connaughton - the payoff; why wall street always wins (2012)

[...]... computer-driven trading Too-big-to-fail banks continue to act lawlessly, teeter on the brink, and destabilize the global economy The postcrisis regulatory reforms (particularly, the Dodd-Frank Act) were and are being written by over-matched regulators with the help of Wall Street lawyers instead of by the elected representatives of Americans, a substantial majority of whom support rules to rein in Wall Street. .. everything else, but they’ll remember you had the guts to confront them.” Turning to the real topic of his speech, the SALT II arms control treaty then pending before the Senate, Biden, who spoke without any notes, explained the contents of the treaty, why he felt it was important to our national security, and the views of the various factions in the Senate Then he turned to that day’s news about the discovery... say, Washington’s decades-long infatuation with deregulation had pulled all the referees off the football field Then, the executives trusted to act in the best interests of shareholders had convinced themselves, against all reason and instinct, that they could engineer risk out of the system Despite the fancy equations from the quants, the executives knew (or should’ve known) that they were gambling with... The onset of the Great Recession should’ve been a moment when reformers realized the financial elite’s grip on Washington had become too strong, as when Teddy Roosevelt stood up to the trusts and FDR cracked down on Wall Street Instead, Obama and Biden gave the problem a sideways glance and then delegated the solutions to the same circle of Wall Street- Washington technocrats who had brought the financial... as the personnel director for the Obama pre-transition and transition And whom did Froman bring in to help him with the job of picking top appointees for the Obama administration? James Rubin, the son of Bob Rubin Tim Geithner, then the president of the New York Federal Reserve Bank, was also a Rubin protégé In late November 2008, Geithner would help pave the way for the Citigroup bailout, one of the. .. to pause and breathe It helped him not to rush his delivery and to give the statement a more natural-sounding rhythm Ted did the 10 same thing, striking with his pen a bit nervously as he worked his way through the pages When we arrived at the hearing, Leahy and Grassley were the only senators there Ted’s place along the curved committee dais was at the end of the Democratic quarter-moon, and that’s... refined” their 12 ability to understand complex financial fraud in the Enron case The FBI would build on this cadre by hiring and training new agents But Enron was one company The potentially fraudulent mortgages that Wall Street had bundled and resold as securities had pervaded the banking and insurance industry in the U.S and abroad The FBI’s then-dedicated resources looked inadequate for the mountain... administrations Washington is a place where the door between the public sector and the private sector revolves every day A lawyer at the SEC or Justice Department leaves to take a position at a Washington law firm; a Wall Street executive takes a position at the Treasury Department The former will soon be defending the Wall Street executives his old colleagues are investigating; the latter will soon be preventing... taxpayers to foot the bill The other group (regardless of political party) primarily courts campaign contributions from the wealthy and powerful, and, for the most part, plots longterm plans for attaining wealth and comfort in the private sector Once absorbed by DC, members of Washington’s Permanent Class serve as Wall Street s handmaidens: When they’re in government they hire Wall Street alums for... (after which the alums go back to Wall Street and make further millions) When they’re not in government, they’re working on Wall Street s payroll Unfortunately for America, Obama and Biden (who pledged in his 1972 campaign never to own a stock or a bond) were both financially illiterate In the presidential debates, Obama did a fair impersonation of someone who had grasped the elements of the crisis (far . of the Private Securities Litigation Reform Act, which he and the republicans had drafted to gut the class-action securities-fraud laws. It was the only Clinton veto given the back-of -the- hand. down on Wall Street. Instead, Obama and Biden gave the problem a sideways glance and then delegated the solutions to the same circle of Wall Street- Washington technocrats who had brought the financial. not-for-profit to keep fighting the Washington -Wall Street nexus on behalf of the rule of law and the average investor. For me, it was a Pogo moment. I said: “Ted, we’ve met the enemy, and the