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"If you prosecute a CEO or other senior executive and send him or her to jail for committing a crime, the deterrent effect in my view vastly outweighs even the best compliance program you can put in place."
It's unusual for a Federal Judge to weigh in on specific matters that could conceivably come before his Bench.  It's even more unusual when those matters involve politically sensitive issues of national policy. A hard-hitting essay published recently in The New York Review Of Books by a 70-year old active United States District Judge has raised eyebrows for doing just that.

Judge Jed S. Rakoff sits for the United States District Court for the Southern District of New York--the nerve center of the financial world.  A Clinton appointee and former Federal prosecutor, he stunned the SEC in 2011 by rejecting a proposed 285 million dollar settlement between the U.S. and Citigroup in a case where Citigroup had been accused of misleading investors through the sale and packaging of collateralized debt obligations.  Rakoff's rationale for rejecting that settlement--which he characterized as "pocket change"--was that Citigroup was not required to admit culpability.  The SEC changed its position on this practice after this ruling.  

Today Rakoff is once again getting under the government's skin. He wonders aloud why no high-level corporate CEO's or other managing officers in private Finance and Banking firms have been prosecuted for causing the financial meltdown that led to what we now know as the Great Recession. His essay, linked above, suggests several reasons and leads to at least one unsettling conclusion: that the Justice Department believes governmental officials' actions tacitly if not directly abetted and enabled the crisis to the point where prosecuting corporate CEO's would simply end up implicating the U.S. government.

His essay opens with some basic questions:

Who was to blame? Was it simply a result of negligence, of the kind of inordinate risk-taking commonly called a “bubble,” of an imprudent but innocent failure to maintain adequate reserves for a rainy day? Or was it the result, at least in part, of fraudulent practices, of dubious mortgages portrayed as sound risks and packaged into ever more esoteric financial instruments, the fundamental weaknesses of which were intentionally obscured?
Rakoff acknowledges that if the Financial crisis were the product of mere negligence, then prosecution of corporate executives would simply be scapegoating "of the worst kind."  But if the evidence points to intentional fraud, that is exactly the type of conduct the Justice Department is designed to confront and its failure to do so a travesty of Justice in its own right:
But if, by contrast, the Great Recession was in material part the product of intentional fraud, the failure to prosecute those responsible must be judged one of the more egregious failures of the criminal justice system in many years. Indeed, it would stand in striking contrast to the increased success that federal prosecutors have had over the past fifty years or so in bringing to justice even the highest-level figures who orchestrated mammoth frauds.
(Emphasis supplied)

Constrained by his ethical obligation to maintain judicial propriety, Rakoff takes great pains to emphasize he has no knowledge that fraud was in fact committed. What he does is distill the crisis to its basic elements--that subprime mortgages of questionable creditworthiness were being packaged and sold as collateral for highly leveraged securities nonetheless rated as AAA, "low-risk." How this circumstance could arise at all without someone--well, lying along the way would appear to be a rhetorical question which Rakoff raises but lets the reader follow through to its conclusion.  Instead of expressing an opinion, Rakoff allows the record speak for itself:

[T]he stated opinion of those government entities asked to examine the financial crisis overall is not that no fraud was committed. Quite the contrary. For example, the Financial Crisis Inquiry Commission, in its final report, uses variants of the word “fraud” no fewer than 157 times in describing what led to the crisis, concluding that there was a “systemic breakdown,” not just in accountability, but also in ethical behavior.

As the commission found, the signs of fraud were everywhere to be seen...
Rakoff then systematically dissects the Justice Department's three predominant excuses for their failure to prosecute individuals who undoubtedly fostered the conditions that led to the financial meltdown of 2008. The first--the difficulty of proving intent (an essential element to prove fraud), he finds weak.  Judge Rakoff believes that given the scale of the abuse the Justice Department would be capable of eliciting enough evidence to prove conscious disregard, or "willful blindness" on the part of corporate CEO's and officers whose companies engaged in these transactions.  In a Federal criminal trial for fraud, conscious disregard can and does qualify as "intent."

The second excuse, that proof of "reliance" would be difficult since the parties to these transactions were sophisticated investors--he dismisses fairly out of hand. The criminal standard for fraud requires no such proof, and he explains why.

Finally, the Justice Department--specifically Attorney General Eric Holder--has raised the possibility that such prosecutions might result in economic harm to the country.  Rakoff believes that for a Federal official charged with enforcing the law this position--the "too big to jail" position-- is disturbing, to say the least.  He notes that Holder recalibrated his remarks and said they had been misconstrued, but in any event this leads Rakoff to his central point--that this concern evaporates if individuals are targeted, rather than institutions.

Rakoff believes that the high-profile prosecution of individual CEO's would have a far greater deterrent effect than do the prosecutions of the companies they work for. So if Justice's excuses are hollow, what is the real reason these prosecutions haven't occurred?  Rakoff tacks off the familiar justifications: First, because agents who could have worked the cases were transferred to anti-terrorism duty after 9/11; second, that the SEC operates under a very limited budget, limited even more by Congressional Republicans; and finally that the potential cases were parceled out to assistant US Attorneys with a greater personal interest in prosecuting "run-of-the-mill" financial fraud such as insider trading because of their immediate payoff.

None of these explanations is particularly satisfactory to him given the scope of the harm done. This brings him to to his second, more alarming point--that the government's own role in fostering the events that led to the crisis has had a chilling effect on prosecutors:

...Even before the start of the housing boom, it was the government, in the form of Congress, that repealed the Glass-Steagall Act, thus allowing certain banks that had previously viewed mortgages as a source of interest income to become instead deeply involved in securitizing pools of mortgages in order to obtain the much greater profits available from trading. It was the government, in the form of both the executive and the legislature, that encouraged deregulation, thus weakening the power and oversight not only of the SEC but also of such diverse banking overseers as the Office of Thrift Supervision and the Office of the Comptroller of the Currency, both in the Treasury Department. It was the government, in the form of the Federal Reserve, that kept interest rates low, in part to encourage mortgages...[.].
If you read that paragraph carefully you'll notice that--fair or not--no one escapes blame. From the start to the finish, the U.S. government has had its hands in the financial mess, and it was again the U.S. government--recall, for example, the near unanimity between the outgoing Bush and incoming Obama Administrations on TARP-- who readily forgave and immediately bailed out most of the very entities directly responsible for the disaster in the first place.
[W]hat I am suggesting is that the government was deeply involved, from beginning to end, in helping create the conditions that could lead to such fraud, and that this would give a prudent prosecutor pause in deciding whether to indict a CEO who might, with some justice, claim that he was only doing what he fairly believed the government wanted him to do.
And that, my friends, is as good a reason as any why you have seen no prosecutions of high level private financial firm CEOs in connection with their actions leading up to the meltdown. While Rakoff won't come out and say it, the implication is clear--if the elements are there to establish fraud, then the prosecutor's job is to prosecute. But who to prosecute when the CEO starts attributing his actions to the government?  And implicating "the government" always means naming names--from Rubin to Gramm to Clinton to Reagan, and everyone in between.

Finally, Rakoff criticizes the trend by the Justice Department towards punishing companies as opposed to the folks who run them, a trend he describes as unfortunate, leading to a familiar dance that looks like this:

Early in the investigation, you invite in counsel to the company and explain to him or her why you suspect fraud. He or she responds by assuring you that the company wants to cooperate and do the right thing, and to that end the company has hired a former assistant US attorney, now a partner at a respected law firm, to do an internal investigation...[.]

Six months later the company’s counsel returns, with a detailed report showing that mistakes were made but that the company is now intent on correcting them. You and the company then agree that the company will enter into a deferred prosecution agreement [requiring fines and future compliance requirements]... You are happy because you believe that you have helped prevent future crimes; the company is happy because it has avoided a devastating indictment; and perhaps the happiest of all are the executives, or former executives, who actually committed the underlying misconduct, for they are left untouched.

The fact that this is coming from a Judge who has a history of creating heartburn for the Justice Department simply bolsters its credibility.  

In the meantime, the consequences of the financial crisis continue to reverberate across the globe in ways that not even the most prescient could have imagined.  On top of the ruined lives and misery inflicted upon tens of millions of Americans, many of whom will never recover economically to pre-Recession levels, the heedless actions of these financial institutions and their principals have unleashed a storm of violent nationalism and xenophobia in Europe, the product of the EU's failed attempt to address the crisis through fiscal austerity. Far right parties are widely expected to increase their power and influence across the continent as stubborn double-digit unemployment threatens to consign an entire generation of young Europeans to stagnation and poverty. The sociological effects of the Great Recession are incalculable, as is the cascading effect of such an economic calamity on generations to follow:  

The rightist parties will campaign primarily on the basis of opposition to the European Union, in most instances posing as opponents of austerity measures imposed by the EU throughout Europe. By shifting somewhat from their usual preoccupation with immigration and Islam, they hope to capitalise on popular hostility to the EU and its austerity agenda.

*  *  *
The “mainstream” political parties—of the official “left” as well as the right—are politically responsible for a situation in which the far right can strike such a pose, since the entire political establishment is implicated in the savage attacks that have been inflicted on Europe’s workers since the financial crash of 2008.

and:
There are increasing concerns across Europe that what was once considered far-right and racist is moving toward mainstream political thought. Anti-immigration agendas have led to increased worry from immigrant communities across the European Union. In recent weeks, a new study has shown that at the same time, concerns among Jews of a resurgence of anti-Semitism are strong and growing.
The effects of this artificial, completely avoidable economic cataclysm on the entire world were so profound, and the consequences so radical, the true ends will likely not manifest themselves for decades.  Whatever rough beast is likely to arise from the ashes of a transformed Europe is probably not going to be to our liking.

The reputations and comfort of a few persons in the U.S. government simply pales in comparison to the amount of harm done here. If Rakoff is right, and the reluctance by the Justice Department to prosecute is out of fear of "putting our government" on trial, then the only rejoinder is that the government--and the people responsible for creating this disaster--deserves to share the blame along with the corporate officers and CEO's who actually turned a blind eye to fraud.  If we fail to hold those responsible to account there will be no expectation of any accounting in the future, and the process will certainly repeat itself as more and more opportunities arise to "package" and transfer vast sums of wealth for the benefit of a tiny, detached and untouchable group of people.  The failure of our society to credibly assign responsibility to those whose unbridled greed caused the Financial crisis will be remembered not just as a human failing but one of the greatest failures of Democracy itself.

         

Note: Nextstep in the comments points out that the SEC in 2011 charged executives of the government-sponsored entities Freddie Mac and Fannie Mae with securities fraud.

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  •  awesome diary (99+ / 0-)

    And I hope Community Spotlight will republish it.

    Mike papintonio talks about this quite a bit. Fine these companies billions; they don't care.

    Frogmarch a few of these sonsabitches to jail and televise it on CNBC.

    Now THAT might get their attention and induce a little humility.

    Nothing less.

    “Vote for the party closest to you, but work for the movement you love.” ~ Thom Hartmann 6/12/13

    by ozsea1 on Wed Dec 25, 2013 at 08:24:53 AM PST

  •  add some puppies and kitties and (41+ / 0-)

    then this diary will get some attention.

    Seems like a few financial "regulators"  ought to be frog-marched along with the CEOs.

    don't always believe what you think

    by claude on Wed Dec 25, 2013 at 08:33:35 AM PST

  •  how complacent we've become since 1989 (66+ / 0-)

    While I've little doubt that many large players from the S&L crisis of the late 80's got away pretty much free (see Neil Bush, HW's son), at least the (gasp!) Republican DoJ did go after many top executives for causing the S&L crisis.

    The only really big name I remember is Charles Keating, who did eventually serve about 4 years (out  of 12 sentenced) in prison.  IIRC, there were about 1100 people the DOJ brought charges against, over 800 convictions/plea-deals, and a few hundred that actually served time. Hell, there was even some blowback against some politicians - notably the Keating Five.

    That we have done so little  (nothing really) about executive/corporate prosecution for the 2008 meltdown is utterly depressing.

  •  Brilliant! (36+ / 0-)

    you and Rakoff have captured it.  Little to add except that the decreasing real income of the 99% made it hard to keep the boom going except by slathering on generous amounts of debt.  Of course it all had to come crashing down sooner or later.  Bush was either too stupid or uncaring to notice. Stupidity no excuse for Greenspan, who was at the center of the cheap money policy that enabled the thing.

  •  Great diary overall, but particularly the bit (30+ / 0-)

    about what is happening in Europe where austerity has hit hard. Why do we never learn from history?

  •  The capitalist system is morally bankrupt... (39+ / 0-)

    and so are all of the politicians that are in the pocket of the ruling class. The implications are clear. Need they be said?

  •  Awesome. T&R (45+ / 0-)

    Frogmarchin long overdue.

    A few arrested fatcats would be a nice start and send a long overdue and absolutely essential message: the party is over.

    I hold zero hope of this ever happening but if it would - somehow- I couldn't wait to see media coverage of the super-wealthy getting cuffed and stuffed in a police car, their mansions raided, their estates seized under forfeiture law, trials, sentencing...them paying somebody to go to jail for them...

  •  A way to answer your own question. (9+ / 0-)

    If I may presume . . . answer this question and you will know why no one has been prosecuted.

    Who specifically, as in name him/her, should be prosecuted for violating which specific provision of the United States Code, by doing what particular act.

    For example, if you say "fraud," answer me who specifically was defrauded, by what false statement in particular.

    We don't live in a nation where people may be imprisoned without violating  a provision of the law, where such violation has been proven beyond a reasonable doubt.

    I have never seen ANYONE who complains that "we haven't prosecuted anyone," ever say who we should prosecute for committing what particular illegal action.  

    The assumption appears to be that someone, somewhere must have broken some law.  Maybe they did.  But proseuctors have to find the someone, and prove when and where they broke the law.  

    So just tell me who and when and where.

    •  I would look at what were/are called (37+ / 0-)

      'credit default swaps". Complicated financial pigs-in-pokes sort of 'product' upon which much of the financial erosion is built.

      Rakoff takes great pains to emphasize he has no knowledge that fraud was in fact committed. What he does is distill the crisis to its basic elements--that subprime mortgages of questionable creditworthiness were being packaged and sold as collateral for highly leveraged securities nonetheless rated as AAA, "low-risk." How this circumstance could arise at all without someone--well, lying along the way would appear to be a rhetorical question which Rakoff raises
      Somkebody somewhere along the way intentionally and systematically mislead people  to accomplish this glorified 3-card monte.

      If I am not mistaken, there could be racketeering charges possible.

      •  'unregulated' (for some reason) (5+ / 0-)

        'credit default swaps' 'markets'
        To me, each step along the way was 'unfettered' (<- new fangled financial explanation).
        If you could sign a mortgage app', you were gifted it. No background worthiness check.
        Didn't matter, the 'loaner' wasn't keeping the loan, it was selling it 'up' the next step.
        the packager (the next step guy) would accumulate enough of these, then needed the guy up the next step (the credit trustworthiness guy) to bestow upon his steaming pile of accumulated 'files', a triple A stamp.
        with the stamp, these piles are now packaged even higher to the next step, where they enter the hallowed markets of CDx's or now known as 'securities', which seems odd as a definition, as they weren't very secure, but sounded good when 'investing' in them.

        "We can't solve problems by using the same kind of thinking we used when we created them." - Albert Einstein

        by pickandshovel on Wed Dec 25, 2013 at 10:06:31 AM PST

        [ Parent ]

      •  How are CDS illegal? You evaded the question. (5+ / 0-)
        Who specifically, as in name him/her, should be prosecuted for violating which specific provision of the United States Code, by doing what particular act.
        Name names.  Name the specific law broken.

        "The way to see by faith is to shut the eye of reason." - Thomas Paine

        by shrike on Wed Dec 25, 2013 at 12:26:28 PM PST

        [ Parent ]

        •  Securities act of 1933 (6+ / 0-)

          There were material misrepresentations made with respect to securities offered to investors.  Also in many instance there were violations of state blue skies laws.    The entire structure was well designed to obfuscate the fact the the underwriting standards described were not in fact followed.   That is a criminal violation

          Asking for more detail is presenting a fake standard since prosecutors take substantial effort to develop the detailed information and so raising some impossible standard to protect popular politicians is mere sophistry.

          •  Answer for the Ages (plus Bonus Specifics) (1+ / 0-)
            Recommended by:
            shaharazade

            thank you, Mindful Nature:

            Asking for more detail is presenting a fake standard since prosecutors take substantial effort to develop the detailed information and so raising some impossible standard to protect popular politicians is mere sophistry.
            Let's turn this on its head, shall we? To shrike and others presenting such questions: what would you do to defend ANY potential clients, accused of "(obfuscating) the fact the the underwriting standards described were not in fact followed" here, in re: the Securities Act of 1933?

            What defense can you possibly present? We await your presentation of lawful jurisprudence to the specific Act in question, with all the attendant details. And please include, in your specifics, the cases you will cite to provide "precedent" that they should be let off the hook altogether.

            This all started with "what the Republicans did to language".

            by lunachickie on Thu Dec 26, 2013 at 07:55:29 AM PST

            [ Parent ]

            •  as usual, crickets (2+ / 0-)
              Recommended by:
              lunachickie, WheninRome

              from shrike and the other Usual Suspects; the corporatist trolls that work for the financial elites in one form or another.

              they are so thoroughly vested in this rotten system that, among other aspects, they believe in their own mis/disinformation because they are deathly afraid of any alternative.

              “Vote for the party closest to you, but work for the movement you love.” ~ Thom Hartmann 6/12/13

              by ozsea1 on Thu Dec 26, 2013 at 10:42:47 AM PST

              [ Parent ]

              •  Of course! (1+ / 0-)
                Recommended by:
                WheninRome

                Oh, but....they didn't see it. Or it's not relevant anymore. Or (insert subject change/diversion here).

                I don't think they really believe it, though. I always envisioned them patting themselves on the back for being able to convince others with such nonsense. Which is why I can't for the life of me figure out why they're here...

                This all started with "what the Republicans did to language".

                by lunachickie on Thu Dec 26, 2013 at 11:03:55 AM PST

                [ Parent ]

      •  I'm very much bothered (13+ / 0-)

        by the fact that the bond rating agencies, whom we all depend upon since none of us are in a position to make these assessments ourselves, have absolved themselves of all responsibility to tell the truth. Their defense is that all they do is offer an opinion, and they can't be held accountable for being mistaken. Apparently they can't be held responsible for being completely incompetent either, or for deliberately lying and deceiving on behalf of the banks either.

        I don't know what the answer to this is, but this puts us in an untenable position. Even if we don't own bonds, our pension funds and mutual funds do. If the ratings are meaningless, then how can we have a bond market?

        Something has to be done about this.

    •  fair enough. how about: (29+ / 0-)

      Ratings agencies and their principals who gave AAA ratings to mortage backed securities they knew were junk, in return for a fee. Likewise bankers who bought these bogus ratings and then concealed from the buyers that these securities were junk. Fraud, I say.

    •  Right off the bat, Lloyd Blankfein.... (32+ / 0-)

      Committed perjury when he lied to congress.

      The various crimes of these folks have been laid out plenty of times before. See Matt Taibbi, Yves Smith, etc. if you want more specifics.

      •  When did he lie to Congress? (4+ / 0-)

        When he said he was "long" MBS?  That was later proven to be accurate.  

        Also there was a trial on underwriting standards:

        Goldman Sachs Group Inc. (GS) and Chief Executive Officer Lloyd Blankfein won dismissal of a suit in which investors said the bank knew mortgage-backed securities it sponsored didn’t comply with underwriting standards.

        U.S. District Judge William Pauley in New York said in a ruling today that plaintiffs’ allegations were “conclusory” and lacked specifics.

        The plaintiffs in the so-called consolidated derivative suit include Michael Brautigam and the Retirement Relief System of the City of Birmingham, Alabama. Those also named as defendants included current and former Goldman Sachs executives.

        http://www.bloomberg.com/...

        "The way to see by faith is to shut the eye of reason." - Thomas Paine

        by shrike on Wed Dec 25, 2013 at 12:11:29 PM PST

        [ Parent ]

    •  Well, we could start with the ratings agencies. (13+ / 0-)

      People at S&P, for example, knew that they rated junk CDOs as AAA.  

      •  The ratings agencies have long been protected (5+ / 0-)

        by the First Amendment just as movie critics are - they give opinions.   However, that is being challenged:

        (Reuters) - A federal judge has said credit ratings are not always protected opinion under the First Amendment, a defeat for credit rating agencies in a lawsuit brought by investors who lost money on mortgage-backed securities.

        The November 12 decision was a little-noticed setback for McGraw-Hill Cos' Standard & Poor's, Moody's Corp's Moody's Investors Service and Fimalac SA's Fitch Ratings, which have long invoked First Amendment free speech protection to defend against lawsuits over their ratings.

        These agencies had argued that the Constitution protected them from claims they issued inflated ratings on more than $5 billion of securities issued in 2006 and 2007, and backed by loans from former Thornburg Mortgage Inc and other lenders.

        http://www.reuters.com/...

        With the pro-business SCOTUS of today they are safe.

        "The way to see by faith is to shut the eye of reason." - Thomas Paine

        by shrike on Wed Dec 25, 2013 at 12:03:25 PM PST

        [ Parent ]

    •  Jon Corzine, is that you? (5+ / 0-)

      When they own the information, they can bend it all they want. -- John Mayer

      by S M Tenneshaw on Wed Dec 25, 2013 at 12:55:55 PM PST

      [ Parent ]

      •  Good example. This place convicted Corzine (3+ / 0-)
        Recommended by:
        mmacdDE, emelyn, bepanda

        before a trial could take place.  Later, ALL the "missing money" belonging to MF Global clients was found at counterparties and returned.

        Corzine did not "steal" a dime like was alleged here.

        "The way to see by faith is to shut the eye of reason." - Thomas Paine

        by shrike on Wed Dec 25, 2013 at 01:35:05 PM PST

        [ Parent ]

        •  You lie like a rug. (3+ / 0-)
          Recommended by:
          Alice Olson, lunachickie, shaharazade

          From a June 27 post at the Too Big Has Failed blog:

          Court documents released today by the CFTC declare Jon Corzine guilty in 2011′s MF Global scandal.
          More:
          There was a bigger problem than just the bankruptcy, though. It also turned out that over $1 billion of customers’ money was missing.

          When questioned about the money back in 2011 Corzine said that he had no idea where it was, and that was “stunned” to discover that it was missing.

          However, the report released today shows that Corzine knew what was going on.

          Cut the bullshit.

          When they own the information, they can bend it all they want. -- John Mayer

          by S M Tenneshaw on Wed Dec 25, 2013 at 03:20:55 PM PST

          [ Parent ]

          •  You and your site are full of shit. (2+ / 0-)
            Recommended by:
            emelyn, bepanda
            MF Global Inc.’s trustee will get court approval to complete distributions to former customers of the failed brokerage, allowing all missing funds to be returned by the end of the year.

            U.S. Bankruptcy Judge Martin Glenn said today he’s prepared to approve a plan to make the final determination of what 26,000 former customers are owed and distribute the money to them. The motion will ensure customers are paid by Dec. 31, satisfying all claims more than two years after the brokerage failed.

            ``That’s quite an accomplishment,’’ Glenn said at a hearing in Manhattan. At the outset of the case, nobody thought that customers would recover everything they lost, he said.

              Nov 13, 2013

            http://www.bloomberg.com/...

            Par for the course here.

            "The way to see by faith is to shut the eye of reason." - Thomas Paine

            by shrike on Wed Dec 25, 2013 at 04:03:46 PM PST

            [ Parent ]

            •  You're the one that's full of shit. (5+ / 0-)

              Just because they'll get their money back doesn't mean Corzine didn't steal it in the first place.  See the original court documents I linked to.

              Liar.

              When they own the information, they can bend it all they want. -- John Mayer

              by S M Tenneshaw on Wed Dec 25, 2013 at 04:23:40 PM PST

              [ Parent ]

              •  You can't read. The PDF clearly states Corzine (1+ / 0-)
                Recommended by:
                emelyn

                made poor investment decisions with the firm's capital.

                Not that he STOLE money.

                It is obvious Corzine ran MFG into the ground.  He may be guilty of incompetence or negligence but that is it.

                Anyway, the whole charade about these Wall Street assholes "stealing" billions is pure horseshit.

                "The way to see by faith is to shut the eye of reason." - Thomas Paine

                by shrike on Wed Dec 25, 2013 at 04:51:56 PM PST

                [ Parent ]

                •  Corzine did "STEAL," as his firm used money (5+ / 0-)

                  from customer accounts to have the firm speculate for the firm's account - which is illegal.  When the speculation failed, the losses went against customer accounts as the firm did not have enough funds to make them whole.

                  A more sophisticated form of stealing, but stealing non-the less.  

                  The most important way to protect the environment is not to have more than one child.

                  by nextstep on Wed Dec 25, 2013 at 05:28:42 PM PST

                  [ Parent ]

                •  Well... (4+ / 0-)

                  The allegations in the PDF are not just that Corzine made poor investment decisions... they are that Corzine misused customer funds, by using client money that was supposed to be kept in segregated investment accounts for the firm's purposes to keep operations going.  I think that kind of misappropriation of funds is fairly called stealing, if proven.  It is easy to see that this kind of conduct is the functional equivalent of theft when you consider that in this case, keeping operations going means that Corzine would have been continue to garner a very high level of compensation.  

                  Of course, the court document provided in this thread was just a complaint... a complaint doesn't "declare" someone "guilty".

                  •  And "misusing customer funds" gets your (1+ / 0-)
                    Recommended by:
                    a2nite

                    securities license pulled.  It is not a criminal offense and certainly not theft or embezzlement unless said funds are directed to a personal account.

                    "The way to see by faith is to shut the eye of reason." - Thomas Paine

                    by shrike on Thu Dec 26, 2013 at 06:23:14 AM PST

                    [ Parent ]

                    •  Incorrect. The laws Corzine allegedly violated... (1+ / 0-)
                      Recommended by:
                      S M Tenneshaw

                      ...carry criminal as well as civil penalties.

                      Simply not putting investor funds into segregated accounts is subject to criminal penalties.  If you read the complaint, Corzine was civilly charged with violating the CFTC regulation that required segregated accounts for customer funds:

                      17 CFR § 1.20 Futures customer funds to be segregated and separately accounted for.
                       (a)  All futures customer funds shall be separately accounted for and segregated as belonging to futures customers.
                      Simply by willfully violating that rule, Corzine would have committed a criminal offense, no matter how he used the funds, because ANY willful violation of a law or regulation carries criminal liability under the Commodity Exchange Act:
                      7 USC § 13 - Violations generally; punishment; costs of prosecution

                      (a)  Felonies generally  
                      It shall be a felony punishable by a fine of not more than $1,000,000 or imprisonment for not more than 10 years, or both, together with the costs of prosecution, for:

                       (1) Any person registered or required to be registered under this chapter, or any employee or agent thereof, to embezzle, steal, purloin, or with criminal intent convert to such person’s use or to the use of another, any money, securities, or property having a value in excess of $100, which was received by such person or any employee or agent thereof to margin, guarantee, or secure the trades or contracts of any customer or accruing to such customer as a result of such trades or contracts or which otherwise was received from any customer, client, or pool participant in connection with the business of such person. The word “value” as used in this paragraph means face, par, or market value, or cost price, either wholesale or retail, whichever is greater.  

                       (2) Any person to manipulate or attempt to manipulate the price of any commodity in interstate commerce, or for future delivery on or subject to the rules of any registered entity, or of any swap, or to corner or attempt to corner any such commodity or knowingly to deliver or cause to be delivered for transmission through the mails or interstate commerce by telegraph, telephone, wireless, or other means of communication false or misleading or knowingly inaccurate reports concerning crop or market information or conditions that affect or tend to affect the price of any commodity in interstate commerce, or knowingly to violate the provisions of section 6, section 6b, subsections (a) through (e) of subsection  [1]  6c, section 6h, section 6o(1), or section 23 of this title.  

                       (3) Any person knowingly to make, or cause to be made, any statement in any application, report, or document required to be filed under this chapter or any rule or regulation thereunder or any undertaking contained in a registration statement required under this chapter, or by any registered entity or registered futures association in connection with an application for membership or participation therein or to become associated with a member thereof, which statement was false or misleading with respect to any material fact, or knowingly to omit any material fact required to be stated therein or necessary to make the statements therein not misleading.  

                       (4) Any person willfully to falsify, conceal, or cover up by any trick, scheme, or artifice a material fact, make any false, fictitious, or fraudulent statements or representations, or make or use any false writing or document knowing the same to contain any false, fictitious, or fraudulent statement or entry to a registered entity, board of trade, swap data repository, or futures association designated or registered under this chapter acting in furtherance of its official duties under this chapter.  

                       (5) Any person willfully to violate any other provision of this chapter, or any rule or regulation thereunder, the violation of which is made unlawful or the observance of which is required under the terms of this chapter, but no person shall be subject to imprisonment under this paragraph for the violation of any rule or regulation if such person proves that he had no knowledge of such rule or regulation.

                      17 CFR § 1.20 is such a "regulation thereunder".

                      That's just one way Corzine could be found criminally liable if the allegations in the complaint are true.  I am positive that there are many others-- look, for example, at 7 USC § 13(a)(4) above... I'd say that he clearly violated that multiple times if he did what he was accused of doing.

                      There's nothing in these laws that says that the funds have to be diverted to a personal account, and for good reason-- otherwise, an executive could avoid all criminal liability by merely diverting money from customer accounts to operational uses to keep their business going, then pay themselves their salary and perks that they would not have gotten if the business had failed.  That is what Corzine did if the allegations are true.  He took his compensation, while diverting money from customer accounts to maintain operations, which made it possible to continue to collect his compensation.  It is easy to see that such a person has enriched themselves at the expense of their customers.  It may be called a more particular name by the law, but it is really nothing more than a fancy kind of stealing, and it should be treated as stealing.

    •  OK... let'say the bankster jagoffs (12+ / 0-)

      did not directly break any laws--

      the BIG disconnect for the banksters; all of who supposedly worship at the false idol; the "free market".. WHY did they need Billions (Trillions?) from the federal government to keep them solvent?

      since they royally F***ed up and are idiots, these banks should've struggled along on their own (just like the rest of us); note that some of this corporate welfare went to pay the usual bonuses to the banksters and their employees.

      Weak.

      "It is essential that there should be organization of Labor. Capital organizes & therefore Labor must organize" Theodore Roosevelt

      by Superpole on Wed Dec 25, 2013 at 01:13:17 PM PST

      [ Parent ]

      •  Except that if the banks collapsed, (1+ / 0-)
        Recommended by:
        Justanothernyer

        the whole economy would have collapsed.  Momma's not happy, nobody's happy, so you gotta keep Momma happy, or you suffer, even when Momma is wrong.

        •  NOPE, Thanks for Buying into Bankster (11+ / 0-)

          propaganda/BULLcrap.

          one of the problems with this crap notion is after the banksters got Billions of OUR money, they went ahead and paid themselves their obscene bonuses; just to prove what entitled, arrogant assholes they truly are.

          further, this federal propping up of the banks did ZERO in terms of assisting our economic recovery.

          the banksters did NOT loan money to businesses as they were supposed to as part of the deal.

          the banksters further raped us by foreclosing on millions of homeowners-- and asshole-Scrooge-like, throwing these people out of their homes.

          you and the banksters actually think this is positive outcome? this is better than had Citicorp been nationalized?

          Gimme a break please.

          "It is essential that there should be organization of Labor. Capital organizes & therefore Labor must organize" Theodore Roosevelt

          by Superpole on Thu Dec 26, 2013 at 02:55:19 AM PST

          [ Parent ]

          •  Yep it's better. (0+ / 0-)

            Full collapse would have been much, much worse.  We saw when just one major institution (Lehman, far from the biggest), failed.  The consequences of just one failure were disastrous for the economy.  Thankfully, we never saw what the economy would look like if there were 10 more Lehmans.

            •  You're STILL Buying into the Bullshit (1+ / 0-)
              Recommended by:
              S M Tenneshaw

              so if shitheel Lord Blankfiend of Goldman Sucks and the rest of them make a bunch of shitty, stupid investments and start whining about totally closing their doors and the sky will fall--  you're DUMB enough to believe them??

              Hah hah hah hah hahhhh!!!!

              weak.

              "It is essential that there should be organization of Labor. Capital organizes & therefore Labor must organize" Theodore Roosevelt

              by Superpole on Thu Dec 26, 2013 at 03:21:54 PM PST

              [ Parent ]

            •  Whadda crock. (0+ / 0-)

              These banks could have been shut down and re-orged over a weekend with no real economic harm.  They do NOTHING that benefits us, and everybody goddamn well knows it.

              When they own the information, they can bend it all they want. -- John Mayer

              by S M Tenneshaw on Thu Dec 26, 2013 at 05:17:15 PM PST

              [ Parent ]

    •  That goes without saying (5+ / 0-)

      Of course we need to have a crime to prosecute a criminal.

      There were plenty of victims of fraud, starting with the financial institutions on the losing end of the deals (Lehman, AIG, etc.), some of those conned into ARMs that they couldn't afford (and let's not blame the victims here -- there was a systematic effort to pump these crap mortgages, and when you offer financially unsophisticated people the opportunity to "own" a nice home... well, that's the hallmark of a con game; make the mark think they're getting something), and -- finally -- the American taxpayers who funded the bailout.  I know, I know -- supposedly it's been paid back, but the math really does not hold up there if you really look at it.  

      As there is no dearth of victims, so is there no shortage of suspected perpetrators.  The fact that no effort has gone into investigating or prosecuting this -- the greatest crime in, possibly, the history of the world -- speaks volumes about the travesty that has become of the justice system in this country.

      They tell me I'm pretty amusing from time to time working with 140 characters or less.

      by CharlieHipHop on Wed Dec 25, 2013 at 06:44:49 PM PST

      [ Parent ]

    •  Here's an answer and critique of the diary (7+ / 0-)

      This is a good question:

      Who specifically, as in name him/her, should be prosecuted for violating which specific provision of the United States Code, by doing what particular act.

      For example, if you say "fraud," answer me who specifically was defrauded, by what false statement in particular.

      I'm "not one of those people" who wonders why no one was prosecuted, although I think it is/was slightly possible to prosecute.

      The precise answer to your question is: An investment bank, its lawyers, and accountants that organized a mortgage backed security trust and issued mortgage backed securities pursuant to a prospectus, registration statement and exhibits, that claimed that said MBS was safe and triple A rated, but that defaulted could possibly be prosecuted for securities fraud under the Securities Act (title 15 of the US Code) for knowingly making a false or misleading statement in the prospectus about the safety of the investment.

      (The way the Securities Act works is this: anyone who issues or sells securities must do so with a prospectus and registration statement, a report that truthfully explains the risks and other aspects of the security, and informs the buyer with facts that help him decide whether to buy; and the issuer or investment bank and lawyers and accountants must sign the prospectus and registration statement; and if they knowingly lie in the prospectus and registration statement to induce the buyer to buy, that's basically securities fraud.)

      In other words, the defendants would be the people who signed the registration statement. The persons defrauded would have been anyone or entity that purchased that security on the basis of statements in the prospectus and registration statement and lost money on that investment -- most likely banks, insurance companies, pension funds and the like.

      That said, I don't think most people have any idea how hard that case would be to make. Just because a security defaulted doesn't mean that the issuer and bank knew it would default. I think the biggest mistake people make trying to understand this problem is thinking that "they" knew the securities were junk. They most likely didn't.

      That's the biggest whole in the diarist's and judge's argument. The diarist says:

      How this circumstance could arise at all without someone--well, lying along the way would appear to be a rhetorical question which Rakoff raises but lets the reader follow through to its conclusion.  

      based on the judge's biggest unproven assumption:

      The first--the difficulty of proving intent (an essential element to prove fraud), he finds weak.  Judge Rakoff believes that given the scale of the abuse the Justice Department would be capable of eliciting enough evidence to prove conscious disregard, or "willful blindness" on the part of corporate CEO's and officers whose companies engaged in these transactions.  
      By contrast, I think proving intent will be almost impossible. Here's why. Here's what the investigation and prosecution would have to look like, and it's an uphill, almost impossible battle.

      First the SEC and DOJ need to find a MBS security that defaulted that was rated AAA. Most MBS became worthless in 2008 not because they defaulted, but because there was a panic and no institution would buy MBS because it was impossible to know which ones would default. That's what caused the collapse and depression -- not that most or even very many MBS actually defaulted. As former Treasury Secretary O'Neill put it as the crisis was happening, if you went into a store that sold bottled water, and they had 1000 bottles of water and the store owner said they are all safe except for 5 which have lethal doses of cyanide, would you buy a bottle of water? Obviously not.

      I'm not sure how many MBS actually defaulted. Iirc, it was at one time in the 10% range. So the investment banks were issuing between $300 billion and $500 billion in MBS in the years before 2008, so you're looking at maybe $30 to $50 billion worth of defaulted MBS to find one that was rated AAA and described as being safe in the prospectus.

      So now you need a group of lawyers to read through the prospectuses, registration statements and exhibits looking for overly optimistic, inaccurate or false statements. That's about 10,000 to 30,000 pages of documents for each issue of MBS.

      The problem is that prospectuses and registration statements were written very carefully. They are full of language stating that despite their predictions that the security are safe, unexpected events could make them default. The likelihood that there was a sloppily written prospectus is almost nil.

      Next problem is all the "due diligence" and study work that went into deciding whether the security was safe. They hired mathematicians and statisticians to look at housing and mortgage data going back several decades. From that data they could make assumptions about what percentage of mortgages go into default and foreclosure and predict how many in the current MBS being issued would default. It is certainly the case that that historical data was not a good predictor of the non-historical, extreme and unusual level of foreclosures in 2007 and afterwards. But the prospectus doesn't need only to be wrong for anyone to have committed fraud; the people who wrote it would have to have known the data would not apply to future events, in order for them to actually have been lying rather than merely wrong.

      Moreover, MBS had all sorts of protections built in, just in case there were exceptional levels of foreclosures.

      This statement by the diarist, for example, is wrong -- in fact exactly wrong:

      What he does is distill the crisis to its basic elements--that subprime mortgages of questionable creditworthiness were being packaged and sold as collateral for highly leveraged securities nonetheless rated as AAA, "low-risk." How this circumstance could arise at all without someone--well, lying...
      The securities were not highly leveraged.  They were the opposite of leveraged. They were over collateralized.

      For example, let's say that the historical data says that 10% of sub prime mortgages would default and go into foreclosure. Then when the MBS trust was set up, the investment bank would put in $100 million of mortgages to issue only $90 million in MBS. So now, the historical amount of mortgages can default without affecting the needed collateral or payout to the MBS holders. This is an important point: the default of the underlying mortgages does not necessarily cause the default of the MBS because of all these protections. Moreover, of the $100 million in MBS maybe only $50 million are even attempted to be rated AAA -- and they are paid first. So now $50 million in mortgages have to default to begin affecting the triple AAA MBS -- that is, for the prospectus to be wrong (let alone fraudulent). They have PhD level mathematicians backing them up. So again, the prospectus may have turned out to be wrong; but that doesn't mean that they knew they were going to be wrong. In fact they can always say, these incredibly brilliant mathematicians said we were right. That means it's almost impossible to prove intent -- rather than simply having gotten the math wrong.

      Another problem is the way people are throwing the word fraud around and confusing fraudulent mortgages with fraud in the issuance of mortgage backed securities. There was lots of fraud in making mortgages -- the so called liars mortgages, no credit checks etc. -- but that did not directly lead to the crisis. The crisis was caused by the default of mortgage backed securities, not by the default of underlying fraudulent mortgages. Some percentage of underlying mortgages were expected to default, and models were developed to attempt to predict how pools of even the most subprime and sketchy mortgages would perform, and the MBS were "engineered" accordingly.

      The next protection was "credit enhancement." In addition to over collateralization the issuer often bought a guarantee. So if Bear Stearns was organizing this trust, they went to Lehman Brothers and said if all else goes wrong and there are super-anti-historical levels of mortgage defaults, will you just pay up cash, like insurance to make sure the MBS doesn't default. Given that everyone was using the same math, Lehman would feel confident in issuing a guarantee for a reasonable price.

      Now here's the problem that few people want to face -- people who think that if things screwed up really badly, someone had to have been lying.

      People don't want to look at the problem of systemic risk (risk created by the whole system), which was a huge part of the crisis in 2008. The financial system was too convoluted and dependent on itself. So Lehman issues a guarantee of the MBS; but Lehman's assets consisted significantly of MBS issued by other banks. But all MBS is becoming worthless because of the panic. But that means Lehman creditworthiness is shot, which means it's guarantee is now worthless, which means that the MBS it guaranteed is no longer is guaranteed, which means the MBS organized by Bear Stearns is worthless, which means another bank that is holding MBS as assets has lost its creditworthiness, which means all it's guarantees are worthless .... and on and on and on. It was like a chain reaction, a meltdown of world historical size and intensity, in which no one had control rods -- except eventually, the Fed, the Treasury, the FDIC, TARP and Congress. That's what "too big to fail" really meant -- not that the bankers were to rich or powerful, but that by being issuers, guarantors and owners of all these securities, the collapse of one could bring down the entire global financial system. That actually happened when Lehman collapsed and for days, it seemed that Citibank, Chase, Goldman Sachs -- all of them were about to collapse at once.

      So let's say DOJ and SEC read several hundred thousand pages of prospectuses and find one (1) that was highly rated, (2) that nevertheless defaulted, (3) that was issued with a prospectus that claimed the MBS was safe and that didn't have cautionary language, (4) that was signed by an entity that is still in business and has assets to make the litigation worthwhile, and (5) that used mathematical modeling that the organizers knew was faulty, ie where there was fraudulent intent, among many other requirements.

      Now they prosecute and get ready to go to trial.

      And everything falls apart. Why? Because the defendants have the right to a jury trial. A jury is called and the lawyers for both sides begin trying to explain to ordinary people -- retired bus driver, housewife/husband, elementary school teacher, etc. -- whether or not a PhD level mathematical model was wrong and known to be wrong.

      The jury's eyes will glaze over and it's all going to come down to competing story telling about whether the banks were good guys or bad guys.

      There's no way a typical jury is going to get to the bottom of the actual issues of whether fraud was committed.

      After all that it's going to come down to a coin toss, basically.

      I'm not saying that it shouldn't be done. But I do understand why it has taken a very long time and why the outcome is not likely to be favorable to the prosecution.

      •  I'd be happier with the coin toss (5+ / 0-)

        I've been involved with even simple cases that might be too hard for the jury to fully grasp. Seems like just lame reason #42 we have no prosecutions.

        There's no way a typical jury is going to get to the bottom of the actual issues of whether fraud was committed.
        How about some faith in our citizens? Try me for instance.
      •  This comment is the only comment one needs to (1+ / 0-)
        Recommended by:
        HamdenRice

        read in this diary to understand how complex the topic is and why the past attempt to convict Wall St (Bear Stearns) bankers by the DOJ was an utter failure.

        "The way to see by faith is to shut the eye of reason." - Thomas Paine

        by shrike on Thu Dec 26, 2013 at 06:56:54 AM PST

        [ Parent ]

      •  An excellent comment (0+ / 0-)

        Except that, in the unlikely event you find your single prospectus without cautionary language, you will get nowhere near a CEO, who will not have been involved in the particular deal at issue.

        So even in that case, the person you prosecute will be some  midlevel banker like Fabrice Tourre.

        •  to be fair ... (0+ / 0-)

          if we are talking about real securities fraud, heads generally do roll, even at that highest level. This is the sort of thing that brought down Enron.

          Not only do top CEO level executives have to sign registration statements; so do their high powered corporate law firms and accounting firms -- and each partner has unlimited liability.

          That's why successfully prosecuted securities fraud cases bring down not only corporate executives, but some of the biggest, richest, and most powerful support (law, accounting) firms in the world with them.

    •  Usual Wall Street criminal enablers (2+ / 0-)
      Recommended by:
      shaharazade, run around

      Posting commentary and/ or up rating bullshit comments like this.

      Speaks volumes to their character and morality or should I say highly suspect character and morals.

      There are plenty if things...
      http://www.dailykos.com/...

      For starters.

      Lastly you mean to freakin tell me that a federal judge who wrote this article who leads to the same conclusion anyone who has an IQ over 2 digits knows as well carries less weight than some anonymous Wall Street bankster types and enablers posting here demanding this shit in every thread that speaks of the criminal bankster class.

      Stop insulting us all here. Just stop...it's disgusting that you and your enablers continue to defend the indefensible criminals.

      Government of, for, and by the wealthy corporate political ruling class elites. Elizabeth Warren Progressive Wing of political spectrum.

      by emal on Thu Dec 26, 2013 at 07:20:29 AM PST

      [ Parent ]

  •  Had It Not Been For The Loosening Of Standards (8+ / 0-)

    I would have never gotten a mortgage. But I did. I held out and held out and paid a higher downpayment but eventually got a fixed rate mortgage. Had I not been able to get that mortgage, I would not have been able to live in the neighborhood I grew up in -- the rents would be far higher than what I pay now.

    So, I benefited.

    The creatures outside looked from pig to man, and from man to pig, and from pig to man again; but already it was impossible to say which was which.

    by The Lone Apple on Wed Dec 25, 2013 at 09:08:51 AM PST

    •  Interesting perspective.... (8+ / 0-)

      Can I presume that your acumen allowed you to get a fairly good value, and if it was a fixed rate it probably allowed refinancing without exorbitant fees that would have locked you in to a high interest rate.

      It was not the original idea that was the disaster, but the expansion beyond all reason.  The nucleus began under Carter, but the affordability of homes was reasonable, since the average all enclusive monthly expense was payable to a majority of workers.  That started to diminish in the early 2000s, and by the time the bubble burst, most of the mortgages we are decrying (not yours apparently) were not sustainable.  It was as if the U.S. Government were subsidizing investments in AOL at the peak in 1999, under the rubric of every American should be part of the investment community.  

      So, the one defense against the "banksters" is that many followed the national laws and regs of agencies.  It was these that became corrupted.  But if the banks were subject to civil penalties, then the top individuals should be subject to criminal prosecutions.

  •  Edward Snowden of the economy? Great diary!!! (27+ / 0-)

    Unlike the security state which hides its crimes under the banner of national security, the crimes of the banksters are visible.

    Their criminal behavior is why the government attacked OWS as a terrorist effort.

    This diary is the reason that I hang around dailykos. This is the kind of reasoning which holds both parties culpable in the decline of the nation and the environment.

    What a Xmas gift is this diary!

  •  The SEC and Regulators (20+ / 0-)

    Any real investigation would discover that the SEC and Regulators were so connected to the financial system, including the government revolving door, that it would be impossible to separate them.  Both deserve prosecution.
    Breaking up the system into smaller regulated parts with clear, not corrupt, oversight would be the answer.  Taking fines that give freedom from prosecution, do nothing for those scammed and go back into the government general fund is not a solution.  Our economy would improve if we could redesign our financial system, our health care system and our military/private "security" system.  All of them are a financial burden on the US.  None of them produce jobs and economic improvement for the US.  Returning the US to the people is impossible with the right-wing victories of the past
    13 years.  It would take a sea-change in ethics and morality.

  •  And the Buck stops where? (31+ / 0-)

    How do those on this website, one that is dedicated to advancing the Democratic party, and where uttering a a "Right wing talking point" is a potential cause for banishment, define the responsibility for what is prosecutorial negligence.  Who is it that Eric Holder reports to, anyway?

    Do we blame it on the fates, on the way things must be.  The lack of criminal prosecution, even if it does not result in a conviction, sends a message to those who in the future will mastermind a monumental fraud such as the sub-prime mortgage enterprise that if it is vast enough, they will never have to pay any personal price.

    It is the CEOs who set the tone, who promoted and fired subordinates who did not meet standards of production of such family destroying policies.  And this is still going on full speed in banks, specifically Wells Fargo as a front page article in the LA Times showed a few days ago.

    Democrats are even more culpable for this legal malpractice, since we are defined as the party of the people, not of corporate power.  So when excusing the most culpable "malefactors of great wealth" happens on our watch, it is actually more of a betrayal than when it happens under the other party.

  •  You can't very well bail out the tbtf (11+ / 0-)

    banks and then prosecute their leaders.  When we did the bail out, we became and are complicit with the tbtf banks.

    "So listen, oh, Don't wait." Vampire Weekend.

    by Publius2008 on Wed Dec 25, 2013 at 09:47:50 AM PST

  •  The economic crisis is far from over, (18+ / 0-)

    the can kicking phase, however, may well be running out of road.  When curtain rises on act 2 we'll have another chance for the frog march parade.  We can only hope that this doesn't happen under the current administration.  The Obama team is honest by the Wall Street definition of the term - Once bought they stayed bought.

    Rivers are horses and kayaks are their saddles

    by River Rover on Wed Dec 25, 2013 at 09:47:51 AM PST

    •  The can kicking phase (12+ / 0-)

      is almost done.
         We already have one of the longest economic expansions in this country's history, combined with one of the strongest stock market booms.
         Just using basic logic you can see that both of these trends are closer to the end than to the beginning.

        things were never allowed to reset after the 2008 crash. So like Japan in the 90's, we are carrying the dead-weight with us.

      None are so hopelessly enslaved, as those who falsely believe they are free. The truth has been kept from the depth of their minds by masters who rule them with lies. -Johann von Goethe

      by gjohnsit on Wed Dec 25, 2013 at 10:20:05 AM PST

      [ Parent ]

    •  Yes, the illusion of solvecy that we've been (3+ / 0-)

      forced to foot the bill for these last 5 years, is wearing very thin as the 24/7 happy talk melts into background noise.

      The problem with the Wall Street parasites and their employees is that they are just too fucking stupid to see where they go wrong
      . Any good gangster could tell them that the secret to keeping the suckers paying is to spread it around.

      When everybody's happy, nobody questions how they got that way. If you steal a thousand dollars, spend a couple of hundred making sure everybody involved has a stake in keeping their mouths shut.

      "Those who can make you believe absurdities can make you commit atrocities." - Voltaire

      by Greyhound on Wed Dec 25, 2013 at 12:46:02 PM PST

      [ Parent ]

      •  Gangsters don't have the benefit of operating (4+ / 0-)

        under color of law. Greed only becomes truly dangerous when it has no expectation of consequences. If the government has your back you don't have to even pretend to care about any one but yourself.  Gangsters need some social conscience to survive - Banksters don't.

        Rivers are horses and kayaks are their saddles

        by River Rover on Wed Dec 25, 2013 at 02:27:04 PM PST

        [ Parent ]

  •  If there was equal justice under the law, (4+ / 0-)

    Bernie Madoff would have gotten a bailout.

    “Society is like a stew. If you don’t keep it stirred up, you get a lot of scum on top,” Edward Abbey

    by Wood Gas on Wed Dec 25, 2013 at 09:49:24 AM PST

  •  Cui bono? (12+ / 0-)

    All you need to know is who got rich during and in the aftermath of the "crisis".

    And who got (and is getting) screwed.

    Really . . .

    Fake Left, Drive Right . . . not my idea of a Democrat . . .

    by Deward Hastings on Wed Dec 25, 2013 at 09:51:52 AM PST

    •  I tend to subscribe to your theory (9+ / 0-)

      Cui bono, indeed.

      People have such short memories.

      In 2008, Hank Paulson presented the U.S. House of Representatives with a two page ransom note - "Give me the authority to fix this problem with no oversight and no top end on the budget to fix it."

      I screamed bloody murder to my congressional delegation.  Many, many Americans did the same thing.

      At the end of the day, and even though the enabling legislation ended up being more than two pages, Paulson got what he wanted.

      As did Larry Summers.

      As did Ben Bernanke.

      As did Tim Geithner.

      As did Ed Liddy.

      As did Jamie Dimon.

      As did...well, you get the general idea.

      It will not get easier before it gets harder. But the harder it gets, the easier it will be.

      by Richard Cranium on Wed Dec 25, 2013 at 03:41:27 PM PST

      [ Parent ]

      •  The initial "No" was the House of Representatives' (1+ / 0-)
        Recommended by:
        cotterperson

        … finest hour in recent years.

        It was the first and last time the House said, "No accountability, no dice" in a long, long while.

        The Dutch kids' chorus Kinderen voor Kinderen wishes all the world's children freedom from hunger, ignorance, and war. ♥ ♥ ♥ Forget Neo — The One is Minori Urakawa

        by lotlizard on Wed Dec 25, 2013 at 10:01:24 PM PST

        [ Parent ]

        •  knowing (0+ / 0-)

          what I know of 'the house' even that first 'no' was a stage act.  

          "History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling the money and its issuance." -James Madison

          by FreeTradeIsYourEpitaph on Thu Dec 26, 2013 at 05:28:37 PM PST

          [ Parent ]

  •  if I could I would (19+ / 0-)

    recommend your diary 1000 fold.

    For bringing to our attention the analysis of this judge.

    when 70 (count ‘em) trillion dollars of casino bets (CDS) are “allowed” to be made against a fraction of the debt outstanding whose default is being insured by the CDS that is destabilizing to a world whose GDP is less than $70 trillion.

    It was a game in which NO One took responsibility for the systemic risk.

    Some knew and tried to warn but the players and the regulators would not listen.

    The banks cannot be trusted to take responsibility for massive systemic risk by avoiding casino style bets.

    Finally people have gotten sick and tired of being had and taken for idiots. Mikhail Gorbachev

    by eve on Wed Dec 25, 2013 at 09:57:44 AM PST

  •  It's even worse than that (35+ / 0-)
     If we fail to hold those responsible to account there will be no expectation of any accounting in the future, and the process will certainly repeat itself as more as more opportunities arise to "package" and transfer vast sums of wealth for the benefit of a tiny, detached and untouchable group of people.
    Not only will it lead to a certain repeat, but it will lead to an even larger repeat. After all, if you get away with a crime the first time, why not do it even larger the second time?

      On top of the moral hazard, we have yet another problem: the system of bailouts has already been pushed to the edge.
      The underlying real economy is nearly broke. We can't afford to do another round of bailouts.
      Thus when the the TBTF financial institutions lose their gambling bets again, they will run to the Uncle Sam for another round of bailouts. But those bailouts can't happen without destroying what is left of our economy in the process.

    None are so hopelessly enslaved, as those who falsely believe they are free. The truth has been kept from the depth of their minds by masters who rule them with lies. -Johann von Goethe

    by gjohnsit on Wed Dec 25, 2013 at 10:10:30 AM PST

  •  Our Government Owns This (11+ / 0-)

    That is why, unless there is a fundamental change in governance, nothing will be done.

    I cannot expect the Obama DOJ or Treasury to give a flying f*** about actual justice and mitigating a continuing criminal enterprise.

    •  I'll Say It! (12+ / 0-)

      Let's stop kidding ourselves, folks.  The lack of prosecution of all those despicable robber barons MUST BE laid directly at the feet of President Obama and AG Holder.  That is because they, and only they, have the sole legal authority (and singular responsibility) to prosecute these colossally felonious miscreants.

      Furthermore, do you know how many laws on the books that were broken by so many CEO's during this international scam of monstrous proportions?  There surely were more that a hundred.

      Do you remember the federal government's prosecution of ENRON (by the G. W. Bush Justice Department no less)?  Even then, there were more than ample laws on the books to prosecute those particular thieves.  Yet, following the breaking of the ENRON scandal, Congress quickly enacted criminal legislation that at least tripled the number of laws on the books which definitely apply to the current situation.

      Just one of those new felony laws required CEO's not to issue any public statements (or sign any quarterly financial reports), which were knowingly false.  Moreover, do you also remember how many CEO's (right up until the September 2008 market collapse) did just that, time and again on national television?  Well, each of those violations were felonies (and there were many during the prior two years).  Also, those felonies were also punishable with huge fines as well as full "claw back" of all ill gotten gains (and were talking about $trillions, folks).

      What's more, multiple prosecutions based upon hard felonies against the rating agencies would be a "slam dunk" under the very same laws.

      Also, more than anything else, the provisions of the RICO statutes were made for situations exactly like this one.

      It's funny in a way.  The AG's office must have its hands full destroying and/or burying evidence; and make no mistake about it, this conduct amounts to tampering with evidence and obstruction of justice (both of which are likewise hard felonies).  

      Hey, have you noticed that the Republicans have never seriously called for the prosecution of these Wall Street robber barons?  What's up with that?

      Additionally, it appears that President Obama really likes bankers.  Look how many he has surrounded himself with after taking his oath of office way back when.

      Of course, they also love him; and they showed it by giving him huge political contributions which greatly exceeded the amount they gave McCain. Do you understand the meaning of "quid pro quo?"

      Gosh, a very long time ago, you should have gotten the unmistakable sense that the American public is being, and has been, hoodwinked big time.

      Beyond that, just think about all the Republican policies, i.e. ACA, that the President helped to enact.  Actually, he's help enact more Republican policies than George W. Bush ever did.  Accordingly, many have described Obama as "Bush on steroids."  Just think about the Patriot Act, NSA, and drones.

      Then there was the laughable "Sequester."  What a massive political scam that was. (Oh, gee, I never thought the Republicans would do it.

      Ha...ha...ha...tehee.      :-(

      Folks, it's long since time to ignore the Kabuki theater and "follow the money."

      There, I've said it.

  •  Fraudulently AAA-Rated "Shitbag CDOs", "Subprime (26+ / 0-)

    Meltdown", "Nuuclear Holocaust", "Shitty Product", "Mike Tyson's Punchout" (described in internal e-mails of Wall Street thieves = prima facie criminal case and irrefutable proof beyond any doubt.) were sold as AAA-rated investment-grade treasure -- the Wall Street thieves knowingly defrauded everyone they could to unload to unsuspecting suckers their worthless trash that were sliced and diced, bundled, fraudulently AAA-rated, subprime mortgage-backed collaterallized debt obligations concocted by John Paulson of Abacus hedge fund and Lloyd Blankfein of Goldman-Sachs.  The AAA rating was crucial to the megafraud.

    Obama sad NO Crimes were committed so he refused to look back and criminally prosecute his thieving Wall Street buddies who he idiotically calls "Savvy Businessmen".  He had Holder, Lanny Breuer, and serial tax cheat Timothy Geithner repeat the idiocy publicly explaining why NO Criminal charges would be pursued against his thieving Wall Street "Savvy Businessmen" buddies.

    The PBS Frontline documentary "The Untouchables" exposed Obama's dishonest idiocy for what it was and  caused Lanny Breuer to resign from the Dept. of Justice 2 days after its airing.  Holder should have followed him out the door.

    Wall Street thieves foreclosed on homes where they had no standing because they had sliced and diced the subprime mortgages, bundled them, and sold them to suckers.  Wall Street thieves contracted with DocX of Alpharetta, Georgia to falsify and forge mortgage documents which were perjuriously introduced into evidence in furtherance of foreclosure fraud perpetrated on the "courts" by the Wall Street thieves with total impunity.  Bank attorney perjury was instrumental in this foreclosure fraud.

    RICO should be invoked for the seizure of Wall Street's ill-gotten gains.  NY Atty. Gen. Eric Schneiderman could easily indict Wall Street thieves under the Martin Act, imprison them pre-trial in Riker's Island as flight risks, and have them sent to Attica or SingSing for life to do "GOD's Work", but he is no where to be found.  His political career needs to end because of it.  

  •  Well, I've been saying for a long time that it (18+ / 0-)

    wasn't a happenstance. But, some people prefer to believe in incompetence rather than intentional malfeasance on the part of people elected and paid to work for them.
    The whole notion that recessions are part of a normal cycle is bogus.

    Obamacare at your fingertips: 1-800-318-2596; TTY: 1-855-889-4325

    by hannah on Wed Dec 25, 2013 at 10:53:48 AM PST

  •  Excellent piece of writing here, thank you. n/t (3+ / 0-)
    Recommended by:
    Dartagnan, blueoasis, Creosote

    "Too often we enjoy the comfort of opinion without the discomfort of thought." - John F. Kennedy -7.2, -7.9

    by helpImdrowning on Wed Dec 25, 2013 at 11:06:21 AM PST

  •  I just watched the documentary "Hank" on Netflix (9+ / 0-)

    It's a biographical account by Secretary of Treasure Hank Paulson about the financial debacle.

    http://www.bloomberg.com/...

    It's clear to me that it all got started by the repeal of Glass-Steagall.  From then on unregulated banks became increasingly fraudulent by selling securitized sub-prime mortgage packages that were not as secure as they represented.  

    The repeal of Glass-Steagall was voted by a Congress heavily influenced by the banking CEOs.  Money in politics is at the bottom of this disease.  Certainly Congress and POTUS were voted in but the driving force was the financial industry.

    Banks were able to become to-big-to-fail as Paulson states in the film.  Blame the repeal of Glass-Steagal for this too.

    Paulson was CEO of Goldman Sachs before he was appointed in 2006.  The real estate bubble was ready to burst.  And yet he claims ignorance about the dynamics that caused it; securitization of sub-prime mortgage loans.  This is where he looses me.

    Everybody in the front lines of real estate knew what was going on.  My Kennedy shoe shine moment came in 2004 when I met a hair stylist who was buying his 4th house in Palm Springs even though I earned twice as much as he did.

    The corruption of the mortgage financial system was there for all top see.

    Certainly all the large bank and investment bank CEOs and even AIG knew they were fraudulently making billions by selling these securitizized mortgage packages in the US and around the world by lying about their nature and supported by the global reputation of the US financial system.

    Paulson may have saved the day, but it is clear, and he does say it in the film,  that nothing has changed and we face another debacle soon.

    The corruption of Fannie Mae and Freddy Mac CEOs is clear too.  They got fired non too soon.  But I do believe that putting one or more of these corrupt CEOs would go a long way to prevent the next bubble and the next financial debacle.

    Daily Kos an oasis of truth. Truth that leads to action.

    by Shockwave on Wed Dec 25, 2013 at 12:00:12 PM PST

  •  the government is clearly responsible now (2+ / 0-)
    Recommended by:
    waterstreet2013, Dartagnan

    regardless of whether a prosecutor could pin something on the government in the past. To me that seems a bit of a stretch. Clearly the government was not writing explicit policy that allowed for fraud - that was the invention of the perpetrators. It's all very distressing, to say the least.

  •  Wall Street CEOs ARE being Prosecuted (8+ / 0-)

    Former CEOs and other former senior executives of Fannie Mae and Freddie Mac are being procecuted by the SEC for fraud.

    From the SEC see SEC CHARGES FORMER FANNIE MAE AND FREDDIE MAC EXECUTIVES WITH SECURITIES FRAUD

    Washington, D.C., Dec. 16, 2011 — The Securities and Exchange Commission today charged six former top executives of the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) with securities fraud, alleging they knew and approved of misleading statements claiming the companies had minimal holdings of higher-risk mortgage loans, including subprime loans.
    Three former Fannie Mae executives — former Chief Executive Officer Daniel H. Mudd, former Chief Risk Officer Enrico Dallavecchia, and former Executive Vice President of Fannie Mae's Single Family Mortgage business, Thomas A. Lund — were named in the SEC's complaint filed in U.S. District Court for the Southern District of New York.

    The SEC also charged three former Freddie Mac executives — former Chairman of the Board and CEO Richard F. Syron, former Executive Vice President and Chief Business Officer Patricia L. Cook, and former Executive Vice President for the Single Family Guarantee business Donald J. Bisenius — in a separate complaint filed in the same court.

    In some reports and columns on the financial crisis written before the SEC charges were released in Dec 2011, put much less culpability on Fannie and Freddie than they were due.  Of note the Financial Crisis Inquiry Commission report was issued before the frauds of Fannie and Freddie came to light - which likely would have resulted in a very different report if these frauds were known.

    In 2008 Freddie represented they were exposed to only $6 billion of subprime debt when they were actually exposed to $250 billion.  In 2008 Fannie represented they were exposed to only $8 billion of subprime debt when they were actually exposed to $110 billion.

    Note that this $360 billion puts Fannie and Freddie at the core of the subprime mortgage crisis and they were the most important players in that market.

    The most important way to protect the environment is not to have more than one child.

    by nextstep on Wed Dec 25, 2013 at 12:04:32 PM PST

    •  JPMC ??? Citi? Countrywide? (8+ / 0-)

      AEG?

      Lehman Brothers? Thornburg? WaMu? CIT?

      Nobody jailed.

      Billions stolen by fraud. Nobody jailed.

    •  Fail (13+ / 0-)
      Note that this $360 billion puts Fannie and Freddie at the core of the subprime mortgage crisis and they were the most important players in that market.
      Both Fannie and Freddie were followers, not leaders.  They did not even begin to get into the subprime securitization markets in any serious way until well after every other major financial player (as in every bank and brokerage house) was deeply involved starting in the 1990's AND after there was pressure internally for them to increase their returns--because compared to others, their investments were deemed "too conservative" to support their primary mission (an increasing mission given the heated housing market): to ensure an ongoing guaranty market for residential mortgages.  While it is definitely true that basically privatizing these GSE's and putting them in the CEO hands of folks used to playing in the casino created by REITs and securitization trusts that were NOT with government made a bad situation worse, it is simply false to say that Fannie and Freddie were "the most important players in the market." They weren't.  They became the most important only because they ultimately guaranteed 90% of all residential mortgages issued by private entities in the United States and those mortgages made by those private entities were collapsing like a stack of dominoes.

      Which is the irony of Fannie and Freddie folks facing jail, but not the underlying criminals that created the situation leading to Freddie and Fannie ultimately taking a bath.

      •  You are wrong on the facts. Wrong to defend fraud (0+ / 0-)

        by Fannie's and Freddie's former CEOs and senior executives . The SEC is right in their complaint.

        More than half of subprime debt went to Fannie, Freddie and other GSEs' financial obligations.  The market for subprime became as large as it did because of their massive buying of subprime mortgages and their collecting fees to guarantee subprime home mortgages (in fact a Credit Default Swap).

        Subprime was a far far smaller market before the entry of the GSEs into this market.

        In addition, their subprime buying gave greater legitimacy to subprime debt sold through other institutions where the GSEs were completely uninvolved.

        Why do you feel obligated to defend fraud by these CEOs and senior executives?  What do you know that the SEC does not?

        The most important way to protect the environment is not to have more than one child.

        by nextstep on Wed Dec 25, 2013 at 03:04:24 PM PST

        [ Parent ]

        •  I Am Not Defending Fraud (10+ / 0-)

          You really should read more carefully.  (And stop screaming by using bold--it doesn't make your argument stronger.) What I am saying is that your contention about where the fraud originated and was most concentrated is incorrect.

          The GSE's entered the subprime market only within their legally-limited role as guarantors.  They have no independent residential lending authority. Thus, blaming the guarantors for the underlying origination fraud is ludicrous.  What occurred was that due to pressures internally, the GSE's loosened their guaranty standards because they were increasingly unable to fulfill their primary mission--which is ensuring a market for residential mortgages through their guaranty.  

          Seriously, you should study this stuff.  I am defending absolutely positively no one.  OTOH, I'm not falling for the right wing lie that it was the GSE's that were the drivers of the primary frauds created in either the securitization market or the subsequent investment markets that led to the collapse, either.  You should stop falling for it, too.

          •  Fannie & Freddie had subprime mortgages on (0+ / 0-)

            their books, and that is why they issued billions in bonds to finance the mortgages.  Their activity was not limited to guaranteeing mortgages.  Fannie and Freddie had subprime mortgage exposure through both portfolios of mortgages and selling Credit Default Swaps (in the form of guaranteeing mortgages).

            You wrote:

            What I am saying is that your contention about where the fraud originated and was most concentrated is incorrect.
            The fraud in Fannie and Freddie originated in Fannie and Freddie.  Or were you thinking that I wrote that subprime fraud started in Fannie and Freddie?  Nowhere did I write anything even close to "the first instances of fraud in the subprime market happened in the GSEs."  I wrote about former GSE CEOs and executives being charged with fraud involving about $360 billion and how this is a significant instance of the Federal government going after individuals involved in the financial crisis.

            Having more than 1/2 of US subprime mortage debt in 2008 on the books of the GSEs inherrently concentrates the impact GSEs had on the subprime market.  

            I find your logic that the executives at Fannie and Freddie must be innocent, because some on the political right place much of the blame for the financial crisis on the GSEs as very weak reasoning.  If they are guilty, they are guilty, if they are innocent, they are innocent.  It does not matter what the other side claims.

            I personally place the biggest cause of the mortgage meltdown as the mortgage market dropping lending standards from 20% equity or 10% equity with PMI (Principle and Mortgage Insurance) to 3% equity or no equity.  The result both caused or exasperated the real estate bubble and maked the housing and mortgage markets fragile.  Throw in extremely low interest rates driven by the Fed, that would eventually rise, and it was just a matter of time before it blows up.

            Democrats should feel no obligation to defend these former CEOs and executives at Fannie and Freddie who were charged with fraud by Pres Obama's SEC in Dec 2011.  There is no upside in doing so, but there is a massive downside if the SEC prevails.

            The most important way to protect the environment is not to have more than one child.

            by nextstep on Wed Dec 25, 2013 at 04:38:14 PM PST

            [ Parent ]

            •  That goes back 40 years. (1+ / 0-)
              Recommended by:
              shanikka
              I personally place the biggest cause of the mortgage meltdown as the mortgage market dropping lending standards from 20% equity or 10% equity with PMI (Principle and Mortgage Insurance) to 3% equity or no equity.
              Down payments over 5% are very rare for first time homebuyers and have been since the 70's. [PMI generally denotes Private Mortgage Insurance, not what you noted].

              The mortgage meltdown initiated in the mid to upper mid strata of home buying, not owner occupied or first timers, but speculative buying for rehab/reselling and renting. The second wave came when jobs disappeared because of the financial meltdown of the speculation and then regular vanilla loans were affected by the contraction of the economy and loss of regular income......and it snowballed from there and is still rolling down hill.

              Historically, low interest rates mean inflation in prices, while high interest rates usually result in reduced prices. Low interest rates also lead to idle money seeking ever more risky instruments with which to gain larger passive income, and the cycle continues.

              •  Countries, such as Canada that required more (0+ / 0-)

                home equity did not have mortgage meltdowns.  The. Residential real estate fall and damaged mortgage markets were largely in countries that required little or no owner equity.

                The shift to lower lending standards in the US took place over several decades, the decades of consistent rising prices with only tiny declines in prices nationally, as lower lending standards helped feed more money into residential real estate.

                Real estate markets that require little equity are more unstable than those that require more realistic equity levels -such as 20%.  Having small owner equity does not show itself to be a problem when home prices are rising.  It becomes a huge problem when prices decline more than equity.

                The US also made the market more fragile with tax law changes that encouraged people to borrow against home equity.  Doing this reduced accumulation of home equity from paying down principle and price appreciation.

                When the real estate market crashed, lending standards degraded so severely, that ordinary terms included zero equity, interest only payments, less than interest only payments, no proof of income or assets required, etc..  While at the same time interest rates were far below normal.

                Having gone to such low standards for mortgage lending, while mortgage lending rates were also very low, the real estate and mortgage meltdown was going to happen even if all the players were saints (there were few if any saints in reality).  The failure of regulators was letting lending terms become absurdly unable to handle a downturn.  Regulators and legislators clearly knew of these absurd terms, as they were frequently promoted, even on TV.  The better bankers and financial institutions reduced or withdrew from these markets.

                From what I see from the rate of SEC and DOJ prosecutions, durning and after the financial crisis, the rate declined from levels we normally saw during ordinary markets.  Even if the rate and level of Financial corruption was constant, one would expect more criminal prosecutions after a crisis, as more borderline situations blow-up revealing corruption more frequently - but we did not see Pres Obama's SEC and DOJ react as many would expect.

                The most important way to protect the environment is not to have more than one child.

                by nextstep on Thu Dec 26, 2013 at 05:49:24 PM PST

                [ Parent ]

        •  Jamie Dimon publicly admitted to a felony. (1+ / 0-)
          Recommended by:
          Wolf10

          One that carries a 20-year sentence. Yet he has not been and will not be prosecuted. Because letting powerful wrongdoers off the hook is just how Obama rolls.

          http://www.salon.com/...

          Fannie and Freddie are a sideshow.

    •  That's what Rush Limbaugh and the wingnuts say. (4+ / 0-)

      Blame Fannie and Freddie.

      People who have studied the issue know, however, that it's bullshit.

      The reason Fannie and Freddie execs were targeted, instead of execs at Wall Street firms, is simply that neither Fannie nor Freddie will be helping make Obama the first billionaire ex-president.

      When choosing scapegoats, it's always a good idea to pick ones who cannot benefit you later.

    •  Chump change in the mortgage market...there was (2+ / 0-)
      Recommended by:
      expatjourno, WheninRome

      11 trillion dollars in mortgages at the time and at least 20% of them had a problem.  Freddie and Fannie buy the loans after the fraud has been perpetrated unless I do not understand how they operate.  

    •  The point is however.... (0+ / 0-)

      ...that the part Fannie/Freddie played in the creation of the Great Recession, although major, was still secondary.

      "From the fall of 2007 until Fannie Mae and Freddie Mac were placed into conservatorship, government officials struggled to strike the right balance between the safety and soundness of the two government-sponsored enterprises and their mission to support the mortgage market. The task was critical because the mortgage market was quickly weakening— the values of mortgage securities were plummeting. "
      But many in Treasury believed the country needed the GSEs to provide liquidity to the mortgage market by purchasing and guaranteeing loans and securities at a time when no one else would. Paulson told the FCIC that after the housing market dried up in the summer of 2007 the key to getting through the crisis was to limit the decline in housing, prevent foreclosures, and ensure continued mortgage funding, all of which required the GSEs to remain viable."
      And as others have been saying here, it was under those conditions that the 2 GSEs brought onto their books such a large percentage of all the loans, and not simply because they were greedier or crooked-er than say, Countrywide and others.

      That said however, the CEOs and other execs at both did most certainly engage in shady book-keeping and other deceptive practices that in my opinion makes them deserving of everything that happens to them resulting from the charges brought against them by the DoJ.
      I do smell an odor arising from the fact that the government chose to charge  execs with whom they already have an established or professional relationship with, hence records giving them a more detailed picture of what went on during critical periods. Typical of Holder, he seems to be going after low-hanging fruit again while confirming to not only us, the public, but for the principle figures themselves who are most responsible for culture that spawned the Recession, that they are indeed "Masters of the Universe" who can get away with causing atrocious hardships and personal tragedies to untold numbers of people without repercussions.

  •  Obama leaving soon (6+ / 0-)

    The question is who will be elected in 2014 and 2016?  Our democracy is in bad shape especially thanks to Citizen's United.  Obama/Clinton are Third Way corporate Democrats.  No way are any of these going to rein in Wall Street until it crashes again running the same games.  All of Congress are either wealthy or supported by the wealthy.  People are toast unless somehow we retake the democratic process.
    Trying to default on the dollar is an example of the stupidity that is also a negative factor.  Same for pollution damage from fossil fuels and general pollution bought by the Koch Brothers and friends.

    •  Who is "trying to default on the dollar"? (3+ / 0-)
      Recommended by:
      emelyn, NewDealer, bepanda

      What in the hell are you talking about?

      The value of the dollar has steadily risen since March 2008.  

      "The way to see by faith is to shut the eye of reason." - Thomas Paine

      by shrike on Wed Dec 25, 2013 at 12:37:00 PM PST

      [ Parent ]

      •  Default (0+ / 0-)

        The Republicans call is defaulting on the debt.

      •  Value of the dollar (1+ / 0-)
        Recommended by:
        Creosote

        "The value of the dollar has steadily risen since March 2008" ????
        Don't know where you're getting your financial data from, but it's 180 degrees from everything I read. For example, read this chart sourced from the US Bureau of Labor Statistics, entitled "The Shrinking Value of the Dollar",
        http://www.infoplease.com/.... See especially the last two numbers on the chart, that shows the value of the US dollar has declined by another 7.8% since 2008. What's your data source?

        •  I use the common US Dollar Index - the DXY. (0+ / 0-)

          In March 2008 it was at 71 just before QE began.  The right-wing crazies I know predicted the USD would crash.

          Today it is 80.5.  

          In that time nearly every commodity price has fallen - oil, gas, wheat, corn, etc.

          "The way to see by faith is to shut the eye of reason." - Thomas Paine

          by shrike on Thu Dec 26, 2013 at 04:46:37 AM PST

          [ Parent ]

          •  Value of the dollar (0+ / 0-)

            The DXY you reference is strictly a measure of the value of the dollar vs. a basket of 6 foreign currencies (euro, yen , pound, Swedish krona, Canadian dollar and Swiss franc), and vey heavily weighted with the euro (over 50%). As such, it's primary value is with foreign exchange trading, as compared to the much broader dollar value measure that I cited.

  •  Who's watching the watchers? (8+ / 0-)

    The core dilemma of any system of justice.

    "Reagan's dead, and he was a lousy president" -- Keith Olbermann 4/22/09

    by kovie on Wed Dec 25, 2013 at 12:15:12 PM PST

  •  Because Wall Street CEOs Decide Who's Prosecuted (2+ / 0-)
    Recommended by:
    waterstreet2013, shaharazade

    Oh. You had other reasons. But doesn't it all boil down to this?

  •  "Look forward, not back." (8+ / 0-)

    We have to parse language like that more closely in the future.  It's code language for "I won't prosecute wrongdoers."

    Second separate comment coming.

  •  This is like torture and war crimes. (11+ / 0-)

    We've wondered why there were no prosecutions in this, and, in fact, a seemingly deliberate coverup and protection for those complicit in Bush era war crimes.  Was it a gesture of graciousness towards the previous administration, good manners, a way of not getting bogged down in the past so the Obama admin could push its own agenda?

    More likely, it was to avoid uncovering Democratic complicity.  Both parties had a stake in covering up and forgetting about the Bush era torture.

    Stephen Hayes (a right-winger, so be forwarned) wrote an opinion piece for, I think, the WSJ back in 2009 in which he argued that the Obama administration would be foolish to prosecute or investigate Bush era figures for war crimes like torture because there were too many Democrats, like (he named) Nancy Pelosi who were briefed on these programs and did and said nothing about it.  

    I was debating somebody about this on another forum back in 2009 and he brought up this article, and I blew it off as the usual Republican defensive horseshit.  Pelosi denied the allegations.  Senator Jay Rockefeller denied the allegations.

    But as time passed, it seemed to not be so far-fetched at all.  In fact, Pelosi and Rockefeller's denials struck a false chord with me, and I speak as somebody who was disheartened and felt let down by heroes.  There was a kind of desperation in their denials.  The body language was all wrong.  They were nervous, not outraged.

    And there were no prosecutions, as we know.  That part of Hayes' prediction came true, certainly, and the more time that passed, the more I came to think that Hayes nailed it.  Neither party would willingly prosecute any Americans for war crimes because there were too many skeletons buried in both parties by high-ranking figures.

    I still hope and (mostly) believe that a day of accounting really will come some day.  But it won't be until a number of Democrats who now hold office either retire or move on, making way for fresher faces with a greater interest in the truth.

    The same may be true of the financial crisis.  Too many dirty hands in the government by both parties for a full accounting is possible until the central people retire or die off.

  •  re-tread diary, no revelations (1+ / 0-)
    Recommended by:
    ItsaMathJoke

    no new info.

    If you can't say in a sentence at the TOP of the diary why it's worth reading, why write it?

    "Why No Wall Street CEOs Were Prosecuted" was the promise, please rather get there in a simple paragraph rather than not there at all.

    Seriously, enough.

  •  Because you don't prosecute noble kings and (7+ / 0-)

    princes.   and I'm beginning to think that is what they are becoming.    

    Why no prosecutions?   You wouldn't dare.

    Vaguely snark, but less vaguely truth.

    Nothing in the world is more dangerous than a sincere ignorance and conscientious stupidity. Martin Luther King, Jr.

    by maybeeso in michigan on Wed Dec 25, 2013 at 04:43:37 PM PST

  •  Oh yeah, blame the government (4+ / 0-)
    ``But who to prosecute when the CEO starts attributing his actions to the government?''

    Wow... where have I heard that before?  Oh yes, it was the government that forced the banks to make bad loans to poor people, especially poor people in black neighborhoods.  I had a relative who was on the board of a bank who claimed this very thing. Sure, the bad ol' government told you that you could no longer red line so therefore you must give loans to people who are unable to repay them.

    So, see? It was the government that caused the whole financial collapse. Just like ``It was my parents' fault for spoiling me and I didn't know it was wrong to plow my car into a group of innocent bystanders''.

    I cannot understand why these CEOs don't go to jail for Sarbanes-Oxley violations. Weren't these guys supposed to sign off on the financial doings of their companies to avoid the kind of denials we were forced to listen to after the Enron fiasco? Doesn't SarbOx have any teeth in it?

    •  A regulation's teeth are meaningless if its... (0+ / 0-)

      regulators are unwilling to bite. I think the accurate continuation of the analogy is that the DOJ and SEC like to bare their regulatory teeth at the financial jackals, request, again, that they promise not to carry off our children at night, then negotiate a settlement that leaves everyone whole.

      "The Democratic Party is not our friend: it is the only party we can negotiate with."

      by 2020adam on Fri Dec 27, 2013 at 07:34:54 AM PST

      [ Parent ]

  •  Outstanding analysis. The point can be generalized (13+ / 0-)

    The most obvious other case is torture and other war crimes, cases in which the guilty parties have openly admitted their commission of the crimes involved without facing repercussions.  In fact, war crimes are routinely committed out in the open, with the most obvious example being drone strikes, with no accountability.  This is how corruption looks, and it runs deep.  And the wide-spread effects described wrt the financial collapse are what one expects from corruption.

    Looking at international finance, we find a similar pattern, with US officials having been warned by a 20-year World Bank official that, unless corruption within the government is curbed, other countries will stop honoring the Bretton Woods gentlemen's agreement.

    source

    Karen Hudes is an attorney and economist who served 20 years in the World Bank’s legal department. The World Bank refused to provide the report of the Executive Search Firm to U.S. Congress following Hudes’ disclosure of internal control lapses during her interview for General Counsel of the World Bank. Karen Hudes describes the corruption in the international financial system and threat to democracy in the U.S. as follows:

    The failure of the press to report accounting scandals at the World Bank involving the U.S. Treasury Department, the Federal reserve, U.S. Congress, and the federal courts is eroding confidence in the dollar as international currency.
    snip

    Credibility in the U.S. Treasury Department was already at an ebb after fifteen years of unsuccessful efforts by the U.S. Congress and World Bank´s Audit Committee to obtain audits of the World Bank´s internal control over financial reporting in accordance with Generally Accepted Accounting Principles and Auditing Standards. A company with good internal controls has reliable financial reporting, timely feedback on achieving its goals, and it complies with laws and regulations.

    The World Bank continues to refuse to cooperate with an inquiry into corruption by the U.S. Government Accountability Office (GAO). The General Counsel of the UK´s Financial Reporting Council (FRC) denied the FRC had jurisdiction over KPMG´s violation of Generally Accepted Auditing Standards and Auditing Standard No. 5 of the Public Company Accounting Oversight Board (PCAOB).
    snip

    The powerful stakeholder analysis which predicted in 2004 that the U.S. would lose the Gentlemen’s Agreement for appointment of the World Bank president began to predict that the rule of law would prevail when the UK and European Parliaments published my testimony.

    Goldman Sachs announced two downgrades in the price of gold, first at the end of February, and again on April 10, 2013. Then on April 12, 2013 the Federal Reserve assaulted the price of gold through uncovered gold certificate short sales of 500 tons.

    Although the Development Committee admitted me to the Spring Meetings of the World Bank and IMF on April 19, 2013, the Director of the U.S. Secret Service disregarded a letter cleared by the World Bank’s shareholders, and illegally denied me access to attend the final two days of meetings on April 20 and 21.

    It is not clear whether U.S. Congress is prepared to “take on” the economic power revealed by Vitali, Glattfelder and Battiston whose misconduct I and other World Bank whistleblowers have been reporting to the legal authorities.

    This is corruption.  It is plain that corruption within the US government has reached the point that the rule of law can no longer be counted on in any meaningful way to stem the blatantly illegal behavior of concentrated wealth.  With corruption and no rule of law come the suffering described by the diarist, and we are only at the beginning.  This is where we are today, with almost no signs of a practical path from here back to the stable world of law and representative government we have known through most of our lives.

    This is corruption, and it is not subtle.  Only a firmly controlled media are preventing its being more widely known.

    Secrecy is a hot bed of vanity. - Joseph Brodsky They who have put out the people’s eyes reproach them for their blindness. – John Milton 1642

    by geomoo on Wed Dec 25, 2013 at 09:34:01 PM PST

  •  A Tarrant County (TX) judge says it best: (2+ / 0-)
    Recommended by:
    Dartagnan, cotterperson

    They're "suffering" from "affluenza."

    HAHAHAHAHA. In other words, they're Too Rich To Prosecute!

  •  Creating market conditions isn't an ethical lapse (1+ / 0-)
    Recommended by:
    Dartagnan

    ...much less an aiding and abetting of fraud.  

    Sure, the government loosened oversight, but one shouldn't have to have a regulator reviewing all paperwork to prevent executives from deciding to commit crimes or gleefully embrace unethical business practices.

    "Too big to jail," and Holder's personal failure to take on the responsibilities of his position as AG still seems the principal reason we haven't seen any fraudster bankers brought before the bar.

  •  Read it, found it weak: (4+ / 0-)
    Recommended by:
    Dartagnan, saluda, Justanothernyer, duhban

    Rakoff's point was that securities don't change from junk to investment grade without someone committing fraud, but that's completely irrelevant to prosecuting CEOs or higher ups.

    The financial collapse brought on by fraudulent repackaging of securities is like finding a body that's clearly a mob hit; it's hardly enough for a conviction of any particular person, much less the mob boss.  That doesn't change if you find a thousand bodies if there's a thousand independent mobs.

    And while he's right on the deterrent effect of a conviction of a guilty CEO, it's a classic bootstrap: first, you have to assume the CEOs are guilty, criminally, so there's something to deter, and then convict them, which nobody says can be done successfully.

    If Hobby Lobby is against contraception, why does it buy its inventory from China, the country that limits the number of children by law?

    by Inland on Thu Dec 26, 2013 at 05:05:26 AM PST

    •  Except mob bosses aren't required to sign... (0+ / 0-)

      documents declaring the validity of the their organizations' financial statements. And their internal communication networks are a little harder to subpoena. And their failure to keep adequate records of internal communications isn't a regulatory violation.

      "The Democratic Party is not our friend: it is the only party we can negotiate with."

      by 2020adam on Fri Dec 27, 2013 at 07:22:07 AM PST

      [ Parent ]

  •  If "we" fail? (4+ / 0-)
    Recommended by:
    Dartagnan, saluda, shaharazade, TJ

    It seems as if "we" have failed, as here we are 5 years later.

    If we fail to hold those responsible to account there will be no expectation of any accounting in the future, and the process will certainly repeat itself as more and more opportunities arise to "package" and transfer vast sums of wealth for the benefit of a tiny, detached and untouchable group of people.  

    The failure of our society to credibly assign responsibility to those whose unbridled greed caused the Financial crisis will be remembered not just as a human failing but one of the greatest failures of Democracy itself.

    For our fallen solders who come home from Afghanistan in a coffin to Dover, "God bless the cause for which they died."

    by allenjo on Thu Dec 26, 2013 at 05:37:41 AM PST

  •  Same old story same old song and dance- (0+ / 0-)

    "The people who were trying to make this world worse are not taking the day off. Why should I?”---Bob Marley

    by lyvwyr101 on Thu Dec 26, 2013 at 08:00:01 AM PST

  •  The rich and poweful (2+ / 0-)
    Recommended by:
    cotterperson, Only Needs a Beat

    vs the poor and the powerless.

    As old as the hills----and unless we can change this dynamic---this narrative------it will stay exactly the same---as it's always been.

    Of course---if we do change this narrative here---in this country---it truly will change everything.

    Changing the narrative.......................

    "The people who were trying to make this world worse are not taking the day off. Why should I?”---Bob Marley

    by lyvwyr101 on Thu Dec 26, 2013 at 08:32:31 AM PST

  •  Because they have the best government that (3+ / 0-)
    Recommended by:
    cotterperson, emal, Dartagnan

    our money bought by robbing us.

    Rich people rob but poor people go to jail.

    nosotros no somos estúpidos

    by a2nite on Thu Dec 26, 2013 at 09:32:17 AM PST

  •  More than financial crimes (0+ / 0-)

    I wonder if that's their excuse for not prosecuting Bush, Cheney, Rumsfeld, Rice, etc. for torture, war crimes, for lying us into 2 wars, etc.  Or for prosecuting the REAL perpetrators of 9/11.  Too serious of an investigation on any given "crime" may all lead right back to Washington and have to "ripply" an effect.  

  •  It was clear from the start that the government (0+ / 0-)

    was complicit in creating and fostering the financial crisis.  The SEC, DOJ, Congress, the Exec are all part of it and are all corrupt.  So of course there will be no prosecutions.  Look, that's why Georgie Bush and friends are still running around.  Congress was complicit in starting the Iraq scam as well.  We live in a corrupt country.  No news there.  Got to make the best of it.  

  •  I know, I know! (1+ / 0-)
    Recommended by:
    2020adam

    They're the ruling class?  Under the hegemony of capital?  Therefore it has to be underlings, the poor and workling people, at fault?  What do I win for being right?

    “Washing one's hands of the conflict between the powerful and the powerless means to side with the powerful, not to be neutral. ” ― Paulo Freire

    by ActivistGuy on Thu Dec 26, 2013 at 02:37:10 PM PST

  •  Corporate Communism for them, Mad Max for you (3+ / 0-)

    A friend for whom I have tremendous respect was asking: why are people obsessed with taking away Welfare and Food Stamps from common, destitute people and subjecting the least fortunate to the most derision and disproportionate punishment when the wealthy and connected go unchallenged and are allowed, pretty much with impunity, to loot the world right in front of our faces in the new Mad Max Gilded Age. To which I replied:

    You're not gonna see anyone challenge the bankers and fat cats, man.... even the Pope still lives in one of the biggest palaces on the planet and sadly I worry that if he keeps saying what he's saying he may get the "tainted lunch" treatment from TPTB.

    Because that's why they are called The Powers That Be... they own and operate the power structure like a wholly owned corporate subsidiary -- the government and the mass media propaganda factory included -- and they have all the guns, all the bombs, all the drones, and all the stuff that Stockholm Syndromes are made of at their disposal. People will not step out of line because, well, they know they'll be brutalized, especially with the new hyper-militarized tools with which the police forces have been accessorized for just the very purpose of keeping the masses docile and for changing the Complaint to the Compliant... remember "Occupy"? They want us to turn on each other anyway, especially since there's really no more manufacturing economy anymore and all those jobs, as well as many of the skilled tech ones, have been shipped overseas where folks will work cheaper. Like Jay Gould said back in the first Gilded Age, "I could hire one half of the working class to kill the other half." In recent years the Wall Streeters have figured out how to rig the whole world by betting on when Grandma would lose her house and the exact day she would die ("derivatives") anyhow, so they don't really need us anymore. There's no need to keep us alive and semi-solvent to buy their products (the Henry Ford model of "My workers need to have disposable income so there'll be someone to buy what they are making"), because there IS no more product to buy. We are the living, breathing definition of expendable.

    The basic cold and hard fact, like it or not, is that the goal of the global elite is a race to the bottom where the ideal is to let a lot of the population starve to death and the people that remain be made to work for 8 cents an hour under the boot of the cops-with-tanks... I don't like it either, but it's the new Mad Max Gilded Age these sociopathic Robber Barons On Steroids want. The sooner this idea -- that our whole paradigm and social construct has been colonized by the entropic, all-consuming force of Capital and Money, to the exclusion of all other possible human pursuit -- is faced by our species, and the sooner a peaceful means is somehow found to overthrow them, the sooner this will be an inhabitable, humane planet... and not a minute sooner. Unfortunately those industrial factories might have to make a comeback -- with the first products off the assembly line being pitchforks, torches and guillotines -- if things are ever going to change in any meaningful way, I'm afraid.

    Basically, money -- not even the people who control it per se, but the amorphous, total aggregate force and attitude of and about it, even amongst the poor who identify with it and the fantasy it offers -- is like the HAL 9000 artificial intelligence computer in Kubrick's classic "2001" now, and it is trying to hermetically seal off our perceptions of our possibilities because it knows that if we get hip to what it is doing, we might shut it off before it kills us. It's like we are asking, "When will something matter besides the psychotic hunger for infinite growth from a finite resource base we are beginning to realize is unsustainable and potentially (if not probably, if not definitely) will make us extinct?" and Post-Industrial Consumer Capitalism is replying, in a dispassionate, soullessly inhumane tone of voice:

    "I'm sorry Dave... I can't let you do that."

    "Some of you are going to die... martyrs, of course, to the Freedom that I will provide!"

    by emperor nobody on Thu Dec 26, 2013 at 02:52:51 PM PST

  •  Justice =/= Law (0+ / 0-)

    First let's look at what is fair and right vs what is actionable under law. The Justice department, despite its name, is limited to prosecuting violations of law. Congress has the power to make bad law so long as it does not violate the Constitution. Banks have the legal right to do harmful things if they are not violating any law; their actions may be immoral but not illegal. Banks and brokerages have resisted repeated efforts to be classified as fiduciaries required to say and do what is in the client's best interest. They are under no such obligation.

    Second, who bears the legal blame? As stated, the crime of fraud requires intent. Which is why the Lords of Wall Street keep their distance from the people in their firms who do things. Which is why we have seen some lower-level people prosecuted--because the action and the intent could be linked to them.  If there were a smoking gun memo by Jamie Dimon ordering something fraudulent--or even condoning it, someone somewhere would have brought it out by now. But Jamie Dimon's name is not on those decisions. So how are you going to indict Jamie Dimon on fraud?

    Systemic failure, when a company's culture tacitly encourages illegal acts--we don't do so well handling this. As the judge said, we can indict the organization, but somehow we miss the people behind the curtain pulling the levers. Systemic failure does not necessarily absolve participants, yet that is how we apply it.

    Of course, another complication is that laws are roped off by boundaries and jurisdiction. Systems are not. Whose laws apply to an Irish employee of an American firm? How about if that employee flies to Singapore to make a deal?  What law applies in that place, and what laws apply to that person? The answer may be different, and different still depending on whether the employee was following orders or going rogue. It's messy.

    And do you think the white shoe lawyers know how to do what where by whom to escape liability? They should, as they probably wrote the laws.

    So I think what this is pointing to is not (just) a failure of the US Justice department, but a failure of law to keep up with crime. The way we define the elements of a crime--things like intent, causation, and result--have not kept up with man's capacity to redefine them.

    •  Thank you President Obama for that brilliantly... (0+ / 0-)

      empty lecture. Here's an insane idea. Let's divert a few million away from prosecuting pot users and take the vast piles of emails evidencing criminality in Wall Street and try our hand at a few cases. Maybe the DOJ loses some, or maybe judges and juries aren't as oligarchically inclined as the folks running SEC and DOJ. Either way, we can burn up a few years of these assholes' lives and discourage the idea that you can sell steaming piles of shit to the American people and their pensions with no liability at all.

      Or we could keep mumbling about how emails demonstrating fraud don't count because it's complicated. And DOJ just doesn't do complexity, unless it's a baseball player using steroids.

      "The Democratic Party is not our friend: it is the only party we can negotiate with."

      by 2020adam on Fri Dec 27, 2013 at 07:16:58 AM PST

      [ Parent ]

  •  Freddie Mac & Fannie Mae scapegoats... (1+ / 0-)
    Recommended by:
    Dartagnan
    "the SEC in 2011 charged executives of the government-sponsored entities Freddie Mac and Fannie Mae with securities fraud"
    As well they should have... but why was it "OK" to go after them and not any of the rest in the more wholly private sector? It makes some sense when the right-wing talking point purveyors message of it all being the fault of  poor people/Acorn and the Govt. A bit ironic that Freddie and Fannie get held up as central blame focuses when the big banks vigorously pushed for the new financial environment they all operated in and then challenged all the weak remaining limits and barriers around past legal and moral breaking points... And with Fredd and Fann having incestuous links to all of the commercial banks, insurance companies, rating agencies, the SEC, and Wall street they were more tag-a-longs on the bandwagon (or Bank-wagon) than initiators and leaders of a greed stampede.

    But as hated totems of "Govt intrusion" and "distortion of free markets" from the point of view of the Randian side of delusion-omics they were first, useful tools to first aid and abet moving far and fast in the wrong direction as part of the bubble swelling and milking process and then after the implosion a perfect target to shift extra blame to. After all for that mind-set it is never the fault of free enterprise... always Govt. meddling and fettering that must be blamed no matter how much of a stretch and willful or ignorant they need to  be to apportion blame entirely on anyone or anything besides their own primary roles.

    Pogo & Murphy's Law, every time. Also "Trust but verify" - St. Ronnie (hah...)

    by IreGyre on Fri Dec 27, 2013 at 03:09:02 AM PST

  •  What is this doing on a site where people (0+ / 0-)

    have often tsk-tsked TARP and big-bank bailouts as unfortunate but necessary actions that prevented a depression.

    The whole "too big to fail" idea was always bullshit.
    The judge is right about too big to jail, and the government was wrong about too big to fail.  Letting some of those big players fail would have caused some consternation, for sure, but the government had a lot of resources at its disposal.

    LG: You know what? You got spunk. MR: Well, Yes... LG: I hate spunk!

    by dinotrac on Fri Dec 27, 2013 at 04:47:23 AM PST

    •  Actually (1+ / 0-)
      Recommended by:
      HamdenRice

      they did let one fail. That would be Lehman Brothers.

      In the weeks and months that followed the Lehman bankruptcy, the stock markets tanked 40% to 50%. One major money market fund, "broke the buck," thereby freezing up the commercial paper markets, you know those short term loans that corporations use to fund mundane things like payroll. It was months before those markets returned to normal. Millions lost their jobs. Not a good result. I'd bet that if Hank Paulson had a do over, he would have never let Lehman go. Moral hazard might make sense sometimes, but in this case it was a disaster.  

      We came so close to dropping off the cliff, that if another big player, like Citi had been allowed to fail, we would have been so fucked.

      Be very careful what you wish for.

      A great, technical book on the subject,  After the Music Stopped by Princeton Economist Alan Blinder makes for a very educational read.

       

      I'll stop calling him Boner when he stops saying I belong to the Democrat Party.

      by al23 on Fri Dec 27, 2013 at 07:27:53 AM PST

      [ Parent ]

      •  "Millions lost their jobs" (0+ / 0-)

        And that was because of Lehman brothers?

        Bullshit.

        LG: You know what? You got spunk. MR: Well, Yes... LG: I hate spunk!

        by dinotrac on Fri Dec 27, 2013 at 07:54:06 AM PST

        [ Parent ]

        •  Bullshit??? (0+ / 0-)

          You know more than I maybe, but lets try this:

          Lehman went bankrupt, Lehman had borrowed $$$$ in short term paper, you know the stuff big companies use to fund operations, like payroll. Lehman is unable to pay back. Big time money market fund takes a hit and is unable to redeem dollar for dollar-repays 97 cents on the dollar.

          Now other money market funds are fearful, they don't buy corporate paper-the entire market freezes-no money to fund operations. Managers at big companies do what?-reduce payroll.

          Of course lots of other things happened, but the fast, uncontrolled downward spiral began the Monday Lehman declared bankruptcy.

          Certainly not bullshit. Problem was these companies were so intertwined with the worlds economy that  apparently no one fully understood.

          I'll stop calling him Boner when he stops saying I belong to the Democrat Party.

          by al23 on Fri Dec 27, 2013 at 09:54:03 AM PST

          [ Parent ]

          •  I should put it differently -- Lehman's certainly (0+ / 0-)

            contributed to some people losing their jobs, but your implication was that bailing Lehman's out would have prevented the carnage.

            I don't believe it, just as I don't believe that the bailouts were remotely wise.

            Once the damage was done, the damage was done.  Our government acted like an enabling friend telling a battered spouse that "He can change, I just know it."

            LG: You know what? You got spunk. MR: Well, Yes... LG: I hate spunk!

            by dinotrac on Fri Dec 27, 2013 at 10:36:56 AM PST

            [ Parent ]

            •  Ok (0+ / 0-)

              I'm trying to understand what your world would look like today. Maybe no investment banks left? Forget about GM, Chrysler and maybe Ford?

              GE may have gone belly up, too.  The entire financial system gone fucked, and that's world wide. Stock markets crash like 1929?

              Maybe even riots in the streets?  (folks get pissed when their money and jobs disappear)

              The bailouts were actually successful, and even made some money for the US.

              I would urge you to check out Professor Blinders book.  It's a no bullshit look at what happened and the resulting response from the Federal gov't.

              I'll stop calling him Boner when he stops saying I belong to the Democrat Party.

              by al23 on Fri Dec 27, 2013 at 01:26:36 PM PST

              [ Parent ]

              •  You are making worst case assumptions. (0+ / 0-)

                We can speculate on anything. Sure.  It would have been terrible if a new outbreak of the plague hit the country because displaced GM workers contracted the disease while they stayed home a couple of months as new ownership re-organized the  company.  And the riots by people who couldn't get new parts for their old Corvairs -- who knows? Might've led to cannibalism.

                As to real world consequences.

                Chrysler might be gone entirely, but it did end up getting bought out by Fiat.  The profitable parts would have been picked up by somebody, but, if not -- so what?  Fewer Chryslers means more Fords.

                Corporations going belly up is not necessarily a disaster, and rescuing corporations doesn't always mean saving more jobs. I wonder what Trabant workers would have to say on the matter?

                How many jobs did GM shed? 30,000, not counting all the jobs lost at dealerships?

                As it is, GM shut down Saturn, Hummer, and Pontiac. How different is it, really from what it would be had it gone through bankruptcy?  Is the country actually better off for not purging more of the people at the top?  Are we better off for being unfair to Ford by throwing in so much money to subsidize GM?

                And -- GM still isn't out of the woods, and just a couple of weeks, the country took an $11 billion loss on its GM investment as GM continues to be a weak sister among automotive companies.  Can you be sure that was really the best use of those funds?  I seriously doubt that it was.

                On the bright side, a few good cars and trucks are coming out.  Whether the bailout was smart or not, GM may end up OK.

                LG: You know what? You got spunk. MR: Well, Yes... LG: I hate spunk!

                by dinotrac on Fri Dec 27, 2013 at 02:01:39 PM PST

                [ Parent ]

                •  I've got my shots (1+ / 0-)
                  Recommended by:
                  Doubtom

                  so I don't worry much about plague.

                  Financial meltdown, yeah that kind of worries me.

                  peace.

                  and read the book.

                  I'll stop calling him Boner when he stops saying I belong to the Democrat Party.

                  by al23 on Sat Dec 28, 2013 at 07:57:07 AM PST

                  [ Parent ]

  •  Calculated distractions? (1+ / 0-)
    Recommended by:
    Doubtom

    Seems to me that the Madoff and insider trader prosecutions came at a suspiciously convenient time, given that the SEC had been repeatedly made aware of Madoff years prior, but chose to do nothing about it.

    When viewed in such a light even 9/11 takes on an altered perception: with the trillions at stake, and the past history of the prior prosecutorial results, creating  or allowing a national disaster that diverted hundreds of agents from investigating fraud to investigating terrorism becomes firmly within the realm of possibilities.

    It is unthinkable to me not to suspect that a relatively small group of sociopaths might not have orchestrated a carefully thought out national con for the past couple decades. Too many "random" events have all served the same purpose for them to be entirely random.

  •  When a crime is large enough... (2+ / 0-)
    Recommended by:
    Dartagnan, Doubtom

    And enough people of influence are involved the chances of it getting prosecuted decline rapidly. Witness the lack of war crimes trials in the last decade in spite of the rampant disregard of US and international law in the many cases of abduction and detention without trial, torture, assassination, and drone warfare in countries we are not at war with.

    In the same way that there is a disgusting calculus that 1 American is worth X number of Afghans, the same mechanism calculates the punishment of a single  Billionaire is worth more than the financial ruin of hundreds of millions of "lesser" citizens.

    Of course no expense is spared in rapidly prosecuting the people who expose the malfeasance of the ruling class, and their government lackeys.

  •  Bravo! Send the crooks to jail! (0+ / 0-)

    "Three things cannot be long hidden: The Sun, The Moon, and The Truth." Buddha

    by Grandson named me Papa on Sat Dec 28, 2013 at 12:39:39 PM PST

  •  Judge Rakoff's 'new' keen insight in legal matters (1+ / 0-)
    Recommended by:
    Dartagnan

    Perhaps the good judge can assist me in trying to clarify a point of contract law,,,If the purchase of a dwelling involves a "contract", which is understood to mean a "legal and binding agreement between two parties, and which further provides for no alterations in meaning or purpose from its original intent, without the consent of both parties to that contract, how is it that one party may undertake the transfer of his obligations to the other party, by selling that contract to a third party, without the consent of the second party to that contract?  Need I point out that the ignored party has no equivalent "right' to rid himself of responsibility?

  •  Good article (1+ / 0-)
    Recommended by:
    Dartagnan

    But the Tea Party "Poll" "Should Obama be Impeached" at the end among the ads is simply BS.  It is even less subtle than the question  "Do you still beat your wife"

    Shame, no honor or conscience, just a bunch of hoods.

  •  Revolving door (0+ / 0-)

    The author of this article and Judge Ratoff are correct.  

    We have a revolving door at the DOJ, the Halls of Congress and corporate power in this country.  WE have all heard of the phrase, its like the fox guarding the hen house.  That is what this revolving door created.  

    What that means is that the heads of industry end up providing oversight for those industries.   This has lead to the industries that are no longer sufficiently regulated and legislation that put this nation at risk.  

    A former Monsanto executive now runs the FDA.  GMO foods lack proper safety research and their pesticides threaten irreplaceable species such as bees (pollinators) with extinction.   This model exists throughout the Federal Government.

    This model unfortunately exists at the DOJ and applies to Eric Holder, our attorney general as well.  In 2001, Eric Holder left the AGs office to join Covington & Burling LLC, a major, established lobbying and legal firm based in Washington DC.  They have offices all over the world.  

    We have all heard that corporations have enough power in Washington to write the legislation that is voted on. Covington and Burling, LLC is one of those corporations.  

    When Glass-Steagal was overturned in 1998, Covington was there as a representative of the Banking industry.   What role did Eric Holder and the DOJ play in banking deregulation in the 1990s?  My best guess is Decriminalization.   The DOJ was in the loop in the decision to overturn Glass-Steagal which in effect legalized the banking practices that created the great Depression in 2008.  

    Eric Holder went from the AGs office to Covington and back to the AGs office, this time as attorney general.    The bankers chose their own regulators in the 2008 election.  

     Eric Holder is Attorney General because he is the man the Banking industry wanted in that job.  If they thought for a moment that Eric Holder or Obama would jail the top bankers in America, Obama would never have been elected and Holder would never have worked for Covington.

  •  How We Got Swindled & the Regulators (0+ / 0-)

    From 4 decades inside the securities business and as the former owner of an NASD Member Firm, and on the SEC's list of broker dealers to submit all proposed rule changes to for comment - My newest book - How We Got Swindled by Wall St Godfathers, Greed & Financial Darwinism ~ The 30 Year War Against the American Dream is fundamental to understanding the context of the fraud as it is the only book from an insider about how all the parts combined to create the 2nd worst economy since 1776 and the worst chasm of financial inequality ever.

    This is what David Satterfield, who wrote the foreword, said:  
    With keen intellect and searing wit, Henry Schoenberger’s How We Got Swindled exposes the myriad financial hijinks and colossal leadership failures that have turned the first decade of this new century into an economic disaster. Schoenberger not only identifies the causes, rationales and human failings that led to this mess; he provides some ready answers for how we must go about fixing it. This should be must-reading for every policy maker in Washington and every student of economics and finance.

    David Satterfield, former business editor of the Miami Herald and managing editor of the San Jose Mercury News, recipient of  2 Pulitzer Prizes

    Swindled should be must-reading for Eric Holder as my book provides whatever he might need to bring an indictment against the most prominent culprits as well as the leaders of the failed regulators and the rating agencies that gave out AAA ratings because they could charge huge fees to Goldman etal to help drive the get a way cars.

    to learn more: www.howwegotswindled.com

  •  Seems fairly obvious that (1+ / 0-)
    Recommended by:
    paradise50

    Although not much is really ever obvious, it would seem obvious why no CEOs who were responsible for causing the economic crash that now has predictions of difficult or even disastrous effects around the globe and for decades to come have been prosecuted. It is simply capitalism gone amuck and nearly everyone is involved including the government in one way or another.

    If you already have big money for the most part you will not get in trouble no matter what you do. If you do, then you will be admonished that you should not have gotten caught. If you get caught you can buy your way out.

    How many examples of this would be necessary to illustrate the point?

    Capitalism served the USA pretty well, but it does have its foibles, like every system. It is interesting to me only in that it did nearly upset the entire world economic schema and with it human civilization. Don't worry, it will soon. After the chaos of however many years that ensues, a new form will emerge. As a philosopher I must remark that to me it would be unfortunate to lose the amazing strides in individual freedom, health and the pursuit of happiness that America has pursued and achieved, and I must not limit this to America but I will say that America is unique in this experiment from its very founding as is clearly pointed out in our founding documents.

    Science tells us that all systems develop imbalances. Some grow to stabilize that imbalance, some collapse and something new and perhaps entirely different grows out of the collapsed decay.

    It is possible for us to control all of this and continue the democracy I believe. But human nature and human history suggest that no control will be effected or it will be inadequate. Nonetheless, something new will come about.

    If enough individuals wish to continue the American democracy they will need to get up and fight for it; probably more or less the same battle that was fought and for the same reasons as that great battle we know as the American Revolution.

    Listen carefully to the Judge Rakoff. I, for one, am with him. When enough Americans and other global residents are displaced there will be a reaction from them. I am guessing that Judge Rakoff would like to avoid that extreme as would I although this is just my reading of this short article; I cannot say what he thinks.

    It has been difficult for me to understand until recently, and I am in my sixties, why we in America could not have great wealth and the democracy. But, the behaviors of those who are amassing enormous wealth have demonstrated pretty clearly the answer to this. Just look at their political and religious bigotry, their hatred of all others and their desire to control the lives of others, their selfishness and greed, their immaturity and certainly their lack of any devotion to the notion of democracy or what it is or means or has accomplished is apparent in everything they do.

    It has been said, "We can have democracy in this country, or we can have great wealth concentrated in the hands of a few, but we can't have both." (Louis D. Brandeis) I must ask why we cannot have a great democracy of great wealth with great humanitarian ideals, aims and accomplishments? Of course, that is what we do have, or did have and that is why America is the most profound and amazing experiment in applied philosophy known to the human race. It would be a tragedy and a travesty to lose it, but then this is simply my own opinion that I am humbled is shared by some of the greatest thinkers I have studied.

    In the grand scheme of things all of this is irrelevant. Life itself is not in question; only the continuation of civilization as we know it is in question.

    If the average life span of a single human is said to be one hundred years and we then compare the age of the race of humanity to that one hundred years life span, how old is the human race? Perhaps two, or three? The terrible twos or threes where everything is me, me, me and no, no, no! In a single human life this is necessary for an infant to establish its own identity. What does it mean in comparison to the race of humans?

    Must it mean that we lose our trajectory toward a just and equal-for-all-civilization in the pursuit of happiness, health and a good life for ourselves and our children? Life will continue even if we despoil our civilization and its accomplishments. I do not think that nature cares one way or the other. But I do. And it seems to me that throughout history there have been a few others who did also; I do not think I really need to name them, do I? Will those few of us who value the democracy and every human life be enough to keep the current economic imbalance from sending us back into the dark ages?

    •  ...so much of what you say is true... (0+ / 0-)

      ...the "capitalists" actually believe democracy is "rule by mob" vs. "rule by law." They are against democracy, in fact that is and has always been the fight...what's good for all (democracy) vs. what's good for the few with most of the wealth and most of the ability to "dictate" what will be by way of having the wealth to "buy the future" and "buy the government."

      Unfortunately, the few will ultimately prevail and destroy what has been "democracy in the USA." We are seeing this destruction right now going on faster than ever before in my life (I'm 56). Unions are being destroyed and with that even the pensions they contracted to have when old. The movement towards states just doing whatever they want regardless of if it's against Federal law., etc...

      Capitalism is nihilistic in that it must always grow and grow to work. New things must be exploited. There's always pressure to keep wages down and profits up. You always have to consume the environment to grow. You always must have ever expanding markets for what you make or sell.

      Eventually the planet will be exhausted. Capitalists truly don't care about that or the people that live on it. Capitalists will poison our air with so much CO2 the planted will not sustain our life but in ever shrinking pockets. Famine and droughts and weather related destruction will do the trick.

      Capitalism is a "positive feedback loop" in reality...and all positive feedbacks are destruction in the end...always. Capitalism won't survive capitalism...and we all will pay a terrible price when it crumbles...the rich will have their private islands and mountain towns and planes and ships. They will have their own police force to keep the masses (and democracy) from affecting them...

      Welcome from the DK Partners & Mentors Team. If you have any questions about how to participate here, you can learn more at the Knowledge Base or from the New Diarists Resources Diaries. Diaries labeled "Open Thread" are also great places to ask. We look forward to your contributions.

      Ignorance is bliss only for the ignorant. The rest of us must suffer the consequences. -7.38; -3.44

      by paradise50 on Mon Dec 30, 2013 at 08:20:48 AM PST

      [ Parent ]

      •  Thank you for your observations (1+ / 0-)
        Recommended by:
        ianpageus

        I truly appreciate reading what you have written...

        I can probably only make a few comments and I am not sure they add to the conversation substantively at least as concerns the survival of 'the American experiment'.

        Cooking over a flame can also destroy that which is being cooked if the flame is not controlled. I see capitalism in this way. When the flame is controlled the result is edible food.

        We have seen in American history the power of capitalism to drive invention, to create a powerful example of democratic ideals partially realized but clearly on the way to realization, to provide an engine to achieve human rights never before realized in human history on any scale such as the American middle class, to foster human health in foodstuffs, medicine and medical procedures, sanitation, education (for those who educate themselves), to create technologies of all kinds, to achieve access to information on a mass scale and to set an example of maturity and civilization to the world unrivaled in any previous culture.

        But, I think you have hit it precisely with your quote, "Ignorance is bliss only for the ignorant. The rest of us must suffer the consequences."

        The Greek philosophers wrote that the only form of government that would actually work for the people would be that of a benevolent despot forcing goodness on everyone. The Greek philosophers analyzed other forms of government until they found the point of failure where the form of government no longer served the people. I ask what happens when the benevolent despot dies?

        Throughout time there have always been those who have had humanitarian ideals at heart. Sadly, they are the few. When will the masses wake up? I was distraught when my board of studies took me into their confidence during my thesis review to tell me that in their 'belief' it cannot happen here. The point of my thesis in education was to bring those noble elements of human rights and dignity into this world from the unattainable notion of ideals bandied about by a select few. I was disturbed by what I took to be their negativity. Certainly history would like me to accept what they said to me.

        Here's a funny observation: The USA, born on the 4th of July is born under the Sun sign of Cancer. Indeed, we have a financial cancer. And, science knows that cancer grows and ultimately kills itself when the infected host dies. Nonetheless, science has been able to eradicate some cancer in some patients.

        One of my very best friends, now deceased, was a Political Scientist of world renown specializing in the Soviet Union and its Nuclear Weapons. After the collapse of the Soviet Union giving way to what is today Russia, the problem of the nuclear weapons remains but a little differently. In Russia the missile silos are no longer maintained nor are they protected from abuse, or perhaps I should say use. The politics of the Russian nation and provinces does not suggest that the nuclear weapons are any less a threat than they have ever been. Yet we think that humanity understood that in order to win the nuclear war, humanity could not have a nuclear war, because no one would actually win; everyone would eventually be consumed in the nuclear holocaust / apocalypse.

        I was raised with the notion that the world would not continue beyond my 50th year because of the threat of a nuclear holocaust. I still find it odd that it is 2013, about to be 2014. Yet things have a way of continuing.

        Will enough of the dis/dys-educated American public come to understand the threat and move to disallow rampant capitalism from destroying the American philosophy that provides our democracy, our lifestyle, our technology/gies, our (former) prosperity, our freedom(s) and our ability to engage in 'the pursuit of happiness'?

        I couldn't tell you. I think we must make every effort to educate all people so that we might have the opportunity to continue the American philosophy and lifestyle.

        As regards the super wealthy and their island homes, mountain towns, planes and ships and private police forces -- there is no way that their wealth will be able to control the nuclear arsenals, and others so called 'weapons of mass destruction' such that they will survive on their island or mountain homes. They are are misguided in their belief that they can buy their survival in the face of the destruction that they wreak upon American and world civilization. In fact I do not believe that these are thinking individuals; they are more at beasts and they certainly do not think of consequences at least not in this way.

        And so, like castles made of sand... the waves will wash over them and return them to the Earth to be broken down and redistributed as natural elements from which new life will grow. This is a natural process if uncomfortable for those of us who are a little more mature, a little more educated, a little more tolerant, a little more self-conscious... and not in a position to guarantee the democracy except through our words and writings.

        Our planet is truly abundant. We are truly blessed in this abundance even if we do not accept or tolerate it. It is only human systems that keep the abundance from distribution to all. There is more than enough of everything for everyone, even seven billion people. And life, life will not be destroyed, just as in the nuclear holocaust notion above -- only human life as we know it (and many other forms of life on the planet) would be destroyed, but not life itself!

        A new form, many new forms will grow out of the rich detritus, perhaps including human, perhaps not. Ultimately life will triumph and for a time it will have discarded that impudent element that we know as humanity. The way in which we treat our home, the Earth, is as though we are a disease on the planet. Once we take the human created imbalance of nature too far a correction will occur that will eliminate the sickness causing the imbalance. It would behoove us to be better stewards of our home.

        Just now the human sicknesses that are caused by the foibles of capitalism (and all systems have their foibles -- perhaps because they are human -- perhaps because that is just how it is), are coming to the surface. These are not the only human sicknesses that are surfacing, but this is the one we are talking about here. Like a pimple full of puss and disease, germs and filth! A pimple that will ripen and burst and then disappear to fade back into a relative balance and healthy complexion (only to await the next pimple!)... such is the nature of life as we know it so far...

        Or perhaps not; and like that uncontrolled cancer the host will perish.

        I am not much for murder and mayhem and I do not like to engage in fisticuffs. I prefer to engage in conversation and discussion and agree to disagree while we all benefit from the richness of 'the American experiment' and the nobility of its philosophies and achievements for humanity but I fear that I must presume that I know I am in the minority as regards the absolute power still accorded to huge money. I remark upon the quotation I saw in these diaries and comments from the genius of Elie Wiesel, "Words can sometimes, in moments of grace, attain the quality of deeds." I admire Elie Wiesel as a truly educated, cultured and civilized individual yet I find in practice of meeting humans that he is amongst a very few who could even think such a thing let alone say it, mean it, live by it, do it, guide the world by it, as we have in America for a time and I hope such a time will continue.

        Perhaps, and just to be light-hearted, the resolution to these difficulties for democracy and I believe for all of humanity will result in the abolishment of money or the notion of ownership. Hilarious laughter! Money has been touted as the root of evil in writings and philosophy from before any times that we know today. Yet we still have it.

        There are many examples in history of cultures that do not aspire to ownership of the planet. In the monopoly game that is a fitting metaphor for today's capitalism it is apparent that the goal of any one individual is to own everything. But I suggest that this is an ill-fated illusion that even if it were to come to pass would not last long as history has demonstrated to us is the fate of monarchies, empires and wealthy aristocrats. Eventually they are put down by the larger society.

        But I prattle on...

        I would like to tell you (by which I mean all of humanity) that y/our future evolution is not entirely bound to the physical and genetic evolution Darwin or science has remarked upon. Once pain and suffering, want and starvation, lack of medical care and shelter and education are eradicated from this world something that is as yet unimaginable will result for each and every living being (not just humans) on the planet. I have heard it referred to as the sea of soul. Karl Jung referred to the 'collective unconscious' of society -- how about the collective consciousness?

        If we all worked together instead of against each other what other things might we accomplish? The eradication of disease, all disease? The nurturing of the planet and all of its inhabitants? The exploration of the unknown not to mention cultural endeavors? And this names only a few items... We could do this right now, we have the technology, we have the money but we do not know what it is that can come of it and we have little if any leadership to take us there... it is something we will all need to discover together... and thus we see the high and low points in what we call civilization. Or perhaps, as my thesis review board suggested, it just isn't going to happen here. Their religious beliefs inform them that it will happen in the next life -- but I cannot speak to that. Like so many of humanity's great leaders, let's just name Jesus, Buddha, Martin Luther King Jr. and Harvey Milk, they all had a vision of an enlightenment and a new life happening here on the planet.

        Let me make an example out of electricity. We already have the ability to supply safe electricity for every human on the planet to fulfill all energy needs in solar electric production. Once you build a solar cell, it will continue to operate without maintenance or cost indefinitely unless something falls on it to destroy it. If we built solar cells all the way around the planet, the sunny side of the planet would provide the dark side with power 24 x 7! So what is in the way?! Oh, politics and political boundaries, racial hatred, money, immature human attitudes like the need for ownership of resources, fear... you can fill in the rest.

        Just think, what if we did supply electricity for the entire world?! What could we then move forward to achieve? But, yikes! What problems would we already have resolved if we were to build a global system of solar power to power all of humanity?! I can only say, Why not?! Would this not be more interesting and exciting then our current status quo?

        Or should I take Sir David Attenborough's published notions to heart? He wrote recently that he is glad to be 86 years old. He doesn't want to live the next 100 years which he sees as fraught with enormous and (apparently to him) insurmountable difficulties mostly brought about by the burgeoning population of the planet. I agree that it certainly doesn't look good.

        I will not even start in at this time on the self-fulfilling prophecies of 'the end of time' that the world's most profoundly negative philosophy foists upon us; Christianity. I am not speaking of the words of the person Jesus. I am speaking of the distortion of Jesus' teachings and the ideologies of those institutions that lose Jesus entirely in their ideologies of the Christ.

        Paul Tillich, renowned theologian revered by all the various denominations said, "While the Church may be the question, it is most certainly not the answer." Are the super-wealthy trying to survive the end of time as they see it or bring about the end of the world as predicted in these various ideologies? In such a suggestion or question my dad would tell me I attribute far too much thinking ability to these folks and he would remind me that they are simply stupid and not thinking.

        In reading the process philosophy of Alfred North Whitehead he writes that if one thinks something it is not necessary to write it down or speak it out but it will forever be available to humanity as a thought or idea. This revisits the notion of the collective consciousness... And if this is satisfying, then we have done our jobs, not in coming up with anything new, but in re-thinking and here even in writing all these fabulous notions bent on solving the problems of the human race.

        I am saddened to say that if you read in original languages texts of antiquity that are two, three, four and more thousands of years old you will find that these notions and solutions to the problems of human nature have always been known and discussed, and yet we still have pretty much the same mentality as humanity did all those years ago and nothing except for a bit of technology, and I think the American experiment has given us any reason to think that anything has actually changed. In this regard my thesis review board was and is correct.

        I was asked, "so, [Eral], in all this human history that you describe in terms of process philosophy, that there is progress?" I answered, "no, but certainly the potential for progress." And, in a bizarre unison, all three said together, "Ah..., [Eral], that is where we differ."

        I say let's solve these difficulties! We can do it if we all work together (yup, guess I am still pretty naïve...)... and the result will be as much paradise here on Earth as it is possible for us to know!

  •  What we really are (0+ / 0-)

    The U.S. government has become a corporation and corporations have become our government. Unless we change this we will become (and I think we are already at least half way or more there) a third world country. Of course this is what the power elite want. It's easier to rule, ill educated, scared, hungry people. That's why they are really going after the middle class. In the 20th century whenever a dictator took over they immediately went after the middle class, teachers, musicians and artists because these were the people that would cause trouble for them.

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