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Occupy Wall Street: Washington Still Doesn't Get It | Matt Taibbi


Business  (tags: Occupy Wall Street, U.S., President Obama, Bank of America, Merrill Lynch derivatives, FDIC, Federal Reserve, Sarbanes-Oxley, fraud contnues, Obama's Jobs Council, protest necessary )

Judy
- 2830 days ago - rollingstone.com
I'll have more coming out about this in a few days, but there have been two disgusting developments in the realm of plutocratic intervention on behalf of Wall Street that everyone protesting should take note of.



   

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Judy C (91)
Friday October 21, 2011, 1:55 pm

Posted October 21, 2011 8:25 a.m.

I'll have more coming out about this in a few days, but there have been two disgusting developments in the realm of plutocratic intervention on behalf of Wall Street that everyone protesting should take note of.

The fact that both of the following things took place in the middle of the full fever of OWS, when everyone is supposedly trying to placate anti-banker sentiment and Obama and the DCCC are supposedly pledging support of the protesters, shows how completely bankrupt this system is and how necessary street-level protests have become. Popular uprising is probably the only move left to stop developments like the following:

1) Bank of America is shifting a huge collection of Merrill Lynch derivatives contracts onto its own federally-insured balance sheet. This move of risky instruments off the uninsured Merrill balance sheet onto the commercial bank's balance sheet was done to prevent Bank of America's creditors from attacking the firm with collateral calls and other sorties. Essentially, an irresponsible debtor, B of A, is keeping a loan shark from breaking his legs by getting his rich parents to co-sign his loan. The parents in this metaphor would be the FDIC.

The FDIC naturally is not pleased with this development, but the Fed, the supreme banking regulator, is apparently encouraging this move. Here's how Bloomberg characterized this move:

In short, the Fed's priorities seem to lie with protecting the bank-holding company from losses at Merrill, even if that means greater risks for the FDIC's insurance fund.

Again and again, the Fed proves it has no appetite for allowing Wall Street to eat its own pain, and continually encourages banks to stick the government with its losses and bad assets. This move will allow Bank of America to keep a Band-Aid over its disastrous financial situation far longer than it would be able to in a genuinely free market. People should be outraged at this development.

2) Barack Obama is apparently expressing willingness to junk big chunks of Sarbanes-Oxley in exchange for support for his jobs program. Business leaders are balking at creating new jobs unless Obama makes compliance with S-O voluntary for all firms valued at under $1 billion.

Here's how to translate this move: companies are saying they can't attract investment unless they can hide their financials from investors. So the CEOs and gazillionaires on Obama's Jobs Council want the politically-vulnerable president to give them license to cook the books in exchange for support for his jobs program. From the Pittsburgh Post-Gazette:

"All you're going to do is have more fraud. The ultimate losers are going to be investors," said Jeff Klink, a former federal prosecutor whose Gateway Center firm helps clients prevent and detect fraud.

If the financial crisis proved anything, it's that Wall Street companies in particular have been serial offenders in the area of dishonest accounting and book-cooking. Sarbanes-Oxley is obviously no panacea, but removing it in exchange for a temporary, election-year job boost is exactly the kind of myopic, absurdly irresponsible shit that got us into this mess in the first place. For Obama to pull this in the middle of these protests is crazy.

If anyone thought OWS has already done its job, and Washington has gotten the message already, think again. They're not going to change until the protesters force them to change, it seems.

 

Lynn S (235)
Friday October 21, 2011, 3:06 pm
Just when you thought that things could get no worse, the financial sorcerers on Wall Street and Pennsylvania Ave have figured a new way to screw more people for generations now and into the future.
1 - Merrill Lynch moving high risk derivatives to parent Bof A in a move to have FDIC (the public) take the risk rather than the investors --- Somebody take these idiots to task and force the reversal of this deceptive move. The Fed might think it is protecting the system with this move, but it isn't. All it is doing is encouraging more unethical practices. The Fed needs to engage in some 'tough love' with these financial teenagers, otherwise the teen won't learn a damn thing and the country will be bankrupt officially.
2 - Obama showing willingness to junk parts of Sarbane Oxley in order to buy support for the jobs bill --- Well Mr President, that is a really stupid move, and not only because you're coming into an election year. Not only are you pulling a Daniel Webster, but Sarbane Oxley was, for the most part, a result of the fiasco called 'Enron'. I should know as I worked with some people to get my employer, an international bank, compliant. By junking it, you are opening the doors again to financial abuse and fraud. You will be guilty of the Potomac two-step --- one step forward with SO, 5 steps back with junking it!
 

Ralph R Sutton (56)
Friday October 21, 2011, 4:34 pm
The protesters need to become more active in Washington. Protesting Wall Street is bring attention to their cause, but it is not putting enough pressure on Congress because law makers aren't confronted with protesters every time they leave their offices. We need large demonstrations in Washington like we did during the civil rights movement and the Viet Nam war protests. Those protests put the problem right on the doorstep of law makers and forced them to address the demands of the people.

Its fine to protest Wall Street's greed but the only way to put an end to that greed is through legislative action and that means more pressure needs to be put on Congress who do not have their offices on Wall Street.
 

Barbara D (70)
Saturday October 22, 2011, 8:30 am
Great article! Thanks, Judy and Carole, for circulating it. But what will it take for the elites to "get it"???
 

David C (75)
Saturday October 22, 2011, 7:42 pm
need to vote out career politicians and not support re-elections....????!!!!
 

Past Member (0)
Saturday October 22, 2011, 7:42 pm
They don't want to get it.

None is as deaf as he who will not hear.

Maranatha
 

Joshua Bigley (8)
Saturday October 22, 2011, 7:42 pm
it will take a real revolution--force--commitment to revolution--marching into Washington- literaly grabbing these thieves and rapists by the throat, choking them, forcing them to their knees, confiscation of all assets, jailing them--detaining them in Guantanamo to await undetermined trials by the people--and if need be--and it will be needed civil war--a class war--guns and ammo. Never in histroy has a corrupt tyrannical government willfully changed or relinquished power--they will not--they will kill us first--they will kill us--as they did on 911. Wak up from your dream slaves. They will never give up power. It must be taken from them. The more orderly we can do it, the better-hold them hostage detained in prison as we hold a constitutional convention--ban money and corporations from our direct democracy, hold trials, and confiscate all assets--establishing natinal healthcare and state/local people owned banks--credit uinons. We will create a WPA jobs programs building green infrastructure. We will put our former senators and wall street banksters to wrok cleaning up toxic superfunds and disasters, at home and around the world, in orange jumpsuits--such as the GUlf, Ecuador, Nicaragua, Bohai gulf in China, etc...They will never never change--their hands must be cut off.
 

Sheryl G (359)
Saturday October 22, 2011, 7:48 pm
We need as many of the 300 million Americans we can muster to take over all Government buildings in this Country. Throw the damn crooks out. Run a truely free from Big Money Election, and start over. I'm so tired of the bull crap out of Washington, Wall Str, and the Corporations. "Imagine all the People, it's easy if you try"
 

Elle B (82)
Saturday October 22, 2011, 10:51 pm
Agree Dandelion...that the majority have to make them change it can't be just a small group. No more M.B.M Austrian School Economics at all... get Krugman and Reich, et al to make some genuine economic analyses and specific recommends. Enact legislation that is the equivalent of reinstating Glass-Steagall and repealing the Financial Modernization and the Commodities Modernization Acts. Get rid of the insurance companies. And get Elizabeth Warren to watchdog the implementation. Set up coops and public trusts. Set-up the infrastructure banks and/or trusts and rebuild the infrastructure. Fund schools. Establish universal healthcare. And no, no one gets a $500 million bonuse ever. Citizen customer services have been so putrid for the past 30+ years none of the greedy guts deserve ANY bonuses nor salaries for that matter. They should all be grateful if we put them on payment plans to reimburse us for all the damages. If anyone doesn't want to share. . .they can call Scotty and Captain Kirk and beam off. This is all just too stupid to be true. Profit margins are not sacred they're not even natural.
 

Douglas S (1)
Sunday October 23, 2011, 6:28 am
Wow, thanks.
 

Past Member (0)
Sunday October 23, 2011, 12:23 pm
They don't want to believe their easy money is slipping away. They will. Keep it up, OWS!!
 

Claudia O (73)
Sunday October 23, 2011, 12:36 pm
Stand with OWS! There is much to gain if this movement continues.
 

Olive Tassell (7)
Sunday October 23, 2011, 1:15 pm
It's not that Washington, Ottawa the other capitals don't get it. They like unfortunately us are controlled by corporations and their lust for greed and profit. I keep hearing even after being part of occupy locally; there are to many of them and to many people thoughtlessly enjoying the benefits who wont except change. With the type of population controls governments have including occular devices which can explode or leave crowds without hearing or brainless, just what they've wanted. I'd like to believe we can sustain a revolution, perhaps minus France's ultimate solution, stop being an active part of commercialism grow your own food.
 

Gloria H (88)
Sunday October 23, 2011, 2:02 pm
Probably a rock thrown through the window, their ivory towers burned down and a guillotine erected with spectators filling the seats (I'll bring my knitting). Losing elections would be a good start too. It may take people becoming martyrs before any serious ink is given in the press since we know how the public lusts after "reality" shows. Maybe toss in an act of God for good measure. Or everyone NOT shopping for a few days (ooooh imagine that!). Yep, gonna take hard work.
 

Judy C (91)
Sunday October 23, 2011, 2:04 pm
You guys make some really good points. These Wall Street psychopaths and their lackeys in Washington are very cunning in coming up with ways to screw us. I don't think the Fed will help us, just because they are a bunch of private bankers who are NOT our friends. We do need to become an ever-present thorn in the side of Washington.

Obama's concession of trashing part of Sarbanes-Oxley in exchange for support of his jobs program seems like Deja Vu. Remember his decision to forego the expiration of the Bush tax cut for the rich? He did that so that Congress would extend unemployment.

The 99% are righteously angry, but if we use violent meas, we will be crushed. There are probably many in the 1% ho would sove that.
 

Judy C (91)
Sunday October 23, 2011, 2:14 pm
Oops--I hit submit while trying to edit typos. Anyway, violence would elicit a fascist response. The technology for repression that exists would crush us. If I remember German history correctly, Hitler was spawned from the Weimar Republic. We can definitely occupy more government buildings, though. They are supposed to belong to us. You guys have some great suggestions, including not buying anything for a while.
 

Bill E (41)
Sunday October 23, 2011, 4:13 pm
Washington does not want to "get it." They want to sweep the problems under the rug and forget about it.
 

Carol H (229)
Sunday October 23, 2011, 6:51 pm
noted, thank you Judy
 

Sheryl G (359)
Sunday October 23, 2011, 8:23 pm
You cannot currently send a star to Elle because you have done so within the last week.

Can we make an Elizabeth Warren and Elle B. Ticket?
 

David Johnson (13)
Monday October 24, 2011, 5:45 am
Wow! thanks for the article.
 

Patricia E G (52)
Monday October 24, 2011, 9:03 pm
.....Force them to change?
They don't want to.
They could legalize marijuana too but...
they just, don't want to.
 
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