Tag Archives: banks

Big Banks Plead Guilty to Collusion, But Fines are Pocket Change

by BeatrizKingsmil Posted on May 20, 2015

Mother Jones

<!DOCTYPE html PUBLIC “-//W3C//DTD HTML 4.0 Transitional//EN” “http://www.w3.org/TR/REC-html40/loose.dtd”>

Five of the planet’s biggest banks have finally been forced to plea guilty to collusion charges in the foreign exchange market:

The Justice Department forced four of the banks — Citigroup, JPMorgan Chase, Barclays and the Royal Bank of Scotland — to plead guilty to antitrust violations in the foreign exchange market as part of a scheme that padded the banks’ profits and enriched the traders who carried out the plot….Underscoring the collusive nature of their contact, which often occurred in online chat rooms, one group of traders called themselves “the cartel,” an invitation-only club where stakes were so high that a newcomer was warned, “Mess this up and sleep with one eye open.” To carry out the scheme, one trader would typically build a huge position in a currency and then unload it at a crucial moment, hoping to move prices. Traders at the other banks agreed to, as New York State’s financial regulator put it, “stay out of each other’s way.”

….The guilty pleas, which the banks are expected to enter in federal court later on Wednesday, represent a first in a financial industry that has been dogged by numerous scandals and investigations since the 2008 financial crisis. Until now, banks have either had their biggest banking units or small subsidiaries plead guilty.

….As part of the criminal deal with the Justice Department, a fifth bank, UBS, will plead guilty to manipulating the London Interbank Offered Rate, or Libor, a benchmark rate that underpins the cost of trillions of dollars in credit cards and other loans.

The total fine is about $5 billion, and it’s about damn time this happened. Unfortunately, I assume that a billion dollars each is basically pocket change that’s already been fully reserved on their balance sheets. Needless to say, not a single dime of this will hit the actual people running the banks, who couldn’t possibly be expected to know that any of this stuff was going on. They were too busy drinking their lunches and remodeling their corner offices to know what a few rogue traders on the 23rd floor were doing. The Times confirms that life will go on as usual:

For the banks, though, life as a felon is likely to carry more symbolic shame than practical problems. Although they could be technically barred by American regulators from managing mutual funds or corporate pension plans or perform certain other securities activities, the banks have obtained waivers from the Securities and Exchange Commission that will allow them to conduct business as usual. In fact, the cases were not announced until after the S.E.C. had time to act.

It’s good to be king.

This article:  

Big Banks Plead Guilty to Collusion, But Fines are Pocket Change

Posted in FF, GE, LG, ONA, Uncategorized, Venta | Tagged , , , , , , , , , , , | Comments Off on Big Banks Plead Guilty to Collusion, But Fines are Pocket Change

What You Need to Know About Hurricane Arthur, the July Fourth Party-Crasher

by RonnyRhmsqsr Posted on July 3, 2014

Mother Jones

<!DOCTYPE html PUBLIC “-//W3C//DTD HTML 4.0 Transitional//EN” “http://www.w3.org/TR/REC-html40/loose.dtd”>

This story originally appeared in Slate and is republished here as part of the Climate Desk collaboration.

July 3, 12:30 pm: Hurricane Arthur is on track for an unwelcome tour of the East Coast this holiday weekend, already raining out fireworks celebrations and forcing beachgoers to flee for higher ground. First stop: North Carolina.

In its 11 a.m. update, the National Hurricane Center said Arthur’s sustained winds had strengthened to 90 mph—an upper-range Category 1 hurricane. The storm should strengthen further before landfall in the North Carolina Outer Banks later Thursday, and is now expected to reach mid-Category 2 status during its close approach there.

The storm is expected to hit hardest in North Carolina, where Gov. Pat McCrory has declared a state of emergency for coastal counties.

A mandatory evacuation of Hatteras Island in the vulnerable Outer Banks was underway on Thursday. With summertime tourism at its peak, and the forecast trending stronger and closer to the coast than earlier expectations, those remaining behind to ride out Arthur on North Carolina’s barrier islands may end up with a bit more storm than they bargained for.

Storm surge flooding is expected to reach five feet above ground level in some locations on the Outer Banks, creating the potential for road washouts. Wind gusts could top 100 mph during the early morning hours of July Fourth.

After its brush with North Carolina, Arthur will spend the rest of the Fourth of July traveling relatively quickly up the East Coast. Arthur’s passage should be at a safe enough distance to keep wind and flooding risk to a minimum, but close enough to create a wave of rain showers and dangerous beachfront currents. Arthur will make its closest approach to New England during the evening hours on Friday: perfect timing to make Independence Day there a washout.

As a result, Fourth of July fireworks will now take place a day early in Boston. Rain should clear out early enough on the Fourth for holiday celebrations in Washington, DC, to continue as planned. The weather will be a bit more borderline on Friday evening in New York City, but the current forecast should still allow for evening festivities. Arthur may also pose a serious threat to Nova Scotia and Newfoundland on Saturday as it transitions to a powerful extratropical cyclone.

This radar animation from Weather Underground shows Arthur’s progression over the last few days. Rain showers were already reaching the coast on Thursday morning:

Source article:  

What You Need to Know About Hurricane Arthur, the July Fourth Party-Crasher

Posted in Anchor, FF, GE, LG, ONA, Radius, Uncategorized, Venta | Tagged , , , , , , , , , , , | Comments Off on What You Need to Know About Hurricane Arthur, the July Fourth Party-Crasher

Obama Calls for a New Crackdown on Wall Street

by SebastiFowlkes Posted on July 3, 2014

Mother Jones

<!DOCTYPE html PUBLIC “-//W3C//DTD HTML 4.0 Transitional//EN” “http://www.w3.org/TR/REC-html40/loose.dtd”>

On Wednesday evening, President Barack Obama called for a new Wall Street crackdown, noting that more than five years after the financial crisis, banks still focus too much on gaining profits through often risky trading, instead of investing in Main Street America.

“More and more of the revenue generated on Wall Street is based on…trading bets, as opposed to investing in companies that actually make something and hire people,” the president said in an interview with Marketplace host Kai Ryssdal. He called for “additional steps” to rein in the industry.

Obama’s comments Wednesday represent one of the most pointed critiques he has made of the banking industry since he took office at the height of the financial crisis, and suggest that he may use his final two years in office to pursue further Wall Street reforms.

The president singled out big bonuses as a central problem plaguing the financial system. Banks can still “generate a huge amount of bonuses by making some big trading bets,” he said. “If you make a really bad bet, a lot of times you’ve already banked all your bonuses. You might end up leaving the shop, but in the meantime everybody else is left holding the bag.”

He did not offer specific policy cures, instead alluding to the need to “restructure” how banks work “internally.”

The massive Dodd-Frank financial reform law that Congress passed in 2010 was supposed to keep banks from taking excess risks and prevent another economic collapse. Obama pointed out that much of that law has already gone into effect. Banks now have to keep more funds on hand to guard against an economic downturn or a bad trading bet, he said. The law created a new agency designed to prevent consumers from being duped by mortgage lenders, credit card companies, and student lenders. Last year, Wall Street regulators implemented a much-touted Dodd-Frank measure aimed at limiting the high-risk trading by commercial banks that helped lead to the 2008 economic crash.

But much is left to be done. Wall Street regulators have completed only about half of the banking rules mandated by Dodd-Frank. Scores of these regulations have been watered down by financial industry lobbyists. Congress has made many legislative attempts to weaken Dodd-Frank. Despite efforts to ensure that banks are no longer too-big-to-fail—or so large that their collapse would endanger the entire economic system—the largest banks are bigger than they were during the financial crisis.

Progressives fault the president for part of the lax response to the financial crisis. Under Obama’s Justice Department, for example, no high-level bankers went to jail or faced criminal charges for actions that led to the financial crisis. And liberal critics slam Obama’s economic team for focusing too heavily on bailing out banks after the crisis, and allowing the foreclosure crisis to fester.

It is unclear how Obama will push through additional Wall Street reforms. He has limited oversight of rule-making, and banking legislation is not likely to get through the current sharply divided Congress.

Continued:  

Obama Calls for a New Crackdown on Wall Street

Posted in Anchor, Anker, FF, GE, LG, ONA, PUR, Radius, Uncategorized, Venta | Tagged , , , , , , , , | Comments Off on Obama Calls for a New Crackdown on Wall Street