A great many people around the county were rightfully shocked and horrified by the recent excellent and hard-hitting PBS documentary, The Untouchables, which looked at the problem of high-ranking Wall Street crooks going unpunished in the wake of the financial crisis. The PBS piece certainly rattled some cages, particularly in Washington, in a way that few media efforts succeed in doing. Now, two very interesting and upsetting footnotes to that groundbreaking documentary have emerged in the last weeks. The first involves one of the people interviewed for the story, a former high-ranking executive from Countrywide financial who turned whistleblower named Michael Winston...
Tag Archives | Wall Street
We’ve seen massive amounts of dark money in politics co-opt and buy our former democracy wholesale. This was especially clear in the post-Citizen’s United elections in the U.S., with special interests, corporations and/or lobbyists spending billions of dollars (that they otherwise argue they need to keep hold of with preferential legal and legislative treatment).
Wall Street, in particular, holds sway over the thinking in Washington, D.C. Our elected policy-makers are increasingly owned, or at least bought and paid for, in other words; whores. So they’re exercising their freedom of speech, and just as with their other shady deal-making, they tend to bet big. Wall Street gave big to the Democrats and Obama in particular in 2008. They gave to him early on before backing Romney as ‘one of their own’ in the financial sector.
But is there anything to the idea that their toxic objectivism is severely conservative nowadays? Open Secrets Blog, a great research site from the Center for Responsive Politics that was instrumental during the election, before and since, for exposing the flow of money from profiteering barons to pandering politicians.… Read the rest
Well Newsweek may be dead, but its Daily Beast reincarnation is actually publishing some interesting articles, not least this one in which “Tom Wolfe draws up a sterling indictment of our unscrupulous financial culture. Twenty-five years after Bonfire of the Vanities, the author returns to Wall Street to see what happened to the Masters of the Universe”:
… Read the rest
Come join us as we go back seven months to the apex of the history of American capitalism in the 21st century. We find ourselves in a swarm of fellow starstruck souls outside the Sheraton Hotel on Seventh Avenue in Manhattan, churning, squirming.
To slip past a battalion of cops and a platoon of security operatives in gray suits with small white techno-polyps in their ears attached to coils of white intercom cord trying to keep us under control… as we all but trample the raggedy, homeless-looking ranks of the television crews and every other laggard in our way.
HSBC was fined of $1.9 billion this week for laundering billions of dollars for Colombian and Mexican drug cartels. It’s worth noting that for the world’s second largest bank, with trillions in assets, this is equivalent to a littering ticket. The New York Times writes:
… Read the rest
It is a dark day for the rule of law. Federal and state authorities have chosen not to indict HSBC, the London-based bank, on charges of vast and prolonged money laundering, for fear that criminal prosecution would topple the bank and, in the process, endanger the financial system. They also have not charged any top HSBC banker in the case, though it boggles the mind that a bank could launder money as HSBC did without anyone in a position of authority making culpable decisions.
When prosecutors choose not to prosecute to the full extent of the law in a case as egregious as this, the law itself is diminished.
Via Ghost Exchange, excerpts from a fascinating PBS interview with former hedge fund analyst Cathy O’Neil on the culture within Wall Street:
… Read the rest
The basic cultural assumptions were not pleasant to me. The sort of most basic cultural assumption was that as a smart person, we have the right to take advantage of the system and of “dumb people.” And that is sort of — I mean, I guess I should have known, going into a hedge fund, that’s what people think.
I was thinking of it naively, more like, “Oh, there’s a system, and we should see what inefficiencies there are in the system and add information.” I mean, I just sort of drank that Kool-Aid. But once I was inside, I realized that’s not really how people think about it. They think, “Well, of course we’re going to take advantage, because we’re smart, and we can. We have better tools, and our tools are our brains.” Take advantage of absolutely everything and everyone that we can, in any way we can.
The hottest new revenue flow trend in banking is simply stealing money from your customers. Via the Village Voice:
… Read the rest
You wouldn’t know it by watching the news or reading the paper, but America’s banks are on the largest crime spree the country has ever known. Let’s go to the highlight reel, shall we?
In July, Wells Fargo paid a $175 million settlement after the feds caught its brokers systematically pushing minority customers into mortgages with higher rates and fees, even though they posed the same credit risks as whites. One study found that Wells Fargo charged Hispanics $2,000 more in what the Justice Department called a “racial surtax.” The bank docked blacks nearly $3,000 extra for their own improper pigmentation.
But despite a colossal civil rights fraud perpetrated against 30,000 customers, the settlement amounted to just .011 percent of the San Francisco bank’s annual income.
Across the country, in Minneapolis, U.S.
Will unregulated, debt-based financial products destroy the world? Bloomberg reports that the funneling of capital into instruments of so-called “shadow banking” continues to balloon to unimaginably large proportions:
… Read the rest
The shadow banking industry has grown to about $67 trillion, leading global regulators to seek more oversight of financial transactions that fall outside traditional oversight. The Financial Stability Board, a global financial policy group comprised of regulators and central bankers, found that shadow banking grew by $41 trillion between 2002 and 2011.
The size of the shadow banking system, which includes the activities of money market funds, monoline insurers and off-balance sheet investment vehicles, “can create systemic risks” and “amplify market reactions when market liquidity is scarce,” the FSB said.
Supervisors consider shadow banking activities to be those that allow banks to carry out business off balance sheets, as well as those which allow investors to bypass lenders and the functions they traditionally fulfill on the markets.
In short, the pillars of finance are accused of illegally boosting Libor at the start of each month in order to inflate the interest rates (based on Libor and calculated at the beginning of the month) paid by as many as 100,000 mortgage holders, in what would seem to be the bilking of a pretty immense sum of money, CNBC reports:
… Read the rest
A pensioner whose home was repossessed is taking on some of the world’s leading banks in the first known class-action lawsuit claiming that alleged Libor manipulation made mortgage repayments for thousands of Americans more expensive than they should have been. The subprime mortgages of Annie Bell Adams and her four co-lead plaintiffs were securitised into Libor-based collateralised debt obligations and sold by banks to investors.
The class action, filed in New York, alleges that traders at 12 of the biggest banks in Europe and North America – including Barclays, Bank of America and UBS – were incentivised to manipulate the London interbank offered rate to a higher rate on certain dates on which adjustable mortgage interest rates were reset.
A New York University professor and an artist featured in The Nation magazine this month were among more than 90 people arrested early Monday morning as Occupy Wall Street marked its first anniversary with various demonstrations in New York City. “Just grabbed off sidewalk, along with everyone else,” artist Molly Crabapple said on Twitter shortly after being picked up by police. Elsewhere, Jacobin magazine founding editor Bhaskar Sunkara reported that NYU Social and Cultural Analysis professor Andrew Ross, was arrested as part of a demonstration in the lobby of the JP Morgan Chase building on Park Avenue. “Cops are never friendly, but these cops aren’t cops,” Sunkara said. “They’re militarized beyond comprehension.”