Stocks // Current TV

The Facebook Faceplant: Falling Stock, Regulators and Now Lawsuits

It’s kind of hard not to chuckle over this Facebook faceplant, because... more

StewSteve
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6 days ago
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Social Security vs. Private Retirement

Is Social Security a good retirement plan? Economics professor Antony Davies shows... more

Radical_Centrist
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27 days ago
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13 comments

Demo stock- and currency trading platform

Demo stock- and currency platform for learning how to build a safe portfolio. Follow... more

buiwoner
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1 month ago
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The 2012 Threat is Financial -- Hunker Down, We're in For a Wild Ride

Goldman Sachs Takeaway: Fix Our Financial System or Get Ready for the Next Horrific Collapse
Only an overhaul in our broken banking and financial system will prevent the next collapse. Goldman Sachs' misdeeds are merely a symptom of a much bigger problem.
March 15, 2012 |

Greg Smith's mea culpa about Goldman should not come as a surprise to anybody who has a remote connection with the financial services industry. But to suggest that the allegations made by Mr. Smith are unique to Goldman's culture is ludicrous. They are symptomatic of a much broader problem embedded in Wall Street culture as a whole. Goldman's major sin was being more astute at exploiting this system than most of its competitors.

The toxic derivatives sold to what employees of Goldman derisively referred to as "muppet" clients (since when was being a "muppet" such a bad thing?) were certainly neither a trend unique to GS, nor was it a recent phenomenon. The truth is that this activity has been embedded in Goldman's culture since the days when Robert Rubin was co-CEO of the company and advocated GS taking proprietary positions (trading for its own account), even if it meant betting against their clients.

Goldman was a successful company and success tends to breed imitation. Eventually, everybody on Wall Street was doing the same shitty business. Goldman, for example, wasn't the only one selling these toxic mortgage products, which helped to blow up the world's global economy in 2008, but they were smart enough to hedge them.

Why is all this so dangerous? Think of the recently deceased James Q. Wilson's "Broken Windows" thesis, which he largely used as his model for "blue collar" crime. Wilson thought that it was necessary to tackle even small signs of crime and decay in a community in order to prevent larger, more system criminal activity from emerging. You see a broken window, you go after the culprit. In the elite white collar crime context we have been following the opposite strategy of that recommended under the theory.

As the economist/criminologist Bill Black recently noted in a piece discussing Wilson's theory, the whole story of the past two decades has been that we have persistently excused those in finance who persistently break the windows. Indeed, we have praised them and their misconduct.

But as Black has noted, "The problem with allowing broken windows is far greater in the elite white collar crime context than the blue collar crime context. The squeegee guys make tiny amounts of money and are hated and politically powerless. The mediocre financial CEO who engages in accounting control fraud because it is a 'sure thing' causes the bank to report record (albeit fictional) profits and becomes wealthy and politically powerful. He uses his wealth to make charitable and political contributions that make him far harder to sanction. He claims that any crackdown on him is 'class warfare' by 'neo-Bolsheviks'."

Incredibly, the Department of Justice, the press, and the economic profession persistently ignore those who become wealthy by breaking windows, communities, and economies. In fact, they are lionised by no less than our President, who once termed both Lloyd Blankfein and Jamie Dimon "pretty savvy businessmen." Yes, and Al Capone was a pretty savvy businessman -- who just happened to be sloppy on his tax returns.

Realistically, what is required is a wholesale shift in our banking culture. In the old days, a banker “hedged” his credit risk by doing (shock!) CREDIT ANALYSIS. If the customer was deemed to be a poor credit risk, no loan was made. But if the loan was made, and turned out to be profitable, both lender and borrower made money, which is how banking should work.

It goes back to a point I have made many times: Creditworthiness precedes credit. You need policies designed to promote job growth, higher incomes and a corresponding ability to service debt before you can expect a borrower take on a loan or a banker to extend one. And, as the economist Hyman Minsky used to point out, in the old days, banking was a fundamentally optimistic activity, because the success of the lender was tied up with the success of the borrower; in other words, we didn’t have the spectacle of vampire-like squids betting against the success of their clients via instruments such as credit default swaps.

Continue reading at http://www.alternet.org/economy/154568/goldman_sachs_takeaway%3A_fix_our_financial_system_or_get_ready_for_the_next_horrific_collapse/?page=2Goldman Sachs Takeaway: Fix Our Financial System or Get Ready for the Next Horrific... more

wolfess
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2 months ago
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'Stockblockers': Stewart Takes on Congressional Insider Trading (VIDEO)

Congress tried to tackle this particular form of corruption by introducing the STOCK... more

StewSteve
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3 months ago
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'Reverse Bonus Checks' Drain Wall Street Bank Accounts

New York -- The global economic crisis has finally caught up with the Wall Street... more

mbalton
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5 months ago
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3 comments

Thai Floods May Prompt Water Futures Trading

Thailand may start trading of water derivatives, giving investors a means of hedging against disasters after the nation’s worst floods in almost 70 years, the Securities & Exchange Commission said.

The regulator is studying the possibility of introducing contracts whose value would be linked to rainfall, or the level of water in the nation’s major dams, said Vorapol Socatiyanurak, who started as secretary-general of the SEC in October. He declined to say when trading might begin.

The total face value of global weather-related derivatives grew by 20 percent between 2010 and 2011 to $11.8 billion, according to a May 20 report by the Washington DC-based Weather Risk Management Association. Demand growth was seen in contracts related to rainfall, snow, hurricanes and wind from industries such as agriculture, construction and transport, it said.

The majority of weather contracts are traded on the Chicago Mercantile Exchange. (CME) CME snow contracts, for example, are based on the exchange’s Snowfall Index, a measure of average monthly snowfall in certain U.S. cities. Traders “determine what amount of snowfall would be detrimental to their businesses and take futures or options positions based on that,” the exchange said on its website.

The risk for Thai water derivatives “would be a lack of trading liquidity,” said Joe Vongkitbuncha, head of equity and structured derivatives at Asia Plus Securities Pcl, the nation’s third-biggest stock brokerage by market value. Still, the contracts may be useful to big conglomerates, whose supply chains and manufacturing “rely heavily” on business continuity, and to agricultural businesses, he said.

more at link...

This is all part of Al Gore's Global Climate Scam. These eco-fascists are trading CO2, they're trading H20...they're even trading snow and it has nothing to do with saving the environment or helping people. Its about controlling, taxing and trading every resource on Earth, consolidating power and installing their New World Order/One World Government.Thailand may start trading of water derivatives, giving investors a means of hedging... more

rodstradamus
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6 months ago
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If we'd only bought Apple and Google and gold instead of our 401k ...

What people want Cenk to discuss - consistently 'how banksters have destroyed... more

donburnham
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6 months ago
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Congress:Trading stock on inside information?

"I was watching this tonight and found this video worth sharing!!! Seems, that... more

KB723
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7 months ago
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115 comments

Retirement Heist: How Wall Street Stole Your Pension (VIDEO)

“They’ve managed to take the retirement plans for millions of people... more

StewSteve
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7 months ago
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Rally in stocks, euro fades as debt crisis drags

European stock index futures fell and the euro dipped on Wednesday, as investors... more

aileenalmeda
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8 months ago
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Manly Men Unleashed!

Men acting all piratey...and manly, of course.... more

jmarkred
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8 months ago
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22 comments

Could a Cyber Attack Shut Down the Stock Exchange?

The system is potentially vulnerable to attacks that would have great consequences to... more

Paisano1
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9 months ago
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4 comments

Financial turmoil evokes 2008 comparison

It feels eerily familiar: Stocks are plummeting. The economy is slowing. Politicians... more

sitsi
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10 months ago
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The Wounded Stock Market, the Political Abandonment Of The Working Class, And The Rise Of The Planet Of The Apes.

U.S. stock market down this week, 500+ points today. . . How does the deficit deal... more

mfb1949
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10 months ago
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Super Frat: Green Makes Green

Mistah Sh*t watches the inevitable result of legalized weed.

TonyDiGerolamo
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10 months ago
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0 comments

Market Crash Predicted /Stealth Stocks Free Report

Dennis Slothower specializes in using technical analysis to help understand the... more

figgdimension
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11 months ago
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1 comment

Stock Prices Have Fallen For Six Weeks In A Row

Well, it's official. U.S. stock prices have fallen for six weeks in a row. So... more

Revelation1217
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12 months ago
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Debt worries hits euro and stocks; government debt, gold up

Renewed worries in the euro-zone over the weekend pulled the euro down to a record low... more

remyric
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1 year ago
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S & P Debt Warning Sends Stocks Tumbling

Standard and Poor's debt warning to the United States took it's toll on Wall... more

letsliveinpeace
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1 year ago
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