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Danny Schechter at the Smirking Chimp - The Crimes of Wall Street: What Are We Going to Do Before Its Too Late?
There is a term in finance called "moral hazard." It refers to policies and practices that reward wrong doing by banker and investors instead of allowing them to suffer their losses in the win-lose environment of the rigged casino that we refer to as markets.
On one level, it suggests that yes, there is some notion of rules and, dare I say, "morality" lurking in the anything goes if I don't get caught financial vampire land responsible for the collapse of credit markets in the aftermath of the disclosure of the subprime ("subcrime") scandal.
The bankers themselves are furiously debating what to do as they post record losses. The Bank of England opposes cutting the cost of credit, something that many expect the US Federal Reserve Bank is about to announce as a "moral hazard." Other bankers overseas are bitterly denouncing their American counterparts. Two banks in Germany had to be rescued.
There seems to be an air of desperation among financiers, also known as "masters of the universe" who always project confidence.
Measures are being taken similar to locking the barn door after the horses are gone. The Securities and Exchange Commission, the nominal regulators were caught napping. They are only now setting up "Enforcement Groups," including one on subprime abuses. They say they are going to be looking at "everyone involved."
Already big banks and credit rating companies that certified the crooked "securitization packages as kosher are firing top executives. Hedge Funds are reporting "shock losses." There is a clear "Contagion" as losses in one sector spread to others. Only the high price of oil is keeping the market afloat.
The industry and government response may be too little too late. Already the dominos are falling as these problems move into the real world or "real economy" as Treasury Secretary ad ex-Goldman Sachs chief Hank Paulson puts it. Just read the headlines in newspapers like the Financial Times.
"RISE FORECAST IN COMPANY DEFAULT RATES'
"Company default rates are forecast to rise nearly 300 percent as the credit squeeze it's the wider economy and raises the prospects of a global recession."
Note: Its not just homeowners who are defaulting anymore. Companies are. One expert says we are already in a recession even though, technically, the economy has to be "contracting" for two quarters for a recession to be acknowledged.
On one level, it suggests that yes, there is some notion of rules and, dare I say, "morality" lurking in the anything goes if I don't get caught financial vampire land responsible for the collapse of credit markets in the aftermath of the disclosure of the subprime ("subcrime") scandal.
The bankers themselves are furiously debating what to do as they post record losses. The Bank of England opposes cutting the cost of credit, something that many expect the US Federal Reserve Bank is about to announce as a "moral hazard." Other bankers overseas are bitterly denouncing their American counterparts. Two banks in Germany had to be rescued.
There seems to be an air of desperation among financiers, also known as "masters of the universe" who always project confidence.
Measures are being taken similar to locking the barn door after the horses are gone. The Securities and Exchange Commission, the nominal regulators were caught napping. They are only now setting up "Enforcement Groups," including one on subprime abuses. They say they are going to be looking at "everyone involved."
Already big banks and credit rating companies that certified the crooked "securitization packages as kosher are firing top executives. Hedge Funds are reporting "shock losses." There is a clear "Contagion" as losses in one sector spread to others. Only the high price of oil is keeping the market afloat.
The industry and government response may be too little too late. Already the dominos are falling as these problems move into the real world or "real economy" as Treasury Secretary ad ex-Goldman Sachs chief Hank Paulson puts it. Just read the headlines in newspapers like the Financial Times.
"RISE FORECAST IN COMPANY DEFAULT RATES'
"Company default rates are forecast to rise nearly 300 percent as the credit squeeze it's the wider economy and raises the prospects of a global recession."
Note: Its not just homeowners who are defaulting anymore. Companies are. One expert says we are already in a recession even though, technically, the economy has to be "contracting" for two quarters for a recession to be acknowledged.