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Will US Regulators Take Action in LIBOR Scandal? |
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Tuesday, 10 July 2012 15:31 |
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[Taibbi writes: "Time and again, American regulators have appeared to be paralyzed by corruption in cases when most or all of the banks have been caught raiding the same cookie jar."
Matt Taibbi at Skylight Studio in New York, 10/27/10. (photo: Neilson Barnard/Getty Images)
Will US Regulators Take Action in LIBOR Scandal?
By Matt Taibbi, Rolling Stone
10 July 12
 he New York Times and its outstanding financial reporter, Gretchen Morgenson, have published an important article about the LIBOR banking crisis, challenging American regulators to take this mess as seriously as the British appear to be.
We found out just over a week ago that Barclays CEO Bob Diamond, as well as several other senior Barclays officials, were pushed out of their jobs after Bank of England chief Mervyn King trained a mysterious Vaderesque power on them, impelling them to leave with an "inflection of the eyebrows."
Morgenson's piece from Saturday, "The British, at Least, Are Getting Tough," wonders aloud why American regulators - Ben Bernanke, cough, cough - don't take a similarly stern approach with our own corrupt bank officials. First, she summarizes what seems to be the mindset of American officials:
"Dirty clean" versus "clean clean" pretty much sums up Wall Street's view of cheating. If everybody does it, nobody should be held accountable if caught. Alas, many United States regulators and prosecutors seem to have bought into this argument.
This viewpoint has been particularly in evidence since 2008. Time and again, American regulators have appeared to be paralyzed by corruption in cases when most or all of the banks have been caught raiding the same cookie jar. From fraudulent sales of mortgage-backed securities, to Enronesque accounting, to Jefferson-County-style predatory swap deals, to municipal bond bid-rigging, the strategy of American regulators has been to accept "Well, everybody was doing it" as a mitigating factor when negotiating settlements, where that should have made them want to crack the whip even harder.
Why? Because "everybody is doing it" corruption is way more dangerous than corruption involving one or two rogue firms going off-reservation. Regulators who spot that kind of industry-wide problem, to say nothing of cartel-style anticompetitive corruption, should be in a panic: They should always impose serious, across-the-board punishments, and it goes without saying that senior executives responsible have to be removed.
This is exactly what has begun to happen in England, now that the British have gotten wind of this LIBOR scandal, which involves the worst and most serious form of corruption - huge companies acting in concert to fix prices/rates. As the Times explains:
Last week's defenestrations of Marcus Agius, the Barclays chairman; Robert E. Diamond Jr., its hard-charging chief executive; and Jerry del Missier, its chief operating officer, apparently occurred at the behest of the Bank of England and the Financial Services Authority, the nation's top securities regulator. (Mr. del Missier also seems to have lost his post as chairman of the Securities Industry and Financial Markets Association, the big Wall Street lobbying group. His name vanished last week from the list of board members on the group's Web site.)
Morgenson notes that the Barclays CEO, Diamond, seemed shocked that there were actual consequences for his misbehavior:
MR. DIAMOND seemed shocked to be pushed out. An American by birth, he probably thought he'd be subject to American rules of engagement when confronted with evidence of wrongdoing at his bank. You know how it works on this side of the Atlantic: faced with a scandal, most chief executives jettison low-level employees, maybe give up a bonus or two - and then ride out the storm. Regulators, if they act, just extract fines from the shareholders.
The article goes on to point out the frightening fact that del Missier, the outgoing Barclays COO, was at the time the scandal broke the sitting head of SIFMA, the trade group representing securities dealers. We know from the emails Barclays released last week that del Missier was privy to the discussions about rigging LIBOR rates; he was one of the people Diamond was writing to when he penned a memo claiming that Paul Tucker, the Bank of England deputy chief, had urged the bank to fake its LIBOR rates.
At the very least, del Missier should have said something, should have opposed the idea. Instead, he went right on being a front for Wall Street's largest professional association:
With each new financial imbroglio, the gulf widens between Main Street's opinion of Wall Street and the industry's view of itself. When Mr. del Missier, the former Barclays chief operating officer, took over as chairman of the Securities Industry and Financial Markets Association last November, he said: "We will continue to work on maintaining and burnishing the level of confidence investors have in our markets, in our own financial institutions, and in the general economic outlook for the future."
Given the Libor scandal, let's just say good luck with that.
Hear hear.
When the rest of this scandal comes out, and it turns out that up to 15 more of the world's biggest banks (including Chase, Bank of America, and Citi) were doing the same thing as Barclays, our regulators better start "inflecting their eyebrows" pretty damn vigorously. Because if it comes out that these other banks were all involved with this scandal (and it will come out that way, almost for sure), and their CEOs and COOs get to keep their jobs, that'll be a sure sign that the fix is in. Let's hope Ben Bernanke, Eric Holder, and Tim Geithner are listening.
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FOCUS: Obama Eats the Rich for Fun and Profit |
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Written by <a href="index.php?option=com_comprofiler&task=userProfile&user=10204"><span class="small">Jonathan Chait, New York Magazine</span></a>
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Tuesday, 10 July 2012 11:46 |
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Chait writes: "President Obama today is demanding that Congress extend the Bush tax cuts on income under $250,000 for another year. This is being reported as a gambit to 'change the subject to the issue of tax fairness.'"
US President Barack Obama speaks during the sixth annual Wounded Warrior Project's Soldier Ride, 04/20/12. (photo: Getty Images)
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The Cowardly Lions of 'Free Speech' |
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Written by <a href="index.php?option=com_comprofiler&task=userProfile&user=15946"><span class="small">Bill Moyers, Moyers & Company</span></a>
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Tuesday, 10 July 2012 09:38 |
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Bill Moyers explains how the Supreme Court decision not to reconsider Citizens United exposes the hoax that Citizens United was ever about 'free' speech. In reality, Bill says, it's about carpet bombing elections 'with all the tonnage your rich paymasters want to buy.'
Portrait, Bill Moyers. (photo: Robin Holland)
The Cowardly Lions of 'Free Speech'
By Bill Moyers, Moyers & Company
10 July 12
http://www.youtube.com/watch?v=x6TuWrfOwug
 elcome. In all the hullabaloo over the Supreme Court's decision on health care, another of its rulings quickly fell off the public radar. Before deciding the fate of the Affordable Care Act, the Court announced it would not reconsider Citizens United. That's the odious 5-4 decision two years ago that opened our elections to unlimited contributions. Within minutes of that announcement, right-wing partisans were crowing about the advantage they now own. An advantage not due to ideas or personalities, but to the sheer force of money. They were remarkably candid and specific.
Here's what Fred Barnes wrote in "The Weekly Standard" about the Senate race in Missouri:
"For three weeks in May, Republican super-PACs took turns attacking Democratic senator Claire McCaskill in TV ads. Republicans hadn't held their primary-it's not until August 7-but McCaskill wound up trailing all three of the GOP candidates in polls. Now McCaskill, unnerved, is struggling to recover.
"That's what super-PACs can do. When they emerged in 2010 and worked in tandem, they were a critical force in the Republican landslide in the congressional elections. This year they're playing an even bigger role. The size and reach of their efforts dwarf what they did two years ago."
Attaboy, Fred, for telling it like it is. For exposing the hoax that the Court's original decision was about "free" speech. Free speech, my foot: It's about carpet bombing elections with all the tonnage your rich paymasters want to buy. Try not to laugh when you hear one of its perpetrators, the noted lawyer Floyd Abrams, say, as he did not too long ago, "I don't think we should want as a matter of policy to make decisions which are essentially, people can't do all the speaking that they can in a political campaign. I don't think we can ration speech."
Excuse me, Floyd: Speech is already rationed in America. On your playing field, those who have no money have no speech. And just who do you think is doing this "speaking"? Hello, poor people, are you there? It's your election, too. All 50 million of you; Hello, we can't hear you. Better get a Super Pac and speak up!
Poor people haven't lost their voice. They can't afford a voice. And every day working people: universal laryngitis, the chronic absence of money. As for children - children who have a big stake in our elections but no vote - for them to be heard they would need piggy banks the size of Wal-Mart heirs. Or the Koch brothers for uncles.
And if "free speech" is a right, why all the secrecy? Why hide from voters where the money is coming from? Why not openly say you're downright proud to be exercising your First Amendment rights and that writing checks is your patriotic duty? Instead, conservatives across the country are fighting to keep their sugar daddies secret. According to their guardian angel in Congress - the highly leveraged Senate Minority Leader Mitch McConnell - the right wing opposes disclosure laws because the super-rich just might be bullied and harassed by the rest of us who want to know who's buying our elections. So that the editorial page of "The Wall Street Journal," asks us to have pity on billionaires and those little ol' corporations and their CEOs who just might have their tender feelings hurt; if they were exposed to boycotts and pickets - were it known which candidates they were buying.
Wait a minute. Weren't we taught the First Amendment also guarantees the right of every citizen to assemble and petition, even to boycott and picket? That's what a couple of hundred protesters were doing just the other day. They marched to the DC offices of American Crossroads and Crossroads GPS. Those are the right wing money mills run by the mastermind of much of this massive fundraising, Karl Rove. He's making a bundle himself buying and selling "Free Speech," while at the same time deploring the disclosure of big donors' names as "shameful" intimidation!
Exercising their First Amendment rights, the demonstrators taped a kind of wanted poster on Rove's office door, indicating they would like to see him wearing an orange prison jumpsuit. Instead, he could be seen last weekend in casual wear, buzzing around in a golf cart at Mitt Romney's Utah mountain gathering of high rollers. No doubt plotting how to raise more millions to pay for more "free speech."
Let's see if we've got this right: On the one hand, conservatives declare that corporations and the superrich can spend all they want on exercising their First Amendment rights, but on the other, they demand to keep it secret so the rest of us can't exercise our First Amendment rights to fight back? Have you ever heard of more cowardly lions?
It's one big joke. Big enough to make you cry. Three things don't go together: Money. Secrecy. Democracy. And that's the nub of the matter. This is all a sham for invalidating democracy in the name of democracy. It's the trick authoritarians always use to hide their real intention - in this case absolute power over our public life and institutions: the privatization of everything. The Supreme Court is pointing the way. Instead of mitigating the worst excesses of both the state and the private sector, the Court has taken sides. Saying to the massed wealth of the one percent: America is yours for the taking, for the buying.
That's what George III thought, too. Which brings us back to our celebration of the 4th of July, to the Declaration of Independence and Thomas Jefferson, who seems to have thought that a little uprising now and then would be good for what ails us. This time the overweening power is not the monarchy but plutocracy, the convergence of the political, religious and corporate right that would keep us in the dark about where all that money is coming from, and who it's buying, until one day we wake up and our country is no longer our own. Fortunately, those orange jump suits come in one size fits all. So remember, moneyed lords and ladies, what King George learned the hard way - you can only push your subjects so far.
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Activists Crash Romney's Koch-Sponsored Hamptons Fundraiser |
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Tuesday, 10 July 2012 09:25 |
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Excerpt: "When Romney held a big, fancy fundraiser at David Koch's estate in the Hamptons, it was not only attended by wealthy donors - activists and protesters showed up, too. And the irony in this LA Times piece is so thick we couldn't have invented it."
Protesters marched down the beach in New York's Hamptons to demonstrate against the power of deep-pocketed donors over the political process. (photo: Garrett Haake/NBC)
Activists Crash Romney's Koch-Sponsored Hamptons Fundraiser
By Julianne Escobedo Shepherd, AlterNet
10 July 12
 ast month, President Obama raised a comparatively paltry $71 million campaign dollars to Romney's Goliath $106 million, and the reason is clear: the Republican candidate is backed by a coalition of Wall Street-humping super-PACs and shady figures like the Koch brothers who want to leverage their dough to take away the rights of average American people. So yesterday, when Romney held a big, fancy fundraiser at David Koch's estate in the Hamptons, it was not only attended by wealthy donors-activists and protesters showed up, too. And the irony in this LA Times piece is so thick we couldn't have invented it:
A money manager in a green Jeep said it was time for Romney to "up his game and be more reactive." So far, said the donor (who would not give his name because he said it would hurt his business), Romney has had a "very timid offense."
A New York City donor a few cars back, who also would not give her name, said Romney needed to do a better job connecting. "I don't think the common person is getting it," she said from the passenger seat of a Range Rover stamped with East Hampton beach permits. "Nobody understands why Obama is hurting them."
Haha! These are the people who would have Romney run the country: rich socialites and business people driving Range Rovers who frequent the natty, exclusive world of the Hamptons and yet think that Obama is "hurting" the "common person." These are the people who are so incredibly out of touch, and who are themselves running companies that axe jobs, like Romney's friend Meg Whitman-who cut 27,000 jobs from HP last month. But of course, the irony was not lost on Twitter: here's MoveOn's Storify about the fundraiser, which features an awesome collection of photographs. Oh, and the Range Rover lady? Here's the rest of her quote:
"We've got the message," she added. "But my college kid, the baby sitters, the nails ladies - everybody who's got the right to vote - they don't understand what's going on. I just think if you're lower income - one, you're not as educated, two, they don't understand how it works, they don't understand how the systems work, they don't understand the impact."
We're willing to bet that the "nails ladies," the babysitters, and probably her college kid, too, find her to be the uneducated one, not to mention totally condescending. These are the people who want Romney to preside over us-the people who think we're dumb for wanting economic equity. Read the rest of the article here.
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