Courtesy of Pam Martens
The horror stories that continue to spill out about what Wall Street banks are doing behind their cloistered walls have blurred the actual function of Wall Street: to efficiently allocate capital so that new industries can be born and thrive in America, creating new jobs and a rising standard of living for all of our fellow citizens.
In the same week that the U.S. Senate Banking committee was taking testimony that one of the biggest Wall Street banks, Wells Fargo, was opening two million unauthorized customer accounts over at least a four-year span in order to generate fees and meet daily sales quotas, the Wall Street Journal reported yesterday that just 68 new companies had been listed for public trading this year, a drop of 51 percent from the 138 companies that had gone public by this time last year.
Let’s recap what the public has learned over the past eight years about the Wall Street banking model from hell. (1) The greatest housing collapse since the Great Depression resulted from Wall Street banks muzzling their internal whistleblowers who wrote memos to management and shouted from the rafters that the banks’ mortgage loan departments were ignoring their own compliance rules and buying up tens of thousands of mortgages with wildly overstated incomes by the mortgage holder. (2) The banks then knowingly bundled these toxic mortgages into pools and paid the ratings agencies, Standard & Poor’s and Moody’s, to assign triple-A ratings to the offerings (called securitizations). (3) The banks knew these toxic mortgages would fail but they sold them to their customers as sound investments. (4) The banks also used their insider knowledge that the mortgages were going to fail to place bets (short sales) and reap billions of dollars in profits as the U.S. housing market collapsed and families were thrown into the streets.
Last December, “The Big Short” movie began to play in theatres across America, allowing millions of people to see how the unchecked, insidious greed of Wall Street had destroyed the nation’s economy along with the reputation of Wall Street, the ratings agencies and the revolving door regulators. (See video below.) The movie was based on real-life people on Wall Street and adapted from the book by the same title by author Michael Lewis, an authoritative source through his previous career on Wall Street.
Years before the movie made it to the big screen, thousands of activists around the country created the Occupy Wall Street movement to advocate for a realignment of their democracy and a radical overhaul of what Wall Street had become: a thinly disguised wealth transfer system for the one percent, being propped up by a corrupt political campaign finance system. After commanding news headlines for months and being carefully monitored by government surveillance, a brutal police eviction was orchestrated against Occupy Wall Street, journalists covering the protests and even New York City Council Members attempting to monitor what was happening. Congressman Jerrold Nadler sent a letter on December 6, 2011 to Attorney General Eric Holder at the U.S. Department of Justice requesting that an investigation be undertaken. Nadler’s description of the events were reminiscent of a police state protecting the criminals:
“In addition to my concerns about police misconduct with respect to OWS protesters, I am especially troubled that during and after the November 15th eviction from Zuccotti Park, the NYPD aggressively blocked journalists from reporting on the incident, and in some cases, targeted journalists for mistreatment. Individuals without press credentials were also blocked from filming events, and were, in some instances, arrested apparently for taking pictures. According to news reports, and a letter from the major daily newspapers and other major news outlets and organizations representing journalists, at least ten reporters and photographers were arrested while trying to report on the incidents at Zuccotti Park. The NYPD forced journalists to leave Zuccotti Park, prevented members of the credentialed press from being present during the eviction, and used intimidation and physical force to prevent reporters and photographers from carrying out their journalistic functions. Many of those arrested were not charged with any offenses. Additionally, the City reportedly closed the airspace above the area in order to prevent news helicopters from recording the actions.”
…
