“Now that we’ve stepped back a few paces from the brink — thanks, let’s not forget, to immense, taxpayer-financed rescue packages — the financial sector is rapidly returning to business as usual,” columnist Paul Krugman warned. “Even as the rest of the nation continues to suffer from rising unemployment and severe hardship, Wall Street paychecks are heading back to pre-crisis levels. And the industry is deploying its political clout to block even the most minimal reforms.” Krugman argues that one of the biggest problems is that investment bankers are still “lavishly rewarded if they deliver big short-term profits — but aren’t correspondingly punished if they later suffer even bigger losses,” which encourages excessive risk-taking.
Registered?
Commenting on WE Blog now requires you to be a Kansas.com member. Use the links above to register, if you haven't already, or to log in.Contact us
Follow us
Daily Archives
-
Recent Comments
- DavidB on Open thread 11/22
- writerdog on Health care reform would save state money
- CapnAmerica on Open thread 11/22
- george on Open thread 11/22
- DorisKing on Open thread 11/22
- Chas on Open thread 11/22
- george on Health care reform would save state money
- satatom on Open thread 11/22
- satatom on Open thread 11/22
- Politico on So they said
21 Comments
We have a vocal group that feels that to regulate, since we bailed them out, is against the freedoms of our constitution and is a government takeover.
I’m glad to see they’re going after madoff’s herd.
“NEW YORK (Reuters) – Epic swindler Bernard Madoff’s two sons, his brother and a niece will be sued this week for $198 million, the trustee winding down the Madoff firm told CBS News’ “60 Minutes” broadcast on Sunday.
Sons Mark and Andrew, brother Peter and niece Shana all held executive positions with the firm and should have known about the multibillion-dollar, worldwide 20-year-long Ponzi scheme, trustee Irving Picard and his chief counsel David Sheehan, told the program.
Wall Street’s biggest investment fraud, a Ponzi scheme in which early investors are paid with the money of new clients, collapsed in the declining economy last December. Madoff confessed to the fraud of as much as $64.8 billion and is serving a 150-year prison sentence.
Asked by “60 Minutes” whether investigators were working under the assumption that there was money still hidden, Sheehan said: “Yes, we are” and Picard said, “We’d assume it’s millions and millions of dollars.”
Sheehan told “60 Minutes” he estimated about $36 billion went into the whole scheme. “About $18 (billion) of it went out before the collapse. And $18 (billion) of it is just missing. And that $18 billion is what we’re trying to get back.”
New York lawyers Picard and Sheehan said the latest lawsuit to recover money for defrauded investors under the Securities Investor Protection Act would accuse the family members of negligence and breach of fiduciary duty. The lawsuits to be filed in U.S. bankruptcy court in New York would also accuse them of profiting personally in the tens of millions of dollars while working at the firm.
All of the family members have said in previous statements that they had no knowledge of Madoff’s crimes.
The sons withdrew $35 million from accounts with little or no investment, Picard told “60 Minutes”.
The stupid and crooked repub will be solidly behind blocking any financial reg reform.
“Even as the rest of the nation continues to suffer from rising unemployment and severe hardship, Wall Street paychecks are heading back to pre-crisis levels. And the industry is deploying its political clout to block even the most minimal reforms.”
———-
Of course, you must keep in mind that anything you read from Krugman is left biased. But isn’t he saying that the Democrat dominated Congress and administration are being bought off?
’sup with that Demos?
If you think this is bad news, just imagine what it would be like if Republicans get back into power. You cannot teach an old dog new tricks.
Especially when that old dog has the most crooked legs.
’sup with Repubs? That is where all the obstruction is coming from. But what is your total of support now – 22% or is it 18%?
Just remember, when average people are suffering and they hear Republicans defending the Wall Street multi-million dollar paychecks – that 18% may just turn out to be 10%.
Payback will not be pretty.
Tot, when folks grow up, even some Democrats, they quit trying to blame others for their own failures.
What do you expect? You give billions of taxpayer dollars to these banks because they squandered their own money on gambling and bonuses and you don’t expect them to go back to their old ways?
You should have let them go bankrupt. The economy is not comprised of 5 big investment banks. It is comprised of 115 million households across the country. Life would go on if these banks failed.
Politicians and banks have done a great job of selling the lie that if these banks fail, the world will implode. One of the greatest lies ever foisted upon the people IMO.
“And the industry is deploying its political clout to block even the most minimal reforms”
___________________________________________________
It’s a dim controlled congress so they must be buying off the dims!
What did you expect when you just turn over a pile of money with no strings attached?
What fools congress is for authorizing such spending.
Outie,
So what do we as taxpayers get for bailing out these rats to the tune of hundreds of billions? Maybe we shouldn’t have done it and let them go under and suffered the consequences, but we did. So now is it unreasonable to get some kind of reassurance that they won’t just do it all over again?
No company should be so big that it can’t, in Bush’s words, be allowed to fail. We once had antitrust laws to prevent that kind of thing, but the ‘publicans repealed and watered down all our protections.
One of the hallmarks of true capitalism is a vast multiplicity of both suppliers and consumers; if one fails, there are others at hand to take up the slack. What we have evolved smacks more of a monopolistic capitalism in a mixed economy where predatory corporations squeeze out any competition, buy politicians who assure them of means and opportunity to grow beyond all reason, and sell us crap. If there was actually real comptition out there, they wouldn’t be able to get away with that! You guys talk endlessly about the small businessman as your ideal of capitalism, yet the system you espouse and the pols you elect allow the megacorps to run roughshod over them. In theory, competition is the lifesblood of capitalism, but you have aided and abetted these huge corporations in eliminating all competition. So are you truly capitalists? If you are, maybe you ought to act like it!
Nice rant Jed.
Since it had no relation to my post though, why did you address it to me?
“What do you expect? You give billions of taxpayer dollars to these banks because they squandered their own money on gambling and bonuses and you don’t expect them to go back to their old ways?”
A very good question. Of course, the answer is something you probably aren’t going to like. I am afraid that rescuing the banks was necessary (look at what was happening to the economy when even routine short term business credit was frozen), but then we needed to follow with more stringent regulations. It seems that Wall Street likes to talk a conservative, free market game, but they don’t walk the walk. They want all the benefits of a free hand but want to be protected from the consequences of their reckless behavior. So, some hard core fiscal conservatives, libertarians, and economic class warfare liberals are all upset about the bail outs. And, in fact, you are right AE, by bailing out the banks and not holding them accountable, our government is sending the message that there are no consequences to reckless stupidity. However, an appropriate and even natural consequence would have been regulation (something most of the other G-20 nations want, and especially want the US to do based on Wall Street’s disproportionate influence). Unfortunately, Wall Street has taken advantage of a mix of faux fiscal conservatives who have a knee jerk reaction to “regulation” and of the vast majority of congress critters who Wall Street can black mail with threats of retaliation or economic doom. Look at Wall Street’s reactions to the recent credit card bill, a needed partial correction to the law an earlier congress passed during the Bush Administration that protected reckless and predatory behavior on the part of those financial institutions that offer credit cards.
“No company should be so big that it can’t, in Bush’s words, be allowed to fail.”
Agreed.
“Of course, you must keep in mind that anything you read from Krugman is left biased.”
Yes, and that is a reason to be somewhat skeptical, but not to dismiss it out of hand. For example, it is important to note that some economic observers who are not nearly as “liberal” as Krugman agree with him, including quite a few economic observers.
“But isn’t he saying that the Democrat dominated Congress and administration are being bought off?”
He’s saying that the Democrats are also susceptible to influence, and when Wall Street threatens or predicts dire consequences to regulations they don’t want, such as the sorts of credit freezes that paralyzed the company, office holders of both parties tend to listen. Particularly representatives who face reelection every two years.
“Of course, you must keep in mind that anything you read from Krugman is left biased.”
Yes, and that is a reason to be somewhat skeptical, but not to dismiss it out of hand. For example, it is important to note that some economic observers who are not nearly as “liberal” as Krugman agree with him, including quite a few economic observers.
“But isn’t he saying that the Democrat dominated Congress and administration are being bought off?”
He’s saying that the Democrats are also susceptible to influence, and when Wall Street threatens or predicts dire consequences to regulations they don’t want, such as the sorts of credit freezes that paralyzed the company, office holders of both parties tend to listen. Particularly representatives who face reelection every two years.
Do you mean those bankers like Goldman Sacs and ther others that gave heavily to the dims?
http://www.buzzle.com/articles/234540.html
Phantom, If 30% of 30% of bankers gave contributions to dems, does that mean that the dems got 30/30 or 100%?
“Politicians and banks have done a great job of selling the lie that if these banks fail, the world will implode. One of the greatest lies ever foisted upon the people IMO.”
For once, AE, I agree with you
Donnyboy,
“Do you mean those bankers like Goldman Sacs and ther others that gave heavily to the dims?”
If only they’d hedged their financial deals as carefully as they did their political bets, maybe we wouldn’t be in this mess.
Should have let them burn. We’ve lost billions and nothing has changed.
“And the industry is deploying its political clout to block even the most minimal reforms”
Nice to see those on Wall Street are coming to their senses. They are realizing what it meant to support the wrong candidate in the election.
They are waking up to the reality of a true far left socialist agenda.
“Uh oh” became “Oh no” and has turned to “Not!”
“We’ve lost billions and nothing has changed.”
36 billion that the Treasury has written off which libs gave to GM and Chrysler.
Yeah, we’ve lost billions, but it wasn’t wall street robbing us blind.