The Great American Bubble Machine | Politics News The first thing you need to know about Goldman Sachs is that it's everywhere. The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money. In fact, the history of the recent financial crisis, which doubles as a history of the rapid decline and fall of the suddenly swindled dry American empire, reads like a Who's Who of Goldman Sachs graduates. Invasion of the Home Snatchers By now, most of us know the major players. As George Bush's last Treasury secretary, former Goldman CEO Henry Paulson was the architect of the bailout, a suspiciously self-serving plan to funnel trillions of Your Dollars to a handful of his old friends on Wall Street. But then, any attempt to construct a narrative around all the former Goldmanites in influential positions quickly becomes an absurd and pointless exercise, like trying to make a list of everything. The Feds vs. Wall Street's Big Win
OccupyStream - Live Revolution CHARTS: Here's What The Wall Street Protesters Are So Angry About... The "Occupy Wall Street" protests are gaining momentum, having spread from a small park in New York to marches to other cities across the country. So far, the protests seem fueled by a collective sense that things in our economy are not fair or right. But the protesters have not done a good job of focusing their complaints—and thus have been skewered as malcontents who don't know what they stand for or want. (An early list of "grievances" included some legitimate beefs, but was otherwise just a vague attack on "corporations." So, what are the protesters so upset about, really? Do they have legitimate gripes? To answer the latter question first, yes, they have very legitimate gripes. And if America cannot figure out a way to address these gripes, the country will likely become increasingly "de-stabilized," as sociologists might say. In other words, in the never-ending tug-of-war between "labor" and "capital," there has rarely—if ever—been a time when "capital" was so clearly winning.
How Paulson Gave Hedge Funds Advance Word Treasury Secretary Henry Paulson stepped off the elevator into the Third Avenue offices of hedge fund Eton Park Capital Management LP in Manhattan. It was July 21, 2008, and market fears were mounting. Four months earlier, Bear Stearns Cos. had sold itself for just $10 a share to JPMorgan Chase & Co. (JPM) Now, amid tumbling home prices and near-record foreclosures, attention was focused on a new source of contagion: Fannie Mae (FNMA) and Freddie Mac, which together had more than $5 trillion in mortgage-backed securities and other debt outstanding, Bloomberg Markets reports in its January issue. Paulson had been pushing a plan in Congress to open lines of credit to the two struggling firms and to grant authority for the Treasury Department to buy equity in them. “If you have a bazooka, and people know you have it, you’re not likely to take it out,” he said. A Different Message At the Eton Park meeting, he sent a different message, according to a fund manager who attended. Stock Wipeout
Revealed: huge increase in executive pay for America's top bosses | Business John Hammergren, CEO of healthcare provider McKesson, earned $145m last year. Photograph: George Nikitin/AP Chief executive pay has roared back after two years of stagnation and decline. America's top bosses enjoyed pay hikes of between 27 and 40% last year, according to the largest survey of US CEO pay. America's highest paid executive took home more than $145.2m, and as stock prices recovered across the board, the median value of bosses' profits on stock options rose 70% in 2010, from $950,400 to $1.3m. The Guardian's exclusive first look at the CEO pay survey from corporate governance group GMI Ratings will further fuel debate about America's widening income gap. Last year's survey, covering 2009, found pay rates were broadly flat following a decline in wages the year before. This year's survey shows CEO pay packages have boomed: the top 10 earners took home more than $770m between them in 2010. Still, there are no bankers among this year's big winners.
Tax gift to the rich Todd Dagres, a prominent venture capitalist and independent movie producer, earned $3.5 million in 2003, and paid not a cent in federal income tax. The IRS challenged the math, and sent Dagres a bill for $981,980 in back taxes, plus $196,369 in penalties. So Dagres lawyered up. His attorneys waived one lucrative tax break to exploit an even better one, and claimed victory in the case in March. In the course of the dispute, Dagres offered five years of his tax returns as evidence in U.S. Dagres earned $58.5 million over those five years — ranking him among the richest 0.1 percent of Americans. Dagres, 51, is not alone. The trend has gotten quite pronounced in recent years, especially for the very, very rich who, like Dagres, earn most of their income from investing and can exploit the low rates on capital gains. During that time, the combined taxable income of the top 400 soared from $16.3 billion to $91 billion. There is more than revenue at stake. Wrinkle in the Tax Code Flip-flop
Occupy Geeks Are Building a Facebook for the 99% | Threat Level Protesters volunteering for the internet and information boards of the Occupy Wall Street protest work and broadcast from their media center in Zuccotti Plaza on Oct. 2, 2011. Photo: Bryan Derballa for Wired.com “I don’t want to say we’re making our own Facebook. But, we’re making our own Facebook,” said Ed Knutson, a web and mobile app developer who joined a team of activist-geeks redesigning social networking for the era of global protest. They hope the technology they are developing can go well beyond Occupy Wall Street to help establish more distributed social networks, better online business collaboration and perhaps even add to the long-dreamed-of semantic web — an internet made not of messy text, but one unified by underlying meta-data that computers can easily parse. [bug id="occupy"]The impetus is understandable. Now it’s time for activists to move beyond other people’s social networks and build their own, according to Knutson.
Schneiderman Sues Three Big Banks, MERS for Deceptive Practices, Illegal Foreclosures In the latest of a flurry of under-the-wire lawsuits that seem to conflict with an imminent foreclosure fraud settlement, Eric Schneiderman, the Attorney General of New York and a co-chair of the federal task force looking into the residential mortgage-backed securities market, sued three banks for their use of the MERS electronic registry which resulted in fraudulent foreclosure filings. Attorney General Eric T. Schneiderman today filed a lawsuit against several of the nation’s largest banks charging that the creation and use of the private national mortgage electronic registry system known as MERS has resulted in a wide range of deceptive and fraudulent foreclosure filings in New York state and federal courts, harming homeowners and undermining the integrity of the judicial foreclosure process. The lawsuit asserts that employees and agents of Bank of America, J.P. Importantly, this is separate and apart from the RMBS working group that Schneiderman co-chairs.
Wall Street, investment bankers, and social good A few months ago, I came across an announcement that Citigroup, the parent company of Citibank, was to be honored, along with its chief executive, Vikram Pandit, for “Advancing the Field of Asset Building in America.” This seemed akin to, say, saluting BP for services to the environment or praising Facebook for its commitment to privacy. During the past decade, Citi has become synonymous with financial misjudgment, reckless lending, and gargantuan losses: what might be termed asset denuding rather than asset building. In late 2008, the sprawling firm might well have collapsed but for a government bailout. Even today the U.S. taxpayer is Citigroup’s largest shareholder. The award ceremony took place on September 23rd in Washington, D.C., where the Corporation for Enterprise Development, a not-for-profit organization dedicated to expanding economic opportunities for low-income families and communities, was holding its biennial conference. There is something in what Mack says.
Kalle Lasn and Micah White, the Creators of Occupy Wall Street Kalle Lasn spends most nights shuffling clippings into a binder of plastic sleeves, each of which represents one page of an issue of Adbusters, a bimonthly magazine that he founded and edits. It is a tactile process, like making a collage, and occasionally Lasn will run a page with his own looped cursive scrawl on it. From this absorbing work, Lasn acquired the habit of avoiding the news after dark. Lasn is sixty-nine years old and lives with his wife on a five-acre farm outside Vancouver. The magazine, which he founded twenty-two years ago, depicts the developed world as a nightmare of environmental collapse and spiritual hollowness, driven to the brink of destruction by its consumer appetites. Lasn was interrupted by a phone call about the Zuccotti eviction while in bed, reading Julian Barnes’s “The Sense of an Ending.” “Eerie timing!” White reached Lasn by telephone shortly before nine. Lasn and White quickly hammered out a post-Zuccotti plan. P. took the subway to Bowling Green.
A Vision of Post-Clicktivist Activism Clicktivism is a Trojan horse, a tactical malware, deployed by a dying American empire. What better way to cripple the revolutionary potential of a whole generation than to embed the logic of the marketplace within the very tools that would-be revolutionaries use? Forget infiltrator "Anna" and the plague of agent provocateurs. The cop we need to worry about is residing in the computer code. If #OCCUPYWALLSTREET fails, it will be because we've blindly adopted "best practices" put forth by wealthy Californian techies turned reformist campaigners. Most clicktivist organizations today can be traced back to the $13.8m (£8.8m) sale in 1997 of a software company located in Berkeley, fifty miles from the heart of Silicon Valley, whose claim to fame was an iconic flying toaster screensaver. Clicktivism uses invasive databases to meticulously track which members are opening emails, signing petitions or donating money. Clicktivist organizations grow like the capitalist cancer we are fighting.
Lesson of JPMorgan’s Whale Trade: Nothing Was Learned Details of JPMorgan Chase's multibillion-dollar trading loss — brought to light by a riveting and devastating report [1] from the Senate Permanent Subcommittee on Investigations — demonstrate what a sham that is. Bankers aren't acting cautious and chastened. Risk managers aren't in the ascendance on Wall Street. What we now know about the incident is that, as the cliché has it, the cover-up was worse than the crime. As JPMorgan got into trouble, traders and the responsible executives treated the valuation of trading positions, made up of derivatives, as a puppet made to do what they wanted. Ina Drew, the head of the bank's chief investment office, referring to how the positions were calculated, asked an underling if he could "start getting a little bit of that mark back." This discussion did not make it into the bank's internal report on the incident from January. Yes, Ms. Of course, it was no such squall. "What Doug said was accurate," Evangelisti said. We shouldn't.
Promontory Financial Draws Washington Scrutiny Alex Wong/Getty ImagesEugene Ludwig, second from left, founded Promontory Financial after serving as President Bill Clinton’s comptroller of the currency. The consulting firm is filled with so many former bureaucrats and political insiders that it has become known as Wall Street’s shadow regulator. Nearly two-thirds of its roughly 170 senior executives worked at agencies that oversee the financial industry. The founder, Eugene A. Ludwig, is a former comptroller of the currency and a law school friend of Bill Clinton; the latest hire, Mary L. Schapiro, ran the Securities and Exchange Commission until late last year. Building off those connections, the Promontory Financial Group has emerged as a major power broker in Washington, helping Wall Street navigate an onslaught of new rules and regulatory scrutiny. But Promontory and other consultants are now facing scrutiny in Congress, amid growing unease over their influence and their close ties to federal authorities. From the beginning, Mr.
The Biggest Price-Fixing Scandal Ever | Politics News Conspiracy theorists of the world, believers in the hidden hands of the Rothschilds and the Masons and the Illuminati, we skeptics owe you an apology. You were right. The players may be a little different, but your basic premise is correct: The world is a rigged game. We found this out in recent months, when a series of related corruption stories spilled out of the financial sector, suggesting the world's largest banks may be fixing the prices of, well, just about everything. You may have heard of the Libor scandal, in which at least three – and perhaps as many as 16 – of the name-brand too-big-to-fail banks have been manipulating global interest rates, in the process messing around with the prices of upward of $500 trillion (that's trillion, with a "t") worth of financial instruments. That was bad enough, but now Libor may have a twin brother. The Scam Wall Street Learned From the Mafia Why? The bad news didn't stop with swaps and interest rates. "You name it," says Frenk.