Tag Archives: banksters

Geithner’s Ghost Writer and the Parable of the River of Risk

By William K. Black
Quito: June 9, 2015

Michael Grunwald has written a column attacking Senator Bernie Sanders. It is entitled “Don’t break up the megabanks.” As Grunwald appropriately discloses, he is Timothy Geithner’s ghost writer and a fervent co-religionist of Geithner’s gospel of adoration of and devoted service to the world’s most fraudulent bankers.

Grunwald gives the reader fair warning that he has no financial expertise and is prepared to say anything to try to defend the banksters and Geithner when he makes his first argument the claim that it is “un-American” to break up banks that pose a global systemic risk. To the contrary, few things could be more American if you are even remotely familiar with American views of megabanks from the founding of our Republic.

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President Obama Fateful Error in Making Bush’s Goldman Sachs/AIG Scandal His Scandal

By William K. Black
Quito: June 3, 2015

We have known from the beginning that Lanny Breuer, who the Obama administration chose as its head of the Criminal Division in order to ensure that there would be no prosecutions of the banksters that led, and were enriched by the fraud epidemics that drove the crisis, would be a national embarrassment. Readers may recall that Breuer publicly admitted that what caused him to lose sleep was not the world’s most destructive fraud epidemics that ruined our economy or his grant of effective immunity to the banksters who led and became wealthy through those frauds. He lost sleep solely over his fear that if he held them accountable for the frauds that had bankrupted their corrupt banks those banks might be placed in receivership and honest managers appointed. (Of course, that isn’t how he phrased it, but that is what he was actually saying.)

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The Murdoch Effect and the Continuing Bankster Crime Wave

By William K. Black
Quito: May 30, 2015

One of common characteristics of the two epicenters of the elite banking fraud epidemics – the City of London and Wall Street – is Rupert Murdoch’s newspapers’ repeated efforts to create a criminogenic environment in both financial centers by cheerleading the regulatory race to the bottom. Murdoch’s papers also act as apologists for the resultant epidemic of elite banksters’ crimes.

One of the bit players that the Wall Street Journal has deployed as part of this apologia is particularly interesting for white-collar criminologists. The setting, as always on the WSJ’s editorial pages, is that the writers are overwhelmingly the most extreme right wing ideologues. The only criminological theory that the right wing loves is “broken windows.” The WSJ presented an op ed by Heather Mac Donald of the hard-right Manhattan Institute. The title gives a good feel of the extreme claim she is making: “The New Nationwide Crime Wave: The consequences of the ‘Ferguson effect’ are already appearing.”

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Sorkin on the Street’s Surge of Suicides: Ignoring the Obvious

By William K. Black
Quito: June 2, 2015

Andrew Ross Sorkin wrote two related columns only two weeks apart, but ignored his first column in writing his second. The May 15, 2015 report by the University of Notre Dame on the results of its survey of financial sector participants in the U.S. and the UK was the subject of Sorkin’s May 18, 2015 column entitled “Many on Wall Street Say It Remains Untamed.” “Untamed” is a word with a positive connotation that Sorkin chose as his euphemism in his self-appointed role as apologist-in-chief for the banksters. Here is the report’s summary.

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SEALs, CEOs, Milton Friedman, and Fraudulent Incentives

By William K. Black
Quito: May 31, 2015

I saw an intriguing squib in the Wall Street Journal about an article in the Harvard Business Review entitled “How the Navy SEALS Train for Leadership Excellence.”  The article offers an, unintentionally, useful insight into the pathologies of elite business schools, their “leadership” faculty, and our elite C-suites.

The most interesting comment in the article is by Brandon Webb, a former senior SEAL sniper trainer.

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The WSJ and Barron’s Apologists for the Banksters Peddle Wallison’s Fables

By William K. Black
Quito: May 23, 2015

Few people’s efforts at myth-making have been as devastatingly refuted as Peter Wallison. But fables that are designed to make the banksters look less criminal are always welcome by the banksters. Any honest discussion of Wallison’s claims would begin with three points. First, Wallison’s adult life has been devoted, on behalf of the banksters, to pushing the three “de’s” – deregulation, desupervision, and de facto decriminalization. He is therefore as culpable as anyone in the world for the epidemics of accounting control fraud that drove the financial crisis and the Great Recession.

Second, he was appointed by the Republican leadership to the Financial Crisis Inquiry Commission (FCIC) to assure that the banksters would have the benefit of their leading apologist. The chances that he would ascribe any problems to the three “de’s” was always non-existent because he does not have a scholarly instinct in his body. He is rabidly ideological and a willing tool of the banksters.

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President Obama Should Apologize for Labelling Americans a Murderous Mob

By William K. Black
Quito: April 28, 2015

This column was prompted by Charles M. Blow’s excellent column about the slanderous way that the term “lynch mob” is used by the right-wing to denounce Americans whenever we protest police violence against (primarily) people of color. The protesters want justice. They do not want to lynch anyone. The same is true of the American people’s demands that the banksters be brought to justice.

President Obama, however, began his term of office by slandering the American people who wanted him to restore the rule of law and bring the banksters to justice. Simon Johnson and James Kwak, the authors of Thirteen Bankers, cite Obama’s claim to the 13 bankers at the infamous March 31, 2009 meeting so close to the start of his term of office that he was all that was protecting them from the public’s “pitchforks” as the defining event of the administration on financial issues.

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The Media Fall for Hillary Clinton’s Gensler Gambit

By William K. Black
Quito: April 16, 2015

Richard Cordray (former Attorney General of Ohio), the head of the Consumer Finance Protection Bureau (CFPG) and Gary Gensler (a former disaster under Bill Clinton and Goldman Sachs) have been the two great appointments by President Obama in the field of finance.  Obama’s other appointments at Treasury, the financial regulatory agencies, and the (non) prosecutors who are supposed to specialize in financial prosecutions have been nightmarishly bad.

Gensler was another Rubinite from Goldman Sachs who, under Bill Clinton, helped destroy Brooksley Born’s effort to protect the nation from the financial derivatives that blew up AIG and much of the financial world through passage of the infamous Commodity Futures Modernization Act of 2000.  As Obama’s appointee to chair the Commodity Futures Trade Commission (CFTC), however, Gensler justly earned praise for attempting to restore effective regulation.  Gensler was a grave disappointment to Obama’s administration, which thought it was sending a reliably pro-finance Rubinite to run a fairly obscure agency he had helped emasculate.  When Gensler showed a spine Obama refused to reappoint him and replaced Gensler with Timothy G. Massad, a Timothy Geithner minion noted for his pro-industry views.  Massad’s claim to fame was being one of the principal unprincipled architects of the failed homeowner relief programs.  As I pointed out in my first Bill Moyers interview, failing (for the right political reasons) proves you are a reliable “team player” and gets you promoted in Washington, D.C.  As Geithner found out, succeeding gets you your walking papers.  Jesse Eisinger, as his norm, wrote a great piece about Massad when Obama nominated him in November 2013.  An alternative view can be found in the American Banker, which gave prominently space to an op ed praising Massad’s nomination written by the head of a firm that trains CFTC staff.

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Capitalism’s Defender Unknowingly Indicts the Banksters

By William K. Black
Quito: April 13, 2015

Johan Norberg, of Cato, wrote a book in 2009 entitled Financial Fiasco.  Norberg is an Austrian School economist and the author of In Defense of Global Capitalism (2001).  As his 2009 book demonstrates, however, the quintessential global capitalists were preparing to blow up the global capitalist system in an orgy of “accounting control fraud” at the time he wrote his “Defense.”

He agrees that Fannie and Freddie were used by their controlling officers as accounting control frauds in order to enrich themselves through lush executive compensation.  He aptly explains President Bush’s hypocrisy about Fannie and Freddie.

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William Black Tells the Ugly Truth!

Crossposted from www.richardmbowen.com

William K. Black, author of The Best Way to Rob a Bank Is to Own One: How Corporate Executives and Politicians Looted the S&L Industry, is a lawyer, academic, and a former bank regulator. He was formerly the litigation director of the Federal Home Loan Bank Board, deputy director of the Federal Savings and Loan Insurance Corporation (FSLIC), senior vice president and general counsel of the Federal Home Loan Bank of San Francisco, and senior deputy chief counsel of the Office of Thrift Supervision. Black was also deputy director of the National Commission on Financial Institution Reform, Recovery and Enforcement.

Black was a central figure in exposing Congressional corruption during the Savings and Loan Crisis. He took the notes during the Keating Five meeting that were later published in the press, and brought the event to national attention and a congressional investigation. Looks as if he had a hit put out on him for his pains!

According to Bill Moyers, “The former Director of the Institute for Fraud Prevention now teaches Economics and Law at the University of Missouri, Kansas City. During the savings and loan crisis, it was Black who accused then-house speaker Jim Wright and five US Senators, including John Glenn and John McCain, of doing favors for the S&L’s in exchange for contributions and other perks. The senators got off with a slap on the wrist, but so enraged was one of those bankers, Charles Keating — after whom the senate’s so-called “Keating Five” were named — he sent a memo that read, in part, ‘get Black — kill him dead.’ Metaphorically, of course. Of course.” Continue reading