Congratulations to the citizens of the United States who have “awakened” to the truth. What truth, you may ask? Wall Street bankers got stinking rich by stealing with a smile. The over-the-counter derivatives market is one of the best examples of the usurping of America. It’s where greedy bankers exuberantly learned they could create a $27 trillion monopoly game and play with real money!
Stabbing in the back has ended its long era. The period of facial impaling has begun! Banks have been allowed to brazenly play with taxpayers’ money and amazingly there have been few prosecuted for their crimes.
The brilliant bankers on Wall Street have stealthily earned the title “pin striped bandits” with good reason. The U.S. Government gave them the inch and they took $595 trillion by 2007. Deregulation of financial markets has been the equivalent of giving a horny, 16 year-old boy an American Express Black Card (no $$ limit), 4 supermodels, a 2011 Maserati Gran Turismo Convertible and saying: “go on, have fun, no one’s watching.” Can you hear the mischievous chuckle?
As one who is opposed to big government, I also know that there must be a rudimentary level of regulation; especially in financial markets. This country was oblivious to the shenanigans played by Wall Street big boys, during the Clinton administration, for example. The economy seemed to be thriving, the jobless rate was low and the market was doing its magic. Alan Greenspan (former chief of the Federal Reserve) was coined “the wizard.” He was the modern-day E.F. Hutton; when he talked, people listened.
Somewhere in the abyss of deregulation, trouble was brewing. No one saw the tsunami coming in from the middle of the sea, heading angrily toward the shore. Mr. Greenspan was telling us all that things were fine; deregulation works. He was convinced, at the time, that the government meddling in the market would cause a disaster of unreasonable proportions.
Along comes Brooksley Born; prognosticator of the age and proponent of regulating the financial markets. She was a Stanford graduate appointed to head the Commodities Futures Trading Commission (CFTC). She saw the coming storm and tried, to no avail, to warn of the catastrophic outcome. Those at the top of the government’s economic food chain turned up the heat to shut her down; it worked. Alan Greenspan, Larry Summers and Robert Rubin convinced congress that she had to go.
By the time Brooksley resigned, the OTC derivatives game had claimed its first casualty – Long Term Capital Management (LTCM). At the time, LTCM was arguably the most sought after hedge fund on Wall Street. Investors lined up to wave dollars in the faces of money managers and they were all too eager to oblige. They were heralded as the company who devised complex mathematical formulas to project the markets. When those calculations began to fail, the company found itself drowning. By the time investors got word of the downward spiral and tried to recover funds, LTCM was on the verge of bankruptcy.
On the heels of that debacle, congress sought to initiate some form of regulation of financial markets. Expectantly, Mr. Greenspan assured everyone that things were fine. The bailout took care of the market and as usual, people listened.
Fast forward to 2011. The market has not yet recovered from the disastrous OTC derivatives crash; the beginning of the end. The country is on the other side of the housing bubble that led to millions out of work and out of hope. It began with the government turning its back on the American people, by giving Wall Street a blank check.
In similar words of a modern philosopher, Antoine Dodson: “hide your wallet, hide your assets, because they are raping everybody out here!” Trust no one.