90.9 WBUR - Boston's NPR news station
Top Stories:
PLEDGE NOW
Michael Lewis & Bethany McLean: Is Wall Street Clean?

After the financial crash and bailouts and commissions, did we clean up Wall Street? We ask Michael Lewis and Bethany McLean.

A pair of traders work on the floor of the New York Stock Exchange, Jan. 28, 2011. (AP)

A big federal report came out last week on the 2008 financial meltdown that blew up the American economy. The report got rolled over by Egypt news, but its issue is still wrapped around all of our necks.

The meltdown was avoidable, it said. And if we don’t recognize that and act differently, it will happen again.

So, has Wall Street really changed?

Michael Lewis wrote Liar’s Poker and The Big Short. He’s with us. Bethany McLean uncovered Enron and co-authored the not new All the Devils are Here: The Hidden History of the Financial Crisis. She’s here, too.

We look at Wall Street now.

-Tom Ashbrook

Guests:

Michael Lewis, award-winning author, financial journalist, and contributing editor to Vanity Fair. His best-selling book about the financial crisis, The Big Short: Inside the Doomsday Machine, is out in paperback.

Bethany McLean, contributing editor to Vanity Fair and a contributor to Slate magazine. She’s co-author, with Joe Nocera, of All the Devils Are Here: The Hidden History of the Financial Crisis. She also is a former editor-at-large and columnist at Fortune magazine, where she broke the story of corrupt business practices at Enron.

Please follow our community rules when engaging in comment discussion on this site.
  • Al Dorman

    (Boston, MA)
    Mr. Lewis writes brilliantly about the “Consumer Finance” industry and other rip-off rackets. Could he go into specific detail on how this industry came to adopt a ‘Screw the Poor’ attitude?

  • Nick

    Is Wall Street Clean?

    Nope. And it never will be as long a Greed is so prevalent here.

    Without regulations and watchdogs, Wall Street will fleece us continually.

    The arrogance that after the tax payer bailed them out – for their Greed – that they are conducting much of the same financial wizardry again. It just baffles me why the American public hasn’t gone to Wall Street with tar and feathers.

  • Yar From Somerset, KY

    The amount an industry spends on lobbying is inversely related to degree of honest value they bring to our society. Think about how much attention insignificant changes in the DOW get from the Media. As balloon boy said “we did it for the show.”
    It takes a heap of hype to keep people sold on a false god.
    I believe in investing in real business, that accounts for maybe 5% of the market, the 95% that make up the rest of stocks sold on any given day are really just the market tax on money flow.
    Baby boomers are going to be hopping mad when they realize they can’t get their money (value) out of the market. The stock market is not designed to allow for the major contraction necessary as boomers retire. The market is for trading, who is going to buy when the majority needs to sell? We have a structural flaw in using the market to store value. Value is not in our money, it is in the education and health of our nation’s children. Their future labor is what will give today’s dollar value tomorrow.

  • at, Santa Cruz

    These people deserve the greatest contempt from the entire nation. We are still awaiting justice (no longer holding our breath) for the treasonous acts that lead up to the financial crisis. At the very least Alec Litowitz needs to be imprisoned for treason.

    You may find the following of interest.

    Rahm Emanuel and Magnetar Capital: The Definition of Compromised
    http://www.nakedcapitalism.com ^ | 13 April 2010 | Naked Capitalism Blog

    Posted on Friday, April 16, 2010 9:37:27 PM by Rockitz

    Magnetar

    1) A neutron star with an intense magnetic field, capable of emitting toxic radiation across galaxies 2) A hedge fund, the single market player most responsible for the severity of the 2008 financial crisis, through the toxic instruments it created

    Rahm Emanuel

    1) White House Chief of Staff 2) Politician selected by Magnetar’s CEO to be sole recipient of his political donations, 2006-2008

    Strange as it may seem, nearly three years after the onset of the global financial crisis, its greatest, most destructive, and most profitable “it ought to have been a crime” has gone almost entirely unnoticed.

    Most people believe that they understand the broad outlines of the financial crisis, and that a central element was an explosion in mortgages made to people who could not afford them.

    But how did such destructive behavior occur on such a large scale? The conventional view is that the subprime mortgage blowup resulted from bank executives being short-sighted, greedy, or both.

    But that simple story deters inquiry into how and why this disaster came to pass. Some recognize that the appetite for subprime mortgages seemed to come from investors. In fact, it resulted in a large degree from the way traders at certain large banks used subprime mortgages in a strategy to make their profits seem much larger than they actually were. The effect of this “negative basis trade” strategy was to overpay employees of those banks and consequently eviscerate the banks’ abilities to withstand future economic uncertainty.

    The appetite for subprime mortgages was also inflated by people who were betting that the housing market would fail.

    Moreover, the devastation wrought by this strategy remains virtually a secret. The fact that it has been almost invisible and appears to have been entirely legal, demonstrates a set of vexing problems. First, that investigations of the crisis have not delved deeply enough, and second, that the deregulation so keenly sought by the financial services industry has made activities legal that by any common-sense standard should be criminal.

    But the sponsors of this toxic trade did bother to make sure they had a powerful friend. The head of the firm in question gave substantial amounts of money by political contribution standards to Rahm Emanuel’s PACs, and only his PACs, over the period when these transactions were in play.

    The moving force behind a brilliant and devastating subprime short strategy was a heretofore unknown Chicago hedge fund, Magnetar, headed by Alec Litowitz, formerly of the hedge fund behemoth Citadel. Our studies indicate that Magnetar alone accounted for between 35% and 60% of demand for subprime mortgages in the year 2006.

    This is how their strategy worked in detail.

    The ruse at the heart of their transactions was creating subprime (so called “mezz” or mezzanine) collateralized debt obligations by investing in the riskiest layer, the so-called equity tranche. This kind of CDO consisted almost entirely of not just any subprime risk, but that of the dodgiest layer that could be sold short, the BBB tranches, via a combination of actual bonds and credit default swaps.

    But Magnetar’s true objective was not to invest in this toxic waste, which its role as funder of the CDO would lead most to believe. While Magnetar paid roughly 5% of the total deal value for its equity stake, it took a much bigger short position by acting as a protection buyer on some of the credit default swaps created by these same CDOs. This insurance in turn was artificially cheap because over 80% of the deal was rated AAA. Most investors did not understand what Magnetar recognized: this concentrated exposure to the very riskiest type of bond associated with risky mortgage borrowers, each of these CDOs was a binary bet. It would either work out (in which case Magnetar would still show a thin profit) or it would fail completely, giving Magnetar an enormous profit and wiping out even the AAA investors who mistakenly believed they were protected by having other investors sit below them and take losses first. Thus the AAA investors were only earning AAA returns for BBB risk.

    As the equity investor, Magnetar could further stack the deck in its favor through the influence it gained over the deals’ parameters. It was able to ensure that the CDOs held particularly dubious BBB exposures, and pushed for, and often got, “triggerless” structures, which stripped away another protection most deals had. When CDOs start to show significant losses, the payments to the lower-tier investors, including the equity tranche, are cut or halted to defend the AAA layer, much the way the human body, when exposed to severe cold, will restrict blood flow from the extremities to save the brain and organs. But triggerless deals, even as they started to fail, kept paying the lower tranche holders, including, in this case, Magnetar itself.

    While these transactions may sound similar to the widely decried Goldman synthetic CDO program, Abacus, by which the firm went short various real estate exposures, effectively dumping the risk on customers, the Magnetar program was not only much larger, but also produced far more devastating systemic consequences, thanks to the distinctive structure of its CDOs.

    As I explain at greater length in my book ECONNED: How Unenlightened Self Interest Undermined Democracy and Corrupted Capitalism, the use of cash bonds turned mezz CDOs from a dumping ground for otherwise unsellable mortgage bond risk to a breeding ground for demand. Ex Magnetar-inspired appetite, it is hard to find an explanation for the widely-discussed phenomenon of 2006 and 2007, of the mortgage securitization pipeline screaming for more subprime product, precisely when Federal Reserve interest rate increases should have stanched demand for risky loans above all others.

    Market participants have estimated that Magnetar’s CDOs drove over 50% of demand for subprime bonds during the market’s toxic phase, 2006 and 2007. With the input of a team including professionals who have worked on some of these trades, ECONNED, we’ve performed repeated, conservative analyses that indicate the true figure is probably at least 35% of demand, and perhaps as high as 60%. And that’s before allowing for the fact that Magnetar’s strategy was imitated by the proprietary trading desks of major dealers. And for good reason. Magnetar made billions, some observers contend as much as subprime kingpin John Paulson, whose fund earned over $20 billion on its short strategy.

    And the hedge fund’s cagey bet on Rahm? Litowitz and his wife had never before made significant political donations. In 2005, they started giving to Rahm and his PACs, and only PACs connected to Rahm, just before the Magnetar CDO program began, and continued through the first quarter of 2008, when the trade would have started to pay out handsomely. The Litowitzs gave a total of $8,000 to Emanuel and $10,000 to his Our Common Values PAC in May 2005. In 2006 and 2007, they contributed $51,700 to the Democratic Congressional Campaign Committee, while Emanuel was chairman. We have been advised by individuals involved in political fundraising that the amounts given would be considered significant, and the way the payments were distributed across the PACs is sophisticated. Put it another way: this money was not given impersonally.

    But this troubling connection should be no surprise. Rahm has long been a favorite of the hedge funds, having raised more money from them than any Senator not running for President. Not surprisingly, he has been a staunch supporter of the financial services industry, and is widely credited with playing a key role in securing passage of the TARP after its initial defeat.

    As the Magnetar-Rahm connection highlights, Obama raised more money from financial services players than any previous presidential candidate, so it can hardly be a surprise that he and his minions are happy to give the industry a free pass. Key policy figures maintain that no one was at fault, that there was a pervasive lack of regulation, and there are therefore no bad actors. That party line also means that destructive behavior is and will remain unquestioned, unexamined, uncorrected, and unpunished. We are still paying for the costs of the financial train wreck of 2007 and 2008. We can no longer afford the costs of willful blindness.

  • cory

    at, Santa Cruz,

    Just too long, dude.

  • cory

    Nick,

    I mostly agree with you. As far as public outrage and consequence go, Wall Street and our own government have convinced us that this is our left arm. If we “cut it off” we would be causing life threatening injury to ourselves. Everyone knows that if you want to subdue the American people, you threaten their wallets. Real change in this area would have to be fundamental to be effective, and it would be painfull.

    Leftfield, Wisconsin

  • WINSTON SMITH

    Although I generally lean toward capitalism, these greedy people are like cockroaches that will continue to survive and find or create the next financial tool to rape the American public as quickly as the last loophole is closed. One day they will answer to God for all of the damage that they have caused. But this is one of the main reasons that I opposed carbon credits. They have already figured out ways to manipulate the system and create “value” out of thin air until it blows up and we have yet another bailout at taxpayer expense on our hands.

  • http://brainmindinst.blogspot.com Peter Melzer

    The overarching issue is risk management. The improper assessment of risk caused the financial crisis.

    The misjudgment occurred when the mortgage banks permitted the issue of liar loans (http://brainmindinst.blogspot.com/2008/09/subprime-lending-truthiness-delusion-of.html) and the investment banks sliced and diced the CDOs that contained these loans (http://brainmindinst.blogspot.com/2007/12/about-taking-risks.html).

    The meltdown of 2008 demonstrates that betting on the market carries great peril. Unsurprisingly, some hedged against the risk. Abacus is a case in point. Paulson and Co. walked away a winner, because the firm analyzed the content of Abacus, coming to the conclusion that this bundle was likely to fail, and the firm hedged against it. They could have been wrong. Other skilled investors believed in Abacus and lost. Should we blame Paulson and Co. that they did their homework, before they came to the table?

    Crimes that led up to the financial crisis must not go unpunished. Alas, that may be the easy part. The difficult part will be to institute a mechanism that reigns in the lighthearted taking of frivolous risk at the expense of all, without unduly stifling financial activity.

  • William

    Nope, and the government is not much better, in fact, worse.

  • BHA – Vermont

    Did we clean up Wall Street?

    OH PLEASE! How can you even ask that question?

    Of course NOT. It is still full of people who have an immense feeling of entitlement for the massively overpaid ‘hard’ work that they do. Any new regulation is met with a massive effort to either block it or work around it. Make another million dollars, there is no other goal.

    The only way to clean up Wall Street is to figure out a way to inject some morality and humility in the ‘players’.
    Ain’t gonna happen.

  • Gary (Davenport, Iowa)

    OnPoint Staff,

    I heard on my local NPR station (KUNI, Iowa City, Iowa) that Monday’s topic was going to be wether or not Pres. Obama’s 80% renewable energy goal by 2035 was obtainable. Instead of this topic, Moday’s show was about the Egyptian uprising, understandably. When will you be covering the energy topic, if at all?

    Thanks.

  • charlie mc

    In all aspects of modern life, the “bottom line” is where we focus our hopes. Things alone matter which bring us a profit and even limitless profit. There is no God anymore in the real world. Even “religious” organizations dilute their souls in fund-raising.How much money one can raise determines triumph in the political world. We wonder where all the money went via public response to the Haitian catastrophe, the Tsunami relief, aid to Afghanistan and Pakistan. Did any of it get to the poor, sick, youth; or was the large bulk of it spent on now rusting military hardware and to top dogs.
    The men who caused the financial disaster, have been the ones profiting from the bail-out and the master-minds advising Bill Clinton in ’97, are now the departees from the current administration, much wealthier with high wage jobs awaiting them. (cf., Alan Greenspan, Larry Summers, Theodore Geitner, Robert Ruben, et als.) Only Brooksley Born stands tall. When will the real story emerge.
    “Justice is mine” says the Lord (oops!).

  • Sasha Drugikh

    Tom, your choice of guests, as usual, is commendable.

    To Ms. McLean: Your brilliant reporting for Fortune brought down Enron and Arthur-Anderson. I would also credit a certain few analysts, e.g. Richard Grubman, who questioned the Enron guys in conference calls and such. The question is just how well these executives understand their volatile businesses. Is there any real pressure on them to explain themselves?

  • Yar From Somerset, KY

    Tom,
    I think you may need to define the meaning of clean. Is Wall Street breaking existing law, in most cases that is difficult to prove. Is Wall Street, using ‘privileged’ access to information to manipulate or game trading in the market. I think the answer is yes.
    If that is the working definition of unclean then the market is anything but clean.

    Here are some simple rules changes I think will clean up the market and return it back into the boring business capital investment system. I want to close the casino open the bank.

    First, require a 50 percent tax on all stock trades held less than thirty days, treat trades as last in first out.
    You can’t game the system through high velocity trading.

    Second, and this changes all relationships not just with Wall Street. Stop federal employees from taking anything of value from any person or company. That means no PAC’s, no campaign committees, no side businesses for our legislative leaders. You choose to serve, you take an oath to only serve not to further your own cause. Our legislators will have to run only on their record while in office.

    Can’t be done? With social media and the power of the people I think it can. We have the power when we organize.

    Want something bad enough, you will act to make it happen. Be the change you want.

  • geffe

    In a word no. Add to that the Republicans want less regulations. I’m kind of surprised that the question is even being asked when it obvious that it’s back to business as usual and for the most part on the tax payers dime. The big players on wall street own us, period.

  • Zeno

    No regulations, No rule of law, No ethics, No national allegiance = Wall St 2011.

    They do have their own ways of grasping for ever larger sums of public money through their many power centers. They control DC and all of the people who reside there, they control the courts, and they control the media. I’m sure they are planning another huge pump and dump of the world economy where the taxpayers will once again be punishing them with huge amounts of public money paid directly to each institution in involved in the crimes.

    I noticed that the oligarchs themselves don’t like being cheated. IMO the Madoff affair illustrates the power THEY have to get back their losses. They drowned the business partner and got a little back. Then they hung the son, to get the numbers either from him or the father, and announced three days later that a huge sums would be returned to the biggest investors. Hmmm.

  • Larry

    Wall Street is intent on looting the economy until it collapses beneath us.

  • Dave in CT

    As long as the power of Big Government is used to pick winners and losers on Wall Street, via the unaccountable Fed and well-intentioned central planners, we will have unfree markets, a lack of alternatives and the status quo collusive corruption that follows.

    Investment Bankers and the State:

    http://www.lewrockwell.com/rothbard/rothbard97.html

    And,

    Hope for open minded, honest, Libertarians and Progressives to work together:

    http://www.thefreemanonline.org/headline/getting-taken-seriously/

    alot of the comments after that article might interest those here.

  • Abel

    Hey Tom,
    Can you ask your guests what they think the most effective action that we as a public can take to stop the fraud in the financial system. I don’t know how many people have faith any longer that regulators at the SEC, the Department of Justice, the FBI or the Fed are willing or able to do the job. I still have some hope that the courts will get it right; that there is some rule of law which applies to all equally, but I’d love to have a plan B and not rely so much on hope.

  • Dave in CT

    Every time you say Wall St, you need to complete the phrase with “Wall St., The Fed, and the well-intentioned Government Planners.”

    Inevitable results.

  • Dave in CT

    Bail outs are government picking winners and losers. Who here in their gut wouldn’t have been more satisfied if the Investment casino banks had been allowed to fail, AIG, GS etc. Yes we would have had tough times, but I trust Americans to help each other with the basics, more than I want to save the corrupt status quo.

  • Eric M. Jones
  • Mike in PA

    Where is prosecutor Michael Fitzgerald? We’ve seen him butt in on Blogojevich and we’ve seen him go after Scooter Libby, wasting millions of tax dollars and getting weak prosecutions!

    Where did Congress’ subpoena powers go? While McCain and Spector were busy holding hearings on Steroid use and having McGwire and Canseco visit DC, people were being put out of their homes!

    Where are the local judges? Get some courage and strike out these mortgages as fraudulent!

  • Dave in CT

    Markets operate, theoretically, under the Rule of Law. If they are acting lawlessly wild, it is due to a lack of enforcement of the Rule of Law, basic, equal guidelines, and only occurs via the power of government and the Fed, choosing NOT to enforce the basic Rule of Law that a true free market needs to operate fairly and efficiently.

  • Larry

    Wall Street owns Washington and everyone knows it.

    Wall Street writes the laws they don’t even bother to follow.

    Wall Street is a criminal sector of this society.

    Wall street is an enemy of the real economy.

  • Dave in CT

    Lets watch the BS here, with all due respect:

    “Finally, libertarians need to be attentive to the difference between being “pro-market” and “pro-business.” It’s easy when talking with Progressives to engage in reflexive defenses of the private sector, but it’s important to keep in mind that what we ultimately care about is competition, not individual competitors, since it is competition that best serves the needs of everyone — the worst off among us most of all. We don’t need to go as far as Kevin Carson or Roderick Long and argue for a more left-oriented understanding of the market, though their work is a powerful corrective to the problem I’m identifying. But we need to be willing to call out private firms that use the State and to acknowledge when private firms behave badly on their own. Reflexive defenses of the private sector are both bad strategy and intellectually mistaken.”

    http://www.thefreemanonline.org/headline/getting-taken-seriously/

  • JP

    Everyone who ever listened to the “This American Life” episode, “The Giant Pool of Money,” has always known that the free market going nuts was responsible for the mortgage crisis, and the government had very little to do with it.

    If you haven’t listened to the episode, do yourself a favor.

    The idea that the government was mainly responsible was the blather of idiots trying to blame anyhting other than the conservative GOD of deregulation.

  • Dave in CT

    Ron Paul and Austrian style economists called this a looooong time ago. Old News.

    Give non-mainstream credit where it is due.

  • Rick

    While we are asking what individual failings and sins led to the meltdown, why not also question how our economists and business schools are justifying, advocating and enabling these practices? For example, economists and b-schools teach that you can buy and sell money for profit ad infinitum as if there were no upper bounds on growth, which is disturbingly inconsistent with everything else we observe in this world. Such large numbers of people don’t act as if their actions are so consequence-free unless they are taught it is so. “Inside Job” started to raise this issue but fell disappointingly short.

  • Darryl

    Does anyone else wonder why the American public is not so upset at the large amounts of monies being spent in bailouts, 0% or extremely low interest loans, and other means that are being financed by the American taxpayer for the sole benefit a few extremely wealthy people?

    I do wonder how long the established political parties in this country can keep forcing the risks that financial institutions take on the American public while letting all of the rewards go to a exceptionally small percentage of the population. This is not only reflected by the government treatment of Wall Street but also our tax code.

  • Webb Nichols

    Forthright, honest, fair government functioning fearlessly without special interest influence serving and putting all its constituents first would be a nice change. Try it you might like it.

  • Dave in CT

    Bankruptcy would have been the ultimate rule. But of course, too big to fail.

    GS–AIG would have paid the price along with the rest of them. They could never have become the beasts the were with Government support along the way, and the knowledge they would be bailed out with our money in the event of failure.

    To just say we have to Regulate, presupposes we know everything, good and bad that can be happen. That is just static utopian dreaming.

    What we need is true assumption of risk by owners and investors, and the might hand of failure to whack down those who go too far.

    Amazing what self-preservation, if you are forced to feel it, can do to control your behavior. But with Big brother and Too big to fail, we never feel it.

  • http://www.peaceabbey.org Lewis Randa

    Read your book The Big Short, then saw the documentary Inside Job and made it a school project to demonstrate with our special needs students at Goldman Sachs in Boston and put a 9 foot statue of Gandhi in the front revolving door with the words “The world holds enough for everyone’s Need, but not for everyone’s greed” and closed the entrance down. Thanks for your book which explained the level of greed which in turn put us over the top … Social Services are hit hard with budget cuts while Wall Street gives billions in bonuses. See: http://www.quakerearthcare.org/Publications/QuakerEcoBulletin/QEBArchive/QEB-PDF/QEB-11-1Right-Goldman-Sachs-web.pdf

    Thanks,
    Lewis Randa http://www.peaceabbey.org

  • Kathy

    I went to a party last fall full of NYC financial types. All the talk was about the houses in the Hamptons they were buying and the elite schools their kids attended. I was horrified by how little pain they felt when the rest of the population is worrying about how to pay the bills. I think they live in a bubble that allows them to believe that they deserve this life — it’s time to pop that bubble! This industry needs serious controls to rein in its behavior!

  • Dave in CT

    Classic report, such dilute finger pointing, ensures there will be 0, yes ZERO accountability.

    Without some big bankruptcies, without jailing some of these corrupt cronies, there will be unrest at some point.

    Little guy will go to jail for years for a bag of weed. White collar cronies get bailed out for willfully destroying a generations economy.

  • Mark, Acton MA

    When it comes to government, you get what you pay for.

    Wall Street bought influence in Washington with campaign contributions and undid or defeated the regulations that would have prevented this.

    We will have more of these cycles unless politicians are answerable to the people, and that will not happen unless we get meaningful campaign finance reform. And that would not survive with the current Supreme Court, as proven by Citizen’s United.

  • Bob of Newton

    I would like you to have Yves Smith of Naked Capitalism on your show. She has a very interesting take on the report.

  • Erin in Iowa City IA

    The government by bailing out these huge monstrosities has only “kicked the can” and delayed what really NEEDS to happen. These firms should FALL and let the truly free markets decide. The super rich still don’t have enough money to prop up these greedy institutions.

  • Phil Brewer

    Everyone on this show needs to go to Youtube and watch “Bankers Song” which is a hilarious and pointed treatment of the testimony of Blankfein, Moynihan, and Rubin before the investigation commission. Here is the url: http://www.youtube.com/watch?v=-fTh2GffJsM

  • Larry

    We have heard it over and over: the banks had to be bailed out or the financail system would collapse.

    So, three years, and 14.2 trillions dollars later Wall Street is back in the stratosphere and the American economy is crumbling.

    What we could have done in this country with that money to get off of oil, to build infrastructure, to educate people, to take care of people, to create jobs is something we will never know.

    We are a wreak of a society now and headed downward at lightening speed.

    There is 20%+ unemployment in this country and the states and municipalities are going to lay off another 1 million people this year.

    We are in big trouble people. And and a good half of it is directly due to Wall Street.

  • bambi

    i recall an independent southern bank owned by a powerful family. it was late ’80s working in bond dept. i was young and didn’t fully understand what was going on. remember overhearing – fully backed by faith and credit of US govt when salesmen touted fnma and fhlmc pools and swaps to their customers– mostly downstream banks. and seeing sen. shelby waltz through collecting contributions. shortly after glass steagall was repealed.

  • jim carroll

    Shortly after FDR was elected he appointed Joseph P. Kennedy as the first chairman of the SEC. Kennedy was widely seen as one of the biggest winners/crooks on Wall St. and FDR figured that if anybody could prevent a future crash by fixing its flaws it was Joe Kennedy.

    I’d like to know if Mr. Lewis could reccomend the modern equivalent of Joe Kennedy?

  • Larry

    I went to a party last fall full of NYC financial types. All the talk was about the houses in the Hamptons they were buying and the elite schools their kids attended. I was horrified by how little pain they felt when the rest of the population is worrying about how to pay the bills. I think they live in a bubble that allows them to believe that they deserve this life — it’s time to pop that bubble! This industry needs serious controls to rein in its behavior!
    Posted by Kathy

    These people think the American people will never rise up and seek justice for the crimes Wall Street has committed.

    They better hope so.

  • John

    Darryl – All my friends and I have wondered why people aren’t protesting in the streets. I think it’s because of the Tea Party – the financial folks have got them stirred up – toward government and Obama. The rest of the country just feels like it’s impossible to make a difference.

    We have a Democratic president and party that is just as invested in protecting Wall Street as the Republicans are. Most of the 60′s types I know I just dispirited about making any dent in the system.

    If you read “The Big Short” or “All the Devils are Here” and look around you’ll see that nothing has changed.

    John
    Williamstown, VT

  • Brynn Jacobs

    Has Wall Street been reformed? Are you joking? You mentioned that Simon Johnson has argued that nothing has changed, don’t forget about former S&L regulator Bill Black, who has been speaking out about the pervasive fraud that Wall Street has demonstrated for years.

    The Statute of Limitations on some of these crimes is ticking, time is running out!!

  • Tom

    Maybe the question is How did we clean up wall street?

    As a small investor I am confused by some of the investment vehicles that have been created. An example is derivatives, CDOs and more. Poor investments made by others directly effect me and my neighbors. Although I have a general idea of what these investment vehicles are I am unable to participate or protect myself.

    It is a closed game.

  • Mark in Des Moines

    The Lewis book is amazing. Read it and weep, or laugh.
    You’ll do both.

  • regina pyle

    Hi Tom

    Would you have your guests comments on the role played by the
    Professors of Economics at our major universities. In the movie,
    Inside Job, Charles Ferguson (producer) interviewed among other, Glenn Hubbard,
    Dean of Graduate School of Business. According to Ferguson,
    Glenn Hubbard was paid approx. $145M by the Icelandic Chamber
    of Commerce to write a glowing report of the banks which failed
    shortly after the report was published. Hubbard saw nothing
    the matter w/ this.

  • David

    The 662 page FCIC report is here:

    http://www.fcic.gov/report

    It’s quite readable. I Hope Michael Lewis & Bethany McLean will evaluate the dissenting statement as well.

    David
    Merrimack, NH

  • Erin in Iowa City IA

    And another thing. How do we expect an entire group of people whose SOLE PURPOSE is making money (“bankers”) to have a MORAL COMPASS? That is a silly question!

  • http://www.thisamericanlife.org/radio-archives/episode/382/the-watchmen jimmy

    Listen to the piece Ira Glass put together for This American Life – NOTHING has changed, listen to how this whole melt-down was allowed to happen gradually from the post Savings & Loan era – all your presidents and their administrations and Congress are to blame…

    Gekko said it and Wall Street lives and breathes it today – “The point is, ladies and gentleman, that greed, for lack of a better word, is good. Greed is right, greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit”

    Good luck America – ride the wave up and cash out at the top >>> history will repeat itself in about 20yrs because Congress has done NOTHING to fix what just happened.

    Jimmy
    Niagara on the Lake
    (on the other side of the river from Fort Niagara)

  • Wilson Lowery

    In addition to Wall Street culpability in causing the financial crisis, why are you not focusing on the roles certain members of Congress played in not allowing more regulation of Fannie Mae and Freddie Mac? President Bush proposed legislation in 2005 about the extreme risks being assumed by by these two organizations and was blocked by Congress, ie, Barney Frank. And how about the risks by Fannie and Freddie assumed and how this benefited former leaders of these two organizations with one leader leaving with more than $50 million.

    Let’s get the full story out; not just the Wall Street chapter.

  • Scott Burns, Jamestown NY

    The best worst quote I have heard was from a Wall St power player that was confronted by Matt Taibi and Jesse Ventura about the practices that brought about this crisis, and how they’re continuing to do them, was when he said (only slightly paraphrased, I promise), “Unless you [the people] tell us to stop it, we’ll keep doing it.”

    ***

    I’d hate to see what would have happened if Soc. Sec, Medicaid, and Medicare were privatized and had been invested in the stock market the way many on the right in Congress wanted to, and it’s being talked about again.

  • http://onpointradio.org Keith

    How about changing the monetary system?

    Anyone who looks beyond the curtain on Wall Street and the Fed will find the ultimate source of todays financial issues AND government debt to be the wrong direction taken with the Federal Reserve Bill of 1913. How about some bold innovation now on the nation’s financial system? “Bold” meaning enough to bring about a fundamental change that brings equality, protection, abundance, and maybe even a bit of leisure time to a majority of ‘we the people’!!!!

    Why not put the right to create money back in the hands of the government, for example?

    Can we hear more about fundamentally CHANGING THE SYSTEM?

  • Dave in CT

    “Darryl – All my friends and I have wondered why people aren’t protesting in the streets. I think it’s because of the Tea Party – the financial folks have got them stirred up – toward government and Obama. The rest of the country just feels like it’s impossible to make a difference.”

    What are you talking about? You guys really swallow the anti-Tea Party stuff hook line and sinker.

    The honest, original Tea Party spirit was against bailouts, against big banks and Wall st colluding with government and against the Government that made it possible via collusion and blind eyeing.

    Yes, alot of the Tea Party has be hijacked by Tea-O-Cons, Neo con, regular Republicans, riding the populist coattails.

    Yes there are social conservative Tea parties we wouldn’t share views on.

    But stop pretending there is no Honest sentiment, directed in the right direction in the little guy Tea Party out there. Just because they see a role of government collusion more clearly than you might, don’t throw the baby out with the bathwater, our surely, we have been divided and conquered.

  • Sophie

    Question for Ms. McLean.

    Please speak to the ratings companies’ sins in the valuation of toxic debt. Isn’t there a common thread here, left from the Enron crimes, there was never really pulled (perhaps except in your fine book, The Smartest Guys in the Room)?

    Is the problem with the ratings companies really a fraud and a conspiracy to allow accounting crime?

  • sean linck

    why don’t you talk about the gov’t forcing these crappy loans? this happened during the clinton adm.. talk about it!!!!!!!

  • Bill Marks

    Wall Street is a scam, as are the politicians who take millions of dollars to prop up Wall Street. The discussion is deliberately ignoring the willful goal of the government to increase home ownership. The guests deliberately fail to mention the many law suits that were brought by the activists against the lenders and banks to force them to lend to those who could not afford such mortgages loans. These lenders, were forced to change their lending qualifications and lend to people who were clearly unqualified for such loans. These banks found ways to unload their defective loans. These lenders, knowing that the loans were defectivem, then sold the loans to others who passed the risk to others in order to make money for themselves. The greed that exists in this country is outrageous. Choke on your money. The taxpayers got screwed again. It will happen again and again. The regulations passed under Obama did nothing. But continue to believe that things are better. Continue to believe that Obama will save you. Freddie and Fannie have not been reformed. As long as the governemnt guarantees such loans, the scam will continue.

  • Brenda

    As I heard the common refrain about all the deadbeats and people who bought mortgages they couldn’t afford, all I could think is people bought Pinto’s too and didn’t think the gas tank would explode.

    Look, the bankers look at mortgage documents all day every day. The average consumer looks at mortgage documents once or maybe twice in their lives. The bankers sold us mortgages that had exploding gas tanks. They knew or should have known that their product was defective, they should be held accountable for this.

  • Larry

    Right now the Senate Budget Committee is holding a hearing on the U.S. economic outlook for the next ten years

    Senator Conrad of North Dakota’s opening remark was the same excuse we’ve heard since the start: we had to bail out the banks or we would have had a collapse of the financial system. We had to hand over trillions of taxpayer dollars or we would have had a depression.

    The truth, Mr. Conrad is you, and your bought and paid for fellow congressman sold the citizens of America into a lifetime of debt and no services because you handed criminal banks a not only a life jacket, but a mega yacht.

  • Dave in CT

    1.4 Billion fine. oooooooo.

    Trillions in bailouts?

    We need realhardship and punishment to the bad guys. Lots of bad guys.

    This attempt to make us think there are no bad guys, just bad system is nonsense. There are just alot of bad guys.

    Make your radical reform, with Rule of Law, AND throw them in jail.

    Such crap. No one else in society gets a free legal pass because the system stinks.

  • Abel

    Can anyone explain to me why investment banks aren’t liable for breaching fiduciary responsibilities? It seems obvious that they represented themselves as offering financial services when, in fact, they were just looking for the best way to make the most money off of them.

  • Tom

    Shamefully no substantive changes have been made. Government is the only player who can protect the common good yet government has been co-opted by the unscrupulous wealthy. That “Wall Street” considers itself justified in manipulating the system for their own profit is proof enough that corruption and unethical behavior reigns. We could well use an Egyptian style Tuni-sami here in the US to force changes in the government and its false stewardship of our society. Government here is owned by the corporations and the filthy rich while being run by their agents, a pack of amoral lawyers and lobbyists.

  • Rob (in NY)

    There is a danger of oversimplying by referring to the entire financial sector as “Wall Street” and villifying it as a criminal activity. The bottom line is that most businesses and governments (from state and local to federal) are dependent on functioning financial markets. This broad definition of Wall Street can encompass bod markets, municipal finance, standard investment banking, venture capital, private equity, hedge funds, etc….

    There was fundamental breakdown in corporate governance and risk management that occured at financial institutions when people whose primary job is to manage and mitigate financial risk started to become compensated like traders and sales people (e.g. on short term sales). Many investment banks essentially became large hedge funds and made more money on their own trading desks from standard investment banking activities from servicing their corporate clients.

    I believe a modern day Glass Stiegal that separates day to day banking and even standard investment banking from risker activities, such as a firm’s proprietary trading and hedge funds, is essential. The Volcker rule was a good start. A key is whether a bank has access to the Federal Reserve discount window, but this entire concept of “To Big to Fail” needs to be addressed even among those entities that fall outside of those with access to the Federal Reserve discount window.

  • John

    We need a money strike

    Your vote doesn’t count, your voice no longer counts with the politicians. In other countries the people call general strikes but the burdens of the downturn still fall on them – not the big money types.

    We need to “vote with our feet” and start a money strike. We need to keep all out money in cash – don’t contribute this year to your IRA or 401K, suspend your automatic payments. March into HR tomorrow and raise up your deductions so you’re paying next to nothing into the tax coffers.

    If we all did this we’d get the attention of lawmakers and bankers alike.

    John
    Williamstown, VT

  • Mark Loomis

    Matt Taibbi, in his new book Griftopia, suggests that the Wall Street speculators are behind the sharp increase in commodity prices worldwide…is this the new manner with which they are crashing the world economy that Micael suggested?

  • Nancy Brockway

    One devil that needs to be called out is the tax code. When a few Americans began gathering even more of the wealth of the nation, they looked for places to invest it. The bond market changed from a sleepy Wall Street backwater to the scene of a modern day snake oil store. For example, Anthony Mozillo let Countrywide get into subprime mortgages under pressure from his lenders to open up his company’s portfolio. Income inequality is one of the villains not often enough noted in the story….

  • Darryl

    @ John

    Thank you and I agree about our political parties, I actually believe that we have one party the Corporate Party that has two competing wings. You are lucky to live in a state were there seems to be a collective push to local systems and businesses that is populated by people who seem to be aware that the accepted business as usual is not sustainable.

    It is a far cry from Alabama, where all of our problems are blamed on the “liberal elite that controls government and business” I really want to move my family to Vermont.

  • Eric

    Do we live in a “corporatocracy” instead of a democracy? Is there even an argument anymore? The system won’t allow the big firms to be broken up. I was heartbroken with the Brown/Kauffman ammendment didn’t make it into the “financial reform” bill.

  • Maria Buatti

    Please ask your guests to elaborate on the false bravado of the Bank CEO’s. They still need to act like big gorillas, who thump their chests to scare away. All along they cannot seem to admit their ignorance of, and intimidation by, the MIT physicists who concocted the CDO’s. They isolated themselves at the top (playing bridge, etc.) while their risk managers had no staff to counter the quants. The CEO’s only cared about the daily bottom line, and maintaining their image of being in charge.

  • Maria Buatti

    I’m from Middletown CT, and a daily listener. I count on Tom to get the real story.

  • Scott B, Jamestown, NY

    Maybe the SEC will do something when it gets the funding, and independence like the Congressional Budget Office ha,) from Congress it needs after it was gutted by the Bush admin. Many of the SEC people wern’te money people, they were lawyers. They didn’t have the staff (Years ago they sent TWO investigators to check out Madoff and pronounced it ok), much of the staff didn’t have the qualifications, and they didn’t even have working office equipment, having to go to Kinkos to simply makes copies.

  • http://tombstone001.blogspot.com Mohammed N. Razavi

    We must look in to the need for extremely low interest to be able to finance the federal debt, wiyh higher rates the government will really go bankrupt.

  • Dave in CT

    Changing the system means changing the collusive influence of the Federal Reserve. As the greatest, unaccountable power in our world, you will never hear the status quo elite that use it to attempt to centrally plan our world, ever challenge it.

    The more complicated and unaccountable our systems are, the more power is shifted from people to government and business interests, the less chance at a fair shake at life we will have.

    Government loves the complicated legal framework they have created over generations because it gives the power to work under the radar and grant legal favors where the want.

    Obviously Big business loves that as they lobby for the favors to their industry.

    Do you see how this is corrupt? How Government/Business collusion, that Democrats and Republicans love, and Libertarians abhor, is continually holding us hostage?

    Central planning gives the utopian dream of actively constructing a “fair” world, but power corrupts. Only liberty, with the collective decisions of free individuals has a chance, not a guarantee, a chance, of leading us to a good place. But concentrated power and central planning is guaranteed to fail.

  • http://wbur Richard

    Could someone please explain to what degree if any did private mortgage insurance (PMI) play in protecting lending institutions from mortgage defaults.

  • Larry

    Jamie Dimon of JPMorgan Chase should be spending time in prison instead of mouthing off at Davos Switzerland about how governments must stop banker bashing.

  • Zeno

    The core of all of this corruption is Investment Banking.

  • cory

    We are to blame as well. We believed their lies. We borrowed and spent and believed it could never end. I am no different. Though others are far worse off, I too have enough debt that I cannot disengage from this corrupt system. I too must be led along by the nose by the corrupt financial and political institutions. Hopefully our children will surpass us in strength and wisdom. I do not believe we are up to the challenge.

    Leftfield, Wisconsin

  • Morticia

    I work in mortgage banking and watched these bad loans going through the banks. The people in the back offices knew these loans were bad but the money was good so they held their noses and signed off on the loans. Staff who objected to churning out all of this bad paper were escorted out the door by bank security.
    The argument we all told ourselves was, “These people really want the house, they’ll find the money to make the payments.” These houses are now vacant.

  • http://cyberfumes.blogspot.com Dave Eger

    How does Brooksley Borne fit into this?

    For anyone who hasn’t seen Frontline’s The Warning, it’s a must-see.

  • Jay

    Rather than trying to break up the big banks which will likely just rebuild themselves over time, why don’t we simply eliminate the securitization of mortgages. Banks will be accountable because they will own the loans. Clearly the expansion of the credit markets that securitization enabled was a really bad idea.

  • ulTRAX

    In the US the easiest ways to get rich are to advance professionally, invent something, speculate, or speculate…manipulate markets… inflate bubbles. Better yet speculating with other people’s money.

    We’ve allowed much too much of our economy to revolve around reckless and unproductive speculation instead of productive investment.

    WNNZ western mass

  • Dave in CT

    “Do we live in a “corporatocracy” instead of a democracy?”

    We live under State Capitalism

    Corporatist Plans (Dems and Repubs alike, currently Dem in office):
    http://www.thefreemanonline.org/columns/tgif/corporatist-obama/

  • http://www.openeyesvideo.com Glenn Koenig

    Arlington, MA – A few years ago, when I heard about interest only mortgages, the hair stood up on the back of my neck. I was just freaked that anyone would buy a house and have a mortgage like that! What could they be thinking?

    Years before that, when I heard about dot com firms that had no assets, no income, raking in the big bucks by selling stock, I thought what are they thinking? Then I realized what they were thinking – that sales at brick & mortar stores would remain strong, AND people would spend that much again for purchases over the internet. Essentially, they were predicting consumers would double their spending! No. Not going to happen. And it didn’t. And it crashed.

    There is a fundamental issue of human nature at work here. That is the desire of something for nothing. The siren song that speculation is a good way to build wealth. Nonsense. Real wealth is not money, it’s what we have created in real world assets.

  • Larry

    Go see Inside Job nominated for an Academy Award.

    http://www.sonyclassics.com/insidejob/

  • Dave in CT

    “We’ve allowed much too much of our economy to revolve around reckless and unproductive speculation instead of productive investment.”

    And it all starts with the unaccountable Federal Reserve and its’ monetary policy, and the leverage it affords the bubble pumpers.

    It is clearly the economic model of our generation. Get what you can from the bubble and get out before it vaporizes. Good luck regular guy or gal.

  • K Kirsch

    It was all trickle down ignorance and greed to me. I saw people buying 270K houses that only earn 50K. This was a rolling economic ball started with the big investments companies eyeballing big earnings and a whole bunch of suckers underneath.

  • George Sedlacek

    Why do we believe there is a difference between the mob and wall street. Criminals always gravitate to the easies place to make fast money and it seems they pulled off the greatest scam the world has seen in a long time.

  • http://www.kusiakmusic.com John

    The little guy isn’t trying to invest in the Wall St. game on purpose. Isn’t Wall St. gambling with our 401K money without our complicity?

  • zofia-maria (from providence)

    When I quizzed my bank representative in 2005 why I was being approved for a home-loan greater than my ability to pay it back I basically received a verbal shrug of the shoulder. I found a more rational lender.

    Wall Street’s behavior showcases how both ethics and common sense can be erased by greed – and the idea of financial stewardship went out the window. We may not be able to teach common sense but the ethics of stewardship can be taught and should be both formally and informally.

    If the food industry mismanaged our national safety this way there would be street riots.

  • Jay in Buffalo

    Would either of your guests comment on the study released by Mayor Bloomberg and Senator Schumer called “Sustaining NY’s and the US’ Global Financial Leadership Services.” This was released on January , 2007 just as the cracks were beginning to appear in the crisis. I have looked and just about every major politician in NYC praised this study and its conclusions even though the practices endorsed in this study were the basis of the crisis. If politicians of the financial acumen of Bloomberg could get taken, what about the rest of us. Now we are all paying in the form of lost value in our IRA’s. 401′s and other public and private pensions. All of us are paying higher taxes and working longer years in delayed retirement.

  • Larry

    Housing prices were deliberately driven up and most people who did got into the game were just trying to buy a house so they could live in it before the prices went completely out of reach.

    To blame this orchestrated crises by the criminals on Wall Street and Washington on people who are just trying to live a decent life is crazy.

  • Gary

    The lending industry is over supplied with people searching for investment. Surplus of savings that drives investment when used to be “need” drove investment. Galbrith Affluent Society, see also Paul Krugman

  • John

    Dave – I wasn’t putting down the Tea Party. I’m pointing out that Democrats and others see no place for them in the Tea Party. They are the one’s getting shouted down by Tea Partiers.

    I say that the Tea Party is not wrong they are just misdirected and late to the game. They should have been questioning how you fight two wars w/o raising taxes back in 2004-5. They should have been questioning how you can keep an economy going without good paying jobs.

    Instead of looking at the root of the problem Tea Partiers have been herded into the budget cut creeping socialism mantra – which is too bad. They need better, more level-headed leadership but the people who could provide that feel very shut out from the Tea Party movement.

    John
    Williamstown, VT

  • Dave in CT

    “Thank you and I agree about our political parties, I actually believe that we have one party the Corporate Party that has two competing wings. You are lucky to live in a state were there seems to be a collective push to local systems and businesses that is populated by people who seem to be aware that the accepted business as usual is not sustainable.” John and Darryl

    Sounds very Libertarian.

    http://www.thefreemanonline.org/headline/getting-taken-seriously/

  • Tom

    I am tired of hearing blame being placed on the mortagees. Some may well know exactly what they are doing but most trust that they are being honestly dealt with. Blaming the little-guy is just blaming the victim – like saying the rape victims are responsible for making themselves vulnerable.

  • Zeno

    Voting against Wall St. – LOL

  • Dave in CT

    Thanks John, I agree with that. I am saddened that honest Tea Party people/spirit has been so quickly and effectively herded and co-opted. Make progressives hate them, try to make them love republicans. Divide and conquer.

  • Larry

    Goldman Sachs, JPMorgan Chase, Morgan Stanley, Wells Fargo, Citigroup, and Bank of America are the 6 banks that control influence over an amount of wealth that is equivalent to 60% of America’s GNP.

  • arthur mcallister

    Louis Brandeis once said that we can have a democracy or we can have large concentrations of wealth, but we cannot have both.

    We are living that prediction with this financial crisis.

  • Rob (in NY)

    Posted by Larry, on February 1st, 2011 at 10:47 AM
    “Jamie Dimon of JPMorgan Chase should be spending time in prison instead of mouthing off at Davos Switzerland about how governments must stop banker bashing.”

    JP Morgan Chase (led by Jamie Dimon) is one of few financial institutions that actually managed its risk to housing and its related financial instruments including subprime, CDO’s, etc… Others in the business can learn from JP Morgan Chase, which will probably make a good future case study at Harvard Business School.

    P.S. I see that the liberal definition of free speech means that those with whom the far left disagrees should be in prison. Spoken like a true Stalinist.

  • J.C. Foritano

    Dear Tom,
    Your show is brilliant! Your guests are brilliant!! You are brilliant!!! But I seriously wonder if all this brilliance is really contributing more of a splash to the so called “National Dialogue than the on-going fog of toxic idiocy.
    Is it not time to bring back real national dialogue by calling out spokespersons such as your guests or a panel of your guests to go up against other spokespersons, such as Jamie Dimond of Morgen Stanley or Jamie and a panel of other experts with the same viewpoint.
    I get so tired of hearing what the “American People” are demanding from self-appointed interpreters, that, I, again, seriously wonder if we don’t have a duty to our nation and the world to put our best minds of contrary opinions in point to point discussions. Civil and self-governed. A new “American Idol” for voters.

  • Dave in CT

    As I’ve said, naive or not, Be a Better Tea Party.

    The Ron Paul/Ralph Nader stuff gives a ray of hope:
    http://www.rawstory.com/rs/2011/01/ron-paul-ralph-nader-agree-on-progressive-libertarian-alliance/

    as does the perhaps emerging Libertarian/Progressive dialog I keep referencing:
    http://www.thefreemanonline.org/headline/getting-taken-seriously/

  • geffe

    If we want change look to the people of Egypt. Get on the streets in the millions and protest and demand the changes.
    If the wall street folks don’t like, to bad. Tell them the party is over, freeze their accounts. Break them all up.

  • David

    Want to know what the “Tea Partiers” are so angry about? DUH!!!!!!!!! Listen to what those who agree with the Tea Party have been saying!
    I am not a Tea Partier, don’t know anyone who is. It’s about having a voice and being heard! And wanting real change, transparancy and accountability from Washington to Wall Street!

  • anne marie havel

    there is another answer that bethany didn’t mention. take your money out of the big banks and put it in your local community banks. start new community banks. take away their assets!! they can’t do what they do without the assets. and make sure that these local community banks cannot be “gobbled up” by the big ones to get their assets back.

    commenting about trying to say that people borrowing too much/buying homes they could not afford. well, i can only say that NO ONE can borrow money unless someone (read, the banks) gives it to them. if they do not know how to do due diligence when they lend money, then, how can they claim to be bankers?

  • nj, Ashland, Mass.

    We are witnessing a convergence of trends and circumstances in this country—the Wall Street abuses being just one of the more blatant and serious manifestations—that appear to be plunging the U.S. ever more deeply into corporatism/fascism a la Mussolini.

    President Hopey McChange railed against lobbyists in his campaign, yet hired the biggest Wall Street players to run his economic team. On this and dozens of other issues, Obama has shown himself to be only the latest Executive-branch enabler of corporate interests.

    When it was earlier asked what can be done, i’d offer one word: Egypt.

    Begging for crumbs, posting on message boards, sending e-mails to politicians is really just pissing in the wind at this point. Sitting behind our computers clicking out missives is not going to do it. Massive public actions look to be the only solution to move the Beast.

    The next segment appears to be about the presumed woes of college students. Where’s the student activism that was so evident in the civil rights, anti-war, and environmental movements in the 60s and 70s?

    Time for a new movement.

  • Larry

    JP Morgan Chase (led by Jamie Dimon) is one of few financial institutions that actually managed its risk to housing and its related financial instruments including subprime, CDO’s, etc… Others in the business can learn from JP Morgan Chase, which will probably make a good future case study at Harvard Business School.

    P.S. I see that the liberal definition of free speech means that those with whom the far left disagrees should be in prison. Spoken like a true Stalinist.
    Posted by Rob (in NY)

    I can tell from your comment you know nothing about went on with JPMorgan Chase in the past 3 years.

    Or you work there.

  • Robert

    It’s time to take to the streets. We are ruled by Oligarchs who have created the illusion of choice by supporting two parties with the same agenda. What’s happening in the middle east can happen here. The difference here is the general public is armed to the teeth. Just look at the overreaction to the assassination in Tuscon. That had nothing to do with ideology yet the overwhelming response by government and media was as if it did (including our dear host). That’s how frightened the ruling class really is of the slightest spark of public realization of our serf status. Open your eyes oligarchs the peasants are in the barn sharpening pitch forks! (And I’m a bleeding heart lefty.)

  • Cecelia Blair

    MYTHOLOGY DRIVES THE NARRATIVES

    1. From Greenspan’s fervent belief in “free market economics”–uncontrolled capitalistic expansion, to

    2. The belief in “the American Dream” of home ownership, to

    3. The big institutions need to be left free of any regulation, from the crowd with torches and pitchforks, and that the only fault is with the poor (read, Black, Hispanic, single mothers, etc.) who took out those mortgages, to

    4. We deserve our high salaries and all the perks, our wealthy lifestyles–we “earned” it–from those making vast sums of money on this system, to

    5. If we identify and punish “bad guys”, individuals, we will have eradicated the source of the problem, to

    6. If investments, such as Derivatives which were reaching levels over 10 trillion dollars, I read, in the year or two even before
    The Crash–as long as these are complex, unregulated, obscure, part of a Shadow Banking System–like other behaviors which are in the shadows, then, psychologically, THEY ARE NOT REALLY HAPPENING and so don’t count,

    It seems clear to me that most are not interested in reality, in facts, in finding out and understanding the truth, but in dealing with their anxiety and uncertainty by reasserting familiar myths as vociferously as possible.

    Yes, I agree that this crisis is not over but continues on, with the subsequent failures being national budgets, beginning in Europe and spreading…this is a long cave in, folks, like the ground over a place which has been mined and mined until it is hollowed out.

    WHEN WE IGNORE REALITY AND SUBSTITUTE MYTHOLOGY, WE ARE FIRMLY SET ON A PATH OF SELF DESTRUCTION.

    My conclusion and remedy is to start being interested in facts and reality and to let these show the way forward. We might start teaching Economics, real Economics in high school. The American public is close to ignorant on the subject, to its peril.

  • Larry

    The elite in Washington didn’t see the uprising in Egypt coming.

    They won’t see the uprising in America coming either.

  • Robert

    It’s time to take to the streets. We are ruled by Oligarchs who have created the illusion of choice by supporting two parties with the same agenda. What’s happening in the middle east can happen here. The difference here is the general public is armed to the teeth. Just look at the overreaction to the assassination in Tuscon. That had nothing to do with ideology yet the overwhelming response by government and media was as if it did (including our dear host). That’s how frightened the ruling class really is of the slightest spark of public realization of our serf status. Open your eyes oligarchs the peasants are in the barn sharpening pitch forks! (And I’m a bleeding heart lefty.)
    Somerville Ma

  • Dave in CT

    “When it was earlier asked what can be done, i’d offer one word: Egypt.

    Begging for crumbs, posting on message boards, sending e-mails to politicians is really just pissing in the wind at this point. Sitting behind our computers clicking out missives is not going to do it. Massive public actions look to be the only solution to move the Beast.

    The next segment appears to be about the presumed woes of college students. Where’s the student activism that was so evident in the civil rights, anti-war, and environmental movements in the 60s and 70s?

    Time for a new movement.”

    Great Sentiment, very tempting.

    I would just hope we know what we want before we get out there. If we have no vision, no shared principles, we will be crushed and the power elite will feed on and use our dissarray and arguing to rebuild the pieces against us.

    At least we have the glimmer of hope with our purported self-governing system. If most of us could largely agree on the basic principles we see as necessary, and used the internet to do and know that, then maybe we could make it happen.

    I think we as a country have been so politically lazy for so long, so disconnected from the basic principles of self-government and our economic model, as we have been compliant piglets at the government/corporate trough for so long, that we have some re-examining to do.

    The discussions on this forum are a good start.

    But if the mass of the country is still divided by the false characatured choices of Neoconservative Crony Capitalism vs Socialism, and we fail to realize that we have a corrupt State Capitalism, we will get nowhere. IMO we need to understand what State Capitalism is, how it is enabled, and why it is bad for democracy/liberty.

    We have alot of reflection and discussion with family friends and neighbors ahead I hope.

    JMHO

  • Rob (in NY)

    Posted by anne marie havel, on February 1st, 2011 at 11:02 AM
    “there is another answer that bethany didn’t mention. take your money out of the big banks and put it in your local community banks. start new community banks. take away their assets!! they can’t do what they do without the assets. and make sure that these local community banks cannot be “gobbled up” by the big ones to get their assets back.”

    If anyone chooses to take this course of action, PLEASE make sure the smaller bank you choose to deal with is FDIC insured and you stay below the FDIC limits on all personal and business depository accounts. People should also ensure your brokerage accounts have SPIC protection (e.g. you get the assets you are invested in if the brokerage firm goes bust). There is nothing wrong with dealing with community bank, just make sure they are reputable and you cover your own risk.

  • http://shulmandesign.net Alan Shulman

    A couple of comments that have caught my attention, the first referring to Wall Street as the enemy of the real economy. I think it was Larry’s observation.
    Wall Street certainly has a lot of its focus on a “separate” economy from the one most of us have to contend with. While Wall Street finds investment opportunities and higher profits in Brazil, China, wherever but here, you and I are buying groceries, trying to keep our cars passing inspection, and the furnace running. Does what Wall Street do overseas really benefit the vaast majority of Americans, or even 5% of us? Would less consumption at WalMart et al and more local purchasing help the situation if most of us did it? Is there a valid consumer response to what Wall Street does?
    The second comment was from Dave explaining that the original and core tea-party movement was opposed to corruption, waste, and cronyism at all levels of government and corporate entities. I want to believe this is the case, but I hear very little, if anything from that sector of the Tea Party. If they have been co-opted, why do they not re-organize as a true Tea Party with a plausible agenda? I’d like to hear more about this. The Tea Party I know falls in line with the Koch Brothers who want less government so their activities are less regulated and certainly this Tea Party wants to see no decrease in the appetite of that insatiable defense industry.

  • Dave in CT

    Oh. And the elite here will have no problem using our military forces against us if we really threatened the system with protest. Who would punish them if they did?

    Right to Bear Arms making any more sense? Not that it would be a remotely fair fight.

  • Steve

    I have been suggesting… OPT OUT….to friends and colleagues for fifteen years and on this web-site for three or four.

    If your house is leveraged to provide stuff that you do not need you were a lamb being lead to the slaughter.

    Government is corrupt. Wall Street is corrupt.

    The only answer now is heads on pikes…let the banksters flee to cities/countries of refuge or face the consequences.

  • Dave in CT

    “Tea Party wants to see no decrease in the appetite of that insatiable defense industry.”

    Ron Paul and Campaign for Liberty types rail against the Military Industrial Complex and Foreign intervention, as well as economic welfare almost daily.

    http://www.campaignforliberty.com/article.php?view=1309

    Also I think its very hard to recreate the energy that kicked off the grass roots tea party stuff against bailouts and too big to fail.

    Maybe we are building up a head of steam again now, as the unaccountability continues, and maybe hopefully we are a broader coalition of outraged.

  • Larry

    Oh. And the elite here will have no problem using our military forces against us if we really threatened the system with protest. Who would punish them if they did?

    Right to Bear Arms making any more sense? Not that it would be a remotely fair fight.
    Posted by Dave in CT

    The police have been militarized and the military would be let lose on the civilian population should the citizens of this country have an uprising directed at the criminal elite. We can’t win going head to head.

    There are other ways to win however.

  • geffe

    Posted by anne marie havel, on February 1st, 2011 at 11:02 AM
    “there is another answer that bethany didn’t mention. take your money out of the big banks and put it in your local community banks. start new community banks. take away their assets!! they can’t do what they do without the assets. and make sure that these local community banks cannot be “gobbled up” by the big ones to get their assets back.”

    This is a good idea in theory. I would also add that credit unions are the best of all options as they are FDIC insured and they are owned by all who are members. One thing to remember more small community banks have failed in this current recession than large ones, the number is scary.

  • Larry

    Also I think its very hard to recreate the energy that kicked off the grass roots tea party stuff against bailouts and too big to fail.

    Maybe we are building up a head of steam again now, as the unaccountability continues, and maybe hopefully we are a broader coalition of outraged.
    Posted by Dave in CT

    The tea parties were not formed against the bailouts or too big to fail.

    They didn’t start until the stimulus bill.

    They are tools of the elite. Nothing more.

  • JaMu

    Cory wrote:”at, Santa Cruz,

    Just too long, dude.”

    Neither too long or too short at, your quote explains exactly what happened and if people didn’t read it how can they expect to do anything about it. Sure some of us know what Litowitz and company did, but it is obvious from the posts that a lot of us still do not comprehend the criminality of what he did. The fact that someone comes here and says “just too long” is sort of part of the problem. I wonder how many people skipped over this post because it was too long. It took me all of three minutes to read it. How pathetic.

  • Robert F

    Why did you ‘softball’ the program title??!!!
    it should be: Wall Street is still dangerous… deluded… and in-charge!!!

  • http://readymade.com Andrew Wagner

    I think the thing that always is the most frustrating about the Wall Street situation is the facade put on so frequently by those in the financial industry — that they play by the rules. In reality of course, they don’t play by the rules yet expect everyone else to play by the rules. Or rather, they create the rules to benefit them heavily. They can bend them and tweak them whenever they see fit but everyone else is expected to play by the straight and narrow.

    In a way, similar to Tiger Woods making millions off of his “family friendly” image when he was anything but.

  • JaMu

    Mark wrote “When it comes to government, you get what you pay for.

    Wall Street bought influence in Washington with campaign contributions and undid or defeated the regulations that would have prevented this.

    We will have more of these cycles unless politicians are answerable to the people, and that will not happen unless we get meaningful campaign finance reform. And that would not survive with the current Supreme Court, as proven by Citizen’s United.”

    Exactly correct.

  • nj, Ashland, Mass.

    Good points, all, Dave in CT. There needs to be enough common purpose, goals, and philosophy behind a populist/anti-corporate/pro-middle class movement for it to take hold and draw in enough people for it to stick. I’d say the current Tea Party is a good example of what can happen when a mass movement goes off kind of half cocked.

    The analysts and philosophers are—although marginalized by most of the corporate, mainstream press—out there and doing good work; witness Chomsky, Hitchens, Nader, et. al.

    There are plenty of people and organizations doing good, meaningful work on a wide range of issues in the trenches every day dealing with sustainable energy and food, a variety of social issues, LBGT rights, etc., etc.

    The Greens offer one organized, political alternative while some (like Thom Hartmann) argue for a progressive takeover of the Deomcratic from within, much like the religious right did with the Republicans in the 80s.

    Part of what’s needed, i’d humbly offer, is a focal point/common goal around which progressives and enough of regular ol’ citizens can unite to galvanize the energy needed for the task at hand.

    Looking at past, progressive movements, the issue/goal/target was clear—labor rights in the early 20th century, civil rights through the 50s and 60s, the environment beginning in the 70s…

    Now, the target is a more amorphous—corporate control over the country’s politics and infrastructure. Harder for most people to wrap their minds around.

    If the new Movement can pick a few manifestations of this broader issue in a way in which the broader population can understand and relate to it, i think we’re off to the races.

    I’d offer that good candidates for this would be the Wall Street/bailout mess (banks for people not for profit), health care (single payer, universal coverage, Medicare for all; health care for people, not for profit). You get the idea…

    The fact the people are at least talking about this in these kinds of terms is encouraging, but there’s a lot of work to do.

  • Sara Porter

    There are two issues that unite us – Republicans, Democrats, and even Tea Partiers (I think).

    Those issues are (1) Campaign Finance Reform and (2) anger at lack of financial reform.

    If we had enough daily tv and newspaper coverage of the lack of progress in those areas — and IF what was reported was true we would see change.

    Fox News built the Tea Party. Let’s not go into how they did that. Who will help re-build us?

    Sara Porter, Midway, KY.

  • http://jcpresents.com John Chatterton

    My business (a rehearsal complex in NYC) was in trouble and I foolishly looked for a second mortgage for my house in Massachusetts. I easily found people through the Lending Tree who would get me a second mortgage or help me refinance my current mortgage, regardless of my iffy financials and doubtful credit. The typical offer was for an extra $60K, of which $10K would evaporate into additional closing or origination fees that looked to me as though the were going directly into the originators’ pockets. These individuals expressly told me that these were “no doc” mortgages, ie that no one would question whatever income I put on the application. My conclusion was that the extra money coming out of these loans and going directly to them was the price of their looking the other way when I lied on the mortgage application.
    Regardless of whether these mortgage offers were subprime, it seems to me that these individuals were engaging in unprofessional and probably illegal activity — certainly activity injurious to the investors in the loans they were originating. Surely enforcing existing laws and regulatory practices would have sufficed to prevent such activity? (Note: I didn’t take out a loan on these terms and am glad I didn’t.)

  • JaMu

    Erin wrote: “The government by bailing out these huge monstrosities has only “kicked the can” and delayed what really NEEDS to happen. These firms should FALL and let the truly free markets decide. The super rich still don’t have enough money to prop up these greedy institutions.”

    This falls into their web of intent. Not only should the firms fall, but the individuals who made the choices that led to the crisis and fleecing, must be destroyed financially for all time and imprisoned. What chance is there of this happening? There is more chance that feed-up citizens will start to randomly shoot the wealthy whenever they have the bad sense to show themselves in public. There is just no way to rid ourselves of their cancer other than physical violence and I do not advocate that in such a random fashion. Wouldn’t it be nice if some public spirited intelligence cabal started to delete them one at a time? Perhaps some special ops patriots returning from the bogus war? Wouldn’t you love to see some of the misery brought home to these “winners”? It is long over due to refresh the roots of liberty with the blood of this trash who attacked us all by the most underhanded and coercive means. They hid behind the lack of specific regulations like anonymous snipers and started killing peoples futures.

  • T. C. Stephens

    I hear a great of blame being cast on students. I hear students taking responsibility for that blame. What I don’t here is much discussion of the way in which the faculty and the organizational environments of Colleges and Universities contribute. Do this exercise: Count the number of adjuncts universities hire. Count the number of faculty publications normally required to make tenure. Listen to the administrative demands on faculty time in terms of producing new knowledge and the funds to support the production of that knowledge. Then look at how much material support those same faculty receive in terms clerical assistant and teaching assistants. Look at how much of their time is spent filling out letters of reference for students. Look at the reward structure for them in terms of teaching. All of this data will show pretty clearly that while most faculty care about teaching and care about their students, they also recognize that this is the one area where their are few rewards for pushing students and holding them accountable. And in fact there are many perverse incentives to do just the opposite and not hold the students accountable. The students sense that fact and are not motivated to, or do not understand how, become advocates for themselves. But its not their fault – not really. The problem is that the mission of universities has changed and not in terms of student interest.

  • JaMu

    Dave wrote: “But concentrated power and central planning is guaranteed to fail.”

    Like it did in China? Like it did in Canada?
    I think that many of us are in sympathy with the views that you express Dave, but you are getting tiresome because you have bought into an ideology and it is only a partially correct one. It was deregulation that allowed the crimes that lead to the crisis, not over regulation. In a purely capitalist free market economy every road is a toll road and the price goes up at rush hour. Under a pure form of capitalism, capital would concentrate at an even faster rate than it has. But you are right “power corrupts” — thanks for the news flash.

  • JaMu

    nj wrote: “We are witnessing a convergence of trends and circumstances in this country—the Wall Street abuses being just one of the more blatant and serious manifestations—that appear to be plunging the U.S. ever more deeply into corporatism/fascism a la Mussolini.”

    The other day someone posted a message in which they asked what the difference was between China as it is now and a fascist state. Nobody answered. I believe the tacit point was that there was none. I love it when those sparkly cheerleaders for China come one Toms show and breathlessly talk about the shinning future and spew their propaganda. I can easily imagine them wearing a nazi arm band and being a poster child for fascist Germany

  • Mari

    “It seems clear to me that most are not interested in reality, in facts, in finding out and understanding the truth, but in dealing with their anxiety and uncertainty by reasserting familiar myths as vociferously as possible….We might start teaching Economics, real Economics in high school. The American public is close to ignorant on the subject, to its peril.” – Posted by Cecelia Blair

    I agree completely. The only thing I’d add is the word “own” between “their” and “anxiety”. We are divided by our own little realities. Dependence on some mythological explanation for the damning results of simple human greed & psychopathy is as old as civilization, itself. I believe we can do so much better, now, due to popular access to truthful, scientific information.

    The best and brightest analysts say that the Wall Street Gang committed the heist of the ages and not only got away with it, they were grossly over- rewarded for their conspiratorial & criminal behavior. Believe it or not. That’s the truth of what went down.

    The formerly “invisible hand” of the market left his fingerprints all over this mess. Time to disband the mob. Split them all up, the same way they have dismantled our collective economy, communities and families. Just for starters.
    -from Quincy Point, MA

  • at, Santa Cruz

    @Cecelia Blair

    Brilliant Cecelia. However punishing individuals will go a long way toward reforming institutions. No individuals have been punished. Unless you consider a good finger wagging in front of congress a punishment. “You were a bad bad boy. Now go home and enjoy your ill gotten gains.”

    Regards, I hope I meet a woman with a mind like yours at LuLu’s when I go for coffee later, or even a man, though that would be less interesting.

  • TomK

    It’s so depressing that after the 1929 crash we took strong action against the “banksters” and put the regulations in place that served us so well until all the job-killing deregulation got going in 1980, and after the 2009 crash we did, basically, nothing. This is horrible! Already we’re hearing about the evils of regulation again. Yes, we’re being set up for another crash. Furthermore, it won’t be an inexplicable, unpredictable “black swan” – it’s just exactly what always happens when you don’t regulate the financial sector. Sure, Bush hyping his “Ownership Society” (anyone remember?) had something to do with the crash, but it was mainly deregulation.

    It’s funny how the right rants about the community reinvestment act, considering that the CRA covers banks only, and most of the bad subprime loans came from the deregulated non-banks.

    Not only are we not protected, but the financial casino is a cancer on the real economy. It contributes to our soaring, disgusting, inequality. It’s amazing that in all the talk about “hard choices” (= hard on average Americans only), there is never any mention of a financial transactions tax, which would damp down the casino and help with the deficit without harming anything of value.

    Repeal Phil Gramm’s job-killing “commodities futures modernization act”. Bring back Glass-Stegall. Tax high speed trading. Raise tax rates at the stratospheric levels where the banksters compensate themselves. Break up the big banks. Jail the financial criminals. Then maybe we can take our middle class society back.

  • bob murphy

    I’m wondering if your guests have read ‘Deadly Spin’ and how they see Wendell Potter’s conclusions applying to the financial arena? I’d love to see Mr. Potter join efforts w/ an insider from any number of areas where this spin is influencing voter opinions. You have named a number regarding the financial crisis you could also add climate change unbelievers, gun control, the electric car……the list is endless. Thanks to your present guests and people like them that provide rays of hope.

    spokane, wa

  • http://WallStreet edward

    If you or I took an insurance policy out on someone we knew would default, and told the insurer that they were a good risk. Then took the house and the insurance pay off… would we not in prison for Insurance Frude? We need true reform and Wall Street needs to pay for it. I cannot believe…

    1. Not one CEOs is behind bars. In a world wide crises. Why are banks making record profits.

    2. All the big banks are bigger because they were given the assets of the backs the collapsed. Only Making them bigger. Why not the little banks that had little or no loss?

    3. The government is loaning banks money a 0% to loan, but they are buying US Bonds that we are paying out on. In what Escher like universe would this make sense and why has it not been stopped.

  • Dave Lake

    I worked for Countrywide in secondary marketing IT and clearly saw the crisis coming in 2005 when I finally quit. It is absurd to imagine that intelligent people didn’t know they were creating a house of cards.

    What is rarely mentioned is the needed reforms or nationalization of the ratings agencies. They were complicit and rated junk as triple A because they are paid by the seller of the junk they are rating. Is there any other business where the seller gets to essentially set the price? The ratings agencies must be paid by the buyers of the securities, not the sellers!

  • at

    ATTn. Web Meister.
    I have attempted to listen to this show four times now and it stops about five minutes into the show and will only start again from the beginning. This has never happened before and I would really like to hear it.
    TIA

  • Dave in CT

    “The tea parties were not formed against the bailouts or too big to fail.

    They didn’t start until the stimulus bill.

    They are tools of the elite. Nothing more.”

    The tradespeople around here, like a foreman who built homes in our neighborhood, who talks libertarian-style, local first, common sense economics, mistrust of bureaucracy and corporate collusion, and self described interest in the tea party stuff, is not a tool of the elite. He is someone who wakes up every day, works for a living, and resents the powers that be mucking up the real supply and demand economy of everyday people.

    I feel like the self-described “liberals” who constantly trash or don’t believe that their is an honest tea-party spirit or people, are as much tools of the elite as anybody.

  • Leon

    To follow up on the commment by TomK, I noted that the recent report of the Financial Crisis Inquiry Commission, other than citing certain “unregulated derivatives”, omitted what has the appearance of being the groundwork for uncontrolled manipulation of investments laid by former Senator Phil Gramm through the 2000 Commodity Futures Modernization Act, which exempted certain credit default swaps from state gaming laws. The earlier 1999 Gramm-Leach-Bliley law eliminated the barriers between banking and insurance, also creating the potential for risky financing.

  • Cecelia Blair

    For people with too much money, if you want to gamble–Fine. Go to Las Vegas or any of the other gambling dens. We will see you as addicts. Fine. You are.

    For people with too much credit, if you want to gamble–Same as the above, only you’re also ruining your family’s finances, future, and so much more.

    But for people who want to INVEST, why not invest in what is real and what needs support, like people and the planet in so many ways. There are so many OPPORTUNITIES to be really constructive. Can we get excited about this?

  • Dave in CT

    “Like it did in China?”

    I think that’s the choice we are facing. Trade Liberty for the greater economic efficiency of undemocratic, unrepresentative Statist control of Corporate activity, or the slower, messier path of freedom, individual choice and tolerance of diversity.

    Elite planning enforced upon us, hopefully in good faith, or Collective Individual decisions within the Rule of Law (anti corruption, crime) leading where it will.

    Depends how desperate we are I guess.

  • Dave in CT

    @Edward Worth reposting.

    “If you or I took an insurance policy out on someone we knew would default, and told the insurer that they were a good risk. Then took the house and the insurance pay off… would we not in prison for Insurance Frude? We need true reform and Wall Street needs to pay for it. I cannot believe…

    1. Not one CEOs is behind bars. In a world wide crises. Why are banks making record profits.

    2. All the big banks are bigger because they were given the assets of the backs the collapsed. Only Making them bigger. Why not the little banks that had little or no loss?

    3. The government is loaning banks money a 0% to loan, but they are buying US Bonds that we are paying out on. In what Escher like universe would this make sense and why has it not been stopped.”

    Exactly.

    And that state of affairs could never happen without the support/collusion of a powerful Federal Reserve and corrupted Government.

    So when people don’t understand why people see government as part of the problem, as well as corrupt business people, I am very puzzled.

  • Brett

    When my houses tripled in value from 2001-2004 I knew something awful was brewing. Some of my younger friends, who were buying their first homes, were getting approved for loans beyond their means and were getting A.R.M.’S, and this made my suspicions run even deeper. (Of course things like tax cuts when they already seemed historically low, and those token, extra tax checks everybody got in early 2002, also seemed strange to me; I mean if the economy was supposed to be doing so well and people seemed to be making amounts of money off real estate over mere months, the kinds of profits usually seen over the course of a decade or better, then…whaaa?)

    When I sold one of my houses in 2005, many of my friends thought I was crazy to sell (that I could make even twice as much as triple the amount I made by selling if I waited another five years). I explained that we were in a real estate bubble, one which would burst within a year or so. I didn’t have any particular acumen in real estate or investing, it was just so damn obvious to see if one simply looked at market trends in real estate over the previous sixty years. Did people really think the market was going to sustain itself behaving in such an unprecedented manner?

    When I began hearing about day trading I thought that was also odd, as if investing in the stock market could be so similar to playing scratch lottery games!?!

    I didn’t quite at the time understand the implications of the Glass-Steagall Act being repealed in 1999, but I knew that if Phil Gramm was involved—he, of earlier fame (or is that infamy?) of the Reagan economic “genius” or “miracle” [sarcasm] in 1981, and of Gramm-Rudman fame (infamy) later, I figured a perfect storm was approaching. Seeing companies that were insurance carriers begin also to offer stock market investment services seemed really disturbing, as well. (Like I said, I didn’t have a background in economics or real estate but could feel at least a window closing abruptly if not a house of cards collapsing just after being built).

    Then there was the conspicuous consumerism present in the late 1990′s and early 2000′s…

    We can complain about Wall Street and government ad nauseam, and rightly so, but if we are not going to accept some of the responsibility for the economic meltdown ourselves, we will be fooled again, over and over.

    And why aren’t these soft revolutions that are happening in the US right now focusing on calling for more indictments on Wall Street? Campaign finance reform? A restructuring of how the lobby system works in D.C.? Huh? I’m not talking about simply blogging and marching, I’m talking something more powerful. The economy is supported by ‘we the people.’ Organized strategically-placed boycotts in one aspect of the market or the other for brief periods of time would be one way, nothing too disruptive just disruptive enough for ‘we the people’ to show we have power and can make demands. Of course, there’s the fear that if we sign up on the buddy system our buddies will betray us, too…

    We see revolution and change too much being something that should look like what’s happening in Egypt, or we look for the next perfect great man or woman in politics to save us (e.g., Obama, Hilary Clinton, Ron Paul, Rand Paul, Ralph Nader). Some of us also look toward some sort of a fundamental change in the system as our saviour (the need for pure socialism, pure laissez-faire capitalism, a three-party system, a return to the gold standard, and so on).

  • David TN

    Fox News built the Tea Party. Let’s not go into how they did that. Who will help re-build us?
    Sara Porter, Midway, KY.

    Sara, Please look at this link from the Washington Post no less; Poll: Americans want GOP to listen to the tea party

    http://voices.washingtonpost.com/thefix/republican-party/poll-americans-want-gop-to-lis.html

    You started out so right in your comments yet bought in once more to the notion that the Tea Party was manufactured encourage “racist” who “oppose government” simply because our President is “of color”. Don’t believe the lies of those who would silence those who have taken to the streets, in order to call attention to the absolute insanity of the status quo. The Tea Party is not about being against government, it’s about being for a government that works!

  • Conner

    Web Staff

    Obama must be testing the internet kill switch he is trying to have installed because the listen now feature of your site is not working. It keeps cutting out.

  • Tess in Columbus

    How much did Alan Greenspan and his hedgefund make?

  • http://Columbus,OH Lyndon

    Steven Eisman (from The Big Short) stated earlier last year that the next subprime crisis is going to arise from the for-profit education sector. His PowerPoint presentation on the matter can be found here: http://www.marketfolly.com/2010/05/steve-eisman-frontpoint-partners-ira.html

    A story that definitely needs more play.

  • cory

    JaMu,

    1. The guidelines for posting here include the words “be brief”. This isn’t the proper place for manifestos, dissertations, or twenty paragraph exposes.

    2. I also have to believe that if there is a terrific point made in that essay, it could have been made much more succinctly or precisely.

    3. Yeah, that post took you 3 minutes to read. There are many days and topics where the posts total 150-200. You may have 10 hours to read them all but I don’t.

    4. And as far as being pathetic… Whatever, DUDE.

    Leftfield, Wisconsin

  • Phil Cefalo

    I’m writing from Boston. It was mentioned earlier in the segment that the large private losses were essentially transferred to sovereign debts. This makes sense given the ballooning US and other sovereign debts since the crisis. However the counterargument to this is always that the banks have for the most part payed back TARP funds. I understand that the govermentand/Fed have been supporting the big banks in many other ways (ie through the support of AIG, Fannie/Freddie, opening of Fed window/Fed loans, etc). However these types of support seem murky to me and difficult to quantify and understand. Could your guests help explain this.

  • Ellen Dibble, Northampton, MA

    Yar, thanks for your posts and your optimism. McLean said the action we can take is not using credit cards (fees to the banks). But she didn’t say don’t use credit to buy houses, which is probably a much larger piece of the credit business.
    The idea of getting the casino element out of our retirement accounts, and getting the casino element out of at least a definable part of the financial lubrication a growing economy needs, that is worth getting behind.
    I got hugely defeated when the banks were NOT broken into smaller, able-to-fail entities in the Dodd/Frank bill, and even more hugely defeated when it seemed in the Citizens United decision that even the Supreme Court is against free and fair elections (in other words, enabling the reign of money, moneyed interests, in selecting and electing).
    Proposing alternatives seems to be the order of the day. I don’t think that we can march in the streets and say down with the dictator, because the dictator it is us. I’m still hoping some international bodies with some kind of international law behind them can look at the international damage banking shenanigans have caused and bring the plutocrats to heel.
    Something like that.

  • Conner

    cory wrote — I also have to believe that if there is a terrific point made in that essay, it could have been made much more succinctly or precisely.

    I read it and I think that if you read it you would have seen you are wrong about that.

  • geffe

    The reality is as I said before the banks own us. They want it all, they want the social security as well.

    The republicans are more than willing to give these robber barons what they want. Hello 1880′s.

    someone mentioned heads on pikes, well I bet that would scare these captains of capitalism but it would not change a damn thing nor would putting the worse offenders in jail. The only thing these people understand is regulations, and they have to be stiff ones with a lot of teeth behind them. Without it as the guests of today’s show stated the future is very depressing indeed.

  • Conner

    Ellen wrote “I’m still hoping some international bodies with some kind of international law behind them can look at the international damage banking shenanigans have caused and bring the plutocrats to heel.
    Something like that.”

    Obviously you believe there is a justice system somewhere that is beyond the corrupting influence of these masters of the universe. I on the other hand find that extremely unlikely. And if there is, there won’t be, once they start meddling in in the family money business.

  • Conner, SF

    geffe: regarding your last post. Here is a portion of the too long post that “at” made that people seemed to have skipped over because it contained too much info.

    “As the Magnetar-Rahm connection highlights, Obama raised more money from financial services players than any previous presidential candidate, so it can hardly be a surprise that he and his minions are happy to give the industry a free pass. Key policy figures maintain that no one was at fault, that there was a pervasive lack of regulation, and there are therefore no bad actors. That party line also means that destructive behavior is and will remain unquestioned, unexamined, uncorrected, and unpunished. We are still paying for the costs of the financial train wreck of 2007 and 2008. We can no longer afford the costs of willful blindness.”

  • at

    Whoa buckeroos: I didn’t write the post you guys are referring too. It was a quote from Naked Capitalism blog from last April.

    Sorry if its length offended some. It seemed very concise to me. It explains things in a few paragraphs that I have seen take chapters and page after page to explain elsewhere, so I thought it was on point. I shall certainly refrain from lengthy quotes in the future. I had no idea this would be a problem since the web master obviously felt it fit the guide lines.

    It won’t happen again.

  • TomK

    It is true that Obama (who I call Oromney) and the Dems are bought just like the GoP. You only have to look at his financial advisors – yuck.

    What can you do when both parties are bought? The TP might represent a promising direction. However it has 2 fatal flaws. 1. The TP is strongly manipulated by the oligarchs. 2. The TP thinks the solution is getting rid of government. However, that will simply let the financial criminals continue to run wild. Why do you think think the superrich support the TP? Follow the money!

    The only solution is to take gvt back for the people and re-institute strong regulation and progressive taxation. I know it seems impossible now, but from the 1930s to 1980 it was what we did. IMO we don’t need a new system, we need our old system. Funny how that’s the period when the American middle class was the economic wonder of the world.

  • at

    Brett: Good for you bro. I am glad to hear you got out in time. My brother did the same. He sold his house at a time when it was going up $20,000 dollar a week. As it turned out he sold at the absolute top of the market to the day. His sale however was not a result of common sense market acumen like yours. He had to move because of work.

  • Arnold

    Why is today’s topic framed as a question when the panel and host are so skewed to one side of this debate? Quite the lovefest of bank haters with nobody knowing what they are talking about. Michael Lewis hasn’t been on Wall Street for 30 years, he’s got little expertise relating to this topic. Blaming potential sovereign defaults on sub-prime loans is ridiculous beyond belief. Rahm was on Fannie’s board, so this is bipartisan.

    Bethany needs to explain why Canada’s banking system is so much more concentrated than ours and yet has not had nearly as many problems. Big banks is not the problem.

    Let’s do another show, same question and have only CEOs from wall street banks or PR departments.

    This Commission was seen as too political for its results to be given much credibility.

    Look at the numbers: total mortgage market, total subprime market, and total subprime defaults.

  • at

    Bravo TomK: Although some of the success of the middle class at that time must surely be due to the fact that the other major industrialized nations were in ruin because of wars for part of that time, I agree wholeheartedly with your assessment.

  • at

    Arnold: Now you are one person who absolutely should read my initial post.

  • Zuna

    1. Why, oh why oh why have they muzzled Elizabeth Warren?? We never hear from her anymore. When Julian Assange reveals his big bank info (ta-dah!), will she be allowed to speak at last?

    2. Time for a March on Wall St. a la Cairo. Close the damned thing down. The global peons have had enough. The whole world is going to be marching in the upcoming financial meltdown. Like the apocalypsters say: 2012 will be a bery, bery big year.

  • http://www.kodiakbrewery.com Ben Millstein

    What we need was ironically proposed by The Onion: The American people actually need a lobbyist to represent them in Washington! How sad is that?
    http://www.theonion.com/articles/american-people-hire-highpowered-lobbyist-to-push,18204/

  • ellenb

    Media consolidation is also a crucial problem that affects how we even know the truth about what’s happening in the financial world. You had jeff zucker the head of nbc on the other day to talk up the merger with comcast. Many comments to your show were critical. Would zucker only agree to appear if he was alone? So we need the other side to the issue aired. Npr listeners deserve to hear guests explore the effects of media consolidation on our news. Npr doesn’t do enough to discuss the anti corporate views of millions of organizations and citizens. Zucker has a huge voice with megaphone. Now let’s amplify the opposition to consolidation and the commercial interest dominance over our citizen owned airwaves for a change. Only Public Radio, which is the place for it, can do this, as it’s not commercial radio, supposedly. G et with it Tom, and NPR, and serve your audience.

  • Arnold

    Seriously, both of these guests are making big money criticizing big banks. Lewis totally buys into the thesis that people who lose money in something obviously didn’t understand it and that people who make money do so because they understood what they were doing. More often it’s luck, good or bad. I owned NEXT Computer stock and did terrible, eventually going under; but I bought it because I thought the CEO was a dynamo. Luckily I got involved in his next venture, Apple. Luck or skill?

    This discussion displayed a considerable lack of civility and balance. I thought Tucson had changed our way of operating.

  • at

    Hey Zuna: Someone named Zuna was on Wait Wait Don’t Tell me last week. When asked what kind of name Zuna was they replied, “First.” Biggest laugh of the show.

  • JaMu

    Arnold wrote: “Seriously, both of these guests are making big money criticizing big banks.”

    Seriously, you should read at’s post

  • geffe

    Arnold if your in the finical world I can understand your point of view however it’s so wrong it’s not even funny.

    What you seem to be alluding to is that the big banks and wall street firms made a few mistakes and now they are OK to go on doing what they. That people like me are not smart enough to understand the system. I understand it well enough to know it stinks. That way to much money is in the hands of to few. That the wealthiest 2% of this nation have way to much of the wealth and that if this keeps up there will be a tipping point.

    As others have stated both parties have enough blame to go around. Obama was always a wall street democrat and his appointments of wall street insiders and particularly the proteges of Robert Rubin are a clear sign that he’s in with these robber barons. Nothing new here, presidents have long sided with the money bags.

  • Arnold

    I think the big banks share in the blame but mostly because compensation should be longer-tailed than it is. I just don’t think the perspective of these guests or the host really helps us understand because their experience is not broad enough and their biases too strong.

  • at

    Ben wrote: “What we need was ironically proposed by The Onion: The American people actually need a lobbyist to represent them in Washington! How sad is that?”

    Maybe we should stop paying taxes like the big boys and just hire lobbiests. Ah hell why play in their game. We should just lynch them. I mean what would you do if one of them came up to you with a gun and demanded money from you? That IS what happened by other means. They thought they could hid behind legislation and duplicitous subterfuge but we are finding them out, what they did, who they are, and we will get them, no matter how long it takes.

  • at

    Script for the hangman: Just before he drops the floor out from under our fearless captains of the financial industry the executioner must look soulfully into the eyes of each and say, “Enjoy your money.”

  • Michael Long

    “Blaming potential sovereign defaults on sub-prime loans is ridiculous beyond belief.”

    Really?

    - If US GDP is 20 Trillion and we gave the banks 12 Trillion in zero interest rate loans that they used to buy US Treasuries then that does not effect the value of our economy?
    - If the derivatives market peeked at 1,400 Trillion (US GDP 20 Trillion) and most of that was multi-tiered CDO deals then that does not effect sovereign default. Even if (as Wall Street says) the derivatives market is a tiny 15 Trillion then you are comfortable with another 600 – 1300 Trillion in leverage and hedges?
    - There were 60 Trillion in Credit Default Swaps on synthetic financial assets. What happens when those are traded and then the counter parties go bankrupt? Cascading default spreading from financial institutional to financial institution?
    - What happens when Private Equity is getting cheap credit through CLOs and creating the same structures in leveraged buyouts that they did in the mortgage market?

    Ireland made all counter parties in derivatives contracts 100% whole. Look at Irish GDP and compare it to the value of these contracts. Germany was forced to follow them. Do you think Iceland is bankrupt because of their extensive fishing industry? The only argument might be that Greece or Spain are in trouble from other bad decisions.

  • JaMu

    Sounds good at, but may I suggest that instead of the typical, make them look like a retch before they are executed, like is typical (see Sadam), we should make sure they have all just had a manicure and five hundred dollar hair cut, and are dressed in their finest five thousand dollar suit complete with power tie. I think this will send a more valuable message to tomorrows would-be cowardly thieves. NO?

  • Peter

    Since the 1950s the financial sectors percentage share of the national income has more than doubled. Marx predicted that the rents collected by finance capital would eventually destroy the productive center. If they haven’t done it yet they’ll keep on trying. Indictments, indictments, and more indictments are what we need. Instead all we hear from the Republicans is a call to investigate the financial crisis inquiry commission.

  • at

    @ JaMu: Maybe, but America doesn’t like killing people who dress up in suits. America likes to kill people who dress in PJs. Not sure why that is, but we do (see Vietnam, Iraq, Afghanistan.) So we might have to dress them in sweats or something.

  • Gail

    William K. Black is an American lawyer, academic, author, and a former bank regulator. Black’s expertise is in white-collar crime, public finance, regulation, and other topics in law and economics.

    He developed the concept of “control fraud”, in which a business or national executive uses the entity he or she controls as a “weapon” to commit fraud. He was active in the prosecuting 1,000 Savings and Loan personnel in the 1990s.

    Black claims that there has been fraud. Here is his latest interview about the Financial Crisis Inquiry Commission Report:

    http://www.youtube.com/watch?v=bkNezph6qGk

  • http://www.bookofzo.blogspot.com Joshua Hendrickson, Talent OR

    To use a quote from Douglas Adams, changing the subject from the original (“time” and “lunchtime”):

    Money is an illusion,
    Finance money doubly so.

    Not all fantasies are dangerous, but those that directly impact the well-being of an entire society–such as money, religion, racial or gender supremacy, etc.–must be recognized as fantasies and denounced as such. Otherwise we will never be able to build a world based on humane realism–the only kind of world that isn’t doomed to self-destruct.

  • E Weiss

    Nothing human is clean; we are a fallen world. Wall Street isn’t so bad, really. Think of all the poor widow pension funds financed by sub-prime mortgages.

  • Mark S.

    Wake me when there’s a perp walk. Just one, other than Bernie Madoff, whose crime was not that much different than what Wall Street did to all the rest of us. Until I see some perp walks, Wall Street will remain in my mind the open-air septic field that it is at this moment.

    I keep remembering George Carlin’s prescient comment that: “They call it the American Dream because you have to be asleep to believe it.” I no longer believe it.

  • TomK

    at, I agree that the post-WW2 lack of international competition made it easier for our system to shine. However, note that, since 1980, GDP has continued to increase. Despite the competition, the USA has continued to get richer, even if at a slower pace.

    The key difference is that, starting in 1980, the median wage decoupled from GDP. Inflation adjusted, it has gone flat to down for 30 years. Part of the reason has to be the casino financial sector sucking the blood out of the real economy.

  • E Weiss

    Wall Street did nothing wrong, and Holder agrees. Those who lied on their mortgage applications deserved to be booted. No one really believes in a NINA mortgage.

  • TomK

    RE Madoff, recall that Markopolis handed the SEC a detailed explanation of his scam, chapter and verse, and they weren’t interested. There was no problem figuring out what he was doing. The problem was that they didn’t want to look.

    The right will claim that means that gvt regulation can’t work. That is a beautiful scam in itself, since they made it not work. The approach of the deregulators, when they can’t remove a regulation, is to simply appoint agency heads with a mandate to do nothing. That was the case with W’s Chris “see no evil” Cox. Then when something bad happens, after they did nothing, they say see, we told you.

    Gvt regulation works just fine, when the staff is led by someone who wants to actually do the job.

    Why hasn’t Markopolis been offered a position at the SEC? Why hasn’t anyone who saw what was really behind Bush’s “Ownership Society” got a job in the administration? All we have is more bankster insiders.

  • E Weiss

    Markopolis was silent until he had a book to sell.

  • http://www.mattjenson.com Matt Jenson

    The ONLY way this will change in my opinion is a majority of the American people stop turning their heads away from these facts and do what the Egyptians are doing NOW. To gather in the streets and gather around the White House, or maybe around Bank of America HQ, Goldman HQ etc. and start YELLING, if not more.

  • realdeal

    Well I guess the tenor of my last post, which is missing, just ain’t gonna fly, so let me encourage you fine people one and all to be polite every day and every way. Just because someone committed a premeditated act that enriched them greatly while gutting everyone else, especially their own customers (known in the biz as “the enemy”)does not mean that they are a bad type of fellow. We must not prejudge them. It is very possible that in court, if we can entice them to invite us there sometime, they may have been following the letter of the law that they had passed. So if they were not doing anything illegal, I am sorry but we must follow their rules, they are obviously as innocent as the new driven snow, and if anything deserve a heartfelt apology and perhaps more of a say in how things are run so that this problem will never come up again. And isn’t that what we all really want — a polite harmonious society like they have given us. They are polite. They do not flaunt their wealth in front of us, they don’t even interact with us at all — except for these unfortunate incidents that we keep bringing up in our incredible ingratitude for what these dynamos of industry have done for us. Think of what you can do in one hour and what you get payed, now just think of what someone who gets several tens of thousands of dollars an hour twenty four hours a day and what they must be able to do. We should get down and kiss the feet of these gods who dain to live among us, or give them a good present, like free money or an additional tax cut because look how they have looked after our interests and the interests of the country. I’d just like to say thanks big guys — you are all the tops.

  • realdeal

    whoops there it is

  • http://www.bookofzo.blogspot.com Joshua Hendrickson, Talent OR

    @ E. Weiss:

    I’m not an arbiter. But you apparently seem to believe in the ultimate fantasy: the arbiter called God (or so I judge by your reference to a “fallen world.”). And your own judgment–”Wall Street isn’t so bad”–suggests that your moral sense really is “unclean.”

  • david

    I did ok during the stock market bust, listened to some right-wing idiots on when to get out and when to get back in. Lost a little, made a fair bit.
    Most here would love to see wall street hung from a tree as punishment for their loses. The stock market is a gamble to begin with, how many here would like to see the gambling industry hung from a tree. Many I know want wall street hung, but will go each weekend to gamble where the odds are against you before you walk into the door. Strange reasoning.

  • realdeal

    Many I know want wall street hung, but will go each weekend to gamble where the odds are against you before you walk into the door. Strange reasoning.
    Posted by david, on February 1st, 2011 at 7:42 PM

    The little difference you fail to note is that people who had no idea what was going on lost their retirements, homes, savings, lives, jobs, and securety. This typically does not happen with casinos, unless you go in and play.

  • Lake

    Tom, Here is the answer: Nationalize all banks and convert all investment banking activities to public Internet auctions. Yes, the government can handle both commercial and investment banking activities more efficiently and more equitably than corporate players. Moreover, the only innovation in the financial industry over the past 20 years has been wihtin the realm of in financial marketing and deceit. Government (through universities and other organizations) can implement equitable innovations in banking and protect the public at the same time.

    Reform the laws, reform taxes (with a variant of flat taxes) and severely punish white collar crime.

  • Lisa

    It’s clear by now that many of those on Wall Street used legal ways to take advantage of many people, and there are probably many that deserve to be punished that.

    But the fault is not only on the bankers and Wall Street. There are many that put themselves in bad situations, most specifically with the housing market crash. People need to take responsibility for their own actions. With the housing market, the bankers may have over-approved loans, but people still know what their own income is, and what they can and cannot afford. We live in a world where people chronically spend money they don’t have, including our own government, so it’s really no surprise we’re in this situation.

  • E Weiss

    Right now there are fifty Jayson Blairs sitting around picking their noses at the New York Times. If Markopolis had a story Krugman would have stolen it from the newbies to feather his own bed. Get over it.

  • realdeal

    @Lisa

    Nonsense: that wasn’t the problem. The problem was scams like magnetic tar pulled. It was all bankers and wall street. That how people were able to get these loans they didn’t give them to each other. It was the managers who made them because they won if the loans went bad. I thought every knew that by now. That’s what the very first posts were about. Back of the class

  • http://www.bookofzo.blogspot.com Joshua Hendrickson, Talent OR

    Why, many more like me, just the same as with your point of view, E. Weiss. Of course, your point of view has really had its day by this time … two thousand years, off and on, of a “fallen” world. Just imagine what the opposite would mean…

  • http://www.bookofzo.blogspot.com Joshua Hendrickson, Talent OR

    ty, realdeal

  • realdeal

    Comon Josh:

    How about “Don’t do s*it to other 8uc8ers that you wouldn’t want the c88k8ukeres to do to you, and if they do do *hit to you, we fu8ke8 #ill them.” Good?

    That’s what I been sayin hey?

  • http://freeourfreemarkets.org sbanicki

    The article below appeared in the New York Times on December 2,2010. THE MESSAGE IS RIGHT ON! It was written by Thomas M. Hoenig, President of the Federal Reserve Bank of Kansas City

    “THE world has experienced a severe financial crisis and economic recession. The Treasury and the Federal Reserve took actions that saved businesses and jobs and may very well have saved the economy itself from ruin. Still, the public seems ungrateful, expressing anger at these institutions that saved the day. Why?

    Americans are angry in part because they sense that the government was as much a cause of the crisis as its cure. They realize that more must be done to address a threat that remains increasingly a part of our economy: financial institutions that are “too big to fail.” More

  • Susan in New York

    We need to acknowledge that what underlay the crisis was the fact that 70% of the American economy at the time of the crash a few years ago was consumption. What economy can survive on that?!!! The fact is that this country does not want to look at the perfect storm that is unbridled, subsidized capitalism and globalization – with cheap labor available for exploitation in many countries. A country so dependent on consumerism has to survive on credit. Let’s be honest about what the future of this country can be without a sober look at runaway capitalism.

  • realdeal

    I mean that regarding human values hey? Like that’s enough rules — Joshua wins — new human era — nobody does crappy *hit to each other or we kill them, nuff said — next.

    (Joshua may not go along with the “or we kill them part”)
    Jesus I forget which parody I am parroting hey?

  • BrettG

    Now the mortgages that Wall ST wanted to be sub-prime – whether the mortgagee was eligible for fixed-rate mortgages are now subject to foreclosure fraud due to MERS, bad legal papers & rocket docket courts. The Florida AG report was headed Fraudclosure.

    http://www.scribd.com/document_downloads/direct/46278738?extension=pdf&ft=1294495314<=1294498924&uahk=iuvvscDE3Dc691LaD0yJQqFOEf4

    If the investors can get enough civil evidence quickly enough, it may speed things up a bit – forward to EBTs

  • realdeal

    True enough Susan. We gotta make %hit. (I mean &hit)
    How about a nano diamond heat pipe for my new processor. I could use one of those. One on which you can change the shape of the pipes would be nice. I would buy it. Watch out for Chinese nano diamond scams though. I can think of lots of stuff I should have. Someone make stuff! Now!

  • realdeal

    I also want a boeing ranging nightsite, a 3D printer that can work with titanium. A nightlight that works by sonarluminescence, a cavitation device that converts graphite to nanodiamonds, I could go on, the list is endless. I mean I am not even getting into the flying car disappointment thing.

  • TomK

    It seems to me that the GoP has forgotten about Bush’s “Ownership Society”. Anyone here remember? It was great, wages were slipping, benefits were slipping, but all was OK because the subprime bubble had given us the “Ownership Society”. Now I think it means that the bank owns you. Have the GoP written it out of history?

    Actually the bubble did a great job of disguising the fact that the superrich and the financial predators were stealing all the $ from the real economy.

  • Jon Erik Larson

    Would you eat a meal cooked by a chef who would not eat his/her own cooking? I wouldn’t.

    So, why on earth would one purchase a security from a investment banker who does not hold a lion’s share of his/her assets in the securities that he/she sells that create the lion’s share of his/her income.

    It seems to me that had the folks who created the mortgage-backed securities had 90+ percent of their compensation in the form of the securities that they were foisting on others, they might have been more careful (and, if not, would be broke today).

    The United States Government cannot afford the talent to monitor the geniuses on Wall Street who create new financial instruments. So, the best regulation that I can imagine is to require, so to speak, bankers to stuff themselves on the food they cook.

  • Katherine

    Specifically what kinds of reform or regulation should be adopted?

    (1) What kind of reform would deal with the moral hazard created by the securitization of mortgage loans?

    (2) What kind of reform would deal with the failure of the ratings agencies to property rate mortgage securities?

  • Mark S.

    Wall Street has no moral compass, no sense of collective responsibility to the abstraction known as “society,” and no shame in the horror they helped unleash on society via derivatives, credit default swaps and other synthetic financial fantasies designed only to enrich the architects of the disaster. It is a moral and ethical malignancy, but unfortunately a malignancy that we have to live with an manage like a slow growing cancer, at least until the USA goes the way of Egypt. In the words of the superpatriot, neocon wingnut Michael Ledeen: “Faster please!”

  • david

    realdeal,
    “The little difference you fail to note is that people who had no idea what was going on”
    In 1991, Larry Burkett wrote The Coming Economic Earthquake, warning of the dangers of the ever-growing appetite for debt … I listened to him on the radio years ago and he predicted almost to the very detail the financial meltdown we have. I knew as well as many around me that this crap was going to hit the fan. As soon as gas prices started up that was the trigger.
    Not to have seen it coming, one must have had their heads in the sand. One year before this all got started, smart so called rightwing idiots knew it was coming. They tried to warn people, but few would listen.
    I tried to warn my brother, he would not listen, he lost his butt in GM stocks. Even the crazy Glenn Beck was warning people to get out of the stock market a year before the fall.
    Here is some more crazy advice, get out of debt, stay out of debt and save as much as you can, cause the storm is not over yet!

  • realdeal

    Yeah David, but lots of people predicted a collapse of a bubble, of all political stripes. It still happened. And it still affected lots of people who don’t even play the market or have a bad loan.

  • http://www.openeyesvideo.com Glenn Koenig

    I have read here that we should march in the streets, a la Egypt’s masses. Others said to take your money out of big banks and put it into smaller banks. I like the latter idea better than the former.

    I say this because I don’t believe that the Federal Government will ever be able to successfully regulate the banks again. I have given up on that. Seriously. The problem is just too complex because banks are just too large and complex themselves. The complexity of any proposed regulations are like any complex software. All software has bugs, unless it is trivial. Same goes for government regulations.

    But, still, it’s difficult. I paid off any credit card debt I had and don’t use them anymore. I moved all my accounts out of Bank of America (just one was left) and put them into local banks. However, there seems to be no easy recourse for a mortgage. First, it’s not as easy as just closing one account and opening another. You have to “refinance.” Then, even if you do, there are almost no small banks that can handle mortgages anymore. So you’re mortgage will be ‘sold’ to one of the same big banks or Freddie Mac.

    I could sell my house and go live in a tent. Or, there is the lifestyle practiced by the Amish, who eschew loans and help each other with ‘big purchases’ instead. They “owe” each other.

    The key here is to shift to smaller, simpler, easier to wrap your mind around ways to live your life. No, it’s not easy. It’s not quick. It’s not as immediately satisfying as saying “throw them all in jail.” But the way I see it, it’s the only thing that is sure to work. So:
    - forget making money through clever investments. Work for a living.
    - network locally. Buy from community supported agriculture if you can. Compost your vegetable scraps because it takes your waste stream out of the world where money is required (i.e. you don’t have to pay taxes to have it hauled away).
    - support local forms of entertainment – live performances in local venues, for instance, local art shows, school plays, anything you can do to keep money and effort within your community.
    - instead of shopping to feel better, go get a massage by a local practitioner
    - (you get the idea)

    As we do this (and we already are – this is not just talk or an empty proposal), we will be slowly but effectively pulling the rug out from under the financial industry. Without our money they are nothing.

    Again, this cannot happen overnight. Nor does it require big street demonstrations. All it needs are thousands of conversations like the one we’re having here. Just spread the word. You don’t need me or any other leader to do this. All you need is the ability to network and act locally. If one network is shut down, use a different one. In the movie “independence day” they fell back on morse code because it could be carried by radio waves that didn’t need satellites (the aliens had vaporized the satellites). So we’re creative and adaptive. We don’t have to keep trying the same old ways to fix this. Writing your congressional representative is so yesterday. Massive street demonstrations are so late 60s. They are good for saying what you don’t want or what you want, but not for actually making it happen. That requires focus and concentration and creative thought on a daily basis. We can are we are doing this. Let’s continue to get on with it.

  • http://www.openeyesvideo.com Glenn Koenig

    OK, forgot to say I’m from Arlington, Mass.

    Also, when I wrote, “you’re mortgage” it should have been “your mortgage.”

    Also, I know that some things I’ve said, above, are overly simplified. “Work for a living,” is not always possible for everyone. Some people are elderly, others are on disability. Some have been out of work for awhile and aren’t sure where to turn for work by now. We’ve found it easier to just let the government support such people – it’s harder to find ways in our busy lives to figure out how to support them ourselves instead.

    So, in the long run, we’re talking about more than just a revolution in finance. We’re talking about an entire shift in culture that affects everything, including education, medicine, the food industry, the military (industrial complex), the church, pretty much everything.

    So, fasten your seat belts. And hang on. The ride is going to be exciting. Thrills and chills. But we’ll get through it. Snow storms and all (or cyclone hitting Austrailia, even. Yeesh!)

  • http://www.openeyesvideo.com glenn Koenig

    “Here is some more crazy advice, get out of debt, stay out of debt and save as much as you can, cause the storm is not over yet!” – (posted by David).

    Yes. I agree. I can’t refinance my mortgage right now. Anyway, I’d just be jumping from one big bank to another and starting the ‘mortgage clock’ over at the beginning (where you pay the most in interest and the least in principal!)

    So instead, every extra dollar I can spare I add to my mortgage payment as extra principal pay off.

    That last sentence I wrote in my first post had a typographical error, “We can are we are doing this.” Should have been, “We can and we already *are* doing this.”

  • realdeal

    Glenn wrote: . . .”Without our money they are nothing.”

    I wish that were true. But I think that without our money they will still own over half of everything, and the way the system has been arranged, their portion of the pie will increase over time. However I certainly
    support your suggestions and follow almost all of them myself.

  • ellenb

    funniest,most clever article in the onion rec by poster above…thanks much…americans hire lobbyist to represent them. This is a democracy?

    The posters here are getting kooky and arguing too much. our financial crisis lack of punishment to instigators are getting people unhinged, it seems. Watch out.

  • http://www.e2m.org Michael Garajan

    Your panelist said “the problem is with the system, it needs reform. But who knows how to reform it?” She was partially right. The system is the problem but it is too corrupted to be reformed, nor is it worthy of reform. Why should millions or even billions of us allow ourselves to be indentured by a system created by the few very rich to serve themselves at the expense of the many? It is easier to start an alternative system within, but separate from, the current one. We do not need the approval of the rich or the government they control; no legislation is required; we can do it at the will of the people very easily anytime we desire. These two videos will explain the problem and how the solution of removing greed from the economic process can transform our society. http://www.e2m.org/videos.html.

    The book “The Community Age” by Michael Garajan outlined at amazon.com lays out a detailed road map and describes how we have created the foundational infrastructure for such an alternative system of community capitalism in Western Mass. We have garnered the support of federal and state elected officials, economists, educators, entrepreneurs, students, pastors, labor leaders, and community members.

  • Ellen Dibble, Northampton, MA

    I picked up a book Monday and think I’d better recommend it. Expletive deleted. I am not your handy composter of books. Most economics books are over my head. This one restates what we’ve been saying to each other on this site for a couple of years. Home-sweet-home.
    “It’s Life Inc., How Corporatism Conquered the World and how we can take it back.” By Douglas Rushkoff, out in 2009, in paperback 2011. Walter Isaacson says “This is a provocative and controversial look at the dark side of corporatist effects on our economy… Whether or not you agree… you will find the book challenges some of our basic assumptiosn about how our economy works.” Great indexing. Great notes. See rushkoff.com.
    The end points to many ways people are already acting on the kinds of concerns OnPoint and the commenters have pointed to. Rushkoff has done a lot of research into who has and is doing what.
    I-cannot-tell-a-lie — I haven’t read through to the end, but I skipped to see. There are many directions. For instance, on banking there’s a section on breaking up the big banks, anewwayforward.org, or http://www.onebluedot.com or kiva.org
    or at page 301, “Simply Evolve the Species,” see http://www.evolver.net. That began in May 2007 with the ezine Reality Sandwich, which evolved into the Evolver.net for “conscious collaboration,” so “by early 2010,” there were over 30 active groups, from Boston to Seattle, Cape Town to Sydney… Further on, and/or before, there’s the issue of campaign funding somewhere here, and media warping and whooping. Gotta go read it now.

  • Sarah

    Kudos to Glenn Koenig and Dave from CT for being voices in the wilderness. I would add only two things:
    1)The shift in thinking Glenn speaks of needs to come from within. Namely, us. Stop demanding something from nothing and recognize that simply put,there is no free lunch. Never has been and never will be. Carry on about social justice (or lack of), or equality and fairness (or lack of)all you want. In the end, there is a cost whether you want to admit it or not – and someone has to pay the bill. There is no free lunch.
    2)Stop thinking in terms of “I can’t”. Never before in my life have I heard so many excuses and seen so many fingers pointed at someone other than who might be responsible. Borrowers “assumed they were being dealt with honestly”? Hogwash! It is your money and your life and it is incumbent upon you to know what you are signing before you sign it – no matter what it is. Who else should be responsible for you?

  • Brett

    “In 1991, Larry Burkett wrote The Coming Economic Earthquake, warning of the dangers of the ever-growing appetite for debt.” -david @10:06pm

    Yeah…um, he also warned people to stockpile food, water, and various emergency supplies to last an extended period of time just before Y2K was supposedly going to be the end of the world. He had been predicting variations on the End of Days belief in his writing and commentary since he began getting published and being a conservative, talk-show radio personality; he was an evangelical Christian, after all (sorry, I almost said “for Chrissake” which would have had too much of at least a double entendre). It was his duty to warn people; he would have been going against the Bible otherwise.

    Mr. Burkett pegged the financial crisis fourteen years early based on such insightful and radical ideas as too much debt can make economies unstable…the man was a genius, a clairvoyant—why, a veritable modern-day Nostradamus! I’d say, it’s just a good thing you managed to go against the grain of the reckless, misguided advice promulgated by east coast, liberal elitists intent on destroying the world/putting a great big old hole in the hull of this great big old ship we all sail in together and listened to those wrongfully-maligned right-wingers that other people called idiots (Mr. Burkett told you precisely when to get in and when to get out of the stock market during the financial crisis–which happened about four years after his death–did he?). Did he speak to you in dreams, through the word of God, during prayer, what? …Hey, there’s nothing partisan about following a prophet, am I right or am I right?

    P.S. -Your theory that rising gas prices caused the financial crisis is an interesting one. Did this guide you at all, i.e., prompt you to get out of the stock market when they rose and get back in when they lowered? Did Mr. Burkett’s heavenly spirit instruct you to let gas prices be your guide or was that in his earlier-written book when he had a more earthly presence? Maybe YOU should write a book; you know, carry on with Mr. Burkett’s missionary work, as it were.

  • Brett

    at,
    Glad your brother was able to sell on the upswing. I had two houses at the time, one was and is my home, the other I had turned into a rental property. The rental property was on the verge of needing some rehab, and I was looking at the prospect of carrying two mortgages and expenditures such as complete window replacement in addition to possibly replacing the furnace in the near future (not small ticket items). I decided before the second house deteriorated to the point of not being able to forgo sinking more money into it, it would be a good idea to sell.

    My real estate agent recommended I ask about $30,000 more than I was, but I said nope. I noticed that houses around town that had been selling in a day or two just six months earlier, with each one enjoying a seller’s bidding war of sorts, were now sitting there for weeks and months; the ones that did sell were not seeming to prompt the climate of buying frenzy that was once present. I sold within the month.

    The guy who bought it from me wanted to do some cosmetic changes and flip the house in a month or two. He ended up not being able to sell for almost a year, at a $1300 a month mortgage; between that and taxes, and having to slash his initial asking price, according to my estimation he lost about $9,000 on the deal (not to mention the headache costs).

    Both the agent and the guy who wanted to flip the house kind of made me not want to do it just because they both seemed to represent how greed has a slime quality to it.

    Interestingly, the people who bought from the “flipper” are now selling, their asking price is about $20,000 less than my selling price! I would love to have enough disposable money to buy it, burn it down (maybe invite the fire department to use it as practice), make a big media event out of turning it into neighborhood green space, and name the “park” after the guy I sold it to, maybe put up a statue of him in the middle of the property calling it a monument to greed…just a silly little idea I had when I saw it was on the market. There was a kind of poetry in my thought. ;-)

  • TomK

    Katherine, good questions:

    “(1) What kind of reform would deal with the moral hazard created by the securitization of mortgage loans?

    (2) What kind of reform would deal with the failure of the ratings agencies to property rate mortgage securities?”

    1. Institutions should be required to keep some % of the loans they originate.

    2. The solution is that the issuers should not be able to shop for a rater. I’m not sure of the best way to implement it. A lottery?

    Above all, a big crash requires leverage (borrowing to gamble). You can’t bring down the economy if you only lose everything you have. As part of Bush’s job-killing deregulation, the SEC upped the allowed leverage by investment banks from 10:1 to 40:1, arguing that they knew what they were doing and would not endanger themselves – the “self regulating” voodoo. Limits on leverage and reserve requirements are crucial!

    Finally, we’ll never recover if voodoo like “gvt is the problem” and “the free market always finds the best solution” persists. There’s a world of difference between an energized SEC with a leader who believes in the mission and an SEC where the staff are told they’re losers because they don’t have a job in the private sector. Ultimately it’s all done by people!

    It would be good also to get over the nonsense “the banksters are too smart to be regulated”. Bull**it. A con is a con i a con. The problem is not the incredible intelligence of the greedy mediocrities on wall st, it’s that we have not appointed anyone who wants to go after them. A 3-card monte guy from the streets of NYC would know exactly what to do.

  • Dave in CT

    “As we do this (and we already are – this is not just talk or an empty proposal), we will be slowly but effectively pulling the rug out from under the financial industry. Without our money they are nothing.”

    Sounds good, but I think we might be underestimating to power of Central Bankers and the Federal Reserve, and their ability to manipulate our currency and strength of the dollar, holding us hostage financially even in cash.

    Thats why as we probe deeper into the crisis and the powers that be, it is hard not to be drawn into the growing interest in reigning in the unaccountable Federal Reserve.

    http://video.google.com/videoplay?docid=6507136891691870450&hl=en#

    http://video.google.com/videoplay?docid=5352106773770802849#

  • TomK

    They are fine without us but with the Fed. The Fed is giving them free $, that’s why they don’t have to offer us any interest on our deposits.

  • Robert Gott Milford New Hampshire

    One aspect of any of the many financial crisis in recent memory is left unsaid. On average american workers compensation over the last thirty years has fallen in real terms. In general compensation has fallen to a third of what it was 30 years ago. I base this on those I know, and starting wages in my own profession.

    It seems that all the emphasis on financial crisis is a beard to cover truly what has happened. We are extended credit to borrow from those who have to maintain a lifestyle that is less and less sustainable.

    Success has consequences. Consequences are that wages go down when productive capacity goes up. In general productive capacity has gone up. While the Time and effort and material to produce something has gone down. This we suspect is a good thing, a success. More can be made with less. Throughout any productive system, across society there is a surplus. Surplus which is accumulated, in some way. This surplus is capital to be stored away in the prices of shares of stock, hedge funds, Capitalized Debt Instruments, so on and so on. The more complicated the financial machinations can get the better. Hide the surplus wealth away, so no one eats it. In this way those who have labored to produce, the surplus, are isolated legally from the surplus, they do not own and are not entitled to it. Once compensated for the effort and time to produce producers should just leave the scene of production. Go away, leave. People who work become another industrial waste product.

    In this global system of surplus production Corporations own the surplus. Ideally this accumulated surplus is stored away as if in a large grain elevator, until it is needed. However Corporations are managed by people, who over time, and generations control the capital surplus. Managers, directors who through simple human nature take proprietary interest in control of the surplus.

    Mangers, CEOs who have the power to choose their own compensations, and use the surplus.

    So it seems that the deal we have all agreed to is that the system is most efficient when it is most profitable. Profitable is when those who produce are compensated the least, and those who control the surplus maintain control.

    Credit is a carrot to manage those who are compensated the least.

    Therefore to keeps wages and compensation down make credit easier. Even make it seem that access to credit is some kind of public good. Don’t call it indebtedness, or bond slavery.

    Therefore control of the surplus production is maintained through easy credit. Credit whereby the creditor eats today, consumes today, and must work tomorrow, to pay back what had already been produced.
    For many decades now the american economy has through this credit system kept the wheel of itself as well as the world rotating.

    Money, is passed hand to hand along this wheel.

    However with each rotation, because of lowering wages, because of increasing inequities in this system, value is removed from the societal system. Borrows owe so much they cannot even make payments on what they borrowed long ago. Value or wealth is concentrated in fewer persons. The economic wheel slows. Greater inequitable incentives from those who have control of the surplus is required to inspire them to insert societies surplus capital to speed up the wheel once again. Each economic cycle seems to take greater effort to reverse

    Eventually the wheel appears to stop altogether, because those who own the means of moving the wheel stay home. Those without have nothing left to put in.

    Like the Monopoly game, when one winner has all the property and all the money Game is over.

  • Mike Hunt

    The report on the crash is a silly thing. It’s a government report, of course it’s not going to blame the government. That’s like asking a restaurant to rate its own cleanliness. This happens after every crash, the free-market gets blamed by the government and their lackeys, and the solution is always more and better regulations. You people need to wake up, freedom isn’t to blame. The bubble was caused by the Federal Reserve. The banks and loan managers knew they would get bailed out by the Fed, so they really didn’t care about risk, they only cared about reward. This is a business cycle, Bubbles always pop, you should look at the reason the bubble was allowed to get so big for so long. Also, you can’t stop human greed, but you can stop it from hurting everyone. We should have let the banks fail, but now this recession will last 10 years instead of 2. We are not through this by a long shot. And the tax payers are the always the ones stuck with the bill in the end.
    If you want real answers on this topic, Please go to MISES.ORG.

  • http://www.beccar.wordpress.com Eugenia Renskoff, NY

    Hi, Tom, I think that the Wall Street guys are deceiving us when they say that the financial crisis was an act of God, or something like that. They know perfectly well that human men and women are/were at the bottom of it. If they got bailed out after helping homeowners lose their homes, it is only fair that the screwed home owners get their money back. In my case, I only wanted a home. That was my only motivation when I bought a beautiful condo in GA. I knew nothing about subprime lending or mortgage fraud or predatory lending. That changed dramatically very quickly. My condo foreclosed and I have been poor ever since. I have nothing against the Wall Street people being rich, but I do not appreciate being blamed by them and other people for something I did not do. Eugenia Renskoff

  • TomK

    Eugenia, it’s nonsense to say the crash was a “black swan”, an “act of God”, or even a surprise. It was just yet another speculative LEVERAGED bubble bursting, not terribly different from Tulipmania or, I expect, something to do with property in Gaul during Roman times.

    Leverage is the key. You can’t crash the economy when you can’t borrow to gamble. Sheesh, I learned in high school that a big part of the 1929 crash was margin (= leverage) debt. Just like nobody seems to remember W touting the “Ownership Society”, nobody seems to remember, or have noticed, that the Bush SEC raised the allowable leverage to 40:1 for the big investment banks. If leverage had been “only” 10:1, none of the big banks would have been insolvent.

    Individual banksters absolutely knew a crash was coming. They just planned to be on that caribbean island before it happened.

  • feelthelove

    To Larry and others like us:

    I say screw the uprising, what we need is a star chamber of real patriots (not the burlesque of manipulated dummies like the teabaggers) and a few teams of special ops guys who have figured out who the hell it really is they fought and bleed for, and are mad as hell. Then they need to take them out one at a time starting with that guy from Magnetar and working there way down in terms of greed and corrupt bankers and government officials. We need the intelligence agencies to get intelligent and help save the America of their great great great granddaddys. That is the only thing these cowardly bastards really understand. Take their money and their lives for being so greedy and evil. Show them how real humans deal with the elitist scum, that take advantage of the positions afforded them by society and turn around and enrich themselves without a thought for the millions whose lives must be destroyed so that they can buy their fifth vacation home. They deserve no consideration and should be dealt with with extreme prejudice. And any American who truly loves his country will aid in their total destruction. Everybody can help. Find out who they are, where they live, post it online, observe them, make them feel the fear that they deserve to feel, and destroy any goons that protect them, and delete their undeserving lives from this sphere of existence. This would be dealing with them as they have been dealing with us.

  • Barnabas

    2nd Amendment solutions to wall street greed?

  • http://www.openeyesvideo.com Glenn Koenig

    Dave in CT, thank you for the links to how the Federal Reserve was created. Fascinating.

    I’d like to acknowledge that there are actually hundreds of other currencies being used or developed right now in this country. They go under various names, such as Time Dollars, etc. They represent a incredible small part of commerce in the US today, escaping the notice of most. However, I recommend that we keep them in mind. They may seem insignificant now, but as Clayton Christensen has so aptly pointed out, they represent disruptive innovation. For a more complete idea of what I’m talking about, have a look at his books, specifically “The Innovator’s Dilemma” wherein he lays out what this term means and how it has worked in the past.

    So if the current monetary system goes completely haywire, and the value of money issued by the Federal Reserve goes way up or way down, keep this in mind. It could save your life.

  • SamIam

    Glenn why don’t you and Dave (if you are not the same person) go off and lick some gold (which by the way has no intrinsic value outside of its industrial use, which will soon be superseded by nano materials. Your ideas have no chance of working in the real world. While inspiring some young patriots to scare the bastards straight actually does. You guys will be working your little gardens and exchanging hemp until the sheriff shows up and kicks you off your land, and the greedy power people will be stealing everything that they already haven’t because you think its 1850, and think you can correct great evil by navel gazing. I go with feelthelove and Larry.

  • Dave in CT

    “Glenn why don’t you and Dave (if you are not the same person) go off and lick some gold ………..”

    ……this is where you go into your actual defense of the unaccountable Federal Reserve and explain how it doesn’t really support the corporatist/warfare state and suck the real earned wealth out of regular people around the world via bubbles and inflation and war, time after time after time.

    After you guys go out blazing with your six guns and have taken out the Wall St scumbags (satisfying sounding), and beat back the stealth fighters, what do propose to replace it all with? Socialism? Two-party State Capitalism? Or something more Libertarian with strict Rule of law against coercion, force, corruption etc, the lack of which has gotten us here?

    Oh the Banks go too big to fail because the Federal Reserve and Government Finance committees did too LITTLE!? BS. They created them through good old fashioned central planning and corruption.

    Gold, any scarce thing of apparent value, lets use wheat if you want to lick or eat it, is there as a standard vs. currency, to keep the powers that be from being able to print excess money willy nilly as they and their crony friends see fit, creating bubbles for their Wall st pals to play in, and debt obligations to keep the masses in perpetual servitude to the Corporate State.

  • Jeremy

    The report on the crash is a silly thing. It’s a government report, of course it’s not going to blame the government. That’s like asking a restaurant to rate its own cleanliness. This happens after every crash, the free-market gets blamed by the government and their lackeys, and the solution is always more and better regulations. You people need to wake up, freedom isn’t to blame. The bubble was caused by the Federal Reserve. The banks and loan managers knew they would get bailed out by the Fed, so they really didn’t care about risk, they only cared about reward. This is a business cycle, Bubbles always pop, you should look at the reason the bubble was allowed to get so big for so long. Also, you can’t stop human greed, but you can stop it from hurting everyone. We should have let the banks fail, but now this recession will last 10 years instead of 2. We are not through this by a long shot. And the tax payers are the always the ones stuck with the bill in the end.
    If you want real answers on this topic, Please go to MISES.ORG.

  • Dave in CT

    “A favorite sport of many conservatives is calling President Obama a socialist because of his anti-market rhetoric and the significant increase in government involvement in the economy. In an earlier column I weighed in on this issue, suggesting that Obama is more of a corporatist than a socialist. Whatever term one thinks best describes Obama’s politics, ironies abound in the conservative charge of “socialism.” In general, conservatives have been quite willing to accept, if not encourage, government intervention in markets.”

    From Cornfield Socialism:
    http://www.thefreemanonline.org/headline/cornfield-socialism/

  • TomK

    Absolutely, Dave in CT, Obama (= Oromney) is a typical corporatist. His financial team is wall st insiders and his health care plan is Romney’s. Our former GoP governor’s plan has now become socialism, as has the individual mandate which the right loved so much in the 90s. A plan by and for the corporations has become “a total government takeover of the health care system”. Geez, WellPoint and the hospital corporations must be really surprised that the gvt has replaced them.

    This is insane!

    Obama is a center-right, corporatist, moderate republican. He’s a lot like Romney. He’ll never tame the financial sector.

  • geffe

    Is Wall Street Clean? Right now there are Pigs flying outside my window…

  • Aynt Rannd Pawl

    Support the financial system! And also eliminate health care, environmental protections, worker protection, and corporate regulations until we can play on the same business field as the third world. Don’t worry, a few billionaire CEO’s will be paying for their pretty private parks for us to look at as we bicycle by.

  • seldoc

    The only thing the even resembles a protest movement is the Tea Party. In the main, they’ve decided to place all of the blame on irresponsible borrowers, Freddie and Fannie and, of course, the government personified by Barney Frank and Chris Dodd. Any talk of regulation is dismissed as government meddling in the free markets. Goodness, no one even mentioned that the commission, divided along party lines, couldn’t even agree on a single report, and that the conservative faction issued its own report that didn’t even mention Wall Street. The bottom line is that Ms McClean’s despair is well founded.

  • Slipstream

    Great show with a couple of articulate and interesting guests! Unlike some public radio show hosts (umm Michelle Martin on WNYC ,e.g.), Tom knows the show is not about him, asks good questions, and lets his guests express themselves. But this did leave me pretty depressed about the state of things today. What does it take to bring about real reform?? Starvation, violence in streets?

  • Thnick

    The tea party was created by big money to diffuse the real problem. Banks, insurance companies, big corporations and the very rich run this country. The uprising should be against these people. I don’t care about these labels..socialist, centrist..Blah, blah, blah. The people of Egypt rose up against exactly what we have here. Corruption and usury by
    unregulated money people and corporations. Where is this party? The
    American Party! Here’s the platform. Tax the rich. Anybody making over a million dollars a year should have their taxes raised. They live here too. They can’t keep using people to sustain themselves without paying for it. And by the way..a bunch of them signed a letter saying they would pay higher taxes! Corporations..they pay little or nothing and ship jobs overseas. Tax them until they help this country. Banks and wall street? Regulate the hell out of them. Bring back Glass Steagel. We had years of great growth under regulations from the 1094′s on up..until the
    business community propagandized us into believe regulation was somehow anti american. Yes, right. And cheating us, ripping us off..is somehow American. Right. Come on folks! Let’s get something going.

    Nick

ONPOINT
TODAY
Jul 24, 2014
Youths seen playing basketball through bars on a window at the Wisconsin Department of Corrections Ethan Allen School in Wales, Wis. (AP file)

The cold hard facts about juvenile prisons. And the case for shutting them all down. Plus: former Secretary of State Hillary Rodham Clinton is with us.

Jul 24, 2014
Orchid (Galileo55/Flickr)

We’ll look at the new science of what plants feel, smell, see – and remember.

RECENT
SHOWS
Jul 23, 2014
Actor Wallace Shawn attends special screening of "Turks and Caicos" hosted by Vogue and The Cinema Society at the Crosby Street Hotel on Monday, April 7, 2014 in New York.  (AP)

From “The Princess Bride” to “My Dinner with Andre “and “A Master Builder,” actor and writer Wallace Shawn joins us.

 
Jul 23, 2014
In this Saturday, July 12, 2014, photo, migrants walk along train tracks and boxcars after getting off a train during their journey toward the US-Mexico border, in Ixtepec, southern Mexico. (AP)

Crisis at the US border. What do Latinos on this side of the border have to say? We’ll ask our special roundtable.

On Point Blog
On Point Blog
Hillary Clinton: ‘The [Russian] Reset Worked’
Thursday, Jul 24, 2014

Former Secretary of State Hillary Rodham Clinton took time out of her global book tour to talk to us about Russia, the press and the global crises shaking the administration she left two years ago.

More »
Comment
 
Where Did Nickel Creek Go?
Thursday, Jul 24, 2014

The Nickel Creek interview originally scheduled for Thursday, July 24 is rescheduled for an as-of-yet undetermined later date. We explain why.

More »
2 Comments
 
Our Week In The Web: July 11, 2014
Friday, Jul 11, 2014

As we prepare for a week of rebroadcasts, we reflect on Facebook posts, misplaced comments and the magic of @ mentions. Internet, ASSEMBLE!

More »
Comment