“Criticism is something we can easily avoid, by saying nothing, doing nothing, being nothing.” – Aristotle, 384-322 BC
August 18, 2009
When I resigned my engineering position in China to return home to run for U.S. Congress, readers of my column “Yet Another Champion of the Constitution” are well aware of my outrage with “dark” OTC derivatives as explained in “Bring Light to Dark Derivatives” and “What the Heck are Derivatives.” I remain highly concerned about our monetary and financial systems, as I noted recently in “The FDIC is Bankrupt” and “Yes, Virginia, There Are No Reserve Requirements.” Last week I attended the Republican incumbent’s town hall in Kempton and politely handed him yet more unanswered open letters I had sent his office and published online, and inquired yet again if my Representative wanted to discuss the Federal Reserve and monetary policy with me. Congressman Dent is making it plainly obvious to me that he does not care to discuss this subject, hence I am now fairly positive he does not care much about his constituents beyond lip service and “politics as usual.” If he truly cared, perhaps he would not have voted to send over $50 billion dollars overseas in foreign military aid to countries like Israel, Egypt, Jordan, Colombia, Guatemala, Haiti, the Phillippines, Belize, Costa Rica, El Salvador, Honduras, Nicaragua, Indonesia, Panama, Angola, Cameroon, Central African Republic, Chad, Cote D’Ivoire, Guinea and Zimbabwe and economic aid to many others.
While I was abroad, the derivatives crisis struck home in the city where I was born, Bethlehem. This city’s school district invested over $400 million in notional value in interest rate swaps and many other derivative contracts with the likes of JP Morgan Chase and Morgan Stanley over the past several years. The transaction fees alone to-date have cost over $25 million. A local paper, The Morning Call, has done a commendable job of investigating and publishing a series of articles and this summary table.
I was invited by a local non-partisan group, the Concerned Citizens of the Bethlehem Area School District, to visit and provide them with an educational presentation and Q&A session on financial derivatives with a highlight on interest rate swaps which I did to the best of my ability. From their mission statement, CC-BASD recognizes that “education is key to the future of our community and our country.” I couldn’t agree more and I hope the group extends me another invitation to speak again.
The presentation PDF I gave can be downloaded here. While it’s missing a lot of information that I said verbally, I think it’s still helpful – please note that slide 13 (with all the text) was not presented. I encourage the reader to check out the links provided in the PDF. Below is a teaser slide.
I hope to see effective containment and corrective actions from the CC-BASD, and they all have an open invite to comment and ask questions at TowneForCongress.com. These men and women all seemed to understand and apply the lessons George Washington and Ben Franklin taught and warned about – that all citizens are ultimately the only keepers of our Republic.
Jake Towne, the Champion of the Constitution
Jake Towne – Talk to CC-BASD on Financial Derivatives (18 Aug 09)
http://towneforcongress.com/economy/talk-on-financial-derivatives-to-cc-basd-1
