Wall Street and Goldman Sachs Party On

Time magazine's cover story this week titled "What's Still Wrong with Wall Street," by Allan Sloan, is a remarkable indicator of where the public stands on the recent obliteration of the economy by a gang crooked financiers and speculators. It shows that even the corporate media is now making the connection that millions of Americans have already made, namely, that a criminal gang of rich white guys in New York did some extremely reckless things with the nation's collective wealth and the middle class got clobbered.

The recent revelations about the criminal "pump and dump" speculative behavior of the Goldman Sachs Syndicate, along with its heartless new role as Repo-Man of Americans' homes, drives home the point, once again, that the federal government must do something to tame Wall Street or we're just setting ourselves up to be scammed again.

No jail time for the men who gave triple-A ratings to derivative junk? No jail time for mortgage originators and their henchmen who were signing up people for loans who clearly did not qualify for them? No jail time for the guys who securitized bad debt and sold it off to investors all over the world? No jail time for the federal officials who turned a blind eye while the house was on fire? Just because everybody up and down the assembly line of greed operated on the "IBG-YBG" principle ("I'll Be Gone, You'll Be Gone") doesn't mean that they should be allowed to walk away unscathed. Their short-term recklessness led to our long-term disaster. The nation will never be the same and the federal response has been half assed.

It's ironic that all we hear on FOX News and right-wing talk radio is how "socialistic" the Obama Administration is when in reality the way the administration has handled the Wall Street crisis is anything but "socialistic." The University of Missouri economist, William Black, recently testified to Congress that Treasury Secretary Tim Geithner and Larry Summers, the President's chief economic adviser, are not the right people for the job because neither of them believe in regulating Wall Street. If Obama is such a "socialist" then why did he appoint the head of the New York Fed to be his Treasury Secretary?

So far the regulations have been either lukewarm or nonexistent. Congress is beholden to Wall Street lobbyists and campaign donors. The Obama Administration is doing nothing to address the big picture. As Kevin Phillips and others have been writing about for years the American economy has been "financialized" and unless something is done aggressively to reverse this trend the "real" economy will continue to falter. According to the piece in Time, as a share of overall corporate profits the financial-sector's profits rose from about 12 percent in the mid-1960s to nearly 41 percent in 2002.

There has been a lot of head scratching in the corporate media and among the mainstream commentariat asking: "Why all the anger?" It's usually dismissed as misplaced "populist" rage. Meanwhile, the right-wing media does everything they can to distract attention away from the real culprits on Wall Street. They say its Barney Frank's fault or Fannie and Freddie's fault or the Democrats' and their "Community Reinvestment Act" or stupid home buyers who should have known better, etc. But no matter how many Red Herrings they toss out the American public has already made the explicit connection between their suffering and the wild party that is still raging on Wall Street. That's why there's so much anger directed at "bonuses" and "executive compensation." The caps placed on the pay-outs to a handful of Wall Street scapegoats might feel good but it doesn't do anything to address the underlying injustices of living in a plutocracy. Unless the federal government steps up and takes control from these people who a year ago came begging for bailouts we're staring down the barrel of the next catastrophe.

 

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Comments

[02bmw76]

Mr. Palermo, your article makes a great point. It is the diversional tactic used by the media to place the American people at odds with each other over partisan posturing. Most of the people I know that are right leaning, but too poor to be, are convinced that big government is the problem, not the free market. Maybe that's partially true but we can't have zero regulation. We've seen how that worked out. Too many people still believe in the free market despite what has been laid in the hands of the taxpayers as well as despite the fact no one is being held accountable. Instead we have promoted those responsible. We are rewarding those responsible for the failure. The present situation should make all people question the validity of everything we think of as a democracy. I'd say we're pretty far from the definition. I really thought we'd come full circle as a country after the recent election. Yet here we are. Meet the new boss, same as the old boss. It's a crime to be poor but an absolute blessing to be an elitist, untouchable, unethical, self serving criminal. Your words regarding socialism and MR Obama are right on the mark. Irony? Absolutely.

[Peter Noble 2]

The reason Cable news like Fox or CNBC cannot succeed in distracting us is that we know these pundits earn tens of millions themselves. We've had enough of pundits, actors, media whores, sports stars and the CEO class earning disgraceful amounts of money while they struggle.

With Obama's the rage will reach critical mass: we voted for change not theft.

[blueken]

Ponzi schemes and health care are all we got left. If the White house attacks them, we will have nothing. I think the pull back will have ot be in slow steps. It took 50 years to get here. It's going to take decades to clean up the mess. One thing is for sure. We as a country have to stop thinking that we can go back to the way it was. It, never was. We also have to come to grips with the fact that like the movie "There Will Be Blood." We let the financial sector and health care become our economy. That's what the "service economy" is. We have to get back to being a "productive economy". It's going to take time. We have to wean ourselves off the sugar and junk food, until we can get to the veggies.

[rissole]

Of course the party continues. Wall Street has a team on the inside in the White House.

[muckraker3]

Jailtime? These guys are lining up for record bonuses thanks to their good friend Obama. With all it's flaws at least capitalism used to be about producing goods and services. Now it is merely a giant ponzi scheme concerned with offshoring, Derivative gambling, taxpayer funded bailouts of the rich and the destruction of america's middle class. All facilitated by paid off Republicans and Democrats.

[Hysterian68]

"Scarface" Al Capone said in 1929 the stock market was a con game, a trap for suckers, run by a bunch of crooks. He was right then and he'd be right today. It took one to know one.

Why aren't these bankers and their henchmen in prison for conducting this the greatest Ponzi scheme of all time? To do so, would be to render New York City the world's biggest ghost town.

[blueken]

Why on earth would a "captain of the universe" invest in the real economy? Magic beans and castles made of sand are much more profitable. These crooks are counterfieters. Printing up phony paper of no value, and becoming rich. Nice work if you can get it.

[joebaggadonuts]

Roubini apparently agrees with you.

http://www.ft.com/cms/s/0/9a5b3216-c70b-11de-bb6f-00144feab49a.html

[MCTSilverlakeCA]

How about this?: WE the People, don't get to have ANY jobs anymore, because we have bad credit now - and all Big Business and Government Jobs require you to have good credit..... so we have no chance to recover what we lost ... our lives, our homes, our families, our savings, our freedom.... because we listened to these real criminals, these ... greedy, arrogant, extremely seriously financially irresponsible clowns that brought the world's greatest nation to it's knee's!

WE the People are not allowed to blame them because they are the ELITE AMERICANS, the Born to Rule Americans, the Above the Law Americans... not the "common people" - not like you and me. We're only good for being repositories temporarily of funds they considered to be their own investments - and when their world began to collapse because of their own stupidity and arrogance and impossibly mutually self-congratulatory grandiose financially irresponsible Ponzi -schemes -- they sucked money out of us not only in ruining our lives, but also in their BAILOUT - taking whatever money we also had invested in our Government.

Arrest every one of them - Put everyone of them on trial, and bring the military in on this because the military swears " to defend the country against every enemy, foreign and DOMESTIC".

[marinara]

There's a real reason for anger. The taxpayer dollar that was sent to Wall St. was magically converted into a Wall St. bonus while our politicians sat at the table.

Stealing money with white gloves and silk purses is bad.
Doing it with a bald face lies right to your face..... worse.

[docjones88]

This is insane!! Is anyone in the White paying attention. I full on supported Obama but this exact issue is the reason I supported him and he is not only doing nothing about it, he seems to be in full support of the continued rape of the american people and it's assets. This issue FAR outweighs healthcare reform, wars, or any other issue he has to deal with. It is imperative that these financial practices, products, and the people who perpetuate it are not only stopped, but brought to account. Begin with someone other than the wall street allies in Geithner & Summers making these decisions, and immediate and comprehensive change in the oversite and secret financial products. This is the ONE issue that will bring down this country.