Gird your loins; Rolling Stone's Matt Taibbi is on the warpath again. This time he's detailing the various methods used to generate massive profits and bonus numbers at the expense of the taxpayer, and it's a ripping good read. Grab a cup of coffee, swallow some Vicodin, and then click HERE.
He starts with a pretty predictable riff on Goldman Sachs and Lloyd Blankfein, but everyone on the Street has to admit that the firm makes no discernible effort to improve their image. Where the article gets interesting is when he begins to outline the different scams used to take advantage of the (ludicrous) rescue measures put in place by the government and he does so in the appropriate con artist lingo.
The "Swoop and Squat" that Goldman and Societe Generale pulled on AIG is a classic, and yielded far more than the $13 billion and $11.4 billion respectively reported by the banks. The coordinated effort to cripple AIG so the government would intervene and pay off toxic crap at 100 cents on the dollar was pure genius, and utterly amoral.
The rest of the scams pile on top of one another and left even a cynic like me with a queasy feeling in the pit of my stomach. I don't think the average American even cares, though. One thing is for sure: we've all been witness to the greatest robbery in human history, with an absolutely staggering amount of wealth transferred into the hands of a minute elite.
Wow, great post. Amazing article.
My prediction...nothing changes.
its all abt jews , believe me
Awesome article. I love Taibbi.
i think you guys might be interested in this:
that's the link to a video of Nomi Prins making a case why banks should be smaller and why we should bring back glass steagall. she does a pretty good job of articulating her case, but i am sure some of her data should be fact-checked.
a couple of interesting points form the video:
*financial institutions like jp morgan and bofa-ml and citi are larger now than before the crisis. this is counter-productive to the current administration's goal of addressing the systemic risks that "too-big-to-fail" financial institutions impose over the economy.
*no solid legislation has been introduced to address financial reform. the only guy talking about bringing back glass-steagall is Paul Volcker. his suggestions have not been acknowledged. basically, having bank holding companies gamble and borrow against deposits and checking accounts is a BIG systemic risk. the great depression taught us that.
*while bankers continued to make record bonuses and banks earned record profits, literally EVERY other sector, industry and market in the economy was losing value.
*financial innovations like financial derivatives and securitizations are not as valuable as we thought.
Nomi wrote the book It Takes A Pillage:
http://www.amazon.com/Takes-Pillage-Bailouts-Backroom-Washington/dp/047…
the title is pretty self explanatory, and she basically makes the case that the bailout wasnt about bailing out the entire economy, but more like bailing out just a few large financial institutions.
although mr1234 is just shilling this book, the youtube was a good summary; but didn't go deeper into some of the core conflicts of interests/incentives that led to this mess...
i dont think nomi was trying to explain why the crisis happened, but instead tried to make the case of why banks should be smaller. if you could elaborate, what are the core conflicts of interests/incentives that led to this mess? and if a book or youtube video is particularly informative, i will shill it.
Most teams at a bank actually do a good job of servicing clients.
The trading quirks are certainly suspect, but so are the actions of large market participants (PIMCO, Warren Buffett, etc).
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