FedUpUSA

Another Day, Another (Two) Outrages

JPMC

Why should I believe anything the government tells me?

Why should I obey the law, other than because I’m scared of the guns the government can point at me?

Why should I build or expand a business when anyone who has government favor can come steal anything — or everything — I build, and there isn’t jack and crap I can do about it as they won’t be prosecuted or punished in any way?  In fact, they’ll be rewarded!

If you want to know how a nation dies without being conquered by war, pestilence or famine, this is how.  The good, honest, industrious people simply say “screw you” and refuse to effort to move the economy and nation forward.

We are there folks, and these two stories explain why.

First, JP Morgan:

Government investigators have found that JPMorgan Chase devised “manipulative schemes” that transformed “money-losing power plants into powerful profit centers,” and that one of its most senior executives gave “false and misleading statements” under oath.

The findings appear in a confidential government document, reviewed by The New York Times, that was sent to the bank in March, warning of a potential crackdown by the regulator of the nation’s energy markets.

The possible action comes amid showdowns with other agencies. One of the bank’s chief regulators, the Office of the Comptroller of the Currency, is weighing new enforcement actions against JPMorgan over the way the bank collected credit card debt and its possible failure to alert authorities to suspicions about Bernard L. Madoff, according to people who were not authorized to discuss the cases publicly.

A confidential government document?  Why should any document of this sort be confidential when it bears on conduct that a regulated institution has taken toward the public?

There’s part of your problem right there.  This isn’t a single incident or issue either; it claims a pattern of conduct as do the other “showdowns.”  Nor is this limited to JP Morgan — there is a long litany of financial institutions coming under “scrutiny” for various illegal and unethical acts and yet what’s missing is prosecutions.

It doesn’t end there.

President Obama’s nominee for Commerce secretary was embroiled in a massive bank failure more than a decade ago, in a collapse that cost depositors and federal insurers millions of dollars.

The 2001 collapse of Superior Bank FSB now appears likely to re-emerge, more than a decade later, as Commerce nominee Penny Pritzker prepares for a confirmation hearing and Republicans already draw attention to the bank implosion.

Tangled?  Like Hell.

This was an all-on scandal and cost the FDIC over $300 million.  Those who were over deposit limits were screwed out of $10 million they have yet to recover, and probably never will recover.  The bank had insufficient if not outright missing risk controls with subprime auto and home lending.

Being a bad businessperson though isn’t an exercise of privilege — that’s just being stupid.

But being able to cut in line before depositors is another matter, and the Prizkers did.

The FDIC “defended” their decision, but again we’re back to the same problem we had with GM and Chrysler, where the rule of law is changed ex-post-facto to benefit wealthy and powerful people and screw the ordinary citizen.

Until this crap stops my entrepreneurial efforts are going to remain on the shelf, and I suspect I’m not alone in this regard.

Discussion below (registration required to post)
Share

Comments

comments