Posted By Levi
July 9th, 2012 6:27pm
I usually don’t watch much TV news. For one, I don’t have the time and when I do, I don’t usually learn much especially now in the election season when nothing else seems to be happening in the world except the horse race between the two candidates as far as most TV news programs are concerned. However, there is one particular show I find compelling and when I am not able to watch, I taped it on my DVR and watch it later – Bill Moyers and Company. Bill is easily one of the few remaining journalists who have the knowledge and interviewing skills to cover complex issues in an in-depth way. If you miss the television show, you can always watch it on the web here.
This morning I had the chance to watch the segment he did recently on the continuing fraud and corruption on Wall Street. Four years into the largest corruption scandal since the Great Depression, one that has affected the lives of millions of Americans in disastrous ways, yet not a single banker or Wall Street titan has been arrested and sent to jail. And precisely because of this, these individuals now believe they have the license to commit murder and get away with it for the Obama administration nor the Justice Department will go after them. And the scale of the fraud and corruption just continue one after the other. The other day it was JP Morgan Chase whose risky and, likely illegal, trading practice which led to multi-billion loss for that bank.
A few days ago, news broke about the financial scandal now gripping Britain in which Barclays Bank is accused of manipulating interest rates and benefitting handsomely from it. For an explanation of this recent fraudulent scheme, see here, here and here. And now, it looks like JP Morgan Chase and others are involved in this one as well.
On this episode, Moyers discusses the banking fraud with Matt Taibbi from Rolling Stones Magazine and Yves Smith, a former employee of Goldman Sachs.
BILL MOYERS: Both of you have mentioned the Jefferson County story. Give me a quick summary of what JPMorgan did in Jefferson County, Alabama.
MATT TAIBBI: Well, Jefferson County had to build a new sewer system. And they had to borrow a bunch of money to do that. And it was originally a $300 million project. But they got into a series of swap deals with JPMorgan Chase to basically push their financing into the future. But the deals were heavily mispriced in Chase’s favor. And Chase actually bribed another bank to stay away from Chase because they wanted that business. They wanted to give the–
BILL MOYERS: Bribed them?
MATT TAIBBI: They bribed them.
BILL MOYERS: That’s against the law, isn’t it?
MATT TAIBBI: Yes, yes.
On the criminality of the banks:
BILL MOYERS: You’re describing a corrupt financial and political system. And both of you in recent writings, your current article in “Rolling Stone,” which is devastating on the scam that the “Wall Street learned from the Mafia,” and a recent column you wrote about the mafia state, you’re both using that metaphor to apply to our financial and political system. When I read your pieces, you’re not playing with words there. You mean it.
YVES SMITH: Yeah.
BILL MOYERS: Why do you mean it?
YVES SMITH: Well, the mafia, when it gets to be big enough, first thing it has services that people feel they need if they’re in a difficult situation. So, for example, loan sharking. If you really need money, they do have the money. And people enter into these loan shark deals even though they know it’s going to be very difficult to pay 20 percent or more interest and they’ll have their legs broken if they don’t pay back.
And the banks actually behave very much in that manner when they find people who really need money. So you see this with credit cards, you know, that, or, and with mortgages. That if you hit– it’s not this if you hit any tripwire, that, you know, become in arrears, the banks basically act in this very extortionate manner and don’t cut any breaks.
MATT TAIBBI: And I think that there’s also this, they are the mafia because of their vast criminality in Wall Street now is that it’s bribery, theft, fraud, bid rigging, price fixing, gambling, loan sharking. All of these things, it’s all organized.
Watch the video: