How Wall Street Will Screw You Over, Again
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The Dodd-Frank Wall Street Reform and Consumer Protection Act was supposed to give taxpayers some trust that the banks would be sufficiently regulated, that too-big-to-fail wouldn’t happen again. But the London Whale drowned that fantasy.
JPMorgan Chase, long considered the safest Wall Street bank, an institution whose managers lobbied hard for a lily-livered Dodd-Frank, has paid more than $8.5 billion since the crash in fines, settlements and other litigation expenses.
Joshua Rosner, co-author of the New York Times best seller, “Reckless Endangerment,” analyzed JPMorgan for consulting firm Graham Fisher & Co. and wrote in a report titled “JPMorgan: Out of Control:
“JPM has a reputation of being the best managed of the biggest banks. This has enabled the company to employ its muscle with elected officials and thwart regulatory efforts.”
Regulators saw no evil as a JPMorgan trader in London lost $6.2 billion last year. A scathing Senate investigative report released March 14 says the nation’s largest bank fought with and dodged federal regulators, misinformed investors and the public andcircumvented internal and federal rules.
Less than a week after the Senate released the report, a House committee passed seven bills that would gut Dodd-Frank’s already weak-kneed regulations governing the very derivatives that the London Whale traded.
This action is an example of right-wing Cypriot President Anastasiades’ view of government: protect the wealthy and influential and compel the workers to pay.
It didn’t go over well in Cyprus. After massive street demonstrations, the Cyprus Parliament unanimously rejected the initial plan to seize money from small depositors’ insured accounts to rescue the banks.
But unless Americans step up the way Cypriots did and demand real regulation, as well as send the message that they don’t trust Wall Street by moving their money tocommunity banks and credit unions, they can bank on being bilked. Again.