Tag Archives: WSJ

EU Deflation Arrives and the Troika Continues to Fiddle While the EU Burns

Posted on January 8, 2015 by | 1 comment

By William K. Black
Bloomington, MN: January 7, 2015

The troika (the EU Commission, the ECB, and the IMF) are flirting with throwing the entire eurozone back into a third Great Recession and much of the periphery into the continuation of the Troika Depression. For nations like Greece, the current Great Depression is now more severe and longer lasting than the Great Depression of the 1930s. The New York Times and the Wall Street Journal’s journalistic malpractice in covering the troika’s gratuitous infliction of misery upon the people of Europe has been the perfect side dish to complement the troika’s toxic economic malpractice.

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Herr Henkel is Shocked that His Party Embraces Bigots

Posted on January 7, 2015 by | Comments Off on Herr Henkel is Shocked that His Party Embraces Bigots

By William K. Black
Bloomington, MN: January 6, 2015

If one wishes to know why Germany’s financial elite embraces vicious economic assaults on their fellow Europeans of the periphery via the economic malpractice of austerity it is essential to consider not only that malpractice, but also the moral rot at the core of the German financial elite. This column updates my earlier discussion of Germany’s internal financial troika, which makes Prime Minister Angela Merkel appear almost rational. My prior column skewered the New York Times’ coverage of that troika. This update addresses the Wall Street Journal’s woeful coverage of two members of the German troika.

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The Wall Street Journal and the Troika Fear they Have Not Adequately Terrorized Greece

Posted on January 6, 2015 by | 4 comments

By William K. Black
Washington DC: January 6, 2015

I’ve written recently about the embarrassing nature of the New York Times’ coverage of Greece (and the eurozone more generally), so it is time to describe the even more appalling coverage by the Wall Street Journal. The WSJ has published a series of articles that contain facts that demonstrate how self-destructive the troika’s infliction of austerity has been to the eurozone, but those articles do not express that conclusion.

Worse, the WSJ publishes a steady dose of articles by Simon Nixon that are presented (at least on the web where I read them) as if they were news articles. Nixon’s job title with the paper is “Chief European Commentator,” but that title is not stated in the series of recent articles about Greece and the eurozone. He appears to have a B.A. in History and once worked as an investment banker. I assume that the WSJ’s defense of his columns is that he is a “commentator” rather than a reporter of the news though on the web I see no indication that readers are warned that they are not reading a news article.

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The WSJ Is Outraged That Someone Would “Loot a Company”

Posted on January 4, 2015 by | 6 comments

By William K. Black
Washington, DC: January 4, 2015

George Akerlof and Paul Romer’s famous 1993 article “Looting: The Economic Underworld of Bankruptcy for Profit” introduced what criminologists call “accounting control fraud” to the economics literature. The people who control the firm (typically the CEOs) use its seeming legitimacy as a “weapon” to loot shareholders, creditors, and, if the resultant losses are large enough, the U.S. Treasury. Their article discussed several examples of such fraud epidemics, including the savings and loan debacle. Criminologists, the S&L regulators, and over 1,000 successful felony prosecutions of the S&L looters confirmed Akerlof & Romer’s insights.

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The Faux “Civility” of “Broken Windows”

Posted on December 22, 2014 by | 2 comments

By William K. Black
Bloomington, MN: December 21, 2014

On December 18, 2014, William Bratton and George Kelling published an op ed in the Wall Street Journal decrying “The Assault on ‘Broken Windows’ Policing.” I’ll be writing a broader response to their piece noting their failure to implement “broken windows” enforcement against the elite white-collar criminals who have made Wall Street one of the world’s most destructive criminal “hot spots.” In this column I point out the implications of their attempt to label criticisms of a NYPD policy they developed and favor as an “assault.” They chose the word to be inflammatory and to try to label their critics as inherently illegitimate and pro-crime.

Here, in light of the tragedy of the murder of two NYPD officers and the reactions to that murder I want to point out what Bratton and Kelling asserted explained broken windows policing was effective. “[T]housands of police interventions on the street … restored order and civility across the five boroughs.” Except, of course, for Wall Street, where crime has skyrocketed and rudeness and disorder are defining elements of the corrupt culture. But that’s my next piece.

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The Wall Street Journal Still Refuses to Grasp Accounting Control Fraud via Appraisal Fraud

Posted on December 2, 2014 by | 7 comments

By William K. Black
Kansas City, MO: December 2, 2014

The Financial Crisis Inquiry Commission (FCIC) report described one of three epidemics of accounting control fraud that drove the financial crisis in these terms.

“Some real estate appraisers had also been expressing concerns for years. From 2000 to 2007, a coalition of appraisal organizations circulated and ultimately delivered to Washington officials a public petition; signed by 11,000 appraisers and including the name and address of each, it charged that lenders were pressuring appraisers to place artificially high prices on properties. According to the petition, lenders were ‘blacklisting honest appraisers’ and instead assigning business only to appraisers who would hit the desired price targets” [FCIC 2011: 18].

The FCIC Report then documents scale of this epidemic of loan origination fraud.

“One 2003 survey found that 55% of the appraisers had felt pressed to inflate the value of homes; by 2006, this had climbed to 90%. The pressure came most frequently from the mortgage brokers, but appraisers reported it from real estate agents, lenders, and in many cases borrowers themselves. Most often, refusal to raise the appraisal meant losing the client” [FCIC 2011: 91].

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The Wall Street Journal Claims that only the “Left” is Willing to Prosecute Banksters

Posted on August 28, 2014 by | 4 comments

By William K. Black

This is my third installment in my series of columns discussing the WSJ’s rant against even feeble actions by Attorney General Holder to hold the banks and (a pittance of banksters) even slightly accountable for leading the three epidemics of mortgage fraud that caused the financial crisis and the Great Recession.  The WSJ is enraged not at how feeble Holder’s efforts have been, but that Holder dared to take any action against the elite frauds.  The WSJ explicitly frames the question of accountability for the banks and banksters as a left v. right divide.  Only the “populist left” is in favor of not granting the banks and banksters immunity from the criminal and civil laws for leading the most destructive fraud epidemics in history.

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The WSJ’s Editorial Posing as “News” about Ecuador

Posted on August 19, 2014 by | 4 comments

By William K. Black

Greetings from Bogota where I’m participating in an economic conference and teaching two class sessions.

Under the banner “Latin America News” the Wall Street Journal has poured out its pain that the people of Ecuador might reelect President Rafael Correa.  The article is actually an editorial attacking Correa and the people of Ecuador for potentially voting to reelect Ecuador’s most successful President in the modern era.

The issue is term limits.  I have always opposed term limits as an obstruction to democracy and competence.  The U.S. had no presidential term limits for most of its history and the only president the population chose to elect to more than two terms was Franklin Delano Roosevelt – one of our greatest presidents.  I am deeply thankful that our Nation had the great good sense to reelect FDR to four terms in office.

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The Wall Street Journal Pines for the Return of Liar’s Loans

Posted on September 23, 2013 by | 3 comments

By William K. Black
(Cross posted at Benzinga.com)

The Wall Street Journal’s editorial staff (WSJ) criticizes the Dodd-Frank Act and the leadership of the financial regulatory agencies.  I share many of those criticisms, but I parted company when the WSJ expressed its horror that: “The regulation micromanages bank decisions down to the kind and quality of loan.”  The Dodd-Frank Act bans a “kind” of loan based on the inherently fraudulent “quality of [the] loan.”  The Act bans liar’s loans.  The WSJ considers this ban so appalling, so obvious a violation of the divine right of banks, that it labels it “micromanage[ment]” and assumes that the label proves the absurdity of banning liar’s loans.

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The WSJ Conflates Lending to Blacks with Imprudent Lending

Posted on September 19, 2012 by | 4 comments

By William K. Black

The Wall Street Journal has written a revealing editorial entitled:  A Fine for Doing Good: The Justice Department sues a bank for prudent lending.

The WSJ appears to have forgotten the concept of a poll tax as a means to exclude most blacks from voting.  Continue reading →

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