Respectfully submitted by Lawrence E. Rafferty (rafflaw)-Guest Blogger
I am sure that you have heard the phrases, “Too Big to Fail” and “Too Big to Jail”, when it comes to the so-called Big Banks. Indeed, the topic has been written about and discussed on many occasions here on Professor Turley’s blog. Fellow Guest Blogger Elaine Magliaro wrote about it here, and I wrote about Big Banks plotting, along with the FDIC and the Bank of England to “steal” depositors money in order to bail out gambling banks, to name a couple of recent articles.
The stories about Big Banks being investigated and fined could fill a very large hard drive. Even with all of those stories and countless others, I was still shocked to read recently about a meeting that JP Morgan CEO Jamie Dimon had with the United States Attorney General, Eric Holder. It was reported that the purpose of the meeting was to discuss yet another financial settlement for alleged JP Morgan irregularities. The numbers they allegedly were discussing were staggering!
According to reports, Dimon and AG Holder were discussing settlements in the neighborhood of $3 Billion to $11 Billion. That is one hell of neighborhood!
“JPMorgan (JPM) CEO Jamie Dimon met with Attorney General Eric Holder on Thursday morning as rumors swirled about a possible $11 billion settlement to end criminal and civil charges against the bank. The Justice Department has a minimum of seven different probes into JPM and they’re reportedly trying to settle as many as possible in rapid fashion.
According to several reports JPM made a $3 billion settlement offer connected to alleged abuses in residential mortgage backed securities. Mr. Holder is said to have rejected the offer. Last week JPM paid $920 million and “admitted to some wrongdoing” to settle regulatory charges connected to the “London Whale” losses.” Yahoo
I just can’t imagine how any corporation could continue to do business when they are paying fines in the range that JP Morgan is paying or negotiating. However, when you are raking in the Billions as JP Morgan is, these large fines may just be like a mosquito bite. The Yahoo article linked above, goes on to give a more complete picture of the costs that JP Morgan has incurred in fines.
“Regarding JPMorgan’s settlements and charges and degrees to which the bank is willing to concede guilt, two things are clear. One, JPM has a ton of money. Earnings estimates are pegged around $22 billion for 2013 and the company has a market cap of about $200 billion. The other is that it will always be politically expedient for young prosecutors on the make to attack Wall Street banks. JPM is going to be in a constant state of legal defense for the foreseeable future.
Ritholtz Wealth Managment CIO and Big Picture editor Barry Ritholtz says JPMorgan has shelled out about $11 billion in fines and spent around $16 billion in legal fees in the last few years. “This is just the cost of doing business for these mega banks.”
I guess when you are “earning” $22 Billion in 2013 alone, the settlement amounts could be considered a pin prick to JP Morgan. However, at what point will JP Morgan’s shareholders revolt against the business practices that are causing these huge fines? I could go a step further and ask when will Americans insist that when any corporation has committed fraud, someone should pay a criminal price along with the financial price?
When I read that JP Morgan is shelling out Billions in fines and legal costs, I wonder why the business model hasn’t changed to prevent or reduce these allegedly illegal practices? The answer is in the aforementioned earnings numbers from JP Morgan. The fines and legal costs are just another cost of doing business. The problem is that they are not gambling their own money. They are gambling and paying out depositor’s monies and shareholder’s money.
It seems obvious to me that unless someone goes to jail and/or big financial institutions like JP Morgan are broken up, this improper activity will continue unabated. This is not a political issue. This is an issue of protecting shareholders and depositor’s funds from the continued shell game that is being played by the large financial institutions.
It is far past the time when cabals like JP Morgan are prosecuted for financial crimes and put out of business. I submit that putting some high executives in jail when they break the law, may have a deterrent effect on the rest of the industry. I not talking about making a few examples.
I am talking about dealing with alleged law breaking financial executives the same way that the government and law enforcement authorities deal with common criminals. If there is evidence that indicates illegal activity, no matter who and what organization is involved, investigate and indict and prosecute them.
Wasn’t it Mitt Romney who once said, and I am paraphrasing here, that corporations are people too? Then it is time that “people” like JP Morgan go to jail for their allegedly illegal activities. Do you agree? What action do you think the Justice Department should take in dealing with financial criminals? If we break up the big banks and/or put law breaking executives in jail, will that stop or reduce the financial crimes that rob shareholders and depositors? What do you think?
Additional resources: Nation of Change;
Great video Elaine about Greenspan’s mistake confession!
However, as I posted in my article, this wasn’t a mistake or flawed thinking on Greenspan, Wall Street, Congressional leaders and the President(s). This was all planned! There was an article in the USA Today, few years ago, stating that a few Wall Street members had ‘bets’ on the economy collapsing. This article (I will find it, it probably wasn’t in the USA Today) went on to state that, due to recession and the ongoing financial assistance from the Federal Reserve and politicians, the rich became richer and poor/middle class became poorer.
LMAO @ RTC’s comments to David!
RWL wrote: “LMAO @ RTC’s comments to David!”
Yeah, he even had me in stitches with laughter. LOL. 🙂
David,
Again, we go back to basic economics. Any normal business develops a future earnings model based on contracts for future services or orders for products in hand. Based on production stats, you either have the personnel to meet demand or not. You either boost production by cracking the whip, paying overtime, or hiring. You can hire temporary staff or contract workers if you don’t expect to maintain high demand for any extended period. I get the feeling all your staff are more or less temporary, but leaving off the nightmare of working in your tweedle-dee world, I can’t believe it costs thousands of dollars to hire and train a new employee. You might want revisit your orientation program there, champ.
BTW, you know who expects a new employee to walk in and start making money right away? I’ll give you a hint. It’s J.P. Morgan!
Oh, and I must say, between your participation here and getting arrested in the park for exercising you free speech rights, you seem to have a lot spare time for someone who works 75 – 80 hours a week. I know, I’ve done it. But don’t stop weighing in here; you’re very entertaining. Because your sincere in your beliefs, I sometimes find myself rooting for you in a twisted sort of way because your such an underdog in your battles. But in an even more twisted way, it’s funnier to see you continually get spanked left, right,and center.
GRITtv: Nomi Prins: It Takes a Pillage Part 1 of 2
http://www.youtube.com/watch?v=G3cKi0DDwUY
GRITtv: Nomi Prins: It Takes a Pillage Part 2 of 2
Elaine,
Definitely, thanks for the video. When you’re in charge of running something into the ground, what do you say. Sorry? Unless you’re Old Rummy, who simply said, “Mistakes were made”. (“Yeh, but by whom?”)
BTW, didn’t Milton Friedman backtrack somewhat on his anti-regulatory stance shortly before he died, as concern over the economy was heating up?
No, I haven’t read “Griftopia”. Yet, but I will.
David:
“Oh, I see it when I go look for it. I’m just saying that since I do not invest in Wall Street, they are not part of my world.”
So, you haven’t been affected by the meltdown? Or simply not troubled by it? From all the stuff you write, you sound like the kind of guy who would be bothered to see someone profiting through dishonest unethical behavior, especially when it comes at the expense of decent, hardworking families. Or maybe you see the world as filled with viscous, manipulative types and you blame the government for giving us the unrealistic expectation that it could protect us from being defrauded.
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“If government would just get out of my way, I would be able to hire more employees and contribute much more to the economy.”
Economics 101: you’ll hire as many workers as you need to meet the demands of your consumers. And if there wasn’t a minimum wage, you’d probably pay them less than they could survive on, and might not provide a safe and sanitary work environment. I know, I know, they could always go elsewhere.
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” Instead they suck me dry and oppress me with taxes that make it very difficult. ”
You don’t mind if we pave some roads for you and your employees to travel to work on, do you? Also it makes it lot easier for your goods and services to reach their destination, which also means they cost less. That’s worth a few bucks, isn’t it?
And how about the court houses? Can we keep the lights on? Lady Justice may be blind, but that doesn’t necessarily mean that court personnel can operate in the dark. Can we get you kick in a few dollars for that?
And what about the police? You know, to protect your property, your investments, your products, and your neighborhood when your not there to shoot anyone who messes around with any of that. I know you don’t place much stock in law enforcement, but it’s got to be better than nothing. And worth something.
Heck, what about national defense? What we have might be overreaching, right now, but overall, down through the years its provided a secure environment for your economy to grow in. That doesn’t come cheap. And a sound regulatory system to ensure honesty from those businesses that require faith, like finance and insurance? Wait, you think commerce would just naturally occur and thrive in the absence regulation? Check out Somalia.
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“By making me the tax collector, they deceive people into thinking that I am the one deciding not to make their paycheck bigger.”
Well, if your employees, or their guardians are too stupid to read a paycheck, then maybe you’re right not to pay them more. Otherwise, I’m pretty sure they can tell who screwing them in proportion.
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“Then the government mails a refund to the employee at the end of the year…. how deceptive. If the government was transparent and made each employee write a check to the government when they received their paycheck, more people would have a true understanding of the oppressive role government plays in collecting taxes.”
You’re kidding, right? This is too facile, even for you. Wage earners see the amount withheld for taxes right on their paystub, so they don’t need to write a check for any true understanding. C’mon, David, if you want to be taken seriously, you gotta be realistic even if you’re not going to deal with reality.
RTC wrote: “Economics 101: you’ll hire as many workers as you need to meet the demands of your consumers.”
Such a statement comes from an egghead sitting up in an ivory tower somewhere writing about economics. It assumes unlimited funds to hire the employees, weeding through all the ones that suck all your money from you and do not contribute to producing income.
When I hire someone, I have to reach into my own pocket to do it. Do you think someone just walks in off the street, and immediately they start making my company money? No, it does not work like that. I have to pay out literally thousands of dollars into an employee that I believe will be able to do the tasks that I assign. I have to train them and have the optimism that I can find someone to pay for the tasks this person does. If none of this happens, I’m out the money I paid. It is like buying a car and expecting it to work, only to find out that it is a lemon and a mistake to buy.
If I could take just a few thousand dollars that I send the government each month and invest it in a worker, I would eventually find someone good and establish another place of employment for someone. Once they are paying for themselves, I could repeat this and do the same with another person. Instead, I have to wait a long time to save up enough money in the bank to commit to hiring another person. The market exists. I work 75 to 80 hours a week, and I would love to get my hours down to 40. Hiring more employees theoretically should allow me to do that.
If this was dreamland, with the right money, I could hire 20 people right off the bat. Next year, I would hire another 20. Guess who I have to turn to in order to do that? Not the blue collar laborer. Nope. It’s the banks and that rich man that you all love to hate. Face it. Without the rich, there would be no jobs. The money has to come from somewhere.
RTC,
I posted that video as proof that Greenspan had “flawed’ thinking with regard to deregulation and banks regulating themselves. Greenspan, an Ayn Rand acolyte, was proved wrong. He had to admit the truth–he couldn’t avoid it. He had become “an emperor with no clothes.”
Have you read Matt Taibbi’s book “Griftopia?” He has a whole chapter in it devoted to Greenspan titled “The Biggest Asshole in the Universe.”
*****
From an interview with Matt Taibbi:
http://progressive.org/matt_taibbi_interview.html
Q: You call former Federal Reserve chairman Alan Greenspan “the biggest asshole in the universe.” Yet the press and public for so long were led to think he was an infallible icon. How do you think he got away with it?
Taibbi: Greenspan is a classic con man. A guy who reached power by sounding smart and giving pretty speeches to politicians who didn’t know what he was talking about much of the time. He’s like religious con men who get to where they are by saying vague things and letting people reach their own interpretation. And he stayed in power by giving the powerful what they wanted. There were disastrous consequences for everybody but him. In the process, he presided over this period where more and more political decisions were moved to unaccountable financial bureaucracies. That’s a big part of the story too: how guys like him gained power and the politicians officially lost power.
Greenspan’s whole career was built on media exposure. He was romantically involved with key members of the media, such as Barbara Walters and NBC’s Andrea Mitchell, who is his wife. He was very, very cunning in getting people to write articles about what a genius he was. That’s how he got into power: first economist to make the cover of Newsweek. He established himself as an infallible oracle, and a lot of it had to do with his ability to seduce key media figures, sometimes literally. In the book, I show his record as an actual economist was complete shit.
Elaine,
Sure, NOWWW he says that. But at the time, he was pretty darn certain that what he was doing was the right course of action, to use a phrase he might have used.
I call this CWA, otherwise known as protecting his legacy.
RTC wrote: “Sure, NOWWW he says that.”
You might want to notice that the video of Greenspan was uploaded Oct. 24, 2008.
What all of you have said –
backroom deals, lies, theft, fraud, no accountability
too big to fail?
just like the government
you have made the case
RTC,
Greenspan “The Maestro” admits he made a mistake:
Elaine – thanks for the video. The commentary was bad, but the video shows Greenspan to be an honest man. He was way better as Fed Chairman than Bernanke.
One problem was that Greenspan kept the interest rates too low for too long. This led to massive buying of real estate, creating the so-called housing bubble. Ironically, that’s actually a regulatory cause. He basically over-reacted to the Carter years which had very high interest rates that greatly damaged the economy. Another problem is what he points out, that there needs to be some regulation of the bankers. They are not always going to do what is in the best interest of shareholders. Some of them will run their company into the ground, take their winnings, and start over with another company under a different name. The honest ones are the only ones who treat their company like they would their own children. They look at it as their legacy in life. Greenspan assumed they were all honest like this, thinking that they were honest like him, but they were not.
This situation calls to mind the facile assertion of free-marketers who like to insist that the market will enforce ethical behavior among businesses in the absence of any governmental regulation. In other words, the market is self-regulating. Alan Greenspan claims that a business operates unethically to its own detriment, because consumers will become aware and stop transacting with it, taking their business elsewhere. Ron Paul offers a version of this in his argument against state licensing of the medical profession. Without taking into account the powerful force of marketing and the skillful handling of public relations, with an effective assist from the media giants, the free-market mindset is disingenuous, to put it charitably.
The corporateers have taken over our government because of the revolving door and the chummy associations these actors develop in college. Richard Ben Kramer, describes it in, “What it Takes”, as a river of power that runs through the Ivy League, where relationships of power and influence are formed among each succeeding generation of the wealthy. It’s an old saw that too many people go into a career in government with an eye on a payoff in the private sector. That’s one reason why I support high salaries for government workers; if you want to attract and retain the best, then the rewards must be among the best. In return, an honest job performance is expected for an honest reward.
Some random responses to:
DavidM:
If you can’t see where criminal and unethical behavior has been committed by Wall St., you are truly dim. If you view the tepid government regulatory enforcement as akin to a mafia shakedown, you’ve had way too much Kool-Aid. You’re an easy mark for the fascist regime. Lay down, lamby-pie.
Bron:
Where do you get the idea that Barney Frank should go to jail? Because he tried to institute some reform? If people had listened to him to begin with, none of this (financial meltdown) would have happened.
RTC wrote: “If you can’t see where criminal and unethical behavior has been committed by Wall St., you are truly dim.”
Oh, I see it when I go look for it. I’m just saying that since I do not invest in Wall Street, they are not part of my world. The only loan I have is the mortgage on my house, and because I built my home in 1999 before the housing bubble, the recession never really affected me very much.
RTC wrote: ” If you view the tepid government regulatory enforcement as akin to a mafia shakedown, you’ve had way too much Kool-Aid.”
Now you are the one who is being truly dim. Government regulation enforcement is hardly tepid. If government would just get out of my way, I would be able to hire more employees and contribute much more to the economy. Instead they suck me dry and oppress me with taxes that make it very difficult. They do the same to most people, but they are deceptive about it. They make businesses like me withhold taxes. By making me the tax collector, they deceive people into thinking that I am the one deciding not to make their paycheck bigger. Then the government mails a refund to the employee at the end of the year. How nice of them. And how deceptive. If the government was transparent and made each employee write a check to the government when they received their paycheck, more people would have a true understanding of the oppressive role government plays in collecting taxes.
RTC wrote: “Where do you get the idea that Barney Frank should go to jail? Because he tried to institute some reform? If people had listened to him to begin with, none of this (financial meltdown) would have happened.”
Are you kidding me? Barney Frank was the prime mover of Fannie Mae and Freddie Mac. He claimed they were fundamentally financially sound even just weeks before the financial collapse they caused. Barney Frank claimed that the Bush administration was exaggerating the financial safety problems of his pet project. Well, Bush was wrong not to step in more aggressively, but Barney Frank was proven wrong in the worst way possible. Afterward, he retired from Congress. Can you imagine the investigations into his role in creating the financial meltdown that would have taken place if he had stayed?
You might want to read something like the following:
“Barney Frank: I’ve destroyed the economy, my work here is done.”
http://communities.washingtontimes.com/neighborhood/tygrrrr-express/2011/nov/29/barney-frank-ive-destroyed-economy-my-work-here-do
“If government would just get out of my way, I would be able to hire more employees and contribute much more to the economy. Instead they suck me dry and oppress me with taxes that make it very difficult.”
David,
Didn’t you recently say that you had trouble finding employees with the work ethic you require. As far as “being sucked dry” that certainly doesn’t stop you from vacations overseas in luxury hotels and ordering expensive breakfasts. shall we take up a collection for you and BTW when you say you “built your house” you didn’t me by your own hand did you?
In tune with RTC’s comments on the unjustified belief that “the market” is self-regulating I give you McDonald’s. They’ve been successfully marketing carbonated crap as food since the 1950’s and are a worldwide brand selling toxic food.
Hell, I’m sure some republican will sponsor putting Ole Jamie on the new 1,000,000 dollar bill…
Thank you for the article Rafflaw.
This is the whole ball of wax. The ground zero for international strife and US peril.
Alex Jones has done the best job of sifting through the dirt and isolating the contagion.
The USA is being conquered by a consortium of six foreign banks in league with powerful multinational corporations. We are now occupied by them. China is in their back pocket.
This is why the Army is teaching that the Army would not be a place for our founding fathers. The reason is the Army is not run by those defending America. It is being run by occupying forces (foreign bankers and multinationals plundering us through the federal reserve via taxation and fiat money).
In Iceland, they arrested the bankers and jailed them. They did not believe the banker lies.
We don’t owe the trillions to these foreign bankers they say we owe. They are plundering us through their banker/corporation Imperial transnational super state more wealthy than any nation.
They control the Department of Homeland Security. That is why martial law is being prepped for. That is why they are turning Americans against Americans, divide and conquer.
When Americans are completely plundered of their treasure, including their pensions, and the planned collapse of the economy occurs, the foreign occupiers (the mafia banksters and corps) will imprison or murder those loyal to America (which will exclude most Democrat leaders and many GOP leaders like McCain and Lindsey Graham). They will seize all our assests, homes, savings, food supplies, and natural resources including waters. And ration it out to only those who tow the line (in true Marxist brutality).
Leftists play into this overthrow by whining about gun control. That is what the international banksters and globalist corps want. They want us disarmed because they know we will be furious when it becomes obvious what they have done to plunder us and take our land, resources, and freedom (as well as our heritage and laws).
That explains the embarrassing false flag operations they have run (and blown) in this country lately. Including the Boston bombing, Fast and Furious (Obama is in their pocket ), Sandy Hook, the Colorado shooting, and more. They are using these black ops against us to panic the public and herd them into crying out for gun control before the intentional collapse of our economy so they can move in and buy asserts at rock bottom prices. These international fascists don’t want so much blood shed if they can avoid it. They prefer patsies in law enforcement do their dirty work and tamp down resistance to the rape of America (in particular)
This is why they are also going after Middle East countries. ME countries don’t want to be tied into the globalist economic system of these foreign banks and corps. So the CIA is out to destroy them and president after president since Eisenhower (Kennedy wasn’t playing along) have been doing the criminal bidding of the globalist and foreign banksters.
Your only hope (outside of Christ) is to get over to Infowars and get up to speed. They want him dead because he has exposed their scheme to take us over. Don’t play into their hands with the gun issue, that is what they want.
In fact, it was governments last century, who murdered the most innocent people in human history. Not armed citizens. You don’t want only government having the weapons, especially since our government is now occupied by the Imperialist Foreign Banker/Corporation Supra-nationalist Technocrats.
rafflaw – I’m pretty sure it should be there. I tried posting twice and the second time it said that I was trying to post a duplicate comment. I don’t know if you can search, but if so, I mentioned Bernanke so maybe search on that name. I also talked about the trickle down effect of wealth from the wealthy having a positive effect for the rest of us, and I gave a personal example of that, so maybe search on “trickle down.”
David, Bron & Oky1,
I do apologize for posting the entire article. None of the comments are mine, except for making the statement of ‘Really, David?’ And ‘Please read the following article’
I do agree with most of what the author(s) are stating.
david,
I just checked the spam filter and I did not see your comment in there.
**RWL 1, October 7, 2013 at 6:31 pm **
RWL,
I haven’t the energy for a long reply, but thank you for your comments, I agree & I too have been after those crooked azzholes for years.
Those Wallst/City London Bank/Insurance trash have destroyed the RE markets, contract law & private property ownership.
I’d like to sentence them all to hell!
Can a moderator free my reply to RWL from WordPress please?
RWL:
that was interesting. In my opinion the fault lies mainly with the FED for setting interest rates too low. The other players just did what you would do if the cost of something was not connected to market forces. The price of money was cheaper than market, that seems to me to be the almost bottom line as to the cause of the crises.
The value of homes was increasing because cheap money flooded the market and increased demand. I know of cases where people bought a house in March and sold it for a huge profit in June. People were freaking out to purchase property, it was a feeding frenzy.
Appraisal fraud wasnt the cause, it may have contributed but when you have 3 homes which sell for more than they are worth, what is an appraiser going to do?
“Appraisal fraud wasnt the cause, it may have contributed but when you have 3 homes which sell for more than they are worth, what is an appraiser going to do?”
Bron,
Stay away from tulips!
I forgot to add: read the actual link (or click on it). The link provides links for supporting their article.