27Mar2010

Do you ask what moral obligation I owe to my fellow man? None.

Except the obligation I owe to myself: Rationality.

26March2010
I work for MetLife Investors, a division of MetLife Inc.

In the financial industry we have been one of the few companies to come through the recession relatively unscathed, largely due to conservative corporate governance that avoided dealing in mortgage backed securities, and what the Wall Street Journal once referred to as a "Fortress-like capital position." This created a number of opportunities for us in the marketplace.

For the better part of a year MetLife has been in talks with AIG to acquire American Life Insurance Co. (ALICO) which is AIG's second-biggest foreign life-insurance unit, in a deal that would propel us from America's largest life insurance provider, to one of the largest worldwide.

Earlier this month a $15.5 billion deal was announced, in which AIG would acquire capital to repay some of the government loans by selling ALICO to MetLife for some $6.8 billion in cash and more than $8 billion in equity. In the era of government bailouts and takeovers, that the deal involved so much equity concerned me.

The President of U.S. business, William J. Mullaney has an open door policy. I decided to put it to the test, going straight to the source with my concerns.

Mr. Mullaney,

I had a couple of questions in regard to MetLife's acquisition of ALICO.

I understand that like AIG's sale of AIA to Prudential, the sale of ALICO to MetLife is an attempt by AIG to raise capital in order to pay back bailout funds to the Federal Reserve.

In regard to MetLife's purchase of ALICO, 6.8 billion was made in cash, and more than 8 billion of the 15 billion purchase price would be paid with MetLife equity.

Per the agreement with AIG, will that equity holding be liquidated prior to repayment? Or will it be signed over to the Federal Reserve, essentially giving the government partial ownership in MetLife?

Any clarification you can provide would be very much appreciated.

Thank you,

Casey Head

I sent that email on March 8th, the day the details of the agreement were announced publicly. I received William Mullaney's response on March 25th, as the details of this transaction are public record, I feel I can ethically post the content of that email.

Casey

Thanks for your question concerning how MetLife will fund the Alico transaction. I'm sorry for the delay in getting back to you. I have been traveling quite a bit this month.

You are correct in that MetLife will be paying AIG cash and securities valued at approximately $15.5 billion, subject to closing adjustments. It is also true that a portion of the securities will include common stock and securities that can be converted into or exercised for MetLife common stock.

These securities will be held by AIG for certain determined periods of time. Therefore, because the U.S. Federal Government owns 80% of AIG, the government will, upon closing, indirectly own common shares in MetLife as well as securities that can be converted into or exercised for MetLife common stock.

However the U.S. government's indirect ownership stake in MetLife stock won't subject our company to any additional government oversight.

Thanks for taking the time to write to me.


Bill

For all of our sake I hope he's right about our company not being subject to government oversight. But I think it's an excellent illustration of the insidious nature of government participation in the private sector. You can do everything right, and still be put in the position of handing a piece of your company over to the government in the name of a good business decision.

The lesson is that of Faust, when dealing with the Devil; Dont.

25March2010
I love arguing morality only to point out the resemblance people's Judeo-Christian morays bear to Marxist doctrine, then watch them twitch.

Socialism is a stage in the Marxist state prior to Communism; characterized by state ownership of the means of production, political power and economic planning vested in a centralized authority and unequal distribution of wealth. Remove the references to Marxism, and that would serve as a fair description of the role of the Catholic Church's role in state during the early middle ages.

The medieval doctrine of "just price" is a hallmark of both Socialist and Catholic social teachings. Originating with the Greek philosophers, and later advance by St. Thomas Aquinas, the just price is an ethical theory in economics that attempts to create a standard of fairness in transactions. It holds that there is an intrinsic price for any given good or service, regardless of people's wants, needs, desires, or supply and demand; and to charge more in the name of profit is amoral.

Socialism is doctrine developed by Marxist philosophers on the role of the state, social organization, economics, wealth and poverty.

Catholic social teaching is doctrine developed by the Catholic Church on matters of poverty and wealth, economics, social organization and the role of the state.

Both systems emphasize the welfare of the collective over the individual, and glorify the plight of the downtrodden inviting that they accept their role rather than aspiration to more.

Of course they're both wrong, it tickles me.

23Mar2010
Obama called his health care strong arming just "another brick laid in the foundation of the American dream."

Well sir, whose American Dream? It damn sure isn't mine.

The more you promise to make everyone's dreams come true, forcing us all to the same level, the more those dreams start to look like nightmares. My dreams aren't dead yet, more like on life support.

Faced with the increasingly slave-state bent within our decaying government, Anarcho-capitalist theory and the life of an expatriate sound better all the time.

I would rather be a laborer in a free society, than an executive in Obama's America. Better to be a free man in struggle, than a slave in relative comfort. I would do with less, and know that I was working for my own benefit, not that of another.

Of course you can't leave the country with your savings without the whole amount being taxed as a penalty. Maybe a midnight drive across the border with a money belt full of gold certificates....

I'm probably reading too much Heinlein.

I love my country. I love its history, and the principles of its founding. I am not yet ready to renounce my national identity.

There’s not even a free land left to run to. There is no Mulligan's Valley waiting to receive me. The best one could hope for is to go “Ruby Ridge” in some remote part of the world, and stay below the radar for a few years.

We’ve fired our warning shots, and still they advanced. Our backs are to the wall and we have no place left to run. If you’re not ready to fight now, you never will be.

12Mar2010
Our President sure loves telling the American people to shut up.

"The time for talk is over”

“The debate is over”

“We don't want those who made the mess to do a lot of talking."

Obama says that Congress needs to stop talking, and take an up-or-down vote on the health care overhaul plan…soon. House Speaker Nancy Pelosi has ordered committee chairmen to postpone their hearings Thursday so lawmakers can meet to chart a course for negotiations. But lawmakers have rejected the White House's March 18th "pass it or else" ultimatum, causing the first family to delay their trip to Indonesia until the 21st.

That's not to say that anyone has committed to passing it immediately. There’s still concerns to be ironed out. Yesterday the Senate parliamentarian ruled the Senate cannot use reconciliation to act on any bill not already signed into law, invalidating the power grab attempted with The Slaughter Solution. Democrats only way forward is for the House to approve the Senate version of the bill, and count on the Senate to use reconciliation measures to make it come more in line with the House version.

Does Nancy Pelosi even have the votes to pass the Senate version of Obamacare in the house? Most signs point to no, at least not yet. So we must be prepared in the event that they do not pass it before the March 26th recess for Easter. Prepared for town halls.

Fix bayonets, prepare for hand to hand. We have to get it through the head of progressives.

We're not going to let them take over a sixth of the U.S. economy and abolish private insurance in the process. They're spending like mad to “help” at most 15% of the population, and selling out the future of the other 85% to do it. They intend to rob future generations, harvesting future earnings and growth, eroding opportunity in America. We are going to stop them.

The date rape attitude of this administration will end. No means no!

11Mar2010
You must hate me.

I fight redistribution every chance I get, and encourage others to do the same. I'm just "too selfish". I mean it's only money, right?

It is only money.

But what a capitalist argues against is not the redistribution of the currency itself, which would indeed be ironic, for it no longer has intrinsic value.

The capitalist argues against redistribution of the value the currency represents; i.e. the of the labor traded for said currency. When the state sets about a program of redistribution, in a very real sense it redistributes a portion of that individual's bodily labor. The work of his hands that are properly his.

In doing so, the state has coerced him to work not for his own betterment, but that of another. Working for the betterment of another, against one's will, without promise or delivery of equitable compensation? That's very nearly the definition of slavery.

To the extent that the state redistributes from one individual to another as a percentage of his "wealth", for that portion of his days, that individual toils in slavery.

Which is my point precisely.

Are you so concerned with equality that you would rather be equal in slavery, than unequal in freedom?