Tag Archives: banks

Jeffrey Sachs on the stubborn, pathological intransigence of the 1% | Exopermaculture

10 May

Sachs described an environment of Wall Street influencing politicians with growing campaign contributions. In the 2012 election cycle, political contributions by the securities and investment sector hit $271.5 million, compared with $176 million in 2008, according to the Center for Responsive Politics.

“I meet a lot of these people on Wall Street on a regular basis right now,” he continued.

“I am going to put it very bluntly: I regard the moral environment as pathological. And I am talking about the human interactions . . . I’ve not seen anything like this, not felt it so palpably.”

“They have no responsibility to pay taxes; they have no responsibility to their clients; they have no responsibility to people, to counterparties in transactions,” he said. “They are tough, greedy, aggressive and feel absolutely out of control in a quite literal sense, and they have gamed the system to a remarkable extent.”

via Jeffrey Sachs on the stubborn, pathological intransigence of the 1% | Exopermaculture.

Simon Johnson: Big Banks Have a Big Problem – NYTimes.com

14 Mar

Attorney General Eric Holder’s testimony to Congress last week also confirmed the latter point: some banks are so big that the Department of Justice is afraid to bring legal charges against them, for fear of how that would affect the economy. Senator Warren of Massachusetts continues to press this issue relentlessly and very effectively.

via Simon Johnson: Big Banks Have a Big Problem – NYTimes.com.

Where the Mob Keeps Its Money – NYTimes.com

26 Aug

Money is money, no matter how much blood drips from it.

THE global financial crisis has been a blessing for organized crime. A series of recent scandals have exposed the connection between some of the biggest global banks and the seamy underworld of mobsters, smugglers, drug traffickers and arms dealers. American banks have profited from money laundering by Latin American drug cartels, while the European debt crisis has strengthened the grip of the loan sharks and speculators who control the vast underground economies in countries like Spain and Greece.

Mutually beneficial relationships between bankers and gangsters aren’t new, but what’s remarkable is their reach at the highest levels of global finance. In 2010, Wachovia admitted that it had essentially helped finance the murderous drug war in Mexico by failing to identify and stop illicit transactions. The bank, which was acquired by Wells Fargo during the financial crisis, agreed to pay $160 million in fines and penalties for tolerating the laundering, which occurred between 2004 and 2007.

via Where the Mob Keeps Its Money – NYTimes.com.

Ex-Citi chief: Break up the banks! – Salon.com

25 Jul

Saul of Tarsus?

I’m having trouble thinking of the proper simile to describe the news that Sandy Weill — the creator of Citigroup, the ur-mastermind of Too-Big-To-Fail banking, the man most responsible for repealing Glass-Steagall — now thinks that the big banks should be broken up.

Genghis Khan, on his deathbed, declaring that pacifism is the way to enlightenment? Karl Marx embracing the invisible hand of the free market as the best possible way to organize society? Ronald Reagan announcing that, guess what, government is the solution?

via Ex-Citi chief: Break up the banks! – Salon.com.

Will Wall Street turn on its own over Libor? – Salon.com

23 Jul

Here’s where, maybe, Goldman Sachs comes into the picture. Because according to a Bloomberg report, Goldman — uninvolved in setting the Libor — is considering taking the law into its own hands and taking care of this Libor business with suits against the firms responsible. Like a fictional comic book metropolis, the financial industry is dreadfully underpoliced, and many of the cops are themselves on the take, so, logically, what Wall Street needs is a morally dubious but incredibly wealthy figure to operate outside the law to achieve order by any means necessary. That’s right: Goldman Sachs is going to become The Green Arrow.

via Will Wall Street turn on its own over Libor? – Salon.com.

Banks That Are Too Big to Regulate Should Be Nationalized – NYTimes.com

23 Jul

Simons (a hero of the libertarian idol Milton Friedman) was skeptical of enormity. “Few of our gigantic corporations,” he wrote [in 1934!], “can be defended on the ground that their present size is necessary to reasonably full exploitation of production economies.”

The central problem, then as now, was that very large corporations could easily undermine regulatory and antitrust strategies. The Nobel laureate George J. Stigler demonstrated how regulation was commonly “designed and operated primarily for” the benefit of the industries involved. And numerous conservatives, including Simons, concluded that large corporate players could thwart antitrust “break-them-up” efforts — a view Friedman came to share.

Simons did not shrink from the obvious conclusion: “Every industry should be either effectively competitive or socialized.” If other remedies were unworkable, “The state should face the necessity of actually taking over, owning, and managing directly” all “industries in which it is impossible to maintain effectively competitive conditions.”

via Banks That Are Too Big to Regulate Should Be Nationalized – NYTimes.com.

Council to Ask Banks to Describe Efforts to Aid Poor Areas – NYTimes.com

15 May

As a huge trading loss at JPMorgan Chase intensifies criticism of the nation’s big banks, the New York City Council plans to vote on Tuesday to require banks to make public their efforts to be socially responsible before the city decides where to deposit the billions of dollars it keeps in banks….

Cleveland and Philadelphia have had laws in place for over a decade similar to the one being proposed in New York, and now the financial crisis has led several other cities to consider them. Pittsburgh recently passed a bill that requires banks that want city deposits to submit community reinvestment plans every two years. Los Angeles, Boston, and San Diego are all considering similar measures.

It’s  a start, but Bloomberg is opposed, naturally.

via Council to Ask Banks to Describe Efforts to Aid Poor Areas – NYTimes.com.

Can Citigroup Shareholders Launch a Revolt on Banks? – Business – The Atlantic Wire

19 Apr

The shareholders of Citigroup voted to reject the generous pay package of the CEO Vikram Pandit this week, setting up a potential showdown that could ripple throughout the corporate world. The “advisory” vote — which is required by the Dodd-Frank Act, but is not binding — now puts the company’s directors in awkward position. They can go along with it and ask Pandit to “give back” some of the $34 million it paid him last year, or they can ignore it and defy the people they theoretically work for. Neither option is attractive, but how it plays out could change the very nature of the shareholder-corporation relationship. It’s the first time a major Wall Street firm has had to face such a vote and it probably won’t be the last one to lose it.

… However, it’s now clear from this shareholder move that it isn’t just Occupy Wall Streeters who are annoyed with the outrageous sums that top executives take home. Now they’re actively trying to do something about it.

via Can Citigroup Shareholders Launch a Revolt on Banks? – Business – The Atlantic Wire.

Ban ‘Pure’ Speculators of Oil Futures – NYTimes.com

11 Apr

Today, speculators dominate the trading of oil futures. According to Congressional testimony by the commodities specialist Michael W. Masters in 2009, the oil futures markets routinely trade more than one billion barrels of oil per day. Given that the entire world produces only around 85 million actual “wet” barrels a day, this means that more than 90 percent of trading involves speculators’ exchanging “paper” barrels with one another.

Because of speculation, today’s oil prices of about $100 a barrel have become disconnected from the costs of extraction, which average $11 a barrel worldwide. Pure speculators account for as much as 40 percent of that high price, according to testimony that Rex Tillerson, the chief executive of ExxonMobil, gave to Congress last year. That estimate is bolstered by a recent report from the Federal Reserve Bank of St. Louis.

via Ban ‘Pure’ Speculators of Oil Futures – NYTimes.com.

JPMorgan Passes Stress Test, Raises Dividend – NYTimes.com

13 Mar

Looks like the Obamicans are pulling out all stops for the election.

JPMorgan Chase became the first bank on Tuesday to say regulators have completed stress tests of its balance sheet, and it said it would raise its quarterly dividend by a nickel to 30 cents and buy back as much as $12 billion of stock this year.

The Atlantic ran a recent article about how these “stress tests” are a scam intended to make  bank for the 1%, not to protect the financial system for the 99%.

via JPMorgan Passes Stress Test, Raises Dividend – NYTimes.com.