Grant Thornton is officially picking up BDO's Victoria and New South Wales offices in Australia […]
They aren’t exactly the U.S. Treasury and don’t foresee any populist outrage but Miami Heat Limited Partnership did Tim a fave and bought his 7,500 square foot manse for $1.985 million, according to Tax Watchdog Robert Snell:
The Miami Heat, one of the NBA’s hottest teams, bailed out former star Tim Hardaway, whose namesake son plays for the University of Michigan basketball team, by buying his Miami mansion and clearing up a $120,000 federal tax debt.
Hardaway, 44, ran into tax trouble in June despite being paid more than $46.6 million during his NBA career. The IRS filed a tax lien against his property and the bill listed his 7,542-square-foot mansion in suburban Miami.
For whatever reason, Tim is still crashing there but the Heat are trying to flip the pad for $2.5 mil, so if you’re in the market for 5bed/5.5bath with a full basketball court, make them an offer.
I’ve previously railed against American International Group for dragging its feet in repaying the $180 billion it owes to the U.S. government, so I need to tip my cap to it for the $35.5 billion deal it struck with Prudential for its Asian insurance division.
And unlike some previous deals, AIG will use a major chunk of cash from the sale of the unit — $25 billion — to pay down a credit line it has with the Federal Reserve. (The insurer will take the remaining $10.5 billion in Prudential securities.)
It’s a move the company had to make, really, especially as it continues to lobby against the pay caps the government has imposed.
“This diminishes the wrath directed at AIG from Americans angry at the bailout,” Clark Troy, a senior analyst with research firm Aite Group, told Bloomberg.
The anger directed at financial institutions is a big deal. Just ask Goldman Sachs, which listed “negative publicity” in the risk section of its recently filed 10-K.
So while AIG had previously done a number of relatively minor deals — at least minor compared to its indebtedness to the U.S. taxpayer — the insurer finally made a major act of good faith. Indeed, the unit was considered its crown jewel and Thomson Reuters data showed it was the largest insurance M&A deal ever.
But here’s hoping the company doesn’t take what little good will it will gain from the deal for granted. There’s still the matter of more than $100 billion left.
Ben Bernanke claims there is “no net impact” to U.S. taxpayers involved in bailing out the TBTF banks, state unemployment funds, car companies, insurance companies, GSEs; need I continue? You know the list by now.
The impact in question comes from the size of the Fed’s swollen balance sheet, surely you are familiar with the number by now. I don’t have to remind you little beancounters that the Fed writes its own accounting manual, so take that “balance sheet” for what it is worth.
“These programs, which imposed no cost on the taxpayer, were a critical part of the government’s efforts to stabilize the financial system and restart the flow of credit,” said Bernanke in prepared remarks to the House Financial Services Committee. Not even a snow day could keep him from this one.
Have you ever seen a “company” drastically reduce the size of its balance sheet? Me neither. Next.
The indirect “net impact” of all of this, of course, is a drag on unemployment. While on a federal level, inflation will have to run hot enough to cover a growing deficit, bankrupt municipalities and states are bleeding businesses and residents dry. So who will be financing the Fed’s unloading of assets? It is unlikely to be the extinct “middle class”.
As many of you already know, CPA Trendlines tracks accounting unemployment numbers regularly. I know some of you are prone to stick to what we did last year but last year didn’t work and we’re about due for some sort of revolt. The BLS revisions represent a significant material deficiency in what we’re being told versus what is actually happening; you kids wouldn’t eat up the layoff posts if it didn’t exist.
So there is Bernanke’s net impact. Need I continue?
Though not measurable in the same way as tax increases and wild inflation, the regulatory impact is also one worth recognizing. How many bad rules will result? I don’t do the math part, sorry. Let’s just sit around and let the rest of the world dictate how we can rebuild the integrity of our financial statements (?)
I’m not sure what “net impact” meant in economics class to our esteemed Fed Chairman but where I come from, bailout measures do appear to have a net impact on taxpayers, whether or not it’s actually called tax. I’m sure some tax accountants can agree with me on that?
Editor’s Note: Want more JDA? You can see all of her posts for GC here, her blog here and stalk her on Twitter.
For months there has been the underlying hum of a newspaper bailout in the air – not much surprise there given dropping subscriber numbers and dwindling ad revenues. But in lieu of an actual bailout (i.e. a check from the Treasury), how about some tax breaks and anti-trust waivers?
At a workshop on the the [sic] future of journalism yesterday, the head of the Federal Trade Commission said the agency is studying ways to help struggling media companies struggle a little less. What might this help look like? It could come in the form of new anti-trust laws, tax breaks, government subsides [sic] or even changes to copyright law.
Well if “journalism” involves rampant copy errors like that, we’re more screwed than it appears.
Tax breaks for mainstream media? Why? I’m a fringe journalist and I still have to pay my taxes, if I don’t bother to tailor my content to my audience to the point that it draws enough ad revenue to pay my bills, maybe I don’t deserve to eat that week.
It gets better.
Rupert Murdoch has long fought Internet news aggregation and would love to see a pay-per-view program for news that — holy shit! — might actually save news. Where do you get yours from? Would you pay for it?
In recent comments, he basically called every blogger who has ever clipped a news article a thief, including Arianna Huffington. You may have heard of her.
Fine, charge for it. I’d pay if it was worth paying for. Would you pay for the recent CNN article that said the Big 87654 ended with more employees than they started with? Me neither.
Point being, Murdoch would rather see news sites charging than peddling for a bailout. I don’t seem to recall major media outlets begging for any bailouts recently, which naturally inspires a healthy skepticism towards the FTC’s comments.
Has the FTC checked this proposed mainstream media bailout “tax break” with the Treasury? Because if I heard correctly, we have $30 billion to put towards Afghanistan now, not to mention the fact that the FDIC is broke and Citigroup is probably going to need a Dubai backstop. I’m not sure if Timmy would be okay with this, better ask him first.