Reforming Wall Street
With the Presidential campaign hitting new, yet expected, lows in half truths and distortions, and candidates taking quotes out of context and shouting them out like a twelve-year-old pointing at a zit on a classmate's face in a desperate hope for attention, real issues continue to remain unaddressed.
While jobs and the economy command most of the spot light, any finger pointing does little more than create shadow puppets in the glare of national attention. The truth is the economy is going nowhere for a long while, no matter who is in the Oval Office, as long as Wall Street remains in charge.
After a year long investigation, the Department of Justice announced that it did not have enough evidence to bring criminal charges against Goldman Sachs or any of its employees for advising their clients to make trades on mortgage-backed securities and credit default swaps that they knew were bad investments while the bank itself made a fortune by betting against those same products which they knew would lose value.
It wasn't just individuals who lost; small towns, businesses and pensions went broke on that advice and the resulting sub-prime mortgage scam caused a chain reaction that brought the economy and the Nation to its knees.
As many learned the hard way, in this country, apparently, it is against the law to rob a bank but it is legal for the bank to rob you. Martha Stewart goes to jail for making a few bucks on an insider tip. Goldman Sachs gets bailed out duping its clients and darn near destroying the country.
Influenced by a powerful Wall Street lobby against regulation, the toothless Dodd-Frank Act was approved as a result. Since then, JPMorgan has gone on to lose almost $7 billion (originally reported as $2 billion) of investor's money in bad gambles.
However, a shudder did go through Wall Street recently when Sanford Weill, retired founder of mega-bank Citigroup and the most powerful advocate for the 1999 repeal of the Glass-Steagall Act, which separated investment and commercial banking, announced, in a complete reversal, that he now favors breaking up big banks in order to safeguard taxpayer dollars and ensure that banks don't become “too big to fail.”
As a high ranking insider, Weill's opinion may carry some weight but it is unlikely to change the open and accepted avarice that is Wall Street today. Wall Street needs to be regulated, and voters need to know where candidates for Congress, Senate and President, stand on this issue.
That is, if they can break free from the petty fight in which they are mired.
Jim Black is a community blogger and is not a part of the Walworth County Gazette staff. His opinion is not necessarily that of Walworth County Today staff or management.