Three Principal Targets On Wall Street:

Discussion in 'Economy' started by MikeK, Oct 14, 2011.

  1. MikeK
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    MikeK Gold Member

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    (Excerpt)

    By Shah Gilani, Capital Waves Strategist, Money Morning

    I've already expressed my desire to embrace the Occupy Wall Street movement. I said last week that I would join in whole-heartedly if I knew exactly what the protesters were trying to achieve. But I don't know - and I'm not convinced they do, either.

    Still, that doesn't mean we should dismiss them entirely. After all, there are millions of Americans who sense there's something terribly wrong with our capitalist system, but they can't pinpoint exactly what it is either.

    But I can.

    Bad actors have done bad things to good institutions and our capitalist system. Today, I'm going to let you in on who three of those bad actors are.

    You see, part of the problem is that when we think of the "bad guys" on Wall Street, or in Washington for that matter, we don't often think of specific people. We talk about "them" as faceless men we might imagine sitting in luxurious high-rises chewing on cigars and laughing as they rake in millions, or even billions of dollars on the backs of hardworking Americans.

    I intend to fix that. I want to shed light on the faces of the people who are gaming the system and lay out before you the tools they're using to get away with it.

    So, I'm going to start today with three of the biggest perpetrators of the mess we're in.


    The Three Bears
    There are hundreds of bad actors on Wall Street, but three in particular tell the inside story of how appallingly corrupt our country has become. They are:


    •Robert Rubin, who spent 26 years at Goldman Sachs Group Inc. (NYSE: GS), before becoming Treasury Secretary in the Clinton administration.

    •Lawrence Summers, who came out of the World Bank and was Deputy Secretary of the Treasury under his pal Rubin before becoming Treasury Secretary himself in 1999.

    •And Phil Gramm, once a practicing economist who served as a Republican Senator for Texas from 1985 to 2002.
    These are the men who - with help of then-Federal Reserve Chairman Alan Greenspan - interfered with the Commodities and Futures Trading Commission (CFTC), an important regulatory body, to squash any regulation of derivatives.

    And now the notoriously murky derivatives market, which was hugely responsible for the 2008 financial crisis, has grown into a $600 trillion trouble spot for the economy.

    This group of very influential and powerful men made sure there was no oversight of derivatives products and markets. None.


    (Close)

    Read the full article here: These Three Men Represent Everything That's Wrong with Wall Street - Money Morning
     
  2. Katzndogz
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    Katzndogz Diamond Member

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    I would just love to see every firm on Wall St close their doors and move out of the country. Go offshore, they can do business on a barge if they decided to. Go to China, India, Moscow if it comes to that. Hand Wall St off as the permanent party site. Fire everyone who worked there right down to the night janitor. Then there won't be anyone to complain about the raw sewage in the street.
     
  3. sparky
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    sparky VIP Member

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  4. expat_panama
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    expat_panama Silver Member

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    That's pretty much what they want. The overwhelming bulk of America's personal income comes from the very same corporations that are under siege. The nation is destroying itself and the current regime is leading it.
     
  5. editec
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    editec Mr. Forgot-it-All

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    It's about forking TIME to start naming names.

    What happened to our economy was not organic, it happened because powerful players in government and the commercial banking industry created the conditions leading to this economy.

    I'd throw Bill Clinton into the pile of folks who have to assume a major part in the responsibility,

    Had his administration not prtected the DEREIVATIVES industry from oversight, this meltdown might never have happened in the way it did.

    Yes RE would have folded, anyway, but the cascading effect that had on the REST of the economy took the DERIVATIVES market to lead the way.
     
  6. Richard-H
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    Richard-H Gold Member

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    This economic crisis has happened because 30 years ago Ronald Reagan & Co. started to popularized a free liberatarian ideology. This growing ideology slowly but surely undermined the economy of this country.

    In the 50 years before Ronald Reagan, the people knew that pure capitalism was a catastrophic failure and that socialism was just as bad. They concieved an alternative to both - regulated capitalism with limited socialism.

    This formula worked - the U.S. became an economic power house as never existed before.

    Unfortunately, the conservative movement took advantage of people's greed and stupidity to slowly but surely destroy the American economic system.

    You can list hundreds of individuals and individual acts that served their part to destroy our system. But it was the overall the popularity of the liberatarian/conservative ideology during these years that added up to the eventual economic failure that we are experiencing today.

    Americans must learn that in a complex industrial society, only a carefully architected balance betwen capitalism, regulation, public-private partnerships and socialism can provide us with a healthy and fair economy.
     
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  7. sparky
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    sparky VIP Member

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    well, for starters, we could stop appointing ex-banksters to official positions in our governance ...~S~
     
  8. sparky
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    sparky VIP Member

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    2nd, people ought to realize just what they've been let to do>

    Do you want to know the real reason banks aren't lending and the PIIGS have control of the barnyard in Europe?

    It's because risk in the $600 trillion derivatives market isn't evening out. To the contrary, it's growing increasingly concentrated among a select few banks, especially here in the United States.

    In 2009, five banks held 80% of derivatives in America. Now, just four banks hold a staggering 95.9% of U.S. derivatives, according to a recent report from the Office of the Currency Comptroller.

    The four banks in question: JPMorgan Chase & Co. (NYSE: JPM), Citigroup Inc. (NYSE: C), Bank of America Corp. (NYSE: BAC) and Goldman Sachs Group Inc. (NYSE: GS).

    Derivatives played a crucial role in bringing down the global economy, so you would think that the world's top policymakers would have reined these things in by now - but they haven't.

    Instead of attacking the problem, regulators have let it spiral out of control, and the result is a $600 trillion time bomb called the derivatives market.

    Think I'm exaggerating?

    The notional value of the world's derivatives actually is estimated at more than $600 trillion. Notional value, of course, is the total value of a leveraged position's assets. This distinction is necessary because when you're talking about leveraged assets like options and derivatives, a little bit of money can control a disproportionately large position that may be as much as 5, 10, 30, or, in extreme cases, 100 times greater than investments that could be funded only in cash instruments.

    The world's gross domestic product (GDP) is only about $65 trillion, or roughly 10.83% of the worldwide value of the global derivatives market, according to The Economist. So there is literally not enough money on the planet to backstop the banks trading these things if they run into trouble
    .


    Four US banks hold a staggering 95.9% of U.S. derivatives: The $600 Trillion Time Bomb That's Set to Explode
     
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  9. editec
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    editec Mr. Forgot-it-All

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    The Real Estate meltdown was the pebble that started the DEREIVATIVES avalanche.

    The ONLY reason that the avalanche has not brought dfown the entire banking system is because the FED and TREASURY pledged to backstop these toxic assets with an UNKNOWABLE value.

    We haven't really saved the system, we've managed only to keep it suspended from total collapse.

    How long we can continue this scam, I don't know.

    Sooner or later some nation or some bankster is going to go down, and when they do?

    Chain reaction time.
     
  10. expat_panama
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    expat_panama Silver Member

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    Land we can see and price. We all agree what a mortgage is. "Derivatives" are anything that a loony leftist says it is so it makes a terrific distraction to get people's minds off the disaster wrought by the current Marxist adgenda in Washington.
     

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