Frank Rich: Wall Street 'Laughing All The Way To The Bank'

New York Times:

Maybe Lloyd Blankfein was doing "God's work" after all.

...

As a reminder of the unchastened status quo, Blankfein remains the gift that keeps on giving.

Read the whole story: New York Times

Comments

[FoonTheElder]

11:35 AM on 04/26/2010

"In a chapter entitled "How Moral Men Make Immoral Decisions," John De Lorean a former General Motors executive (and famous for many things) muses over business morality. "It seemed to me, and still does, that the system of American business often produces wrong, immoral and irresponsible decisions, even though the personal morality of the people running the business is often above reproach. The system has a different morality as a group than the people do as individuals, which permits it to willfully produce ineffective or dangerous products, deal dictatorially and often unfairly with suppliers, pay bribes for business, abrogate the rights of employees by demanding blind loyalty to management or tamper with the democratic process of government through illegal political contributions" (J. Wright, 1979: 61-62). De Lorean goes on to speculate that this immorality is connected to the impersonal character of business organization. Morality, John says, has to do with people. "If an action is viewed primarily from the perspective of its effect on people, it is put into the moral realm. . . .Never once while I was in General Motors management did I hear substantial social concern raised about the impact of our business on America, its consumers or the economy" (J. Wright, 1979: 62-63).

The result was that despite the existence of many moral men within the organization, many immoral decisions were made."

http://pegasus.cc.ucf.edu/~janzb/courses/phi4804/crittheory8e.htm

[Wupta]

02:45 AM on 04/26/2010

I just so disgusted. I would like to get a hold of these guys by their shirt collars and slap them till the snot comes out of their noses. Then toss them in jail with some sex starved inmates.

[CabinGuy]

11:44 PM on 04/25/2010

Is there any columnist more boring than Frank Rich? No wonder the NYT circulation keeps going down and down.

[rougebaisers]

10:37 PM on 04/25/2010

And so is Obama and most of Congress...laughing all the way to the bank. More lies called reform.

[northstar11]

09:40 PM on 04/25/2010

everybody and his mothers uncle knew that subprime mortgages and derivatives was a bomb that was going to explode or implode

i knew it would happen but i simply could not see how i could capitalize on it -----i just assumed house prices would fall and people would lose their homes and lenders would lose equity.--i didnt see how i could profit from it.----

it never once occurred to me to go to goldman to create a vehicle that would parcel up a basket of sure failure mortgages that i could short ---

SILLY ME--- i thought doing that then lying about the value of them by labelling them as triple A would not only be unethical nut also illegal INSIDER TRADING and would probably land me in jail.

[pastgone]

06:47 PM on 04/25/2010

I am so sick of people who have swallowed the talking point about the fundamental cause of this financial crisis--again repeated by Mr. Rich, who cavalierly trots out the "subprime mortgage bubble" line as if it is dogma.

I have worked in the financial end of real estate all my life--and let me assure you that so-called "subprime" borrowers--this a term first coined by our friends at Fox News--when you hear "subprime", you're first supposed to think "poor" and then you're supposed to think "minority"--there IS NO POSSIBLE WAY that the few mortgages, if ANY, that were provided to "subprime" borrowers that otherwise would not have been provided caused ALL housing prices in this country to shoot through the roof and beyond and then plunge again.

THE ENTIRE MARKET was affected by this, and none less so than so-called "Jumbos"--the biggest loans of over a mill--NONE of which EVER went to "subprime" borrowers--and which have just as high a default rate as any other loans.

ARTIFICIALLY LOW INTEREST RATES CAUSED THIS CRISIS, NOT LOANS TO "SUBPRIME" BORROWERS.

[northstar11]

09:50 PM on 04/25/2010

I THINK YOU ARE PARTIALLY CORRECT --

-another part is the big banks had way too much money and nowhere to invest it so they made bad loans ---easy come, easy go

--another is lehman brothers deliberately made the bad loans with full knowledge they would fail ---they bought a company doing exactly that with the promise to clean it up --instead they copied the model and expanded it -----the hope was mortgages would fail and lehman would cash in on foreclosures and resales --in the mean time the execs were looting the company of commissions generated from fraudulent lending

[northstar11]

10:02 PM on 04/25/2010

the other part --the worst part ----AIG subsidiary wrote insurance policies it did not have the cash to cover ----thanks to paulsen and geithner the pockets of the american tax payers were picked to make good on the policies -----they had no business doing that -----

to pull off that heist they had to play """the sky is falling game"""

what should have happened was ----all the derivatives trading ( cdo and credit default swaps)should have been declared fraudulent and a standstill agreement should have unravelled every last one of them------

banks would have lost equity --too bad thats the price of making bad loans ---and some folks would have lost equity --too bad you overpaid for the assets

[WorldisMorphing]

06:40 PM on 04/26/2010

"-another part is the big banks had way too much money and nowhere to invest it so they made bad loans ---easy come, easy go "
-- That is what keeps me obsessed to find out the reasons why the numbers are so surreally astronomical when it comes to derivatives (63 trillions says a comment below ...I've heard similar numbers myself referring to the total amount...and I know that there are many kinds..but ...whatever..just think about the damn number !!! We are talking about a big f-bomb tumor here.. ).

So astronomical that they make you wonder...were the bankers so hard press to create growth in the economy that they had to resort to these schemes...incapable of "allocating resources" and letting the market and free will do the rest?

Seems like they opted for wealth assimilation instead of wealth creation.
Meaning only one thing. --Comes a point where capitalism is irrelevant and no longer needed. All bankers need is -Control-. Control over the web of inter-dependencies of the global economy. Wealth creation couldn't make them grow fast enough for them to exert that kind of control...
Greed is what motivated some--even most-- but the central bankers ?--

[LinkSync]

02:01 AM on 04/26/2010

Good King Billary started the push to losen loans so poorer folks could own homes.
Good King George continued it and improved on it with his so called "ownership society".
Fanny and Freddy did the deals and took market share by doing them.

Meanwhile everyone in the realestate industry had and still has to compete.
So when your competition starts taking market share with subprime and out right liar loans you end up doing it too or you are done.
Besides , who care? just sell it away and avoid RISK.

Same happened/happens to the ratings agencies, they too respond to competition and the desire for hot profits rolling in fgor nothing at all, not even any research, just stamp it !

Same again for hedge funds and other insurances that provide ways to avoid all risk and bet both ways and make money hand over fist..

Then along come creative instruments, CDS and CDOs and other derivitives of derivitives that get bought and sold the world over by "investers" that are riding the bubble wave, knowing they can sell at a profit and get a nice fat bonus, even though the security itself is crap all to the tune of over 63 TRILLION world wide.
And you are pissed at 798 billion in TARP funds....

Then add the incentive to PROFIT wildly some more and you get what we got.

Screwed.
Royally Screwed.
By Greed and nothing more than greed.
Un-regulated greed, the Republican agenda in practice.

[TheRLeePost]

06:12 PM on 04/25/2010

Mr. Rich's comment " . . . sleazy role in the Great Crash of ’08" confirms my assertion that 'The Media' and therefore the public simply don't understand the underpinnings of our economic crisis.

All anyone focuses on is the Credit Crisis which occurred in '08. To the whole country, that is the reason we have over 10% unemployment, and millions have been bankrupted.

Frankly, the level of stupidity of the American public has not changed since the inane black comedy of errors leading up to an inept Congress giving Bush his private use of the military in Iraq.

The Credit Crisis of '08 and its fallout was a mere symptom, not a cause of our economic misery. While most Americans were blithely going about their lives in 2008, the media utterly ignored that 5% of the economy had been obliterated by the housing collapse in 2007.

The unemployment which bubbled up so high by late 2008, was not a factor of the Credit Crisis! It was from the wave through the economy of the millions who became unemployed in 2007, didn't shop at the Walmart, Target, Best Buy, etc. It was like a snow ball careening down the hill side, damaging sector after sector all through late 2007 and 2008.

It's not a wonder as to why Congress has failed miserably at using the federal purse ($1 trillion) to reignite demand and thus employment. They haven't a clue as to what caused our economic bridge to collapse.

-RLee
http://therleepost.blogspot.com

[racetoinfinity]

05:39 PM on 04/25/2010

We need everyone to support Sens. Brown/Kaufman's SAFE BANKING ACT which will break up the too big to fail banks:

http://act.boldprogressives.org/cms/sign/petition_breakup

[bascombe]

04:09 PM on 04/25/2010

STERLING, AS USUAL, MR. RICH!

[zell]

03:07 PM on 04/25/2010

Kudos to Mr. Rich..............I believe that this is his best analysis of the Wall Street corruption yet. It is the love of money that has wreaked financial havoc upon the United States and the world. In the Bible, 1st Timothy, 6th Chapter and the 10th verse tells us that: "For the love of money is a root for all kinds of evil." (NIV). Please note that it is not money that is evil; it is the LOVE of money. When money is put in its' proper perspective, then everything is alright. But, when it is loved, well, then all kinds of evil happens. That is what We, the People are experiencing now in the financial world--evil.

[tralbry]

01:19 PM on 04/25/2010

Related to this story, I am proud to announce that I have secured an important endorsement in my campaign for Wall Street's Master of the Universe.

http://sites.google.com/site/tralbry/endorsements

[telebob59]

12:32 PM on 04/25/2010

Any trolls out there who care to invoke a Bernie Goldberg? That is, to excoriate Rich for his broad-brush characterizations? Or to lay more blame at the feet of the current POTUS than necessary? How about making "Democrat" elected/appointed officials shoulder all the...I didn't think so. And when the Gray Lady or any of its charges commit a transgression, I'll leave it to Gore Vidal to set me straight.

[annecros]

01:54 PM on 04/25/2010

What do you not get about "all of the above suck?"

[telebob59]

04:34 PM on 04/25/2010

I see my attempt at irony is completely lost. I see very clearly what you don't get.

[Democrat in the South]

12:08 PM on 04/25/2010

After we investigate G. S. and wall street, are we going to investigate the S.E.C.? And then are we going to investigate politicians who took money & participated in the fraud by looking the other way? No? Why not? Lets trickle all the way to the top!

[WorldisMorphing]

12:22 PM on 04/25/2010

At the very top you'll find the culprit: --Ideology--

[Democrat in the South]

12:52 PM on 04/25/2010

Brilliant!

[Paolo7219]

02:14 PM on 04/25/2010

IMHO, the SEC--under Bush--should be where any investigation shoulld start. Christopher Cox is the master enabler for the financial meltdown. Cox was head of the SEC when this activity by the likes of Goldman Sachs and J Pirate Morgan was going on. Cox did nothing to stop this "bubble" and it was his job to put a stop to the kind of malfeasance GS and JPM were engaged in. One can speculate as to why, but my opinion is Cox was a complete incompetent as SEC chair or he was corrupt. Either way, Christopher Cox should be held to account for his actions/inactions. After Cox, the next person who should be held to account is Alan Greenspan. But that's another story.

[henryberry]

11:31 AM on 04/25/2010

“At least in an actual casino, the damage is contained to gamblers,” wrote the financial journalist Roger Lowenstein in The Times Magazine last month. This catastrophe cost the economy eight million jobs.

...and so I am starting to see the catastrophe which is continuing to unfold as a financial holocaust with the middle class as its victims. The banksters/Wall Streeters such as Blankfein and co. are intent on pursuing their financial totalitarianism aimed at amassing the entirely of the country's money, assets, and property (the 1/3 they possess already is not enough for them) and the government including Obama have no intention of reversing this. The common metaphor of a casino does not begin to imply the immeasurable social effects of what is going on in the financial industry and in government.

[WorldisMorphing]

12:36 PM on 04/25/2010

I don't know about you, but I'd really like to know what was --The Grand Design-- ?
..until it crumbled under its own arrogance...

[henryberry]

01:52 PM on 04/25/2010

The scale of the duplicitous financial operations and the similar mindset of Blankfein, Dimon, and the others and idiotic collusiveness and passivity of politicians and government officials looks to be like a Grand Design. It doesn't to you? And the middle class was targeted since it had income and assets (e. g., savings, home equity) which the banksters didn't yet have for themselves.

The effects of the financial holocaust are likely to be so devastating on the middle class that it will no longer be a meaningful element in U.S. society. It barely is now as we see. Or alternately, the middle class is likely to be so engrossed in defending itself against the deceits and aims of the banksters and their government agents that it does not have a status nor life nor vitality nor future of its own. This is one form of enslavement.

One of my points was that the banking/investing system has not crumbled. It's as strong as ever, and with the government pussyfooting, it only grows stronger. I've seen this kind of development with respect to the criminal activity in the Connecticut legal system I've been exposing.

[belogical2010]

10:38 AM on 04/25/2010

I say don't do the financial reform if it doesn't end to big to fail and Swaps contracts. That way when the economy blows up again we'll know the exact politicians to charge with treason.

[hgovernick]

10:57 AM on 04/25/2010

Well, heck, why wait until the economy blows up again? However, I prefer to think "impeachment" is more the term at this point than treason.

But to each his own.

[annecros]

11:17 AM on 04/25/2010

Well, technically, it is an easier impeachment if the individual in question has committed a high crime.

Besides, convicted of treason would be too good for the politicians in question.

[Nonpartay]

11:30 AM on 04/25/2010

We already have the Sherman Antitrust Act. I wonder why it has not been invoked since Carter broke up AT&T. As far as I know, it's still in effect. Why would we need anything else?