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What Would You Ask New Pecora Hearings to Investigate?

(Photos by Robin Holland)

This week, the U.S. Senate voted to support a new commission to investigate wrongdoing in the lead-up to the economic crisis. Bill Moyers asked economist Simon Johnson and legal scholar Michael Perino what they would want such a commission to investigate.

Simon Johnson suggested:

“I would want to understand whether the laws were broken in potentially predatory practices around the way the consumers were treated in the housing market and in the credit card markets recently… That question will reveal a lot of unethical behavior or a lot of behavior that we should be uncomfortable with and that will then lead, I think, to sensible changes in the laws. So, really digging into the micro details of who was taken advantage of, who was misled, how [they got] retired people into some of these esoteric financial products. And, of course, the selling of savings products also. We know that local governments, for example, were enticed into schemes that they really didn't understand. And, of course, it may turn out in the investigation that the banks didn't understand it either. But, going through [at] that level of detail and showing, you know, who made what kind of mistake, who was misled by whom, who misled themselves – that is going to give you the factual basis on [how] you could construct a lot of new, sensible laws.”

Michael Perino recommended:

“I'd add to it the role that the credit rating agencies played in this entire process. Particularly in the creation of these derivative instruments. It's an industry that I think is not well understood on Wall Street. I think there has been some reluctance to dig into exactly what's going on there, and that's something I think I'd want to take a hard look at.”

What do you think? In examining the causes of the economic crisis, what would you ask a new Pecora Commission to investigate?


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Comments

Nlf, again, "Did you comment on this when Bush was in power?"

You betcha!

I challenged, too well, the moral arguments hooligans were making in "religious" circles...the better the argument I made against "war", the quicker those WORDS were snatched up and used by havelina pigs as a moral case FOR war. One big Dilbert cartoon, the bloviators...they could never come up with what they do on their own...

I am not the enemy, Nlf. But the mixed blood that flows through you will not allow you to see who, or what, is REAL.

Stop stalking me. Offer your opinions without getting personal. I started talking to you to help. I'm very sorry I did. If face to face, I would have probably sensed your amorphous hatred and not stepped into it. Shame on you for acting like you were a nurse.

USA has the largest jail population in the world because everyone is coming here with way too many issues - always was that way...from the very beginning....not the best human stock and the nasty original criminals have been here the longest and that's why they have so much $$$.

It's a problem. As a first generation USA citizen, I am horrified by the history and am seriously considering getting the hell out of hell. Native Americans on a war path, African slaves ganging together, vicious cretin "money lenders", Roman back stabbers, and on and on...sex, drugs and bullets....money money money...

I am convinced my people must have been from another planet altogether...we need to decide on a place and all go there together to have something resembling culture and civilization again...not sure with 7 billion people where that could be on earth...no wonder why we keep indulging in the urge to built rockets that can leave the planet :-))

Anna,
40 billion for war!!.

Did you comment on this when Bush was in power?
In an illegal war.

I am delighted to see, somewhat belatedly, that the show took up an examination of this hugely important public servant and the manipulations that were common on Wall Street at that time.

The contributors have recommended a very narrow scope of activity for the New Pecora Comission. This is a shame as there are much larger issues to be addressed, like Naked Short Selling (ie selling stock that was not owned or legitimately borrowed, thereby creating counterfeit shares). This particular form of manipulation has eroded property rights, destroyed development stage companies, and financially harmed the owners of the shares subject to the manipulation. For more information please visit www.deepcapture.com.

Focusing on the rating agencies and the lack of consumer disclosure in mortgage lending is pablum...let's focus on the big stuff and follow the money.

New 'Pecora Commission' being formed: Help Democratic Leaders 'Name the new panel'
http://crooksandliars.com/john-amato/new-pecora-commission-being-formed-help

I already wrote an email to the site about this but I'm really surprised that Mr. Moyers hasn't challenged Simon Johnson on his role as former chief economist of the IMF on any of the policies he called for for "developing" countries. I guess when it's not America it's not important? Well, the rest of the world is quite used to crises.

Like I said in the email, he should have Simon Johnson and Joseph Stiglitz on together for a conversation.

There was a past American President (can't remember his name) who basically said, the only thing America need fear is when Big Corporations become so powerful, their interests are more important than American Citizen's. That is exactly what we are seeing happening in America. Bank CEO's, Big Phar Corporations, Monsanto etc. are able to get people in positions of political power or influence and with out proper regulation, get their agenda's in place to defraud America. Government needs a big over haul, we need people in political power who are ethical, have integrity and are not bought by Banks and big Corporations.
The wolf isn't at the door, it owns the door.
PS Bill Moyer, if you want to investigate an even bigger crime (one that is agaisnt humanity) look into what Monsanto is doing with their genetically modified seeds: soy, wheat and corn. They know it causes cancer and they still brought it to market without the FDA (which is bought) looking into the scientific research which proves it causes mutations and cancers to grow. 75% of all processed food has genetically modified seeds and cattle is feed it also.
Go to this website:
http://www.seedsofdeception.com/Public/BuyingNon-GMO/index.cfm
and interview the author Jeffrey Smith of Seeds of Deception.

1. Do not presume the laws are the correct basis for judgement.
2. Reseparate 'investment banks' from 'regular banks'. FDIC protects reg banks. Investment banks should take risks but risks with real consequences.
3. S&P, Moody's are hugely at fault for improperly labeling the mortgage backed securities...that was a real crime.
4. AIG and similar insurance co. can never be big enough to cover that much financial risks...only Uncle Sam can do that ---as we are finding out the wrong way.
5. Since the risk can't be covered then the banks would have to be more prudent in their investments
6. The Treas. sec. should not be able to come from Goldman Sachs....

"Follow the money",
and
"What did you know & when did you know it?"

Shades of Watergate-but then
Congress wasn't up to its eyeballs in the scheme! So,
don't expect any real hearings from Congress.

Great program BILL.But all an all it is the same shell game and big name con artist and their buddies in government alway,s play with middle/poor class people who pay all the bills and donate the most time and money to charity and are the backbone of this once great country.We need big change alright like a new party the democrats/republicans have had over 200 years and still can not figure it out.Bye the way we the people give president OBAMA an F- grade!!!!

The Perino/Johnson discussion was excellent, as I expected, and I learned a lot. (I had never heard the name "Pecora" before.) I was disappointed, however, when Johnson (and Perino, too, I think) talked about breaking up the big bank-like institutions into "boring banks" and "risk takers". Professor Johnson talked about the need for entrepreneurial investment, as if that is the type of risk that these institutions engaged in. In fact much of their risky behavior was nothing but naked gambling. There was "creativity", for sure, but it was (and still is) the creativity of Ponzis and Madoffs. Don't get me wrong; I'm not opposed to casino gambling. I've dropped a few quarters into slots in my day. But when you're talking about breaking up mega-so-called-banks, they need to be broken into three, not two, pieces: 1) boring bank; 2) capital investor; 3) gambling casino. Then don't EVER again let anyone believe that the taxpayers will cover those gambling-debts-gone-bad from the "creative" instruments that the Type 3) bankers-cum-pirates invent.

The Last Temptation of Risk
by Barry Eichengreen
http://www.nationalinterest.org/Article.aspx?id=21274

Sorry re the error below. The "insured" amounts by CDSs as best I can remember (?) equalled a sum equivalent to 104 $700 billion bailouts.

Good one, John Q.

We also need pie charts that break down all mutual funds etc with what percent of same ='d the sliced&diced mortgages. There also needs to be a flow chart of how the actual mortgage payments find their way back to the instruments they wind up in (otherwise we are talking about things we have no inkling of). There also needs to be an illustration of who bought the credit default swaps ("insurance") and how much of the bailout has gone to pay'em off. I have been reading psychology for a few weeks, and have forgotten the estimated "insurance" represented by outstanding CDSs before the crash. Was it in the 70s of trillions? I just remember I calculated it equalled 104 700K bailouts.

"New Pecora Hearings" I would hope could do a job even better than Pecora. After all, we now have PowerPoint etc. To generate the outrage what's outrageous will have to be described, and it's probably more complicated this go round.

Richard R. Palmer: Elizabeth Warren is a "too nice" woman and not a sufficient critic of our business system to advocate real reform. I recall how she was obsessed with bad credit card etiquette (high and rising interest, jumpy billing periods, issue to teenagers and insolvent) on her Moyers visits. She did admit that wages had been depressed for 30 years, but offered no solutions. She comes from Harvard like our President. These people tend to be impressive in the storefront window and disappointing down on the street. Their connections (how they came up) are an insurmountable handicap when it comes time to get tough on the privileged classes. (What is America if not the Lux-Life clamor, the "success ethic"?)
You said it yourself in relation to journalism: wealth envy co-opts. If Senator Dodd is in a rich man's pocket we need to de-pants the big man, not offer Senator Dodd a stipend. Like a K-street lobbyist he'd probably accept both offers, and feel the wiser for it. There is no remorse in Congress without handcuffs.

Maybe humanity has outgrown the advantages of capitalism. If we are refusing to examine such a possibility we may be sealing our doom. All the hints are plain to see. I find that those who call all alternatives degenerate socialism are themselves would be predators (masters and their macoutes) who don't want the law restricting their happy hunting grounds. People forget the expedient reasoning behind the illegal (hollow treaty) seizure of aboriginal lands, the very lifeway of distinct nations. Change had to come in one form or another; too bad it was often unjust, violent and environmentally destructive. (Hindsight is clearer.) Maybe the days of global corporate capitalist business have expired, not due to mass reactive violence as Marx predicted, but because Earth is tamer and sicker today, and our lifeboat is shrinking. To me our Libertarian ideals are majestic and beautiful, but out-dated and unrealistic under present circumstances. The skunk odored bear skinners don't mix well at the museum reception; unless they are the exhibit.

Pecora worked nearly 75 years ago, and he accomplished relatively little that endured. Now business is global and beyond Congressional purview. Don't look to the mythic past for pragmatic salvation. People probably need to become disobedient to undermine counterproductive interests. If the Internet has any utility in this regard it is to negate intellectual property rights, to rob the overlords in their profit cribs like rats on corn. When I imagine the bit-torrent piracy all around the world I laugh and shirk the "New World Order." Capitalism is coming down like a great redwood with the fall notch already cut and the saw dragging away remaining cross-section. I hear the echoing shot of the snapping hinge. Timber! Get out of the way! Which capitalists will run under the shadow only to be crushed by the irresistible weight? It is up to the people to prepare for the coming sunlight. The canopy of hierarchy is opening and the fertile land is ours to cultivate. (Pray for organic vegetables and a network of interconnecting trails. We're gonna cooperate for awhile and let competition relegate to a hobby.) Inculcate the young with hopeful vision and egalitarian dispositions.

Note: I recall working for Eugene Henry Reitzke in McClean during the Watergate Hearings. he didn't complain when I neglected his affairs and memoirs to watch John Dean or Samuel Dash. (It was on the networks daily.) He told me about the flu pandemic of 1919, how only he was spared in an extended California orange growing family. He now owned much od Ratheon and capital Cities Broadcasting. Henry spent his last able days in his telescope observatory photographing our Universe. "Don't get hung up over Watergate and the dignataries at our garden parties," he would say. "It will all pass away, and in yor lifetime will be a new world oldsters like me could never imagine." Odds are he was correct. (He was confident of that.)I opened my wallet just now and laughed about the $2 bill he gave me. ("It'll help you recall the United Stares," Henry said, "someday when it is a myth like Camelot.")

Captcha: 10 laming

Vernon J. Vander Weide:
Thanks for sharing your experiential insight which only goes to confirm out direst suspicions. Did you ever meet Michael Greenberger, another former attorney-regulator? (Now teaching at the Univ. of Maryland-CP) He corroborates much of your testimony. I beg to differ that campaign finance reform would be sufficient to reign in business corruption. Now it has become a global problem, beyond US statutes. I'd say the Derivabanksters are in a league equivalent to Somali piracy, making the rules of engagement as they proceed. Capitalistic tendencies have been nurtured for too long and too well under the force of law that favors wealth-power. It is not too late for even lawyers like you to get an imagination and embrace people power. Why should human rights be bound by limits not applicable to "business"? Don't you owe humanity something for your advantages? I can't believe your august name alone (Is it really Vander Weide?) was responsible for your successful career.

Forgive my tone: Sometimes I sound like a Betsy Whitfill-Anna D. hybrid. (Moyeristas!)But remember that my attitude possesses one great advantage: It is correct.

Captcha: erodes Mdwst

Wayne Coady: You old canuck, you'd enjoy Michael Parenti's book "The Assassination of Julius Caesar." It parallels just what you said below.

captcha: diaz 15-day

I was waiting to see if anyone in the press or media would bring up Pecora...and Lo and Behold! Moyers came through!
I will await the book, too.

But as to the likelihood that there will be effective hearings, or adequate coverage: I doubt it. (Can one imagine the soaps being interrupted for congressional hearings these years of the networks?) My basic beef with the media now is that most everyone who offers opinions or manage media are overpaid, and identify with their corporate managers, and the rich. (Nobody an ink-stained wretch out of "Front Page.")

Elisabeth Warren knows the issues, has the right attitude, and would be excellent -- but OOPS! isn't male and would not be taken seriously...

As to reform: beginning with Chris Dodd, the congressional leadership is in the POCKET of the modern Malefactors of Great Wealth.

Your Bill Moyers Journal program last Friday, April 24, 2009, was very interesting. As an attorney who has worked in the securities regulation and litigation area for almost 40 years, including six years on the staff of the SEC, I’ve had close to a front row seat to the evolving regulatory environment that resulted in the worst financial crisis in 80 years. I read and listen to every discussion of the causes of this crisis that I come across.

Nothing in what I’ve read and heard addresses what I believe are two important causes of what happened: the federal judiciary and those organizations whose business is to cater to the retail investor. With respect to the former, beginning in the early 1970s, after a couple of decades of expanding investor protection under the federal securities laws, the United States Supreme Court issued a series of decisions under those laws that significantly eroded the investor protection ostensibly provided by such statutes. This set a tone and environment for the entire federal regulatory system in which the new deregulation pure market ideology flourished.

At the same time, organizations that largely depend upon the individual or retail investor sat silent and failed to challenge the pernicious conditions that began to dominate the markets and pervert the regulatory structure. These include mutual funds and their trade association, the Investment Company Institute, and brokers whose retail “financial consultant” business was just as important as their investment banking business (e.g., A. G. Edwards). For example, when the SEC and CFTC did make some timid efforts at regulating hedge funds and derivatives and met with strong opposition (including from Congress), these organizations said nothing, even though it would seem obvious that regulation that protected the markets for the benefit of individual investors was also in the long-term interest of such organizations.

I agree with Simon Johnson on the likelihood of real reform. This too will pass, just like the crises fomented by LTCM in the late 1990s and the mortgage-backed derivatives fiasco in the early 1990s and the unregulated leverage that permeated the markets that many astute observes repeatedly warned about. Your commentary at the end hit the nail on the head: campaign contributions. Until we can extricate Congress from the financial services industry’s pockets, there will be no reform, and we will continue to suffer from repeat episodes.

You will recall that a massive infusion of cash into the Obama campaign was attributed to “grass roots” supporters contributing their five, ten and twenty dollars via the Internet.

Everyone bought that explanation without questioning. For that matter, how does one prove or disprove this statement? The reality is you can’t …and no one wants to be the first to dispel the fairy tale that a hope-starved nation was ready to buy … hook, line and sinker. This is exactly how it was that Obama’s presidency evolved … replete with Oprah’s anointing.


African Americans, of course, are ecstatic that “one of their own” could ascend to the highest echelons of power in their country of residence … that has harbored such a dark, and violent history for their race. Imagine, a black man as the supreme leader of a country where others of the same race have been denied so much … and continue to be denied.

The privations and oppression would end with “one of our own” at the top.
This is a script right out of Hollywood … if Hollywood were still capable of producing quality product .

Now, for those of you who have been around for the last fifty or more,or have a good grasp on history ... I want you to think back to the evening newscasts that came out of the U.S. in the days when black Americans, fed up with being third class citizens in a country that is purported to be one of the richest in the world, finally blew … and hit the streets in Watts and other areas to burn and loot in a rage of protestation that left authorities cringing while they witnessed police cars being overturned and burned in the streets. In fact, those “leaders” were beyond any capability to lead during those riots, if indeed, they ever were. An out of control mob, hell bent on destruction and driven by two hundred years of oppression and denial is next to impossible to calm. Paralyzed by abject fear, those charged with upholding law watched helplessly as businesses were first looted and then burned to the ground as kinetic rage joined opportunity.

Fast forward to the human degradation spawned by “Katrina” in New Orleans and environs, and, once again we saw what happens when apathetic leaders were unmasked … ineffective and incapable … evidence again of the fragility of leadership.

The crisis in the United States economy today is the scaled up equivalent of what happened in New Orleans, with implications far more damaging than even the so called experts can ever know. Greed and mismanagement and a complete lack of political will … coupled with the fact that governments have become subservient to organizations they should be controlling through well considered regulations are responsible for what’s happening right now.

Those authorities claiming they did not see the current economic mess that is the United States,are unadulterated liars. This is the nation whose successive administrations have manipulated its people into wars so profiteers could benefit and allowed the real assassins of two of its political powerhouses, the Kennedy brothers, to remain free. And that’s not counting all of the young men and women who went to their untimely deaths in Vietnam and the Middle East … so elitist sleaze like Dick Cheney and Donald Rumsfeld and their confreres could plunder and profit with impunity.

So it was that the affable and well spoken Barack Obama was manoeuvered into the presidency of a country that likes to bill itself as “the most powerful nation in the world”.

Considering all that continues to roil on Wall Street and the repercussions that continue to emanate outwardly, the working classes, a large percentage of them being African Americans, should have rioted in the streets throughout America as they lost jobs, homes and their humanity. But they haven’t and they won’t … as long as they continue to believe in their president, a brother, who has treated them with respect when he comes before them as their leader and tells them there are better days ahead. No one hears his qualification that it “may take time” to get the country back (or words to that effect) and the implication is they should trust him. Yes, Obama the man, is worthy of respect and deserves some time to make the changes his country needs … but, the fact of the matter is Obama is only flesh and blood like all of us. This goes against the American psyche that their PRESIDENT is some sort of God, but, the reality is he does NOT act alone … and his power is not absolute. Even Hitler and Stalin eventually met their match. Stalin succumbed to his own mortality… as Fidel Castro eventually must.
In Hitler’s case, he was at a point where he should have been taken out by his own countrymen if fate (and poor planning) had not been on his side, but, he too, could not beat the odds forever.

Certainly, this is why John F. Kennedy and his brother, Robert were assassinated by others who were out to enunciate that their power was not absolute, nor were they invincible. Their deaths proved they could not, on their own, change those things that money and power do not want changed. Similarly, Barack Obama has not been blessed with divine powers to change the status quo.
Pundits have lately expressed that a second American Revolution is nigh, if not overdue.

Can it be that Barack Obama is the unwitting “Uncle Tom” who is being used to give people a semblance of hope … while he is being used to keep a lid on the potentially explosive powers of unbridled mobs whose breakout could foment total anarchy in the United States?


Simon Johnson and Michael Perino made an excellent combination for both the history of economics and the current economic situation.

"The true lover of knowledge naturally strives for truth, and is not content with common opinion, but soars with undimmed and unwearied passion till he grasps the essential nature of things."
Plato

The essential nature of economics is the efficient exchange of goods and services to provide the needs and desires of the people of any and all societies.
Economics is not a plaything that depends on whim, chance and random foolishness.

I don't like to use Facebook, Terrence. Please feel free to contact me directly via e-mail at butch112247@yahoo.com

Pura Vida.

Wow, TFB! So Rupert Murdoch is gonna protect your privacy better than yahoo or gmail. I share my email on here frequently but rarely get a reply. Do you think some Moyeristas are really macoutes or will the USA degenerate to Chinese tactics as the cascade failure continues its relentless implosion.

Aphorism: "I was sad that I had no socks until I saw a Walmart that had no fabric softener."

Paintings swops

To anyone who has Facebook, I can be reached through my page there.. Terrence Finnerty Burke.

I'm reluctant to post my email address here, but happy to keep discussing this basic issue of... getting to the basics of this issue.

I appreciate discussions about the details, but fundamental questions are in play, such as those raised by Johnny Rocket, and others...

I don't believe in the right of one person to live off the labor of another either really. That makes me a "communinist" I guess, but I never read Marx... I just think it is common decency that people should share, not seek to exploit, one another. I also think it makes more economic sense... with all this concentration of wealth in the (heavily armed) hands of such an obscenely small minority, how can anyone claim this is "efficient" or that what we have constitutes a "sound economy?" Like joseph dussourd points out... how can anyone buy anything if they are basically always in the hole? Jeez... isn't it obvious??? The rich HAVE TOO MUCH.

This is the 600 pound elephant in the room, and what all this veiled reference to the dangers of "populism" and "witch-hunts" and "over-regulation" refers to I assume. These guys are NERVOUS that the bottom of the heap is starting to get sick and tired of their pompous high and mighty talk about what can and can't be done.

Mr. Bill Moyers, thank you for being a journalist with the integrity to host a discussion like this one. If I had one suggestion it would be to open the door a little wider, and seek to give a space in the discussion for those who have no résumés, who aren't rich or work as mouthpieces and apologists for the rich, those at the bottom of the "economic ladder" (what a stacked metaphor THAT is!) who are in fact the real subjects of this discussion.

We, those who make less than say, $40,000 a year, are the majority. We are the victims of fraud and abuse, and good-old-fashioned INJUSTICE and we are shut out of forums because we don't say what the owners want to hear. Who was it that said something like "if we deny the majority the means to participate democratically, we leave them no option but to rebel." Whoever it was was right on.

I'd take it further: Enough of this assumption that someone has the RIGHT to be in a position to allow or deny me or anyone from participating, as if it were an option, a privilege. It is my RIGHT to participate in the discussion and decisions that affect me, and this attitude that someone has some kind of right to decide if and how I get to do that is, well, can I say, Anti-American?

The true, real minmum wage is closer to 64 grand per annum, not ten bucks per hour. I wonder then, if capitalism and the middleclass can be rescued. Where are the salary bases to come from? Who's going to buy and who's going to sell? Can I save the planet if it will cost me my livelihood? If I keep my job, who will have to forfeit theirs? These are the questions that need asking.

re: "Please feel free to ... contact me if you would like to continue our discussion"...

How?

and add to the discussion: without real PUNISHMENT of the rich and powerful lawbreakers, our laws are meaningless

also add: if the results of our society are grossly inequitable, the law itself is unlawful

There seems to be too cozy a situation between Tim Geithner and the banks. He got too cozy with them when he was head of the NY Federal Reserve (those banks essentially own the Federal Reserve). Agreeing with the statement that the banks control Obama, it's obvious that they're doing it through Geithner. This all was planned in advance by the bankers, with full knowledge by Geithner. They knew they could pull Obama's strings and get US (the taxpayers who "insure" the Federal Reserve) to banks (too big to fail) without any risk to themselves, their profits, their salaries, and their "retention bonuses".

During the Congressional Hearing (7/04), the regulator was called in (Alfonzo Franken Jr.) and testified that Fannie was issuing bad loans. Why was that not pursued, and why was it so partison? It seemed that the Democrats supported Mr. Raines til the very end while the Republicans used the regulator's analysis. What happened to all of that?

In reply to Richard... I agree. In fact, I was saying as much in this poster that I made in 2003!

http://la.indymedia.org/uploads/2008/09/wallstterror.jpgbegjld.jpg

If you like it, you can download a pdf and print it here:

http://la.indymedia.org/uploads/2008/09/wallstterror.pdf

How is this different than terrorism? Unleash WMD on the economy and country/world. Threaten to further destroy it unless a huge ransom is paid. Leave the perpetrators free to threaten again.

(Responding to Roger's post, below)

Hanna's argument that business owners are generous to provide employment to others is absurd.

Those whose avarice exploits the labor of others frequently seek to soothe their troubled consciences with such drivel.

Those who profit from others' toil at minimum wage (the least compensation possible without committing a crime) and without health care are happy to embrace this silly fallacy.

It's easier to exploit the labors of others when one believes that allowing them the privilige of working for him is itself an act of supreme generosity.

But truth is truth. Those who do not labor themselves, but merely accrue further wealth generated by those who work for less than they deserve, are simply parasitic.

That is certainly not to say that business owners are bad people. When governments fail to provide the public with jobs, vital products, or necessary services, the opportunity exists for wealthy investors to fill the void.

But extracting a profit for something that should have been provided by the government is hardly an act of generosity.

Some people start businesses with the purpose of improving society. But most simply seek to profit, and to increase profits by compensating workers as little as possible.

That, in itself, is not a grand contribution to humanity. It is simply a means of increasing one's wealth.

And nobody who underpays his laborers has any claim to virtue thereby.

I would ask the Pecora Commission: Isn't the entire Wall Street stock market business nothing but a Ponzi scheme? Who's really doin who?

=
MJA

Bob Swan,

Here's a better law enforcement rule: "Follow the Bush's" (Prescott, Poppy, Jonathan, Dubya, Jeb, Neil, Marvin...). Seems like wherever these assholes go, trouble follows.

Poppy’s brother, Jonathan, worked for Riggs Bank. This bank has ties to the House of Saud and their terrorists.

Neil was involved with the ‘80s savings and loan crisis. A couple years ago, he and Rev. Moon were trying to get a tunnel (Peace King Tunnel) built under the Bearing Strait to connect Russia with Alaska (I’ll bet Russia and China would love this). And last year he was with Moon’s son down in Paraguay (probably an outlaw hideout, sort of like Riyadh).

From ’93 to ’00, Marvin was a board member for Securacom. Securacom was the security company for Dulles International Airport, United Airlines, and the World Trade Center. 9/11 occurred a little over a year after Marvin left.

http://www.margieburns.com/blog/_archives/2006/2/26/1784217.html

Why is it that no one talks about the real issue. That the Federal Reserve is a private company, not part of our government and doesn't have our best interest in it's agenda.

Terrence,

re: "Please feel free to ... contact me if you would like to continue our discussion"...

How?

//Roger

The rule of investigative pursuit is "Follow the money". The biggest money is in the very complex world of Credit Default Swaps, and the biggest flow has been in the direction of Goldman Sachs (and their affiliates in high places). CDS is a zero-sum game that once executed transfers vast wealth from losers to winners. The biggest losers so far: the taxpayers who support Bear, AIG, Merrill so that they honor the commitments they made to pay billions of dollars when toxic loans go bad. The important question the new Pecora hearing needs to investigate is to discover if the perpetrator of the toxic lending is the same organization that benefitted most from the CDS wealth transfer.

t,

butch112247@yahoo.com

r

Put Paul Volker as head of a Pecora Commission, and let them investigate what went wrong. Most may not realize that at its heart, this crisis is about the confidence lenders (private and institutional) have in the safety of a return; as such it threatens ALL the bells-and-whistles of go-go capitalism. I'd imagine the reinstatement of the Pecora commission is a start, warts and all.

Señor Don Roger,
Thank you. Sincerely, I can feel your heart in what you write.

I am interested in the book you have recommended, I will seek it out.

Please feel free to look me up and contact me if you would like to continue our discussion, I feel that this forum has another purpose, but it has been a blessing to meet you.

Thank you,
t

Terrence,

As an entrepreneur -- with a Christian-informed conscience, I might add -- I have benefited from Frank Hanna's book, What Your Money Means and How to Use It Well. Here is part of a review of it found at Amazon:

"Wealth creation: the second vocation of those with money," is a gem in this book and might even entice a buyer to pick up this book just to explore this chapter. In this chapter, the author opened up my mind to the responsibility and even the vocation of those with wealth-creating acumen to use their money to build wealth and provide work so that others can earn money to purchase the bare necesseties and fundamentals of life. In the midst of a deepening recession, there are fewer ways greater to be charitable to other human beings than operate a business that allows them to earn a meaningful income to provide for themselves and their family."

Here are other reviewer's comments...

http://www.amazon.com/What-Your-Money-Means-Well/product-reviews/0824525205/ref=dp_db_cm_cr_acr_txt?ie=UTF8&showViewpoints=1

Hanna's book, in my view, proposes sound biblical, as well as rational principles regarding wealth creation and the universal destination of goods. In this regard he approvingly quotes John D Rockefeller:

"The best philanthropy, the help that does the most good and the least harm, the help that nourishes civilization at its root, that most widely disseminates health, righteousness, and happiness, is not what is usually called charity. It is, in my judgment, the investment of effort or time or money, carefully considered with relation to the power of employing people at a remunerative wage, to expand and develop the resources at hand, and to give opportunity for progress and healthful labor where it did not exist before. No mere money-giving is comparable to this in its lasting and beneficial results."

All the best...

//Roger

The banksters and hedge-hogs are still writing derivative contracts, as I write this, and -- thanks to taxpayer largesse -- collecting every day on lunatic bets that should never have been permitted to parties with no insurable interest in the deals.

Our president and Congress have done nothing to stop or even regulate this daft practice. They merely murmur of creating a voluntary "clearing house" -- as has been inconsequentially murmured for two years -- while they continue charging us to settle these contracts as if they were sancrosanct. Funny how other contracts aren't treated that way -- if, say, they have to do with workers' wages, retirement benefits or credit card terms.

Definitely fodder for our new Pecora, if only we could get one.

http://www.deepcapture.com/category/data/

http://www.deepcapture.com/government-accountability-office-gao-response-to-deep-capture/

arrest jim chanos, john mack,hank paulson,ben bernanke,barney franks chris dodd,pelosi,cantwell,
jim cramer,the cnbc crew,
raid the dtcc and seize all the documents. arrest ms schapiro,cox,nazareth,force all broker dealers to submit all ex-clearing data,stop protecting those with "juice" release information regarding bear stearns and lehman brothers, you get the picture???? put the heat on keep it on and lets get those responsible to face justice...if there is any justice left.

Osama bin Laden's stated goal was to destroy the US economy and thereby undercut the nation's strength. The financial crisis is no less a terrorist act on the United States and it's allies. It must be dealt with as such. The guilt parties must be stripped of their ill-gotten gains and imprisoned as surely as they were terrorists. What makes them worst than terrorists is that they took all the advantages afforded them by the country and betrayed it with acts of destruction.

Johnson is on target. Everything in the financial system needs examination and redoing. At Harvard there was once a visiting lecture on the motivational virtue of "Greed". That principle has dictated every financial system (Public and Private). Use of "Greed" was raised to an "art form." 30 years ago the newly minted MBA"s gave it a pure name of "Creative Finance" which made it all an acceptable standard for the rest of us to seek after. It has destroyed us.

The government has done many moves that would have put us private business men in jail. Bernie Maddoff's Ponzi system was perfected by the US Government.

We need major change in this country
with what we "think." and believe.

Johnson is on target. Everything in the financial system needs examination and redoing. At Harvard there was once a visiting lecture on the motivational virtue of "Greed". That principle has dictated every financial system (Public and Private). Use of "Greed" was raised to an "art form." 30 years ago the newly minted MBA"s gave it a pure name of "Creative Finance" which made it all an acceptable standard for the rest of us to seek after. It has destroyed us.

The government has done many moves that would have put us private business men in jail. Bernie Maddoff's Ponzi system was perfected by the US Government.

We need major change in this country
with what we "think." and believe.

I want to investigate how 10 billion dollars a month for "war" without end can be paid out without closing down more businesses and throwing more people out into the streets.

With "debt" being at 40% of GDP, doesn't that mean that 40% of the people need to be robbed of EVERYTHING that they ever had or ever wanted to work to have?

And because we are a bottom-up society where LOCAL government is how we rule ourselves, 40% of people without jobs, businesses, credit, etc. also means that 40% of our cities, towns and villages will be empty of people so there goes the tax base.

I agree with Johnson about examining predatory practices and whether those practices broke the rules of the laws of the jungle. Let's level the playing field and have everyone play by the same rules.

One commenter said I may have been too hard on Mr. Perino for his failure to bring the Chicago Plan into the discussion of the 1930s parallel to our present situation.
By way of explanation, most history books of that era find the Chicago Plan was the designed as the greater and more elementary of the new contructs to finance and monetary economics, with the Glass-Steagall and other reforms the lesser.

That being the case, how can we not address today the threshold issue of the Chicago Plan - that of government CREATION of the nation's money, rather than the private bankers who are today telling the government to F* the heck off or they will trash this puppy, and the government will be to blame.
The result: Obama the deer frozen in the bankers' headlights.

When are Americans going to wake up to a certain reality?
It is OUR money system.
The nation's money system does not BELONG to the bankers, domestic nor foreign(IMF).
We had a Revolution, remember?
Unfortunately, all of that money-power control of our political system they discussed resulted in the government's 1913 transfer of control of our money system to the private bankers.
And they brought us HERE.

You cannot expect Simon Johnson to present true reform methods for public consideration. IMFers don't do that.

Mr. Perino boldly raised the historic actions of the Pecora Commission as an example of the type of investigation that is needed to answer the truly threshold question: How did we get here?

To me, if you don't google the paper on How Debt Money Goes Broke, and Treasury System versus Federal Reserve System, we will, after great struggle and incredible taxpayer theft by the banks, end up with a modern version of Glass- Steagall, from which we can begin again.

I am with the Ghost of Soddy and Fisher, and with other scientific teachings on the monetary system. We need the Chicago Plan for Monetary Reform, not bank bailouts.
Let banks get back to banking.

"What do you Terrence PROPOSE is the right thing for a just and compassionate society to do for the under privileged?"
-Roger Miller

OK... I just got it, what I want to say...

The question is one of ENTITLEMENT.

We as a species live under an ethic in which this question is settled in terms that define who is entitled to what, and the cards fall as they may from that central point.

The concept of OWNERSHIP is what determines who is entitled to the benefits of living free from hunger and the threat of destitution.

I propose the un-proposeable Roger... "a just and compassionate society"... exactly.

I propose that the central point from which entitlement is determined be moved from ownership to something you might call COMPASSION.

I know... I said it was un-proposeable, so why bother going on... I can hear the din of the brilliant realists and pragmatists as they hurl their critique at such a Pollyanna-ish idealistic idea... "the poor and the weak will always exist, it is the law..." blah blah, blah.

OK... so be it. But PLEASE do not insist on calling yourselves moral. Or Christian or Jewish or Muslim... call yourselves what you are: selfish.

And cowards. Because if there was a shred of Christ in you, you would rather give than have by privilege. You would rather die than kill. You would rather do anything than to know that a mother starves as her infant sucks on her loving breast. These things are obscenities. But the system of entitlement, the "ethic" if you can call it that, dictates that we accept these things and "move on."

So... you can take this as you will. To gain a PhD in this culture, by definition one must eschew the pursuit of silly ideas like I propose. To struggle to overcome selfishness is a fool's errand. I am therefore more than proud to call myself a FOOL and walk away.

The writing is on the wall for all of the geniuses of the established order... the logical conclusion of their "realism" is total destruction and ruin. Yeah... "The End Is Near" and all that, but don't believe me, go look at a crumbling glacier, a contaminated aquifer, a hundred million desperate refugees... Then tell me who is being "realistic."

The un-thinkable idea of displacing the current ownership of the entitlement to life with dignity and the security of freedom from desperate want from the idea of PRIVILEGE BY OWNERSHIP to one of COMPASSION is an idea whose time HAS come. I pray for the day when they give PhD's to those who have made it so.

Here is the answer! On Nov 4
2012 America votes for all the poorest candidates running for all offices in the government starting with
the office of President down
through the Senate, Congress,
limit campaign funds for all,
no one would be a puppet to the almighty rich. Then we
would reinatate all the laws,
rules, and regulations. The
candidates should run their
campaigns on the internet
and have their debates on
public television.

Investigate insider trading,
stock inflating, tax evasion,
start at the top and work down to the triple A rating companies, the brokerage firms, real estate holding
companies, all owned and
driven by the big banks and
the AIG's

re: "Thank you for having Mr. Perino and Mr. Johnson on your program. They are among the clearest, reasonable and enlightening people I've yet heard discussing the whole of the financial crisis, especially distilling into easy-to-understand language the issues and potential solutions and realities of reaching solutions to this terrible situation for millions of people in our country and around the world."

If you liked Johnson and Perino, watch In Depth with Dr. Robert Higgs at Book TV on C-SPAN 2 http://www.booktv.org/program.aspx?ProgramId=10300&SectionName=In

I agree with both of your guests, Mr. Perino and Mr. Johnson, that hearings should be focused, and conducted without scapegoating any individuals or organization. The hearings should begin immediately, and be thorough, and whatever authority is constructed to operate the hearings, they should have extensive subpoena power. Hearings should be run by independent, and well-qualified individuals, such as Elizabeth Warren, and not Congress. They should investigate the credit rating agencies, and their obvious conflicts of interest, the mortgage practices of all of outfits, big and small, including the wide-ranging state laws and regulations, some of which allowed serious unethical practices to take place, hurting many people and families. The credit card companies, too, should be investigated, because of their arrogant and under regulated practices.
I also wish to have investigated the loosely regulated cozy relationships between Wall Street institutions and the Washington power brokers, be they in Congress, the executive branch, or wherever in our government.
Thank you for having Mr. Perino and Mr. Johnson on your program. They are among the clearest, reasonable and enlightening people I've yet heard discussing the whole of the financial crisis, especially distilling into easy-to-understand language the issues and potential solutions and realities of reaching solutions to this terrible situation for millions of people in our country and around the world.

re: "No Amendment is necessary. Merely the political will for Congress to pass a Bill that will break up the mega-banks ... returning them to small, locally-managed banks that are fiscally-sound and 'boring' once again."

I forgot to include another crucial circumstance ... "Banks that know there will be no bailout if they screw up." This is part of what is meant by the invisible hand that operates in free, open markets.

re: "The spirit of the US constitution does not permit this. We need *a constitutional fix* that addresses the modern realities of corporate power."

No Amendment is necessary. Merely the political will for Congress to pass a Bill that will break up the mega-banks ... returning them to small, locally-managed banks that are fiscally-sound and 'boring' once again.

Simon Johnson hit the nail on the head when he cites the huge problems facing the super banks in Europe. He laments that they are not simply too big to fail but too big to save!!

We need not make this same mistake.

Ironically, after all the positive discussion about the regulations/laws that came from Pecora's investigations, at the end of the program Michael Perino quotes Pecora for this final take-home message: "Laws are not a panacea and they are not self-executing."

In the end, society cannot legislate morality; it can only propose what it might look like. "Locks," my grandpa told me, "are made for honest people ... not burglars."

What do you Terrence PROPOSE is the right thing for a just and compassionate society to do for the under privileged?

The key place to focus is on the loan packaging in collusion with the ratings agencies which then became the motor that drove this bubble to excess, turning it into calculated fraud on the part of just about everyone involved.

This is a clear case of pump and dump. (This was just a very elaborate pump).

The other place to focus is on how people who've made government policy (Rubin, Gramm) have returned to the private sector where they've made millions off those exact policy changes in this elaborate pump and dump scheme, in clear contravention of the common public good.

The spirit of the US constitution does not permit this. We need *a constitutional fix* that addresses the modern realities of corporate power.

Please, Bill Moyers:

Find someone to come in and discuss this issue with reference to the Constitution, and the ways that the financial sector is doing an end run around the "checks and balances" that we like to think we have--and perhaps once had, but clearly no longer do-- in the actual funtioning of our government.

In US constitutional terms, it's probably not unreasonable to say that we are looking very much like a failed state.

Sometimes--as Thomas Jefferson knew-- government must be thoroughly renewed. We are clearly in one of those times.

This is not a partisan issue.

Well... I am not too smart, or well versed in all the arcane details. I do know one thing. I depend on work to eat. I work hand to mouth. I get some money when I do a job. I spend it the same day on rent, food and gas, mostly.

The money I spend, the money I earn, where does it go and where does it come from? It comes from people who have money becuase they DON'T work a job to get their pay, they have INCOME. Oh I know... they work... but the work they do is to maintain their interests... it isn't the same. What they do pays and pays and pays. They OWN things... for what I do, I get a dollar and thats that. And the money I spend? It goes right back to the same people who paid me that dollar. That's how the game works. That's why what I call work and what they call work aren't even in the same language.

People ar divded like this all over the world, with most of us just making it day-to-day, month-to-month. We are not stockholders, we are not bankers, we are not owners of resources and commodities. Those things "belong" to some ridiculously small number of people who decorate their privilege with high-sounding rhetoric and language and justify their advantge with truisms about how people like me lack brains and initiative.

Well that's fine. But it doesn't hide the truth. Some people get the breaks because they OWN and the rest of us have to hope that these people will not let us die hungry.

My rent is three weeks overdue for the third month in a row. My landlord cut off my water today. I guess he thinks if he does that, I'll "get off my butt" and find a job. There IS no work, but hey... what can I tell him. Poor guy. He lives off my rent money.

If I don't pay in the next few days, none of this theoretical stuff I enjoy watching you PhDs talk about will be available to me anymore. I'll be literally out in the street.

I know what is going on here even if I can't explain it all in your terms. Privilege is beating the s__t out of me and millions of other people like me who don't own anything, We just work for a living, and that apparently doesn't mean much.

I hope you get it all figured out, with your debates over regulations and witch-hunts and scapegoating and the danger of over-regulation and everything. In the meantime, I'm out of food and just maybe out of doors till somebody needs me to do the next job.

In the spirit of "reflection and understanding" as Tom Shillock put it, consider economist Mark Thornton's provocative words about the upside-down world of Keynes:

Keynesian-style policies have resulted in disasters such as the Great Depression, the "stagflation" in the United States from 1970 to 1982, and the aftermath of the Japanese Bubble. Each lasted more than a decade. It would be far better to allow for an unobstructed free-market correction process. With no government safety net or bailouts, there would be more hoarding, faster deflation, more bankruptcy, and a speedy return to prosperity.

Instead of having two like-minded guests who practically tripped over themselves to agree with each other, why not have two guests with opposing views go at it and then let the viewers decide who presented the more credible argument for his/her side?

Why not indeed?!

This is a nice flow chart of the current financial crisis:
http://flowingdata.com/2008/11/25/visual-guide-to-the-financial-crisis/

I agree with a previous posting - the enormous "bonuses" self-granted to those in financial institutions was a reason to "retire wealthy before the House of Cards falters". That is the incentive that is not depicted in the flow-chart but wraps around it as a motivator. And that is why all the fraudulently acquired money taken over the last several years as "bonuses" must be clawed-back.

I disagree with Simon Johnson and Michael Perino that congressional hearings would reveal how the financial collapse happened. In essence, we already know. As Bill Moyers noted, the financial services industry was the largest contributor to political campaigns. In the mid to late 1990s, Rubin, Summers, Greenspan (Geithner?) and Bill Clinton prevented Brooksley Born from regulating derivatives such as credit-default swaps at the Commodity Futures Trading Commission. She argued that these risked bringing down the financial system. They knew that regulation would dramatically reduce profits and thus campaign contributions across the board for both Parties. In the late 1990s Phil Graham helped push through legislation that prevented derivatives from being regulated.

This explains the depth of the government rescue under Bush and Obama (over $12 trillion, including the ‘mere’ $800 billion TARP) not the utilitarian propaganda about preventing the financial system from collapsing. This also explains why hearings like Pecora’s will not happen this time no matter how high unemployment, unless of course it’s Kubuki Theater. That would be easy given the ownership and values of journalism and journalists today. Similarly, large campaign contributions from the medical mafia (insurance companies, pharmaceutical companies, medical products companies, hospitals, physicians) will preclude good health care for every American.. It also explains how silly it is of Johnson to place his hope for financial regulatory reform that will prevent a recrudescence of collapse on Obama. Who does he think hired Geithner and Summers and backs their outrageously oligarchic programs? Who does he think used Paul Volker as a prop for interest in independent economic and financial opinions? Obama has said nothing about how Bernanke has been bailing the oligarchs. Where does he think Obama’s massive campaign contributions came from? As Johnson himself said, the oligarchs won.

I was disappointed in Perino’s and Johnson’s bend-over-backwards desires to avoid blaming anyone, to avoid, as they so pejoratively put it, a “witch hunt”. As Frank Partnoy, a derivatives trader, has pointed out (cf his recent book FIASCO): “Today, when I am asked if anyone saw this crisis coming [he left in 1996], I think back to the people I worked with in the derivatives groups at Morgan Stanley and First Boston, and my answer is yes. We invented the products that ultimately blew up the banks. We created the instruments at the center of the subprime mortgage meltdown. We fostered a culture of epic greed, which nearly destroyed the financial system. Yes, we saw it coming. How could we not?” http://www.npr.org/templates/story/story.php?storyId=102325715

Historically, people serve the organizations that employ them because the aggregate interests of the members are best served by perpetuating the organization. But the outsized profits made on derivatives and the incentive structures led to financial organizations that served individual members at the risk of their institutions. Lehman, etc. became vehicles for the greater wealth of employees to the degree that it no longer mattered to them whether their institutions survived, they were so well off. In effect, employees shifted risk onto their institutions so they could rake in enormous amounts of money. Generally, the interests of individuals and their institutions were no longer aligned. That’s why the failure of large financial corporations does not imply that their manager and traders were stupid. Nor were they necessarily smart, just very lucky to be in the right place at the right time in the right way.

Finally, it is discouraging to hear a very bright and exceedingly articulate intellectual like Johnson glibly use the terms ‘right’, ‘left’ and ‘center’. Whatever descriptive political meaning these terms once had has long since been superceded by their emotive meanings. Using them merely reinforces emotions and reactions not reflection and understanding.

My question is: If it is too big to fail, then it has to be in violation of some form of Anti-Trust Law

This was a good program right up until Simon lauded Rockfeller, maybe he doesn't know that JPMorganChase is the family piggy bank. The only thing a new Commission need concentrate on is the Boards of Directors;Governors;Major shareholders of these said finacial institutions, from there the house of cards will fall. As it is we citizens of the world are enriching the robber barons of all stripes, to continue this fuedal system masked as Democracy.

If people were to really comprehend the implications of what Mr. Black reveals, there would be bodies swinging from every lamppost up and down both Wall Street and Pennsylvania Avenue.


What Would You Ask New Pecora Hearings to Investigate?

Did the banks win, yes.

Did Wall Street (brokers, mutual funds, hedge funds) win, yes.

Did Insurance Companies win, yes.

How?

The US Federal Government now operates on a Ponzi Scheme by taking from the many (taxpayers) and giving to the few (those who work in the Financial System listed above).

This is born out by the top 1% and the top 10% now owning the same percentage of wealth as they did in the 1920’s which was the last time they fleeced America and “laughed all the way to the bank”

Even though the Federal Government Ponzi Scheme blew up in September of 2008, they still managed to keep it going by raiding the Treasury and by the Federal Reserve printing money to cover the bets of the Rich, both individuals and Institutions.

It should be said that the Congress for some time has stolen approximately Three and one half (3 & ½ ) TRILLION Dollars from the Social Security Fund. Of course they gave the SSA “IOU’s” and you know the IOU’s like the money printed by the Federal Reserve is worthless.

The Federal Government Ponzi Scheme was brought to light for two reasons:

First to gain access to the Trillions of Dollars the tax payers would be forced to bail them out with.

Second to have a reason to blame Social Security for the Federal Government failing to meet its obligations.

Your Government is about to allow your pensions to be destroyed along with your Social Security Benefits to disappear in the name of “we are broke and can no longer pay the tax payer that which they paid in good faith.

Save your faith for God and save what money you can because not one wave is about to hit but several waves called, Credit Card Failure, School Loan Failure, Commercial Real estate Failure, Car Lone Failure and there will be more failures not on the horizon at present.

Wall Street is not the solution but the cause of the shift in wealth from the 90% to the 10%. Wall Street causes every product and every service to go up in price by their manipulation of the price of both.

If the Steel Company could sell the Manufacturer the steel and the Manufacture could sell the can to the Food Processor it would be much less costly then having Wall Street biding the price of materials and services UP.

Wall Street makes people Rich who do no real work. They are like leeches sucking the blood out of Main Street.

Main Street is in fact the tax payers both blue and white collar who are actually highly skilled crafts & technicians men & women who actually make the decisions and make the products and provide the services.

Main Street has one problem and they are in denial of it to the point of fault. That problem is population growth and it is the reason why everything is more and more expensive.

The Federal Government and the Corporations will not admit to Population being a problem because whether by births increasing or by immigration the Government and the Corporation needs more people to continue the Ponzi Scheme in order to keep a failed financial system going.

What the Federal Government does not understand is they are headed for a cliff that will be life changing for the world.

It is only a matter of time before the US and China and India self destruct again and though no one will believe it, population will cause the earth as we know it to self destruct.

There is no point in the New Pecora Hearings to Investigate anything as no one will tell the truth and there are no consequences for lying.


I agree with Perino's recommendation, we need to investigate the derivative instruments (more specifically Credit-Default Swaps (CDS)). I would like to know how much money was involved and who benefited from them.

Plus, I think the commission should investigate Former U.S. Senator Gramm’s involvement in the deregulation of these instruments. If the Enron emails are legitimate, then Gramm should spend the rest of his miserable life behind bars.

As usual, Bill sums up the problem in his final comments. It's something we have in common with the ancient Chinese culture, a failure of the gate keepers. With all the private money flooding Washington, can we really be surprised ?

We have a rare opportunity to rid ourselves of a shadow economic system that has been allowed to exist in this country for 96 years, a private central bank in the form of the Federal Reserve System. We only had one economic recession in the first 137 years of our country and that was associated with spending to support the Civil War. Since the creation of the Federal Reserve in 1913, permanent debt and economic recessions have become an integral part of our economy. The founding fathers envisioned a credit system for our country and they, and their successors, fought unsuccessfully for decades to block a British backed monetary system controlled by a private central bank that has total control of the distribution of our currency and the associated debt generated to reward the private bankers who own the FED. Given the public's outrage at this point, we have yet another golden opportunity to end this plague of corruption for all time; or we can just pass it on to our children !

Sirs,

Very much enjoyed your conversation. Envy ya'll getting paid for what I do as compulsion. Licking wounds from the matrimony of my family to the oligarchs, I followed the trail to what my father would whisper when S-mom was out of the room full of commodes that make Thain's sound like a toilet. "Wyoming."

Funny, all the booty we were surrounded by came from a guy from Montana. So, a few years ago I went deep and found out a far greater story than Pecora's, not that he isn't great. Teapot Dome. We gloss it over in history class, ignoring the deeper issues.

My Smom's GUncle helped buy Harding the White House. They were buying the House before they chose their man. The details of how five oil men raised $8 million dollars in 1919, with the Unc as their Ways and Means Chair and shell corporation, distributing the untaxed profits in his favorite denominations, Liberty Bonds, is a great salve to my wounds. But learning he and JP ginned up the commie bogeyman with a classic one, two punch just in time to sock American Worker's over the head, as well as passing cash to Lenin as the power shifted to win AIC Baku, makes me more angry than amused.

Can't really recall all the sources that inform my two year quest to unhat the Wicked Witch of the West, but you guys have got to read "America's 60 Families." Ferdinand Lundberg. 1937. Out of print, but didn't the power elite snap them up. Expecting a roll call of honor, they found an indictment of oligarchs.

Winced when one of you lauded the philanthropy of Rockerfeller. Read the chapter on foundations. Skip out on two thirds of the estate tax and maintain the power our founders sought to weaken by preventing the concentration of wealth within a few families. Couldn't put it down. Must read. Thought you guys were on to something, but you still have farther to go. Love watching you go there.

BTW, thanks for sending me to the bank to see what the kids were up to. No one there. What's an old lady dressed as a pirate to do? So I took my shtick to the sidewalk and in five minutes was sandbagged by a "journalist" and two police cars lights flashing. Told me I didn't have to go, but warned me of liability for accidents that might occur. They convinced me. "Journalist" tried to get me to argue. I'm a fighter pilot's kid, no fool to authority.

So when I went to my car, they wouldn't let me leave. "I thought you said I could go." "No, we said you could stay." One nods while the other shakes his head. Had to give them the same info the clumsy infiltrator asked me for. Very peculiar that she kept giving me rational for it after I'd given it to her. Get better training, Judas. If they hadn't matched up, would have been calling Hubby. "Sweetheart, I took a run by the bank and I need you to bail me out."

That´s right....Titans of finance & friendly politicans. Echoes of the past will hunt us still...perhaps there is no one like Pecora in the 30s to take on the establishment. These wimps are watching their own backs.

Since the Great Depression, the names have changed but the game remains the same: use borrowed money to grab as much of society’s wealth as you can, then get out while the getting is good – before the debt pyramid collapses. A “new Pecora Commission” would no doubt find that most of what caused our current crisis was legal, however socially detrimental and ethically challenged. We need a fix to the system, not more Stalinist show-trials. The model for this is indeed the work of a group of the nation’s leading economists in the depths of the Great Depression. The results of that work were given voice by Irving Fisher - perhaps the best known US economist of the early 20th century and for whom, cynically, a working of G20 representatives in Washington DC last November was named - in his book “100% Money”.

This time, however, instead of allowing politicians like Richard Nixon to subvert real reforms like the Chicago Plan and its modern antecedent, the American Monetary Act (http://monetary.org) using money created by bankers for the purpose or contributed by their partners in crime on Wall Street, we need to insist upon real systemic changes – not the carefully managed dissipation of popular anger orchestrated by mob-master politicians in the pay of the criminals.

All through your program on Pecora, and the question who could prosecute an investigation of Wall Street, the financial industry and its connections to Washington, one name kept coming to mind ... Elliot Spitzer.

Sorry, I meant to write the younger versions of Stephen Rose and Robert Krowitch might have been able to help...were they around.

I can see there are many good suggestions here, but at this moment I must quit my scanning (from most-recent going down) at jobhed's post. Perino and Johnson's suggestions are good IMO.

The important thing to me is that citizens and students catch up with the findings. It's scary that no one seems to have a handle on how to make understanding these scams a desired media product. It may not be as impossible as has been said, however, in that understanding Obama's platform recently did become a desirable product.

Mike Perry's suggestions from my POV are good ones. Of course, one important thing is that gambling on assets one does not own should be broken down or explained to the masses in Pecora-style fashion. What is the big deal about explaining that some folks knew they could insure risky investments whereas we commoners had no idea this was the case? Can you still do it? [If they're try'n to sell the old "toxic" CDSs, I guess you can.] Put someone like Stiglitz or Michael Hudson or Kuttner or Greider or Simon Johnson on the panel [Johnson may be doing pennance but he nevertheless gets a lot said in a short space]. Put all of'em on the panel. Then these questions'll get answered. Someone then has to write it all up [like Gupta's "101" version of the "meltdown" at Alternet] so commoners can understand it (commoners do run Oracle aps after all). The younger versions of Stephen Rose or Robert Krowitch might be able to help with something like this too. I mention Rose in connection with graphic representations as the mighty internet has given us not squat (it looks like the last Mother Jones though is getting the message).

After that IMO we should get down to priorities no matter how much the professional symbolic analysts are forced to really re-think theory along with the rest of us: single payer health insurance; local food production; the inherent credibility of "the debt-monetary-system" (as also discussed by Doug Henwood); whether there should be any new nuclear power stations or none; and...ceasing blowback generating globalism, Realpolitik, and the beltway-MIC all of which augment terrorism in the first place. Do it in Congress if necessary. After all, it's now plain at this juncture that the way we dedicate our resources means not just the future health of democracies but literally their survival.

I would ask a new Pecora commission to thoroughly investigate campaign contributions and lobbying efforts by the financial industry over the past 20 - 30 years. This information should be at the forefront and laid out very clearly before the American people because it is at the foundation of the problem.

I think the genesis of "too big to fail" is that the banks own too much of our government to fail.

Isn't it obvious how captured our Senate and Congress is - beholden to election financiers. I am always appalled to hear how little our public representatives will sell out the public for - a few thousand in campaign contributions here and there - while passing on billions in lobbyist-favorable legislation in return, making them little more than dime-store prostitutes. They are the enablers of predatory capitalism, not productive capitalism, though they would never make a distinction between them.

Dear Elizabeth Warren,
Our fervent hope is that Harvard has better law professors than certain individuals from the MBA class it graduated in 1970.
Ask them about usury.
We wish you Godspeed.

Usury.
Described in detail in the Old Testament.
President Obama should challenge the oligarchs to the meaning of the word. Congress will, I hope, discuss with them what punishment should be meted out to the perpetrators and facilitators of usurious crimes in the United
States over the past 25 years and, indeed, the world.
Financial lobbyists and politicians: May God help you come to grips with the effects, the pain, the hardship,usury has caused on 95% of the citizens of the planet.
Before the bankers make threats about not being treated nice they should be quizzed on their meaning of the word usury.
Hank Paulson, MBA Harvard 1970; Alan Greenspan, PhD NYU 1970, 2005: Tell us the meaning of the word usury. Two prime individuals who should have showed up for class that day in high school when the term was discussed.
Bill Moyers, you do a great job and may you live forever.
Jim Daniero
Fresno

How does one question lemmings? Apparently all the investigations in the world are worthless and only futile attempts to quiet squeaky wheels. And, after this has passed...and it will...we will go back to our ways that got us in this mess. Are you going to jump or dive? Does it matter once you're over the cliff?

Thank you for having Michael Perino and Simon Johnson on the show. If only their final conclusions did not frighten.

Who's minding America's economic store? The bankers and the bullies who run it and robbed it; democracy little more than a means of building and buying a culture of abusive capitalism instead of building and sustaining a culture of freedom and responsibility.

Strangely enough, it reminds of Thurber's "Is Sex Necessary?" Perhaps a revision is in order: Is truth really necessary?

Yes.

sorry please read the context as 85% good guys and 15% fraudsters

I agree with much of what William Black has said. Aside from the obfuscation and gaming of the tax payer, with the known collusion of the regulators and ratings agencies, I think there are two issues here. One is that there should be a "McCarthy style" investigation to recover the bonuses paid to all staff in the GSE's, banks, estate agents, valuers and lawyers who were involved with the property boom that started under Clinto (and including Clinton). Not to do this means that the 85% of people who were not involved in this housing fraud, essentially robbed the bank and got away with it. There is probably around $200 billion in bonuses paid to bank staff in just the last three years. That's 10% of the 2 trillion (Geithner number) needed to put things right. To me the costs of putting this right, is exactly equal to the size of the fraud that has been perpetrated in the last ten years. I personally think the number is 6 trillion. Get all the money back from the thieves and maybe the 85% of us can look forward to a decent life again.

My questions are as follows: How do bubbles develop, rise and fall? Can we avoid the collapse of the credit card bubble? What laws are in the pipeline to identify and stop Ponzi type investment schemes and to help the homeowners who are losing their homes? The program had a lot of good information and could easily have lasted another hour. The suggestion that banks become boring (and small) again is probably the best way to make them stable. The world is full of gamblers (risk takers) and non gamblers. Both should have separate ways to invest and the gamblers could possibly win big and the non gamblers could reap reasonable returns and not worry about losing everything.

Great program.

Bankers make their bonuses on a yearly basis on trades which sometime require a much longer time to reveal whether the trade was good or not.

They maybe so called "rocket scientists" and they may understand the long term complex risks involved in their trades. But if trades go well in the short term and they get a fat bonus on a yearly basis as a result - They think "who cares about the long term risk. Why bother with complicated maths - let someone else at a later stage fix my problem and in the mean time I have my bonus".

This is one of the fundamental problems with how Wall-Street functions. Regulations should make sure that bonuses are paid on a longer time scale which matches that of the maturity of the assets they trade.

Individually they are rocket scientist - collectively they are made to act as a herd of selfish greedy irresponsible fools - and we are picking up the tab.

If you don't fix this problem - then of course you get cyclic dynamics where financial crises are inevitable and occur on a periodic basis.

Simon Johnson was smite when he said at the end of the show about worrying that attempts to truly regulate wall street and the debt mongols may cool down since baseball season is coming and said in a sense " oh well, I guess everyone is just going to have to hurry up and embrace the moment when it comes to regulation reform because after all everyone is going to be going on vacation soon...." Tea Anyone?

Well ... Simon, what about everyone that doesn't have a job to go on a "vacation" from? Or maybe Simon doesn't feel that unemployment at 16% and growing (when you do a complete head count) does not statistically matter that much.
That excepting a debt of 80% to GDP is just fine as a course of events. Of course why not, after all he worked for the IMF so what other kind of comments and conclusions can one expect from him?

q.e.d.

Since this is by everyone’s admission a ‘systemic failure’, Congress needs to be asking ‘systemic’-level questions. For example, the enormous sums governments around the world are ponying up to stabilize their financial systems are said to be the result of banks, hedge funds and other financial entities being over-leveraged. So they either loaned or borrowed too much money in relation to the value of the asset securing the loan.

Question: How is that even possible if someone is managing the total amount of money being created?

Since most of our money is created by PRIVATE banks and credit card companies not ‘printed’ by the government, we have in effect thousands of little mints churning out money. As long as these ‘mints’ can make a profit creating money, they are going to do it. If they create more of it than required by the real economy to exchange goods and services or even more of it than required to finance the creation of real wealth – what we need to live and enjoy life – there is nothing to stop them. If they create so much money it destroys the value of our savings because we don’t or can’t invest them so as to at least keep pace with inflation, there is nothing to stop them.

Question: Why shouldn’t the government manage the money supply to maintain a stable value over time so neither debtors or creditors get robbed? If it needs money to finance its operations, why shouldn’t it just impose a direct tax instead of trying to disguise the tax as inflation by borrowing from private banks?

Realistically few of us will ever be expert enough to weigh in on arcane regulatory details or even an appropriate high-level architecture for banking and finance. What most of us want from money is just stable prices and savings that don’t vaporize with each new financial crisis created by all the little private mints out there inflating asset bubbles until they explode. Understanding whether or not we are getting it doesn’t take a degree in economics.

Question: Oh, and whatever happened to the ‘political’ in ‘political economics’? That’s what it used to be called and we have sure as hell learned that’s what it is. Markets are not free; they are what politicians say they are. They are made and unmade by politics – always have been and always will be.

Two academics talking about their latest "history case lesson.." Sad..
How many children went hungry today because of this disaster? Again, sad..
Leave it to academics to miss the point in their little, "case history lesson." And that is, what are the forces that allowed the history to repeat itself? Could it be that election & lobbying reform might enter their discussion? How about some discussion of the 8th Amendment? How about discussing that a private bank never has loaned or invested its own money?
How about that they need not own the assett for the derivative either? No, "it's all just too complex for you mere commeners to understand...

Dear Bill, Thanks for having Michael Perino and Simon Johnson on your show tonight. The program was excellent as usual. And thank you for keeping this issue as the #1 issue our nation is facing. I hope that you continue with programs on this subject until some real action is taken by our Congress. I would ask the new commission to first of all examine each and every action taken or not taken by Congress regarding financial services corporations since 1980. This means detailing for the American people how the laws Congress passed, or did not pass, allowed for the unregulated financial corporations to bring this nation’s economic system to its knees. That financial corporations took unreasonable risks, made immoral decisions, and probably broke laws is secondary to Congress’s actions during this time. Everyone knew banks and financial corporations can not be trusted --- that’s why the financial regulations from the 1930s were instituted. So the real question is why did Congress deregulate banks and financial corporations starting in 1980. But I think getting an answer to that is going to be very difficult since, as was pointed out on your program, donations from banks and financial corporations have been the largest donations to Congressional election campaigns for a very long time. Campaign donations is the problem but this is why getting all the answers is problematic.

This new investigative commission should explain in detail how primary mortgage lenders were able to defraud so many people and why individual states were not allowed to regulate these lenders engaging in mortgage fraud. Any investigation must explain how the rating corporations got their AAA ratings so wrong.

Here are a few other suggestions. Although I support President Obama, I think he is surrounded by economic advisors who have grown up within the existing financial paradigm. President Obama needs to bring in advisors other than Larry Summers, Robert Rubin, and Paul Volker. President Obama needs other views on this situation. At this time we have a nation that is of the corporation, by the corporation, and for the corporation. Of course we know that the goal is that our nation becomes a nation of the people, by the people, and for the people. In this respect the Congress has not represented the people of the United States since 1980, but instead has represented the banks and financial corporations. Any solution must include separation of regular banking from investment banking from insurance, etc. as was the case under the Glass-Steagall Act.

I would first ask about the size of individual banks relative the size of the entire financial system. This question would include the "shadow banks" such as AIG. It seems that at some point a large,growing bank simply cannot aggregate sufficient backup capital and will emperil itself. Regulators appear to turn away from this question. Big banks very likely need to be split up.

Thank you for the interesting discussion on the Journal with Simon Johnson.

An urgent opportunity exists, under Pres. Obama's leadership, and should be seized, to put in place reforms needed to put a stop to the unregulated practices by financial services institutions which directly caused the current serious financial crisis.

Mistakes were made, now is the time to effect corrections.

Self-regulation didn't work - strict legislative guidance is required.

Here is your first witness:

An insider finally spoke out about the dirty laundries of Wall Street on C-Span: Janet Tavakoli "Dear Mr. Buffett: What an Investor Learns 1, 269 Miles from Wall Street" hhttp://www.qanda.org/Program/?ProgramID=1228

Public outrage in the United States may be in its infancy, but the forces of information control, cooptation and repression are at full adult prowess. I expect infanticide. Evision Haiti after the Franco-American removal of Aristide in 1994. Money talks and bull**** walks.

Captcha: 85 gradient

Why bother? Only those who could face the reality and tell the truth grow wiser; it is so for an individual as well for a country. Our government and many American people may have long lost such capability. That is why all these disasters in the first place and more later.

Public outrage is only starting. The taxpayers of this country need to demand a thorough investigation of wall street and Washington's payoffs.

I'm encouraged by the plethora of comments expressing frustration and rage, as well as some interesting and worthwhile opinions for change from the well informed, engaged posters. I also wish to commend Mr Moyers on his usual excellence in programing and guest choices. Mr. Johnson's comment regarding what political will there is to effect the regulation needed is, n my opinion at the crux of the matter. Nothing will happen because the financial industries OWN all the critical congressional and senate representatives. A quick check of opensecrets.org's website will confirm this. I think the only relevant investigative body will have to be composed of non-governmental citizen members deputized and given the full power of subpoena.

I would ask for further investigation of why Canadian banks aren't failing?
The hubris of the gigantic financial institutions is not to be tolerated any longer.
I agree with the thought that restructuring shouldn't be out of the question.

I would start questioning the CEOs of the “too big to fail” banks. I would ask if they are good managers? Did they know what their banks were selling? Did they understand derivatives? Did they coerce rating agencies to give their derivatives a triple-A rating? Did they know that the derivatives were not backed by sufficient reserves? Of Goldman Sacs CEO, I would ask what he was paid by the company in 2007 ($71M), where did he get the money in 2007 to pay out over $1B to the top 50 executives, and did he know that the collapse would be a big as it has gotten?
I would try to determine if this was a worldwide scam, the biggest scam in history run by the bankers who have paid Congress more contributions than any other business group.

"We can live without plants and animals, but we can't live without business." How absurd that propogandistic retort to Rachael Carson's "Silent Spring" sounds 46 years later. Carson assumed that along with a balanced nature human beings needed an ecology of mind to survive and flourish.

Elizabeth Warren would agree I think, and yet if put in charge of investigation and reform of finance she would be as set-upon as Carson. Johnson and Perino would fall on the side of her adversaries because they are creatures of the present oligarchic system, just as the purveyors of DDT are and were creatures of the chemical industry. What these men said to Moyers was in essense:"We can live without general prosperity or middle class aspirations, but we can't live without the present scale of finance." To them the Stiglitz utility model of boring banking is too radical. They can advocate nothing distasteful to an oligarch or great usurer.
Burst bubbles don't harm the big players. Even little grunge journalist Naomi Klein has explained how they benefit from general disruptions. 60 Minutes explained last week how the 401Ks so many Moyers watchers panic over are at origin a great scam. I have been an observer in this society all my life, having worked mostly as a volunteer and activist, having received only about 300K in before tax wages my entire working life, living on barter and good will. Now I see how you ants are no better off than the grasshoppers like myself. You can't be a true critic of a system in which you retain an unreasonable faith.

Maybe the biological evolutionary model applies to cultural advance, and we have reached a crisis of punctuated equilibrium versus extinction. If so, our entire lifestyle must be replaced, because tinkering around the edges in an effort not to disturb privilege would be genocidal. One thing remains true after such a successful adjustment: All value originates from human labor as it interfaces with a fully functional and sustainable natural system. We cannot escape nature because we are at root creatures of it, especially when one considers Carson's recognition of the primacy of mental ecology. Her philosophy was that unnecessary replacement of nature is always dysfunctional and ugly. We must change the things that alienate us from natural systems and our nature which originates in the environment. Despite the protestations of perverts and monstrosities, business is superfluous and unnatural, and can only bring conflict and injustice upon us. It should hold a very low priority, something to be resorted to only as a last recourse. Most people agree we are headed in the wrong direction, but they don't yet understand how lost we've become. Rachel Carson knew, but died too soon even to slow insecticide and herbicide use sufficiently. Look around. If you want an investigator or a spokesperson,choose an observant visionary, a critical outsider.

captcha: alludes 28th

The financial products industry needs to be overhauled radically. At the core of the crisis are the credit rating agencies. There is no parallel to what exists in the financial industry in other sectors. We do not have pharmaceutical products rated by private organizations. We have the Food & Drugs Administration (FDA) deciding if the pharmaceutical products are good for consumption and if so, the FDA also decides the label which goes on the product. Nobody questions the competency of FDA staff. Should we not have a government agency doing the same for financial products? Interestingly, the credit rating companies are paid by the very same financial companies whose products are being rated by the credit rating agencies. Not only that, the credit rating agencies get more for higher ratings (AAA instead of BBB)!

If the credit rating agencies were truly independent and had rated the financial products appropriately, instead giving them AAA rating, we would not be in this dire situation. Because of these incorrect ratings, pension funds and other funds purchased these faulty financial products.

Nobody questions the right of financial companies to bring innovative financial products to market. If these financial products are rated properly by truly unbiased organization (not funded by financial industry), the market will determine the true value of these products.

Surprisingly, we have not turn yet looked at the credit rating agencies closely and brought them into congressional hearing rooms.

It is time for the Obama administration to look at all the players who contributed to this financial crisis.

[quote="roger miller"]If Bill Moyers wants to be absolutely fair and balanced about getting the facts behind what led to our current -- as well as our past --financial booms and busts, he needs to invite Tom Woods,[/quote]

No, William Grieder wrote on the Fed; and better...Woods is a Libertarian idealogue...

Interesting that a former IMF official(often criticized for draconian economic deeds itself), Simon, is now doing penance?

Concerning the question, "In examining the causes of the economic crisis, what would you ask a new Pecora Commission to investigate?", I think they should try to find out if any of those legislators who repealed in 1999 the Glass-Steagall Act (which had prevented banks from making risky investments) subsequently profited from the megabanks which emerged and are now in trouble?:

http://hnn.us/roundup/comments/78471.html

If Bill Moyers wants to be absolutely fair and balanced about getting the facts behind what led to our current -- as well as our past --financial booms and busts, he needs to invite Tom Woods, author of the current New York Times best seller Meltdown: A Free-Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts Will Make Things Worse, on his show!!

Declan McCullagh of CBS News says "New Book By Thomas Woods Says Bad Government Policy Caused The Economic Meltdown." His excellent review can be found at http://www.thomasewoods.com/uncategorized/cbs-news-reviews-meltdown/

McCullagh ends his article with these words: "Meltdown will not be the last word on the slow-motion crash we've been waking up to every morning. But it has the virtue of being published early enough, and written accessibly enough, to make a difference. Assuming, that is, anyone in Washington besides Ron Paul reads it."

Excellent! Proof that a little history goes a long way. I would urge viewers once again to tackle two books: Lionel Robbins, The Great Depression (1934) available online here http://www.mises.org/books/depression-robbins.pdf and Bray Hammond, Banks and Politics in America, from the Revolution to the Civil War (1957) and still available in paper from Princeton University Press, for a deeper understanding.

I think, as I have frequently written, we have all become corrupt, not just a few of us. We all have used easy money to live like little princes and princesses, while ppl in third world countries supported us, believing in the process that we were wealthier as prices and incomes rose because we could by merely printing money command the labor of these poor, who have become poorer and poorer. But this can only go so far.

There's a so-called virtuous cycle of increasing productivity and decreasing price, the money supply as a result remaining steady or contracting, which everyone in economics is familiar with, but there is also a vicious cycle in which production decreases and prices rise, and this happens when efforts are made to not cut prices and trim inefficiencies, but to increase money, the result increasing income and wealth disparity. As it proceeds fewer and fewer ppl can afford what is made, and less and less is, as a consequence, made. The more goods an economy has, the less money it needs, and vice versa. More money invariably means more poverty, not more wealth.

This has had a profound impact on the planet as ppl are forced into the cities in search of work, or into cutting down forests, and have more children to aid in feeding themselves. The need for ever cheaper means of production increases pollution, as does the runoff from the manicured suburban lawns of the middle-class forced out of ever higher-priced city neighborhoods. For relief, the downtrodden look to dictators and oligarchs, who use their positions only to line their own pockets, and Johnson's point that it can happen here, is well-taken.

The best way, if deemed Draconian by some, to tackle all these problems is to require 100% fractional reserves for banks, that is, by making banking really dull, by preventing them from printing money. Easy money should be viewed by business and labor alike as subverting the salutary effect private property has in keeping us honest and doing more damage to freedom than any totalitarian anywhere.

So close, yet so far.

There's a lot of grandiose commentary here about what is being billed as a financial transformation.
I can hardly stand it. Put banks back to banking!

But to hear Simon say the best we can do is put off another CRASH for 50 years, and to hear Mr. Perino talk of a limit to what can be done due to the control that the financier's have on the Congress, this all leaves me siding with Simon on being afraid.

I have always been afraid that the banks would raise their threatening, Cheney-esque posture - if you don't do it our way, it's going to get worse.
Now sit down and shut up!

But here I am afraid that we haven't been able to identify the one vehicle that has the potential to satisfy all of the worthwhile objectives of this terrific discussion.

Guess what guys? The answer is in the money system. And you need some explaining as to why you are not going there.
The Chicago Plan for Monetary Reform.
I cringed, and pleaded aloud in watching historian Perino dance around the fact of the very existence of the Chicago Plan proposal in the evolution of the reforms made to the financial sector with Glass-Steagall and other laws.

Mr. Moyers.
Mr. Perino.
Mr. Johnson.

It's the debt-money system of the private fractional-reserve bankers that is the problem.

If you read the purpose of the Act that introduced the Chicago Plan into legislation you can see its relevance to the discussion of the day.

If its relevant, why isn't it being discussed, rather than danced around?
The Chicago Plan.
You woulda thunk Obama had heard of it.

I was surprised more attention was not paid to Obama's statement yesterday on regulation of the credit card industry. (Some of the visuals were amazing--who WAS that sneering tan silver-haired guy a few seats away from Obama?)
I heard Elizabeth Penn Warren speak about predatory lending practices approx. a year ago. She's smart, very human, and is totally committed to revealing the rot in this situation--and fighting the ongoing fight to protect the little guy. She needs to be front and center in this discussion.

Keynes, Keynes and more Keynes...

President Harding's *inactions* proved that Austrian economists like Robert Higgs are right!!

Follow the money. It was true before, and is true now. Large financial institutions want to keep their parasitical grip on the country and the economy. It has taken them only 10 years after the repeal of Glass-Steagall to bring us back to the brink of another Great Depression, bribing ratings agencies for false ratings and using mortgage banks as feeder-funds to their fraudulent securitization profits, then keeping the illusory "profitable" creations off-balance-sheet to hide them, gorging on them with lobbied-for 40:1 margin. All this conveniently allowed them to award themselves years of larger and larger bonuses. Follow the money. Such deft organization is not happenstance.

What an electrifying discussion from the two guests tonight. I knew I had to tune in with Simon Johnson on the show.

I am struck by the situation today that Johnson describes - as a moment of clarity to seize and act upon which will soon pass. It seems that hundreds of thousands of us can post on blogs and message boards about our disgust and yet we don't act in concert to force political change. Our elected officals and banking executives just hope that this will blow over when what our country needs is real change. The "New Way Forward " movement was a start, but there has to be consistent pressure on Washington to do the right thing. Are we going to do it? How are we going to do it? We have the power to shape our own destiny.

I don't have the answers, but major props to Moyers and the guests on his show!!

Michael Bloomberg, Jon Corzine, Meg Whitman, Jane Harman, John Kerry, John McCain -- the list of the established and the aspiring goes on. They are among the wealthiest people in the US, the world. Even a once-great advocate of common people -- Charles Rangel -- has proved himself a corrupt money-grubber.

This is the American oligarchy. It grows while we the people are driven into greater poverty.

Simon Johnson refers to oligarchy in his current Atlantic essay.

He may be writing rhetorically, but the US is indeed now substantively an oligarchy. The vast majority of members of Congress and leading figures in the executive branch are millionaires. They identify with the people on Wall Street, not the commoners.

A growing number of fairly moderate, prominent figures are now calling the US an oligarchy (e.g., Michael Kinsley).

I have no optimism whatsoever that the essential structure of this modern American oligarchy will be challenged. President Obama has given every indication that he has no inclination to offer any serious challenge (just as he is clearly resisting calls for justice in the case of Bush-era war criminals).

As Simon Johnson says, the oligarchs have won. The structure of justice and economy in the US for the next 50 years (or even century) is being established now. The US has shown _none_ of the political energy of Europe in the past year. There is little reason to think that Americans will rise above what Galbraith called the "Culture of Contentment".

What about Eliot Spitzer as the lead investigator? He may be compromised as far as sexual ethics go, but he's the best prosecutor of the financial sector in recent history.

(Responding to maryalice, below)

"It is abnormal for a bank or lending institution to deliberately make loans they don't expect to be repaid."

That's true, so long as the bank that makes the loan remains the creditor. But that is not how these loans worked.

The lender would make a loan, but then immediately bundle that loan together with others, and sell them all to a larger bank.

What happened after that was of no concern to the original lender. He had already made a quick buck on the transaction and went off to make more loans.

So what if the loan wouldn't be repaid? The original lender wouldn't suffer. It was just one quick deal after another. Of course others would lose money, but so what?

That's the problem with mortgage-backed securities: The original lender received nothing but profit, no matter how irrational the loan was. Only those they sold them to bore any risk.

For the bundlers, for the people who made these loans to begin with, the fact that the loans would default meant nothing at all.

Too bad Congress passed a law back in 2000 that prohibited the Securities and Exchange Commission from regulating such financial instruments.

Above all, we must understand why those involved with derivatives and strategic investment vehicles believed they were safe risks. Obviously, they deluded themselves or they are sociopaths or, perhaps, both. We need to truly understand human behavior more to avoid future debacles since all laws are made to be broken due to human weakness. So we need to know how to turn around the tendency toward greed motivated behavior so we do not become victims of it! Right now, most Americans our victims of circumstances far beyond their control. It's a travesity of justice. But we must accept it, and try to learn from our errors. Maybe there's a way to monitor financial transactions so one maybe able to detect irregularities before they get out of hand. Obviously we need a new way. It should be our top goal--understanding the behavior and either taming or controlling it.

I agree someone should prosecute wrongdoing by those in the financial sector who contributed to our current fiscal crisis. However, to help the victims and avoid future financial catastrophes like this one, it's at least as important to get a full understanding of what went wrong as it is to punish real (or imagined) "bad guys."

I fear that if we put most of our energy into voicing moral indignation the bad guys, or the supposed bad guys, we may fail to understand and fix the flaws in our banking sector and in our whole economic system that make financial crimes and financial meltdowns almost inevitable.

What are some of those flaws? It depends on who you read.

The hedge fund manager Richard Bookstaber, in his book "A Demon of Our Own Design," argues that terrible financial instability is inherent in our current globalized financial world (a) partly because of its complexity, (b) partly because of the tight coupling of seemingly very different parts in the financial sector, and (c) partly because of its computer-enhanced speed.

What Bookstaber's book suggests is that punishing a few wealthy Wall Street denizens (like himself) will have little effect unless the structural problems in the financial world also are fixed. And that means somehow working make the financial system less complex and less tightly coupled, although not necessarily more tightly regulated -- since regulations, Bookstaber argues, can themselves contribute to the system's instability.

Coming from a very different perspective, but reaching somewhat similar conclusions, the American socialists John Bellamy Foster and Fred Magdoff in their book "The Great Financial Crisis" make the case that today's banking meltdown has its real roots in a crisis in the "real" world economy that goes back several decades, and that stems from industrial capitalism's amazing productive coupled with its chronic problems in distributing all the wealth it creates.

Since the 1980s or before, Foster and Magdoff argue, , American capitalist industry has had the capacity to make much, much more stuff than it can possible sell at a profit, while the wealthiest Americans have had huge sums of money on hand seeking new investment outlets.

It is simply foolish for rich people or for their highly paid financial advisors to invest large sums of money in the expansion of factories and agribusiness operations under these circumstances, Foster and Magdoff argue. There is no sense in expanding the productivity or the productive capacity of industries that already are facing stagnant or glutted markets.

Therefore, to provide a possible outlet for the "global savings glut" of investment capital accumulated by rich Americans and large would-be investors in other countries, Wall Street has had to invent fancy varieties of financial speculation to soak up investment capital that cannot go elsewhere. But the result of the new financial investment vehicles, of course, has been speculative bubbles, one of them after the other, and now some of these speculative bubbles have popped.

The problem, Foster and Magdoff conclude, is that unless the production and distribution and overcapacity problems with the "real" capitalist economy are fixed -- if they can be fixed -- the financial sector is just going to have to think up new bubbles to replace the old ones.

Like Bookstaber the arch-capitalist hedge fund manager, then, Foster and Magdoff as scholarly socialists think the worst problems are mostly structural, not rooted in the personal dishonesty of individual bankers (although such dishonesty does exist, and can do damage to society).

Martin Wolf, veteran financial analyst for London's "Financial Times," also focuses on the structural problems of the financial world in his new book "Fixing Global Finance."

To Wolf, one huge destabilizing factor in today's global economy is the fact that it has virtually required the United States and its citizens to rack up huge debts, in order to absorb the "global savings glut" posed by the rapid industrial growth of China and the amassing of enormous oil export revenues in places like Saudi Arabia and the Arab emirates.

Wolf concludes that to allow continued market-based development in China, the major oil-exporting countries and other developing countries of the Third World, it has been necessary for rich Americans to buy many of the export goods that these countries were producing.

Also, to help these same exporting countries recycle their dollar profits, America and Americans have served the global economy as the "borrower of last resort," and a global savings glut arising largely from Chinese and Arab economic growth has been soaked up by the sometimes absurd consumer debts and business and government debts racked up by Americans.

Martin Wolf's sense of how to fix the underlying problems is somewhat different from that of Richard Bookstaber, which again is different from the socialist prescriptions of Foster and Magdoff. But Wolf's work indicates that however reprehensible the misdeeds of Bernard Madoff and other flim-flam artists have been during the lead up to the subprime mortgage mess, they were just icing on a very big cake.

To Wolf, the underlying cause of crisis is a global financial system that stumbles into a serious crisis every time there is a major shift in resources from the older, richer capitalist societies of the West to the newly emerging capitalist societies of the Third World. And it is this rather than the individual dishonesty of particular Wall Street traders, he indicates, that needs fixing if we are to avoid future financial meltdowns resembling the present one.

I'd like to see Bill Moyers and the Journal focus much more attention on these structural diagnoses of what's wrong with the financial markets and the global economy they serve, and somewhat less attention on the moral failings of any given crook on Wall Street.

Yes, of course, let's prosecute the crooks. But if we focus on the big bonuses or even the lies and swindles of particular Wall Street operators while ignoring the bigger flaws of the system in which they operated, we'll be a bit like the jury that sought to blame the My Lai massacre in Vietnam, not on the military command structure at the time, but only on Lt. William Calley. We need some serious economic diagnosis here, not a rash of moralistic populist scapegoating.

I thinks it all started when Congress threw out the previous law separating retail banks, insurance companies, and investment banks from doing the business of the others.

Many people at the time prophesied that this would all end in tears and by golly I believe we finally reached the time of wringing out our wet hankies last fall.

I mostly blame ex-Senator Phil Graham.

Where did the initial pressure to make bad home loans come from? It is abnormal for a bank or lending institution to deliberately make loans they don't expect to be repaid. I don't believe that this policy was initiated by the private sector banks.

We need to focus on a brand new financial system that's built on integrity and honesty with full tansparency throughout.

You may want to search out and prosecute the people who knowingly created those so called "financial instruments" which led to this crisis but then you must also include every politician, financial executive, lawyer and board member of every monetary, insurance and financial institution in the United States who, for so very many years, never had the consciousness to stop the insanity, greed, and out and out corruption. It won't be hard to figure out who they are just look at the various annual reports, bonus and/or kickback sheets.

I suggest firing them all and banning them for LIFE from ever being involved in or working with money in any fashion, whether it be Wall Street, insurance companies, credit card companies, banks, accounting firms and law firms. They would also be banned from any type of lobbying firm.

To put them in jail satisfies the need for consumer revenge however that puts the burden back on taxpayers. Let them get reeducated for some other type of employment, say BLUE COLLAR work like hauling refuse, cleaning public toilets, driving city buses, pouring liquid tar into the cracks of city streets when the mercury reaches 100 degrees! Let's show them how to get their "hands dirty" with a positive end result. Now that's what I call real satisfaction!

Winifred Larsen
St. Paul, MN

Congress caused the financial crisis by weakening the regulatory
laws that would have prevented it, or at least dramatically
reduced its severity.

Here is what the commission must investigate:

1) Carefully review all of the regulatory laws, why they were created, and when. A lot of these laws were passed after times of great irresponsibility and criminality -- like those passed during the Great Depression, or after the Savings and Loan scandal.

2) Consider each and every action that Congress took to weaken those laws.

3) Examine the influence that campaign contributions had on Congress's decisions to weaken regulatory laws.

4) Determine whether or not any of the dangerous actions taken by banks, investment firms, insurance agencies and so
forth would have occurred at all, had the regulations not been undermined by Congress.

Finally, the commission must issue a clear, factual report of the extent to which Congress bears responsibility for the current situation.

If this commission is a smokescreen to pacify the public, then it can investigate whatever it likes, report whatever conclusions it likes, and hope that the public falls for it.

But if the purpose of the commission is to obtain real insight into what caused this mess, in order to prevent future disasters, it must investigate the role Congress played.

Do you suppose a congressional commission will have sufficient courage and integrity for such honest self-assessment?

I listened to William K Black's comments on our current fiscal crisis and agree completely. The shame is that politicians and CEOs of major corporations hold themselves out to be above the law and the public doesn't rise up with a single voice to change things.

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