The Rolling Stone's Matt Taibbi is on a roll today. First, he writes a terrific piece about Occupy Wall Street in which he says,
...my initial impression was that it would not be taken very seriously by the Citibanks and Goldman Sachs of the world. You could put 50,000 angry protesters on Wall Street, 100,000 even, and Lloyd Blankfein is probably not going to break a sweat. He knows he's not going to wake up tomorrow and see Cornel West or Richard Trumka running the Federal Reserve. He knows modern finance is a giant mechanical parasite that only an expert surgeon can remove. Yell and scream all you want, but he and his fellow financial Frankensteins are the only ones who know how to turn the machine off.
That's what I was thinking during the first few weeks of the protests. But I'm beginning to see another angle. Occupy Wall Street was always about something much bigger than a movement against big banks and modern finance. It's about providing a forum for people to show how tired they are not just of Wall Street, but everything.Read the whole thing here. But also be sure to read Taibbi's story about the judge who finally stood up to Wall Street. Citibank had been caught ripping off its investors for a third time, and stood to get a slap on the wrist from the Securities and Exchange Commission. Federal Judge Jed Rakoff rejected the SEC's proposed settlement. Here's the analogy Taibbi uses to describe what happened:
Imagine a car thief who, when caught driving a stolen Lexus, tells the police he simply stepped into the wrong car and drove off by mistake. Now imagine he tells the same story when, two years later, he’s caught screaming over the GW bridge in a stolen Mercedes.
Then, two years after that, he’s caught on the Cross-Bronx Expressway blasting the stereo in a boosted 7-series BMW. Cops ask him for an explanation. “I must have gotten in the wrong car by mistake,” he says, shrugging. And the cops buy the story and send him home without a charge.
That’s roughly what we’re dealing with with this SEC action. To extend the metaphor just a little further – let’s say that BMW wasn’t even the only car he accidentally drove away that day, but the cops didn’t bother with the others.In a broad sense, Citigroup did what Goldman Sachs tried to do to YRC before Jim Hoffa exposed the misdeed. Both Citigroup and Goldman Sachs were promoting investments that would fail and trying to profit from those failures. (That is not the way to create jobs, by the way.) In the Citigroup case, Rakoff dumped all over the SEC. Writes Taibbi,
Judge Rakoff balked at the settlement and particularly balked at the SEC’s decision to allow Citi off without any admission of wrongdoing. He also mocked the SEC’s decision to describe the crime as “negligence” instead of intentional fraud, taking the entirely rational position that there’s no way a bank making $160 million ripping off its customers can conceivably be described as an accident.Read the whole thing here.