. How long has this been going on? Avila: “Madoff said it started small, a temporary solution to hard times in the early 1990’s when the market was struggling, so he turned to fraud.” For all you karma fans out there, this is where it gets good. Avila again: “Madoff’s bail was instantly revoked his penthouse no longer an option. Instead he was cuffed in open court and hustled off to a downtown Manhattan federal holding cell while the judge decides how many of the possible 150 years the man once known as Uncle Bernie for his friendly sales demeanor must serve, likely in a maximum security prison.” This is not the end of the investigation-Avila tells us that (prosecutors) continue to pursue others suspected of helping him. But collecting the money owed victims? Avila: “Victims may in the end recover only a small fraction of their losses.” Mr. Madoff will be sentenced on June 16th.
MADOFF/VICTIMS-While we heard from only three victims in federal court today, there were plenty others inside and outside the courthouse who were there just to see the bane of their existence NOT return to his penthouse after the hearing. Victim DeWitt Baker in Dan Harris’ WORLD NEWS piece expressed satisfaction with sending Madoff directly to jail saying “If he was going back to his penthouse, we would have been absolutely betrayed.” Now the $65 billion question-how do I get my money back? Dan Harris: “Victims are eligible for up to $500K in investment insurance. They can also write off the losses on their tax returns and whatever assets investigators are able to find in Madoff’s estate will be divided up amongst his victims.” Which means what? Former federal prosecutor Robert Mintz was quoted in Harris’ piece saying “typically in these schemes if you get 50 cents on the dollar, that’s a great return. I think in this case, unfortunately, it’s going to be substantially less.”
I’VE BEEN DOWN SO LONG THAT IT LOOKS LIKE UP TO ME/DOW 7000!!!!-The Dow Jones Average was up for a third straight day, adding another 240 points today to close at 7170. That’s 700 points in three days, which had Charles Gibson asking Betsy Stark THE question-“Have we turned a corner?” Stark’s answer-“For now we can’t call this more than a bear-market rally. But it comes on a day when we got some better than expected news on retail sales and some good news from one of the banks we’ve been worrying about.” To wit-Bank of America’s CEO said the bank is making money and won’t need more government aid. Ditto for GM. Stark tells us “GM shot up 17 percent after saying it’s been so successful cutting costs it won’t need the next $2 billion in emergency loans from the government.” And how does all of this sit with the individual investor, have they thrown on their rally caps as well? Not quite-Stark tells us “they are more optimistic that things have at least stopped getting worse but most ordinary investors are going to need more proof that the economy is on the mend before they trust their money in stocks again.”
STEEL CAGE MATCH OR SENATE HEARING? TREASURY SECRETARY GEITHNER DEFENDS THE OBAMA BUDGET-The Senate Budget Committee invited Treasury Secretary Tim Geithner to help explain the President’s budget. Guess what? Senators don’t like it. Jon Karl, reporting on WORLD NEWS, tells us that Geithner was “hammered hardest by Republicans who attacked his budget and accused him of being too close to Wall Street.” Rather than employ the rope-a-dope strategy, Geithner got his Irish up. Geithner: “I’ve been in public service my entire professional life, never worked on Wall Street, never worked for a financial institution.” But Geithner was certainly on the receiving end more often, and not just with the Republicans. Karl tells us that the Chairman of the Senate Budget Committee (Kent Conrad D-ND) “took issue with one of the largest items in the budget:$646 billion for health care reform” with Conrad telling the Treasury Secretary “we’re on an unsustainable course.” And there was more Geithner-bashing but Karl tells us that “after almost two hours of grilling…the embattled Treasury Secretary finally got a little gratitude” from the ranking Republican on the committee, SC Senator Lindsay Graham who said “Thank you for taking the job. I know it’s tough. If you’re looking for a way to serve the country, join the marines or go to the Treasury.” So Vince McMahon, I mean Jon Karl, what’s the judge’s decision? Karl: “This is the 7th time Geithner has testified before Congress and for all the anger and frustration over the financial bailout, today he held his own, earning some grudging admiration from several Senators.”
–We learned a bit more about the ALABAMA GUNMAN Michael McLendon and his frame of mind today at an early evening press conference by law enforcement officials. Barry Tucker with the Alabama Bureau of Investigation says McLendon had told a confidant in the days before the shootings that he was depressed and unfulfilled. Authorities also say he left a letter saying he had killed his mother and planned to kill himself. He also mentioned a family dispute over a legal issue but authorities say he didn’t reveal plans to kill anyone else.
–Let’s move on to that darn SHUTTLE LAUNCH. NASA is removing some parts from the shuttle that is out on the launch pad in hopes of plugging a gas leak and launching Discovery (or STS 119 to you acronym freaks) to the international space station on Sunday. Discovery was supposed to blast off Wednesday night with a crew of seven and one final set of solar wings for the space station. But hydrogen gas began leaking as the shuttle was being fueled, and NASA called everything off. Gina Sunseri reports there will be a 10:30am NASA briefing tomorrow.
–NETHERLANDS BOMB THREAT-Christine Brouwer tells us that “Dutch press is reporting Dutch police arrested 7 people (6 men and 1 woman) in connection with a bomb threat against a busy Amsterdam shopping district today. In a press conference tonight, Dutch Public Prosecutor Bolhaar said one of the suspects is in a relationship with a person who was involved in the Madrid train bombings of 2004. He said today’s bomb threat was of a “terrorist nature.” The suspects range in age from 19 to 64, according to reports in Dutch newspapers. They are apparently Dutch citizens of Moroccan descent.
–IRAQI SHOE THROWER- Remember that guy who threw shoes at former President George W. Bush last December? Iraqi journalist Muntadhar al-Zeidi has been convicted of assaulting a foreign leader and was sentenced to three years in prison. He shouted "long live Iraq" when the sentence was read. His lawyers vow an appeal.
–TREASURY DEPARTMENT-Another one bites the dust. George Stephanopoulos reports “that Democratic sources say that H. Rodgin Cohen, a partner in the New York law firm Sullivan and Cromwell LLP and the leading candidate for Deputy Treasury Secretary, has withdrawn from consideration. I reported on Monday that Cohen was likely to officially nominated for the Deputy Treasury Secretary position. He’s been a counsel to just about every major player on Wall Street. Now, the nomination is off. Democratic sources said that an issue arose in the final stages of the vetting process.