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Saturday, October 22, 2016

July 2 (Bloomberg) — Lord knows we’ve had more than enough scandals ginned up by Wall Street over the years, and the message that banking executives proclaim after each is: “Don’t worry, we’ve learned that lesson, and it will never happen again.”

Which is how we got to the recent spectacle of Jamie Dimon, the chief executive officer of JPMorgan Chase & Co., testifying twice before Congress that although the bank’s chief investment office was taking huge proprietary risks with some $350 billion of its depositors money — and lost $3 billion (and counting) by making a bunch of risky bets on an obscure, thinly traded derivatives contract — everything is now fine and dandy because the unjustifiable gambling has been stopped dead in its tracks.

We were, of course, told pretty much the same thing after the collapse of the junk-bond market in the 1980s, the collapse of the Internet initial-public-offering market in the 1990s, the collapse of the telecom debt market in the early 2000s, not to mention the scandals over IPO spinning and laddering and the ones involving the trading of favorable corporate research for investment-banking fees.

We are told repeatedly that when Wall Street’s deeply flawed incentive system leads to one bad outcome after another, year after year, it will never happen again. Yet it does. And you can add this vital business to the list: The way state and local government officials hire Wall Street firms to raise the billions of dollars their municipalities need to build schools, hospitals, airports and sewers, and provide other essential services.

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Copyright 2012 The National Memo
  • William Deutschlander

    We, the U S A MUST go back to LOCAL, BANKING!

    These MEGA ISTITUTIONS MUST be dismanteled and abolished.

    The TRADING on the stock exchanges and funny markets MUST BE CLOSELY SUPERVISED!

    ALL BUSINESS MUST BE LEGITIMATE not figments of imaginative perverse minds!

    Lets work together to restore AMERICA to a position of worldwide respect and envy!


    Mr. Cohan is right: The Matt Taibbi article in Rolling Stone is really excellent.

  • Sep_Arch

    I don’t understand your contention that Wall Street has learned nothing. Indeed, they have learned that they can endlessly scam taxpayers and (mostly) pay no price. We are the ones who have learned nothing, as our government repeatedly sells us to the highest bidder.

  • howa4x

    Wall st will never learn a lesson when greed is still the underlying foundation of business. In this country we lavish onto the wealthy perks that no one else gets. The wealthy use their republican lap dogs to protect their interests over that of the middle class. The republicans say we have to de regulate the job creators(wealthy) even though they are not creating any jobs. They will use slogans like class warfare every time someone mentions that the rich should pay their fair share of taxes or creeping socialism when well meaing politicians want to protect the interests of the middle on bottom. In NJ Christie wants to end the earned income tax that lower middle class people pay in order to give tax breaks to the wealthy whom he terms job creators. Well why didn’t they create jobs during the Bush tax cuts instead of outsourcing 2.9 million jobs to China and India. Wall st is now the new criminal class in this country with their CEOs like the Dons of the Five families. They engage in a new loan sharking scam with government instead of how the original mafia did with poor immigrants that were denied loans in the old days.

    It is up to stop this because most of elected government is on the take, and has sworn an oath to protect these new Dons over any interest in the country. The Tea party was manipulated by this group and are now worthless as defenders of the middle class and have joined the ranks of the lap dogs.

    It is up to thinking people with a moral compass from any party to stand together once and for all and say Enough!!!