Oh ya the spoilers first; the bank clerk did it !... the financial executives / economists who with chameleon like ability appear and re- appear as the academic economist in Harvard who gives authenticity to deregulation plans ,, then as the secretary of treasury (finance minster) who passes these favorable laws , then as the federal reserve bank chief (central bank chief)who rectifies these laws & then as the bank CEO who gets all the benefits from such plans!. Point to be noted is that same person can appear as all four in different points of time…to call this conflict of interest will be understating it !
one upon a time...
If one has to pin point where it all started going wrong then it was the when the investment banks started using their assets in speculative market (packaging as CDO). This was not allowed by law after great depression. From 1933 (after great depression) until 1999, the United States maintained a separation between investment banking and commercial banks. A series of laws from 80’s to 90’s started to deregulate the control that government had on investment banks. The final nail in the coffin was the act passed in 1999 which virtually opened up the banks fully to open market. The act passed by Clinton was planned by Robert Rubin and Larry Summers.
Now lets just see how so called economic whiz kids ticked every box in the page of “conflict of interest” by incestuously being the law makers and at same time beneficiaries of those laws..And interestingly how they still continue to do the same!..of course they did it quite ‘bipartisanly’ as the idiotic politicians keep saying in US
Robert Rubin (treasury secretary under Clinton) ; Harvard economist who was CEO of Goldman Sacks before he became the secretary, then he successfully passed the bill for de regulating the investment banks and after leaving the government became Vice Chairman of citigroup!!
Larry summers (treasury secretary after Rubin); Harvard economist who actively assisted Rubin and later succeeded him as secretary. After leaving the post he made millions as advisor to a CDO based hedge fund. Now obama has re-appointed him as financial advisor!
Henry Paulson ; MBA from Havard and later become the richest ever CEO of Goldman sacks. resgined that post after Bush jr (poor chap!) appointed him as his treasury secretary and Paulson happily commented later that the US economy has never been more robust. 6 months later Lehman brothers collapsed and paulson was the treasury secy when the crisis peaked. Was in charge (with Ben Bernanke the Federal reserve chief) during the period when Goldman Sachs benefited from AIG bailout and made sure in doing so that AIG can’t sue GS .he along with Ben Bernanke facilitated the takeover of Meryl lynch by bank of America (hiding the real debts of ML from BOA)
enter " yes we can"...
Barrack Obama…he made all the right noises in run upto president election about controlling the greed in Wall Street. Now let’s see what he did once he took charge (lil boy obama must have felt like the proverbial deer in front of headlights in front of these finacial merlins)
1) Re-appoints Ben Bernanke as Federal Reserve chief (he was reelected by the narrowest margin ever in history). The very guy who conspired with Paulson to save Goldman sacks and then facilitated the takeover of Meryl lynch by BOA against their interests
2) Selects Timothy Geithner as his treasury secretary. Geithner‘s biographers has always debated whether he was a truer protégé of Rubin or that of Summers (the two founder fathers of deregulation). Active participant in planning the 1999 bill to deregulate and major contributor in GS bailout plan
3) Guess who gets appointed as White House National Economic Council director? Summers himself!
4) Guess what was the new New York fed reserve chief (largest of 12 federal banks in US), William Dudley’s job before he joined government? Chief economist, Goldman sacks!
5) Don’t even bother guessing obama’s Commodity Futures Trading Commission (CFTC is to protect market users and the public from fraud, manipulation, and abusive practices ) chief’s previous job; GS, what else!
6) as a foot note, the present chief of staff of obama (equilanet to prime minster) William Daleywhom we saw in the famous pic of whitehouse insiders watching "kill osama" operation was in executive committee of investement bank JP morgan chase & co!
Well in short u have almost all the perpetrators of the heist in the investigating team !!!!..
to cut a long story short, till the next econmic crisis (may be in 2016!) lets see what we wont be hearing..we wont hear a single finacial executive being punished or probed or any bank being asked for damages ...but for sure we will be hearing one thing..a lot of bipartism cutting across the party lines about economy..and the chameleon act will continue..... but please dont blame the politicians...these financial genuises know that politics is too smart a field to be left for politicians
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