Author Archives: William Black

Wall Street Crime and Misdeeds

Posted on June 6, 2014 | 1 comment

NEP’s Bill Black appeared at the Unstoppable Right/Left Convergence event in Washington D.C. on May 27, 2014. He talked about Wall Street Crime and Misdeeds.

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Tagged accounting control fraud, banksters, criminogenic environment

Valukas Assumes GM’s Reported Quality Was Real despite 13.8 Million Recalls in Five Months

Posted on June 6, 2014 | 6 comments

By William K. Black

I just posted an article about the ludicrous excuse that Mary Barra, GM’s CEO, offered in her congressional testimony for GM’s lengthy refusal to correct a design defect it knew was killing and maiming people.

The defective design caused GM cars, without warning, to suddenly lose electrical power essential to the driver’s ability to control the car and for the air bags to function. The car became an unguided missile and simultaneously lost the protective device that was most critical to safety in such circumstances. The design defect, therefore, endangered not only GM customers but also anyone in the vicinity when the GM car lost electrical power.

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Tagged Barra, criminogenic, GM, Valukas

How Institutional Defects Get Ignored: The GM – and Lehman Reports by Valukas

Posted on June 5, 2014 | 4 comments

By William K. Black

The beleaguered profession of law has one lucrative growth area – preparing reports for a corporation on the misdeeds of the corporation. One of the leaders in this burgeoning field is one of the Nation’s top white-collar defense firms – Jenner & Black. Its head, Anton Valukas, is now famous for the “Valukas” reports for Lehman and GM. I testified at the same House hearing on Lehman’s failure with Valukas. Valukas famously suggested there could be grounds for criminal prosecutions of Lehman’s use of an accounting device designed to deceive investors and creditors about the (crippling) extent of its debt. Attorney General Holder and a senior SEC (anti) enforcement leader combined to allow Lehman’s officers commit this variant of accounting control fraud with impunity. (This is one the events that sparked the recent long-time SEC enforcement attorney’s evisceration of the SEC at his retirement dinner.)

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Posted in William K. Black

Tagged Barra, GM, Valukas

The Tories Refuse to Take Responsibility for the EU “Fault Lines” They Decry

Posted on June 5, 2014 | 1 comment

By William K. Black

The Tory insider and journalist Matthew D’Ancona has written a remarkably disingenuous op ed in the New York Times entitled “Europe’s Dangerous New Fault Line.”

The setting for the op ed is three related crises that D’Ancona’s dogmas have helped create (and a fourth one that is likely in the process of being created). D’Ancona, of course, ignores causation and his responsibility for the policies that caused each of the crises. The three crises are the Great Recession, the gratuitous second recession (Second Great Depression in the case of Spain, Greece, and Italy), and the rise of fascist and racist parties in the EU. The fourth crisis that may be developing is the troika’s austerity policies forcing several EU nations back into a third recession.

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Posted in William K. Black

Tagged austerity, D'Ancona, tories, troika

Where Do the Troika, WSJ & NYT Think Deflation Comes From?

Posted on June 4, 2014 | 5 comments

By William K. Black

If the troika (the European Commission, ECB, and IMF) taught sex education students would believe that storks brought children, that sex had nothing to do with pregnancy, that confident women never got pregnant, and that women should be forced to lose weight when they became pregnant. The Wall Street Journal and the New York Times would repeat these myths as science. The NYT would employ one of the world’s top gynecologists (Dr. Krugman). Dr. Krugman would debunk these myths nearly every week – and neither the troika nor the reporters for the NYT and the WSJ would ever listen to him.

The last several days have led to a flurry of WSJ and NYT stories about “deflation.” I just posted critiques of some of the earlier stories here and here.

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Posted in William K. Black

Tagged austerity, deflation, Eurozone, troika

The Troika Continues to Harm the Eurozone and the WSJ continues to Miss the Story

Posted on June 3, 2014 | 4 comments

By William K. Black

The European Central Bank’s (ECB) written policy is to maintain the eurozone inflation rate at just under two percent. The ECB has consistently failed to achieve that goal. Indeed, its failure has been growing steadily. The ECB’s failure tells us something enormously important about what is wrong with the eurozone’s economy and the troika’s bleeding of that economy through austerity. The ECB’s increasing inability to even come close to its inflation target demonstrates that demand remains woefully inadequate in the Eurozone – making austerity an insanely self-destructive policy. The Wall Street Journal (WSJ) reported on the ECB’s latest failure in an article entitled “German Inflation Rate Plummets as Manufacturing Slows.”

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Tagged austerity, ECB, troika

The Troika Attack Italy for Refusing to Bleed the Economy

Posted on June 2, 2014 | 12 comments

By William K. Black

The title to the latest Wall Street Journal article on Italy is “EU Tells Italy to Adopt More Austerity Measures.” It’s an old, stupid remedy. If you hit your carburetor with a hammer and it doesn’t fix it – hit it harder and more often. Italy is the troika’s carburetor and austerity is its hammer.

The Troika’s Response to Renzi’s Electoral Success: Crush Him

The general context of the troika’s latest act of depravity is particularly interesting. The troika consists of the European Commission, the IMF, and the ECB. The troika’s insistence that the periphery inflict austerity caused not simply a gratuitous second recession through much of the EU but a Second Great Depression in Italy, Spain, and Greece. One-third of the eurozone’s population – 100 million people – was kicked into a Great Depression due to the troika’s long-falsified economic dogmas.

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Tagged austerity, eu, Italy, Ollie Rehn, troika

The 80th Anniversary of the Strike that Freed Minnesota from Tyranny

Posted on June 2, 2014 | 6 comments

By William K. Black

Teaching makes one feel very old, very quickly. You make a movie or literary allusion and your students stare at you blankly because A Man for All Seasons won all those Oscars decades before they were born. University students know only a world in which women are the majority and make up half the students in law schools and many other professional schools. The idea that women were treated as less than second class citizens is inconceivable to our students.

Tom Frank, the author of What’s the Matter with Kansas? How Conservatives Won the Heart of America, (who has a doctorate in history) writes about how most Democratic Party leaders turned their back decades ago on organized labor. Frank routinely asks progressives what they think about labor unions – and he tells me that the answers are overwhelmingly negative in terms of immediate responses. Eventually, the progressives mention the vital role that unions once played, but that is an intellectual response about a bygone era.

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Tagged Citizens Alliance, Minnesota, strike, unions

Spain’s “Stimulus” Plan: An Oxymoron Crafted by Regular Morons

Posted on June 1, 2014 | 1 comment

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

Spain’s conservative government, eager to change the media’s emphasis on its repudiation in recent EU elections, has launched a media campaign stressing its adoption of an aggressive “stimulus” program. Spain’s conservatives – and their predecessors the so-called socialists – are infamous for embracing the troika’s demands for austerity. Why have the Spanish conservatives finally admitted that austerity is a disaster and stimulus is essential? They have not done so. Instead, they have rebranded “austerity” as “stimulus.”

“MADRID—Spanish Prime Minister Mariano Rajoy is planning to launch a €6.3 billion ($8.59 billion) economic stimulus package, a move to keep sky-high unemployment and the risk of deflation from derailing the country’s recovery.

Mr. Rajoy told 200 business leaders at a conference in Sitges, near Barcelona….”

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Posted in William K. Black

Tagged austerity, Ollie Rehn, spain, stimulus, troika

The WSJ Suggests Hollande May Redefine Chutzpah by Complaining to Obama about BNP Paribas – on the 70th Anniversary of D-Day!

Posted on June 1, 2014 | 7 comments

By William K. Black

I am not a French hater – and there is no “but” to that clause. The Wall Street Journal, however, frequently engages in French bashing. The WSJ has also, unintentionally and unknowingly, suggested that the French may act in a manner that would provide a new humorous answer to the old joke that begins: “What is chutzpah?” The context is that the U.S. and New York state authorities are negotiating with BNP Paribas (a very large French bank) to settle a series of felonies involving primarily sanction-busting – and covering up those crimes.

A political movement has arisen in France opposing any U.S. criminal actions against Paribas. Americans will have no difficulty understanding this political dynamic, particularly because our Department of Justice (DOJ) continues to give a total pass to the U.S. officers who led the accounting control frauds that drove the crisis and prosecutes only foreign financial operations. What is remarkable is the WSJ’s suggestion of how the French Prime Minister Hollande might bring French objections personally to the attention of President Obama.

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