Son of Makoff
The SEC just filed against Stanford bank here in Texas for ... wait for it ... $8BN fraud in certificates of deposit.
This is your results of deregulation in spades. Without supervision, the institutions were left to police themselves. Under the Greenspan Doctrine (yes, my invention) that maintained it was in business's best interest to provide honest services, those financial institutions were left to make up banking as it went along.
From an earlier post;
This is what we are encountering now, the printing money aspect of deregulated financial institutions. In this case, it was in selling certificates of deposit that did not represent the real item. No pony.
It's getting worse daily, because even when the former head of the Federal Reserve realized things were not right, he refused to use his powers to stop the crap game.
We all lose.
Update:
In the article cited:
The SEC said the firms falsely claimed that their deposits were safe, that more than 20 analysts monitor the investments, and that yearly audits were being conducted.
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In addition, one of Stanford's companies falsely told customers that it was not exposed to the $50 billion Ponzi scheme allegedly orchestrated by Bernard L. Madoff, the SEC said.
DEVELOPING
SEC Charges Stanford Financial in $8B Fraud
The Securities and Exchange Commission has charged Texas businessman R. Allen Stanford and the financial firms he controls with fraud in the sale of $8 billion of certificates of deposit, one of the largest alleged financial frauds in U.S. history.
This is your results of deregulation in spades. Without supervision, the institutions were left to police themselves. Under the Greenspan Doctrine (yes, my invention) that maintained it was in business's best interest to provide honest services, those financial institutions were left to make up banking as it went along.
From an earlier post;
European financial concerns are very concerned, because they are well aware that regulation needs to be imposed so that investors will return to U.S. Treasury bonds. As it stands, the Fed has allowed 'fails to deliver' to be the result of investment buys, in an increasing amount. What this basically means is that when a purchase is made, the bond is expected to arrive, but it hasn't been arriving. That is something like the old horsetrader trick, you advertise something for sale, take the money, and yes, 'fail to deliver'. In horsetrading, you had made the pony up. In international financial terms, the Fed is printing money, or making it up. In October, 20% of daily trading had become those fails.
This is what we are encountering now, the printing money aspect of deregulated financial institutions. In this case, it was in selling certificates of deposit that did not represent the real item. No pony.
It's getting worse daily, because even when the former head of the Federal Reserve realized things were not right, he refused to use his powers to stop the crap game.
We all lose.
Update:
In the article cited:
The SEC said the firms falsely claimed that their deposits were safe, that more than 20 analysts monitor the investments, and that yearly audits were being conducted.
ad_icon
In addition, one of Stanford's companies falsely told customers that it was not exposed to the $50 billion Ponzi scheme allegedly orchestrated by Bernard L. Madoff, the SEC said.
Labels: Bush Legacy, Corruption, Economic Justice, Economy
posted by Ruth at 10:02 AM
2 Comments:
Under the Greenspan Doctrine (yes, my invention) that maintained it was in business's best interest to provide honest services, those financial institutions were left to make up banking as it went along.
Heh. Did you happen to see Clinton's marvelous "I did not have sex with that investment bank" confession/non-confession Ruth?
They're wrong in saying that the elimination of the Glass-Steagall division between banks and investment banks contributed to this. Investment banks were already...banks were already doing investment business and investment companies were already in the banking business.
So if they were *already* doing it, instead of enforcing the law, let's just change the law! Viola!
Sadly, a lot of otherwise good minds were taken in by that mantra that we were in unparalleled prosperity because of deregulation, not because this was the result of a large economy of consumers that was only threatened by the mogul horde stealing everything and stowing it in .... Antigua.
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