Friday, May 3, 2013

I'm pretty sure Freddie Kruger went on to be a prominent banker

When you were a kid did you ever do something you weren't supposed to and then get caught by your mom (or dad)?  Maybe you were told you could play in your yard or David's yard (next door), but nowhere else, then she came looking for you and found you six yards down the street playing with Tony?  (Or Toni? *wink*)

She was worried and mad, and she spoke to you firmly, or if she was really ticked she would take you home and give you a spanking.  You cried and/or were embarrassed, and you promised to never do it again.  And you didn't, 'cause you knew she was watching, and you certainly didn't want to get caught again.

Apparently today's Ivory Tower bankers were never disciplined as kids.  To this day they do things, get caught, then go back and do them again and again and....

Instead of saying, "I'm sorry, it won't happen again" and then cleaning up their act, they just pull together their top people and brainstorm better, more devious ways to cheat.  To them it isn't a sin to cheat.  It's only a sin to get caught.

Case in point:  The Federales (8 different agencies) are all over JP Morgan Chase bank for screwing over the public in too many ways to list here.  One of the more egregious was a scheme to turn some money losing power-generating plants they owned into powerful "money centers".

....under "pressure to generate large profits," the agency’s investigators said, traders in Houston devised a workaround. Adopting eight different “schemes” between September 2010 and June 2011, the traders offered the energy at prices “calculated to falsely appear attractive” to state energy authorities. The effort prompted authorities in California and Michigan to dole out about $83 million in “excessive” payments to JPMorgan, the investigators said. The behavior had “harmful effects” on the markets, according to the document.

Shades of Enron!  Oh, just FYI, the very senior Chase banker responsible for this fraud, Blythe Masters, was one of the original developers of those "credit default swaps" at the heart of the worldwide economic meltdown of 2008.  

"...and then we wring every last cent we can out of them.  Now, about my bonus..."

See why I'm so down on the big money-center banks?  They are NOT going to change their ways, I don't care how many eyes they have watching them.  That's why these big banks need to be broken up into smaller, more transparent, easier to oversee pieces.  

These guys are just gangsters in high-dollar three-piece suits.



  1. Incentives are all based on this years profit, not long term growth. What always got me is when some trader lost huge amounts on bad trades and then covered them up and they went further south he would be fired, but became a hot commodity. Apparently the thought was anyone who could lose that much money must be pretty smart. Go figure!

  2. Hey why not, the Bush administration enabled them by giving them that bailout. So they figure if they get caught and things go south, the government will step in to give them another bailout and once things have cooled they can go right back to it. Maybe a token person will go to jail for a couple of months but there's just too much money being made to not do it.

  3. Next time they get in trouble . . . Let. Them. Fail.

  4. I don't think any bank should be allowed to become so big that the Feds are required to bail it out to protect the economy. They should be broken up.

  5. Sounds like a good spanking would do them a world of good! Maybe they should build it into their business plan ;P

  6. At least I am not working for that evil empire ;)