B12 Solipsism

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Plotters on Wall Street

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Frank Rich writes:

Benjamins

But in the 16 months since that other calamity in downtown New York — the crash precipitated by the 9/15 failure of Lehman Brothers — most of us are still ignorant about what Warren Buffett called the “financial weapons of mass destruction” that wrecked our economy. Fluent as we are in Al Qaeda and body scanners, when it comes to synthetic C.D.O.’s and credit-default swaps, not so much.

What we don’t know will hurt us, and quite possibly on a more devastating scale than any Qaeda attack. Americans must be told the full story of how Wall Street gamed and inflated the housing bubble, made out like bandits, and then left millions of households in ruin. Without that reckoning, there will be no public clamor for serious reform of a financial system that was as cunningly breached as airline security at the Amsterdam airport. And without reform, another massive attack on our economic security is guaranteed. Now that it can count on government bailouts, Wall Street has more incentive than ever to pump up its risks — secure that it can keep the bonanzas while we get stuck with the losses.

[Click to continue reading Frank Rich – The Other Plot to Wreck America – NYTimes.com]

Continuing to Talk

In an ideal world, the corporate media would be investigating this crime wave as breathlessly as they hyped the underpants bomber or the Balloon Boy. Why aren’t they? Collusion? Lack of intelligence? Lack of trust that viewers can understand complex issues? All of the above? The US Congress is so wimpy that they won’t consider investigations with teeth unless public outcry reaches deafening crescendos, and the public is only silently weeping at the moment. I doubt there are any public officials with the intestinal fortitude of Ferdinand Pecora in today’s Washington.

The last time Washington enacted sweeping financial reform, more than 75 years ago, the catalyst was a cigar-smoking, Sicilian-born immigrant named Ferdinand Pecora.

A former New York prosecutor, Pecora was the last in a series of investigators hired to examine the causes that led to the stock market crash of 1929 for the Senate Committee on Banking and Currency. In early 1933, the newly-elected Democratic president, Franklin D. Roosevelt, gave the bulldog lawyer his blessing to dig deep into the excesses that had plunged the nation into the Great Depression.

The result was a relentless investigation, 12,000 pages of transcripts that laid bare abuses on Wall Street and failures of Washington to adequately regulate the nation’s financial system. Pecora’s efforts provided a basis for reforms that would alter Wall Street and maintain relative stability in the banking industry until the recent crisis. These included legislation that for the first time regulated the sale of securities and helped establish the Federal Deposit Insurance Corp. and the Securities and Exchange Commission.

For all the differences between then and now, there also are whispers of familiarity: Abuses on Wall Street. The blind eye of Washington. An economy in crisis. A new and eager administration calling for reform, and efforts by those with v

[Click to continue reading Ferdinand Pecora Ushered In Wall Street Regulation After 1929 Crash – washingtonpost.com]

Written by Seth Anderson

January 11th, 2010 at 3:32 pm

Posted in politics

Tagged with , , ,

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