Posted on 11/11/2013 8:46:59 AM PST by Renfield
I've been away for weeks now on a non-financial assignment (we have something unusual coming out in Rolling Stone in a few weeks) so I've fallen behind on some crazy developments on Wall Street. There are multiple scandals blowing up right now, including a whole set of ominous legal cases that could result in punishments so extreme that they might significantly alter the long-term future of the financial services sector.
As one friend of mine put it, "Whatever those morons put aside for settlements, they'd better double it."
Firstly, there's a huge mess involving possible manipulation of the world currency markets. This scandal is already drawing comparisons to the last biggest-financial-scandal-in-history (the Financial Times wondered about a "repeat Libor scandal"), the manipulation of interest rates via the gaming of the London Interbank Offered Rate, or Libor. The foreign exchange or FX market is the largest financial market in the world, with a daily trading volume of nearly $5 trillion.
Regulators on multiple continents are investigating the possibility that at least four (and probably many more) banks may have been involved in widespread, Libor-style manipulation of currencies for years on end. One of the allegations is that traders have been gambling heavily before and after the release of the WM/Reuters rates, which like Libor are benchmark rates calculated privately by a small subset of financial companies that are perfectly positioned to take advantage of their own foreknowledge of pricing information....
(Excerpt) Read more at rollingstone.com ...
too big to jail.
Some part of what’s going on here is government extortion. The last huge judgement of $13 billion is mostly for deeds done by Bear Stearns before the government begged JP Morgan to take it over.
Rolling Stones? The guys with the terroist on the front of their magazine.
Sometimes I read Taibbi to see what Bush is being blamed for this time around.
Scandal + banks = bullish. Since there is no law enforcement, there is no penalty, therefore, the revelation that banks are engaged in, oh, I don’t know, money laundering, selling hinky derivatives, any number of other things...this is akin to an announcement that said bank(s) are opening up new lines of business, and since they wouldn’t do that unless they were profitable and there is no conceivable law enforcement mechanism (that penalizes them more than the profits gleaned from the criminal acts) to prosecute black-letter law violations, these things are complete nothingburgers.
It’s like announcing, “ooh, now the Mafia is moving into meth!”
“Some part of what’s going on here is government extortion. The last huge judgement of $13 billion is mostly for deeds done by Bear Stearns before the government begged JP Morgan to take it over.”
...after extorting Bear Stearns into a major portion of the bad behavior.
The banks have to give up billions to the feds for their dealings. Yet savers still get near 0% interest rates on their savings. What’s wrong with this picture?
I don;t want to click on that link.
Those assholes have Buttcrack Odumbvo 12 times on their effing’ cover.
bump
Taibbi may be an America hating radical, but his epic takedown of Thomas Friedman is worth seeking out.
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