I’m going to make a point to see this soon….
Inspired by true events (think Bear Sterns? Merrill Lynch?) and with an all-star cast including Jeremy Irons, Kevin Spacey, Stanley Tucci, Paul Bettany, Demi Moore, Penn Badley, Zachary Quinto, Simon Baker….
It was also just named “Best First Feature” by the New York Film Critics…
I’ll let you know more once I see it….
Filed under Occupy Wall Street, Politics, The Economy
Okay, I’ve published enough fluff for today.
Let’s get back to Politics….
This is one of the biggest issues associated with income inequality. And it’s frequently overlooked.
The ridiculous salaries on Wall Street are creating a Brain Drain that draws young people, fresh out of College and many with large student loans, to go to Wall Street to try chase the dream to slave for ten years or so and retire billionaires at 40.
All these ridiculous, complex new financial instruments, like Credit Default Swaps, Hedge funds, etc. are really legalized gambling, market manipulation and frankly, fraud, created by super smart people to make a quick buck. The old, staid Wall Street of yore would never have thought these things up or known what to do with them.
Face it, the guys who used to run Wall Street weren’t that smart…
Now young people who should be attracted to jobs that might make Society better, be more fulfilling and create something positive are all running to Wall Street to try to think up the next ridiculously complex financial instrument to make themselves rich- no matter who it hurts or that it adds nothing to society.
Let’s get back to the basics:
It’s all out of whack….priorities, salaries, creativity and risk.
It shouldn’t all be about a quick and easy buck-like today’s system encourages….
From Huffington Post:
But what if top students didn’t go to Wall Street? What if, rather than creating complex financial products that collapsed the global economy, they were building bridges and creating new technologies instead?
As America struggles to create jobs and get back on its feet after the recession — caused largely by the financial industry’s recklessness — the country is in desperate need of more entrepreneurs, inventors, scientists and other professionals, a complaint regularly made by non-Wall Street business leaders and members of both major political parties.
Lee Jackson is a senior economics major at Stanford who edits a financial newsletter called The Opportune Time. He has interned on Wall Street and plans to work in finance after graduation, but admits the profession needs reform.
“I think the emphasis is more on making money and making a profit, and there’s been less emphasis … on what the greater societal implications of that are,” he said, pointing to fields like law and medicine that focus on the needs of the client or patient and have outreach programs to help low-income individuals. During the debate over Wall Street reform, meanwhile, bank lobbyists fought a provision in the Dodd-Frank legislation that would require financial companies to operate in the best interests of their clients.
“Over the past few years in the mainstream American culture, the bad side of American finance has come out time and time again,” he added. “But my fear is that the good side of finance and the side that can help people save for retirement, build their own wealth and be able to support themselves [will be lost].”
Yet without a cultural shift and reforms that rein in the financial industry’s sky-high profits and salaries, a disproportionate number of the best and the brightest will continue to head to Wall Street.
“Our financial system remains out of whack in terms of regulation, compensation, and until our economy is stronger, it’s not surprising that young people will be attracted to the place where the money and jobs are,” Elizabeth Warren, U.S. Senate candidate and creator of the Consumer Financial Protection Bureau, told The Huffington Post. “In a sense … it’s a demand problem, [as well as] the fact there is not enough demand in the rest of the economy. It’s both problems.”
via America’s ‘Brain Drain’: Best And Brightest College Grads Head For Wall Street.
Filed under Occupy Wall Street, Politics, Uncategorized
It’s becoming an accepted probability, for the first time in our history that, in financial terms, children will probably not do as well as their parents.
Thanks to Republican policy since Reagan-with notable assists from the Dems on many occasions, thanks to the decline of Unions, thanks to the loss of well paying manufacturing jobs, thanks to declining educational standards, thanks to our contaminated food supply, thanks to the redistribution of wealth to the top 1%, thanks to a lot of poor decisions by a lot of people….
This puts some numbers around who is most likely, demographically speaking, to have been pushed out of the Middle Class– so far.
From YahooNews.com. Hat Tip to my friend Kirk for sending me the article:
The American Dream of upward social mobility has stalled for some people, according to a big new study from Pew.
The study checked in on a bunch of middle class teenagers from 1979 to see how they were doing 25 years later. Notably this survey was performed before the Great Recession, so most of these numbers would be worse today.
Pew found that 28% of the sample group had fallen out of the middle class. This number was significantly higher for certain demographic groups including divorced women and black men.
Divorced women are 35.8% more likely to have fallen out of the middle class.
Divorced men are 13% more likely to have fallen out of the middle class.
Unmarried women are 17.6% more likely to have fallen out of the middle class.
Unmarried men are 10% more likely to have fallen out of the middle class.
Black men are 17% more likely to have fallen out of the middle class (vs white men).
Black women are 5% more likely to have fallen out of the middle class (vs white women)
Women without a college degree are 16.3% more likely to have fallen out of the middle class.
Men without a college degree are 7.5% more likely to have fallen out of the middle class.
Hispanic men are 8% more likely to have fallen out of the middle class (vs white men).
Hispanic women are actually 2% less likely to have fallen out of the middle class (vs white women).
A fascinating article in The Guardian from the UK that is worth reading in it’s entirety.
Being a student of History, I have often wondered if we were at the beginning of the end of the American Empire. Or maybe in the middle of it….
Like people, Empires have a finite life span. Neither the Roman nor the British Empire lasted forever. On my bad days, I wonder if we aren’t all living in a declining democracy on the way to being a third world country.
I particularly have this feeling when I travel by air or read too much about the Republican positions….
Don’t go screeching USA! USA! USA! at me…
Read the article and think if there are ways we can reverse this- or is it already too late?
Talk amongst yourselves…
Let me put an alternative hypothesis. America in 2011 is Rome in 200AD or Britain on the eve of the first world war: an empire at the zenith of its power but with cracks beginning to show.
The experience of both Rome and Britain suggests that it is hard to stop the rot once it has set in, so here are the a few of the warning signs of trouble ahead: military overstretch, a widening gulf between rich and poor, a hollowed-out economy, citizens using debt to live beyond their means, and once-effective policies no longer working. The high levels of violent crime, epidemic of obesity, addiction to pornography and excessive use of energy may be telling us something: the US is in an advanced state of cultural decadence.
Empires decline for many different reasons but certain factors recur. There is an initial reluctance to admit that there is much to fret about, and there is the arrival of a challenger (or several challengers) to the settled international order. In Spain’s case, the rival was Britain. In Britain’s case, it was America. In America’s case, the threat comes from China.
Britain’s decline was extremely rapid after 1914. By 1945, the UK was a bit player in the bipolar world dominated by the US and the Soviet Union, and sterling – the heart of the 19th-century gold standard – was rapidly losing its lustre as a reserve currency. There had been concerns, voiced as far back as the 1851 Great Exhibition, that the hungrier, more efficient producers in Germany and the US threatened Britain’s industrial hegemony. But no serious policy action was taken. In the second half of the 19th century there was a subtle shift in the economy, from the north of England to the south, from manufacturing to finance, from making things to living off investment income. By 1914, the writing was on the wall.
In two important respects, the US today differs from Britain a century ago. It is much bigger, which means that it benefits from continent-wide economies of scale, and it has a presence in the industries that will be strategically important in the first half of the 21st century. Britain in 1914 was over-reliant on coal and shipbuilding, industries that struggled between the world wars, and had failed to grasp early enough the importance of emerging new technologies.
Even so, there are parallels. There has been a long-term shift of emphasis in the US economy away from manufacturing and towards finance. There is a growing challenge from producers in other parts of the world.
via Decline and fall of the American empire | Business | The Guardian.
Filed under Elections, Politics, The Economy
Wow…
Goldman gets blasted by both the Democrats and the Republicans on this committee and both are referring it to the Justice Department for possible prosecution….
Not often you see this kind of bi-partisan criticism….
It will be interesting to see if this goes anywhere….
From TPM and Reuters….
In the most damning official U.S. report yet produced on Wall Street’s role in the financial crisis, a Senate panel accused powerhouse Goldman Sachs of misleading clients and manipulating markets, while also condemning greed, weak regulation and conflicts of interest throughout the financial system.
Carl Levin, chairman of the Senate Permanent Subcommittee on Investigations, one of Capitol Hill’s most feared panels, has a history with Goldman Sachs.
He clashed publicly with its Chief Executive Lloyd Blankfein a year ago at a hearing on the crisis.
The Democratic lawmaker again tore into Goldman at a press briefing on his panel’s 639-page report, which is based on a review of tens of millions of documents over two years.
Levin accused Goldman of profiting at clients’ expense as the mortgage market crashed in 2007. “In my judgment, Goldman clearly misled their clients and they misled Congress,” he said, reading glasses perched as ever on the tip of his nose.
A Goldman Sachs spokesman said, “While we disagree with many of the conclusions of the report, we take seriously the issues explored by the subcommittee.”
The panel’s report is harder hitting than one issued in January by the government-appointed Financial Crisis Inquiry Commission, which “didn’t report anything of significance,” Republican Senator Tom Coburn said at the briefing.
More than two years since the crisis peaked, denunciations of Wall Street misconduct are less often heard on Capitol Hill, with lawmakers focused on fiscal issues. But Coburn joined Levin at Wednesday’s bipartisan briefing, firing his own sharp attacks on the financial industry.
“Blame for this mess lies everywhere — from federal regulators who cast a blind eye, Wall Street bankers who let greed run wild, and members of Congress who failed to provide oversight,” said Coburn, the subcommittee’s top Republican.
“It shows without a doubt the lack of ethics in some of our financial institutions who embraced known conflicts of interest to accomplish wealth for themselves, not caring about the outcome for their customers,” he said.
The Levin-Coburn report criticized not only Goldman, but Deutsche Bank, the former Washington Mutual Bank, the U.S. Office of Thrift Supervision and credit rating agencies Moody’s and Standard Poor’s.
“We will be referring this matter to the Justice Department and to the SEC,” Levin said at the briefing, though he did not elaborate. A spokesman later said, “The subcommittee does not intend to reveal the specifics of any referral.”
via Senate panel slams Goldman in scathing crisis report | TPM News Pages.
Filed under Politics
Have we really learned anything?
Interesting article from Kevin Drum at Mother Jones about the new push to relax the weak financial reform rules that passed last year…
This is a response to comments from Jamie Dimon, CEO of JP Morgan/Chase and comments from Matt Yglesias in the Financial Times:
So Dimon doesn’t like higher capital rules, doesn’t like derivatives regulation, doesn’t like debit card rules, and we already know what the entire industry thinks of the new Consumer Finance Protection Bureau. Long story short, he doesn’t really think the financial industry needs any new regulations at all, thankyouverymuch.
Well, if I were him I suppose I wouldn’t think so either. But guess what? It’s only been two years since the Great Collapse, and finance industry profits have already rebounded to their bubble-era levels. That’s a strong sign that finance industry leverage is also returning to its bubble-era levels, which in turn means the industry is about as dangerous as it’s ever been. And Dodd-Frank is a notably weak piece of regulation, about as weak as any bill could be and still be called regulatory reform in the first place. Wall Street got off easy, and Dimon knows it.
AND
Years ago I remember a lot of moderate liberals talking about how the Bush era radicalized them. For me, it was the economic collapse of 2008 that did it. The financial industry almost literally came within a hair’s breadth of destroying the world, but even so it took only a few short months for them to close ranks with Republicans and the rich to prevent anything serious being done to rein them in. Profits are back up, new regulations are barely more than window dressing, nothing was done to help underwater homeowners, bonuses are as obscene as ever, unemployment remains sky high, and the public has somehow been convinced that this was all their own fault — or perhaps the fault of big government, or big deficits, or something. But the finance industry has escaped almost entirely unscathed. It’s mind boggling. If this doesn’t change your view of who really runs the world, I don’t know what would.
Filed under Politics, The Economy, Uncategorized
Like I keep saying, our Financial system is totally screwed up…
It has become like an Atlantic City Casino with Las Vegas morals…
Dan Dicker, who has spent nearly three decades in the oil market, has a profoundly disturbing explanation of why the price of oil, and the gasoline that comes from the crude product, has risen so dramatically in recent months. It turns out, Dicker says, that the price has nothing to do with supply and demand for oil. It’s the financial market for oil, filled with both professional speculators and amateur investors betting on poorly understood oil exchange-traded funds, who have ratcheted up the price of gas to such sky high levels.
“There is no supply issue going on here – what you have is the perception of the possibility of a supply issue,” Dicker says. “A whole bunch of people are pouring money into an oil market trying to take advantage of what they perceive to be a real risk in supply. It’s a marketplace that I argue should not be allowed to be wagered on like a stock or bond.”
Dicker notes that Libya produces only 1.3 million barrels of oil a day, just a tiny fraction of the world oil market. Even if Libyan crude were lost to the world market in the current turmoil, and there is no sign that it is, Saudi Arabia has 5 million barrels a day to use in case of an emergency.
Dicker, who has just published a book called Oil’s Endless Bid: Taming The Price of Oil To Secure Our Economy, makes a strong case that if the government stepped in and regulated oil trading so that only investors with a genuine interest in the physical product, such as airlines and heating oil companies, could buy and sell oil futures, then the price of oil would fall by 50% overnight and our economy would be much better off.
Filed under Oil Dependency, Politics, The Economy
Lost in the 21st Century 