Category Archives: Uncategorized

By Pam Martens and Russ Martens: February 22, 2017 President Trump’s nominee to head the Securities and Exchange Commission, Walter J. (Jay) Clayton, a law partner at Sullivan & Cromwell, has represented 8 of the 10 largest Wall Street banks as recently as within the last three years. Clayton’s current resume at his law firm is somewhat misleading. It lists under “Representative Engagements” in “Capital Markets/Leveraged Finance” the following: Initial public offering of $25 billion by Alibaba Group Holding Limited; Initial public offering of $190 million by Moelis & Company; Initial public offering of $2.375 billion by Ally Financial. All three of the above IPOs occurred in 2014 – less than three years ago. A quick check of the prospectuses for the IPOs that were filed with the Securities and Exchange Commission shows that Clayton, as a law partner at Sullivan & Cromwell, was representing the underwriters in the offering, which include the largest … Continue reading →

By Pam Martens and Russ Martens: February 21, 2017 There’s a very old joke on Wall Street that goes like this: “How do you make a small fortune on Wall Street? Answer: Start with a large one.” Unfortunately, millions of Americans have discovered since 2008 that this is no laughing matter. There are now more than 1,000 articles on this website that address the failure of our Congress and regulators to rein in the serial and frequently, conspiratorial, abuses of Wall Street against the investing public. There are brilliantly written books on the fleecing and insatiable greed of Wall Street; there are movies and documentaries on how Wall Street’s reign of financial terror brought the U.S. to the brink of financial collapse in 2008. And yet, the public continues to play the role of sucker at the big trading houses on Wall Street. Just last week the Securities and Exchange … Continue reading →

By James A. Kidney: February 20, 2017 The Trump administration assault on investor protections put in place following the 2007-08 financial crisis continues apace.  The war on investors takes place in arenas both large and small. The large issues get the attention, of course.  These include repeal of much of the Dodd-Frank law and regulations of the biggest Wall Street banks, limiting or eliminating the Consumer Financial Protection Bureau, which actually helps individual customers abused by giant financial institutions, and preventing adoption of fiduciary standards for financial professionals recommending securities that line their pockets but are risky to customers. But Washington is not merely a swamp of self-interest with large, highly visible alligators munching on small fish to satisfy their insatiable greed.  Another apt metaphor is a field of giant weeds — weeds of rules, processes and procedures that can be manipulated for the interests of the Fat Cats. These … Continue reading →

By Pam Martens and Russ Martens: February 17, 2017 It was Tuesday, August 6, 1974. New evidence had surfaced showing that the President of the United States, Richard Nixon, had lied to the nation about his knowledge of the Watergate burglary and attempted coverup. Senator Barry Goldwater blurted out in frustration at a Republican luncheon: “There are only so many lies you can take, and now there has been one too many. Nixon should get his ass out of the White House — today!” The next day, Goldwater led a delegation of Republican leaders to the White House. They told Nixon he had lost the confidence of his party; he did not have the votes in the House to ward off impeachment or the votes in the Senate to avoid conviction. The very next day, Thursday, August 8, 1974, Nixon addressed the nation and announced his resignation as President. One … Continue reading →

By Pam Martens and Russ Martens: February 16, 2017  Less than two weeks after Mary Jo White was nominated to become Chair of the Securities and Exchange Commission by President Barack Obama on January 24, 2013, White filed an ethics disclosure letter advising that she would “retire” from her position representing Wall Street banks at the law firm Debevoise & Plimpton. White wrote on this subject in great detail, stating: “Upon confirmation, I will retire from the partnership of Debevoise & Plimpton, LLP. Following my retirement, the law firm will not owe me an outstanding partnership share for either 2012 or any part of 2013. As a retired partner, I will be entitled to the use of secretarial services, office space and a blackberry at the firm’s expense. For the duration of my appointment, I will forgo these three benefits, though I may pay for some secretarial services at my … Continue reading →

By Pam Martens and Russ Martens: February 15, 2017 Increasingly, under the mantra of liquidity, trading activity on Wall Street that would have resulted in criminal charges in another era is yawned at by regulators. The week that Donald Trump shocked markets around the globe by getting himself elected President of the United States, Wall Street banks like Citigroup, JPMorgan Chase, Bank of America and others traded millions of shares of each other’s stocks – as well as trading millions of shares of their own publicly traded stock. The trades were not directed to a regulated stock exchange like the New York Stock Exchange. Instead, the trades were conducted internally by the Wall Street bank’s own Dark Pool – an entity appropriately named for its darkness and hands-off regulation. In an effort to create the illusion that there is some element of transparency about what is going on in these … Continue reading →

By Pam Martens and Russ Martens: February 14, 2017  Today’s news headlines are not the stuff of confidence-building. It seems like a 241-year old democracy should have gotten its act together a lot better by now. Bloomberg News is reporting that 17 of the most prestigious colleges and universities in the country (including Harvard, Yale and Stanford) have filed court papers seeking to join a lawsuit in a Brooklyn Federal court against President Donald Trump’s hastily constructed Executive Order. The Order called for an immigration ban which has drawn a flurry of lawsuits, nationwide protests and a rebuke by the Ninth Circuit Court of Appeals. The schools told the court that during the last academic year, more than one million international students studied at U.S. universities and now, as a result of the immigrant ban, 42,000 scholars, including Nobel Laureates, are calling for a boycott of educational conferences in the … Continue reading →

By Pam Martens and Russ Martens: February 13, 2017 In 2005 and 2006, Wall Street Journal reporters distinguished themselves in covering the charges of fraud being hurled at the giant insurer AIG and its CEO, Maurice (Hank) Greenberg. At that point, the Bancroft family had owned the Wall Street Journal for more than a century. But in 2007, Rupert Murdoch and his corporate entity, News Corp, bought the newspaper. The paper’s editorial page has subsequently taken bizarre positions on Wall Street’s crimes, refusing to allow the facts to get in their way. Last evening, hitting a new low in the arena of “alternative facts,” the Wall Street Journal opined that Maurice (Hank) Greenberg, the former Chairman and CEO of the giant bailed-out insurer, AIG, had received a “vindication” by last Friday’s settlement with New York State Attorney General, Eric Schneiderman. The editorial characterized the case against Greenberg as a “revenge … Continue reading →

By Pam Martens and Russ Martens: February 10, 2017 Students and teachers at Franklin High School in Seattle are walking a little taller and prouder this morning. One of their own, 37-year old Noah Purcell, the Solicitor General of the State of Washington, has in the span of less than a week, beat the most powerful man in the world – not once but twice. Purcell convinced District Court Judge James Robart in oral arguments on February 3 and all three judges sitting at the Ninth Circuit Court of Appeals in oral arguments on February 7 that President Donald Trump had illegally imposed an Executive Order banning immigrant entry into the United States from seven majority-Muslim countries. The 29-page wide-ranging decision from the Ninth Circuit says as much about the power of Purcell to hone sweeping constitutional concepts into a finely-tuned legal argument as it does about the ability of … Continue reading →

By Pam Martens and Russ Martens: February 9, 2017 At 3:08 p.m. Pacific time, the Ninth Circuit Court of Appeals issued a 29-page decision on President Donald Trump’s Executive Order regarding banning immigration to the United States for 120 days and banning people from seven majority Muslim countries from entering the United States for 90 days. The Court found that the States of Washington and Minnesota, which had taken their case to a lower Federal District Court and won a Temporary Restraining Order, did indeed suffer harms from the Executive Order. The Court wrote: “We therefore conclude that the States have alleged harms to their proprietary interests traceable to the Executive Order. The necessary connection can be drawn in at most two logical steps: (1) the Executive Order prevents nationals of seven countries from entering Washington and Minnesota; (2) as a result, some of these people will not enter state … Continue reading →