pmn1
  • pmn1
  • Herf-A-Holic Topic Starter
Wednesday, February 25, 2009 8:07:00 AM
I think its time for Congress to do complete investigation of Wall Street. Congress needs to learn more, not only about the kind of criminal activity for which Bernard Madoff is being charged, but also the legal practices -- such as risky home loans -- that created dangerous bubbles and put families at risk.

If voters and politicians are going to be able to evaluate legislation that is being proposed on a weekly basis, citizens must understand what has gone wrong

The Fact is Wall street has been corrupt for decades. In 1932 the Pecora Commission investigated the Crash of 1929.

It learned that the tycoon J.P. Morgan had not paid income taxes for three years. Even worse, tax evasion was common among the wealthy. In his new book on FDR's Hundred Days, Adam Cohen recounts how the hearings revealed how National City Bank had caused enormous problems by mixing commercial and investment banking, reaping huge profits as customers were persuaded to make terrible investments.

Preferential treatment on stock, the commission learned, was routine as certain clients on Morgan's "preferred list" were given the best offers. By the time it closed, the commission produced thousands of pages of data about the inside operations of the financial world.

I think the time is right for another Pecora investigation by Congress - because the little guy has been getting screwed is getting screwed and its time WE demand it stop.

Ram27
Wednesday, February 25, 2009 8:10:00 AM
Greed is good........
herfidore
Wednesday, February 25, 2009 8:19:00 AM
Greed clarifies. It cuts through.
HockeyDad
Wednesday, February 25, 2009 8:27:00 AM
I'm calling the bottom now!
cbc812
Wednesday, February 25, 2009 8:29:00 AM
Good freaking luck.

There are laws against most of what is wrong with Wall St. right now. The problem is that enforcement is a joke. Why? Because those breaking the laws have the overlords of the regulators in their pockets.

Go into a bank, pass a note, end up with $1,500, do 10 years hard time. Manipulate stock prices, destryy billions in wealth, worst case scenario you do 2 years in a country club.

It's ridiculous.

HockeyDad
Wednesday, February 25, 2009 8:36:00 AM
Just covered a "short" position. Obama is about to save the markets!
herfsnipe
Wednesday, February 25, 2009 8:46:00 AM
Yeah, as much as I hate to say it, the cronie network is alive and well on Wall St. They put on a great show by hauling the chiefs of all the banks up in front of congress and berating them for a day or two, but it's all for show and likely won't result in a better system.

Deregulation of the financial institutions allowed them to come up with new types of securities in which to feed their greed. That was Alan Greenspan's doing.

We're all gonna pay for it for a long long time. Yep. Someone should go to jail. My list is a long one and it starts with the bankers.

Then it goes something like this:

Mortgage brokers who peddled tricky and cheap loans on expensive houses in which there was no hope of getting a payback and selling those loans in bundles as securities and collecting huge fees.

The rating agencies that gave these bundled securities bonafide AAA ratings.

The financial firms that bought and sold these secutities and collected HUGE fees.

The criminal #uc#sticks that fell for the schlopp the mortgage brokers were handing out and signed on the dotted line knowing full well they were out of their league.

The list goes on, but if you want to get educated, and see the real story, NOT a slanted or biased version that protects those in power, watch the CNBC documentary by David Faber "House of Cards."

This is a great show and a must see if you want to learn what really happened and who's to blame. Also, PBS Frontline "Inside the Meltdown." You can watch it online.

http://www.pbs.org/wgbh/pages/frontline/meltdown/view/ 

This is shorter, and has better access to the Washington side of the story. You'll be amazed.

HockeyDad
Wednesday, February 25, 2009 8:48:00 AM
That is a pretty accurate "hit list".
teelio
Wednesday, February 25, 2009 8:52:00 AM
Wall Street does what they're allowed to do.

Once upon a time, we had regulations. Glass-Steagall acted as a firewall against banks owning investment brokerages and insurance companies, and was enacted after the crash of '29. Usury laws prohibited banks from making loans to those known to be poor credit risks. Monopolies were found to be not in the public's best interests, and were broken apart.

Those who felt Milton Friedman's "free market" economic policies were best began undoing such firewalls. Although primarily embraced by republicans, Friedman's policies found proponents on both sides of the aisle, with those who could benefit from associating with trans-national corporations. Phil Gramm lead the charge to undo Glass-Steagall, and Bill Clinton signed off on it (as he did with the disastrous NAFTA). The marketing push was overwhelming: they were no longer "usurious loans," now they were "an innovative set of new products."

Friedman's contention was that, if left alone and freed of restraints, the market would correct itself. The resulting uber-wealthy class would create jobs.

I leave it to you to decide for yourself if that has worked, but no less a free marketer than Alan Greenspan recently expressed amazement that the banks & wall street did not police themselves. He thought the fox would dutifully guard the hen house.

We've created lots of jobs-- in India and China. Yes, we get cheap goods from those countries, and American companies profit from having an offshore labor base. But without a job, it's hard for Americans to buy those goods.

So has supply-side economics worked? CAN it work if there's no demand because no one can afford goods because they're unemployed?

This is not a right vs left issue. It's supply side vs demand side---Friedman vs Keynes. Wall St is a symptom--the tip of the iceberg.

I'm no macroeconomist, but I will say that, to my observation, the Friedman way (a) makes no sense to begin with, and (b) certainly appears to have caused this mess.

Could we really expect society to police itself, without laws or law enforcement officials? Libertarians would probably say yes, but most of us would probably find that a not very good idea.

Yet we have expected the economy to do just that.

HockeyDad
Wednesday, February 25, 2009 8:58:00 AM
Smith & Wesson and Ruger stock have been moving up fast in the last few days. Sounds like some fear manipulation.
plinytheelder
Wednesday, February 25, 2009 9:04:00 AM
"Friedman’s contention was that, if left alone and freed of restraints, the market would correct itself."

It did.

But, then Congress and the President bailed them out. So the people that made all the money doing illegal things, and should've lost most of it when the market they should've been protecting went into freefall, were protected from the theory they believe in...

HockeyDad
Wednesday, February 25, 2009 9:24:00 AM
Always use protection.
donutboy2000
Wednesday, February 25, 2009 7:01:00 PM
Obama should immediately appoint Geitner to investigate Wall Street tax evasion!
pdxstogieman
Wednesday, February 25, 2009 7:27:00 PM
They would've been better off getting their economic strategy from Kinky Friedman.