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According to the Collins English Dictionary 10th Edition fraud can be defined as: "deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage".[1] In the broadest sense, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation. Defrauding people or entities of money or valuables is a common purpose of fraud, but there have also been fraudulent "discoveries", e.g. in science, to gain prestige rather than immediate monetary gain
*As defined in Wikipedia

Tuesday, August 16, 2011

The Taxpayer Subsidizes Goldman Sachs

We should remind ourselves every day about who and what caused the Great Recession which began in 2008. Make no mistake, Goldman Sachs was right there fraudulently creating mortgage-backed securities , having them rated AAA and selling them for huge fees to unwary investors. The securities turned shitty and people lost money through their pension funds, their savings and foreclosures. Municipalities that bought these securities lost their money too.

The Great Recession was not an accident: Goldman Sachs knew what it was doing and gleefully piled billions onto their salaries in bonuses beyond belief.

Remember that as you try to make sense of the transfer of wealth from us to the banks like Goldman Sachs.

As William D. Cohan says, Of course the taxpayer is subsidizing Goldman Sachs!

Ending the Moral Rot on Wall Street, Part 2: William D. Cohan
By William D. Cohan - Bloomberg

Can it be true that the trillions of dollars we spent bailing out Wall Street only restored the deeply flawed status quo, instead of bringing about the fundamental system overhaul we needed?

One of the unintended consequences of the rescue of the banks in 2008 was to restore many of the most heinous aspects of Wall Street’s culture, thus exponentially increasing the inherent risks in the system. Indeed, while Main Street continues to suffer from high unemployment and plunging home prices, the financial industry is dancing a jig after paying itself about $150 billion in compensation in 2010.

In September and October 2008, as the fear of financial and economic collapse was at its most acute, there was a brief moment when it seemed there was a real chance that Wall Street would be reformed. That didn’t happen.

Since 1970, when financial companies began selling shares to the public, the industry has ensnared the rest of us in repeated crises of its own making. There was the crash of 1987 and the credit freeze that followed, the Asian crisis, the Mexican crisis, the Russian crisis, the collapse of Long-Term Capital Management, the Internet bubble and, most recently, the risky mortgage-related behavior that led to the Great Recession and brought us to the edge of economic devastation. As the past few weeks have shown, we are still suffering its aftershocks.

Capital Markets

At the time, each of these crises seemed existential and rendered the capital markets -- the engine room of capitalism -- dysfunctional for long periods. The increasing rapidity and intensity of each of these events is directly correlated with the decisions by Wall Street companies to go public. The consequence is that Wall Street replaced its traditional partnership culture -- where stakeholders shared profit and losses -- with a bonus culture that encouraged accountability- free, asynchronous risk-taking with other people’s money. Rather than accept responsibility for these recurring crises, Wall Street’s defenders resort to the patently false argument that they are the result of normal market vicissitudes.

Wouldn’t such an obviously broken system need repairing? Apparently not. Instead of a genuine fix, in the past two years, Washington has put Wall Street back on its feet without demanding any accountability for the damage caused to the economy and with only modest changes to the way business is done. Although a boon to congressional campaign coffers, such accommodation damages the credibility of markets and does little to rehabilitate an ailing economy.

Dodd-Frank Act

Worse, the cozy relationship endures, as Wall Street’s lobbyists and executives exert influence over regulators such as the Securities and Exchange Commission and the Commodity Futures Trading Commission. This gives Wall Street sway over the drafting of the new rules governing our financial system that were mandated by the inadequate Dodd-Frank Act.

Read the rest of the article here


Anonymous said...

Aug. 15 (Bloomberg) -- William Cohan, author of "Money and Power: How Goldman Sachs Came to Rule the World" and a Bloomberg Television contributing editor, discusses his latest Bloomberg View column about Wall Street. Cohan speaks with Maryam Nemazee on Bloomberg Television's "InsideTrack."

Anonymous said...

Wall street can't function without a swindle mentality...

JP Morgan's Fractional Gold Scheme Is Working

Here's how it works. JP Morgan sells Comex gold to hedge funds, who then opt to safekeep it at JP Morgan's Comex depository for a 15 basis point fee. It makes the purchase very simple, the "storage" inexpensive and enables the hedge fund to seemingly have possession of physical gold. But in reality all the hedge fund gains is a "security interest" - or paper documentation - in the gold rather than the actual gold. Here's why: how many of those hedge funds will actually ever ask for delivery of the gold into a private depository or go visit the vault to make sure that the gold it purchased is physically sitting in separate, allocated bin? JP Morgan is "banking" on the fact that none of them will. This enables JP Morgan to make an electronic ledger entry and create an account statement showing the market value of the gold purchased, but it never has to actually produce the physical bars and deliver them. This dynamic permits JP Morgan to sell gold that the bank is never held accountable for. This is exactly the scheme Morgan Stanley used with their silver fraud on a much smaller scale, that GLD and SLV use and that the Comex and the LBMA bullion banks use for their futures/forwards business.

Anonymous said...

"We are way past the point of pretending that the CFTC, SEC, FDIC, self-regulating trading communities like FINRA or our esteemed Federal Reserve DO ANYTHING BUT SERVE THE INTEREST OF CASINOS with HFT machines POSING AS BANKS.

Anonymous said...

Good way to escape the law...wonder how many tbtf heads will take up residence?

Silicon Valley billionaire funding creation of artificial libertarian islands

Thiel has been a big backer of the Seasteading Institute, which seeks to build sovereign nations on oil rig-like platforms to occupy waters beyond the reach of law-of-the-sea treaties. The idea is for these countries to start from scratch--free from the laws, regulations, and moral codes of any existing place. Details says the experiment would be "a kind of floating petri dish for implementing policies that libertarians, stymied by indifference at the voting booths, have been unable to advance: no welfare, looser building codes, no minimum wage, and few restrictions on weapons."

Anonymous said...

Wednesday, August 17, 2011
High Crimes At The SEC: Time To Fire and Prosecute Mary Shapiro
When the subject of how many files were destroyed came up, Storch answered: "18,000 MUIs destroyed, including Madoff."

This isn't just about Rome burning burning while Nero fiddles or Obama riding a bus through Podunk, Iowa while his wife travels abroad with an entourage of friends on the Taxpayer dime. This is about criminal liability at the SEC and those responsible for enabling corrupt Wall Street enterprises and thieves like Madoff to operate without fear of prosecution. If Obama does not take leadership in this situation and really shake up the SEC, including getting rid of Mary Shapiro, he may well go down as the worst President in history.

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