Category Archives: Uncategorized

By Pam Martens and Russ Martens: November 23, 2015 April 18, 2000 was the day John Reed retired from Citigroup, pushed out in a board room coup, leaving Sandy Weill the sole Chairman and CEO. In 1998, the two had, with great fanfare, merged the FDIC-insured Citibank with Salomon Smith Barney, an investment bank and brokerage firm, and insurance companies controlled by Travelers Group to create the global behemoth known as Citigroup. The pair had initially served as Co-Chairmen and Co-CEOs. At the time, the deal violated the Glass-Steagall Act, the Depression era law which barred firms primarily engaged with underwriting securities to affiliate with insured banks. The Bill Clinton administration would obligingly repeal the Glass-Steagall Act the year after the Citigroup merger. At the close of trading on April 18, 2000, the day Reed stepped down, 100 shares of Citigroup were worth $6,212. Today, a decade and a half … Continue reading →

By Pam Martens and Russ Martens: November 19, 2015 Until March 30, 2014, most Americans and even long-term veterans on Wall Street had no idea how the electrical plumbing responsible for transacting buy and sell orders at stock exchanges and other trading platforms actually worked. That all changed on March 30 when author Michael Lewis went on 60 Minutes and told its 12 million viewers that “The United States stock market, the most iconic market in global capitalism is rigged.” Lewis was promoting his new book, Flash Boys, which detailed in language the public could easily understand, (devoid of the intentionally cryptic acronyms used across Wall Street) how the stock exchanges, mega Wall Street banks and high frequency traders were conspiring through technology to front run orders from unknowing investors. In the 60 Minutes interview with Steve Kroft, Lewis drilled down to how the legalized theft had escaped the notice … Continue reading →

By Pam Martens and Russ Martens: November 18, 2015  Thanks to the Occupy Wall Street movement and more recent cross-country stumping by Senator Bernie Sanders, millions of Americans have awakened to the frightening reality that corrupted power in America is now fully engaged  in running an institutionalized wealth transfer system cleverly masquerading as an economic model. As Senator Sanders has reminded the tens of thousands turning out to hear him speak: The U.S. has the greatest income and wealth inequality of any other major developed country; One percent of the population now controls a greater share of pre-tax income than at any time since the 1920s, (the last time Wall Street was legally allowed to gamble for the house with bank deposits); The top one-tenth of one percent of the super elite own almost as much wealth as the bottom 90 percent; Since Wall Street imploded under the weight of … Continue reading →

By Pam Martens and Russ Martens: November 17, 2015 Everyone has been waiting for the next shoe to drop in the Clinton cash scandals but no one expected Hillary to be the one to drop the shoe. But after making the stunning assertions in last Saturday night’s Democratic debate that most of her donors are “small” and her Wall Street spigot of funding was turned on as a result of her helping New York to rebuild after 9/11 – Hillary, the perpetual Teflon candidate, has been pummeled from Twitter to cable to mainstream media. Elizabeth Bruenig, writing for the New Republic, pointed out that “large donations make up 81 percent” of Hillary’s current campaign donations, refuting the candidate’s misstatement that “most” of her funding is from small donations. (The chart below from the Center for Responsive Politics provides the actual breakdown.) Bruenig writes further that confidence in Hillary’s assistance in … Continue reading →

By Pam Martens and Russ Martens: November 16, 2015  The Consumer Financial Protection Bureau (CFPB), the federal agency created after the 2008 crash to protect the little guy from Wall Street predators, which has done a top-flight job of it, was portrayed as a commie organization in a advertisement that ran repeatedly during the Republican Presidential debate on November 10. To enhance the communist theme of the ad (see full video below) giant banners of CFPB Director, Richard Cordray, and Senator Elizabeth Warren, who pushed for the creation of the agency, hang on the wall in a nod to Soviet dictators. The advertisement is grossly misleading, overtly suggesting that the job of the CFPB is to deny car loans and mortgages to regular folks seeking credit. The agency, in fact, has absolutely nothing to do with approving credit applications. Its job is to root out and punish financial institutions that … Continue reading →

By Pam Martens and Russ Martens: November 12, 2015 Landing in our inbox this week was an 86 page report from the Government Accountability Office (GAO) on the current status of the Troubled Asset Relief Program (TARP). The GAO is among a growing octopus of taxpayer-funded bodies attempting to reassure the American people that their tax dollars that were used to bail out Wall Street during the financial crash are being properly tallied up. The GAO report found the following: “While the total disbursed for TARP programs was $430.1 billion, OFS [Office of Financial Stability, an office in the U.S. Treasury Department] has collected $424.9 billion (or $442.4 billion if including the $17.5 billion in proceeds from the additional Treasury AIG shares) through repayments, sales, dividends, interest, and other income.  As of September 30, 2015, only $714 million in bank investments remain outstanding.” Lumping dividends, interest and other income together … Continue reading →

By Pam Martens and Russ Martens: November 11, 2015  Following the Republican Presidential debate in Milwaukee last evening, Senator Elizabeth Warren issued a blistering statement to supporters. It said, in part: “Did you see the attack ad about me during the GOP debate tonight? A right-wing group launched a full-scale assault on the Consumer Financial Protection Bureau – the watchdog we set up after the 2008 financial crisis to fight back when big banks try to cheat people on credit cards, mortgages, and other financial products…If the Republicans want a fight over the CFPB, I say, ‘Bring it on.’” The Consumer Financial Protection Bureau (CFPB) is one of the few positive outgrowths of the Dodd-Frank financial reform legislation passed by Congress in 2010 after the epic financial crash in 2008. It’s a legitimate and real champion of the little guy.  But because the agency has been exposing student loan frauds … Continue reading →

By Pam Martens and Russ Martens: November 10, 2015 The fourth Presidential Republican debate will take place this evening in Milwaukee. The leading candidates (Donald Trump, Ben Carson, Marco Rubio, Jeb Bush, Ted Cruz, Carly Fiorina, John Kasich, and Rand Paul) will take the stage at 9 p.m. ET. Lower polling candidates (Chris Christie, Mike Huckabee, Rick Santorum and Bobby Jindal) will debate earlier at 7 p.m. ET. The event will be hosted by the Fox Business Network and the Wall Street Journal with a free live stream available for viewers at www.FoxBusiness.com. The 9 p.m. debate will be moderated by Fox Business News anchors Maria Bartiromo and Neil Cavuto with the Wall Street Journal’s editor, Gerard Baker. One person to watch as much as the candidates this evening is Maria Bartiromo for a pro-corporate/anti-government tone to her questions. Bartiromo has regularly sided with corporate bigwigs accused by the government … Continue reading →

By Pam Martens and Russ Martens: November 9, 2015  Republican Presidential candidate, Ben Carson, came under media scrutiny last week over his longstanding claim that he had been offered a “full scholarship” to West Point, which turned out to have been a mere suggestion that he might qualify for one by persons whose names he could not remember. Politico broke that story while other media outlets have challenged the accuracy of his portrayal of himself in books he has authored as prone to violence as a young man, including an attempt to stab a friend, followed by turning his life over to God and going on to become a world renown neurosurgeon. The scenario of God’s redemption of Carson has greatly appealed to evangelical Christians who now form a large base of Carson’s supporters for his White House bid. One highly significant area of Carson’s life that has not come … Continue reading →

By Pam Martens and Russ Martens: November 5, 2015  According to the Random House dictionary, Stockholm Syndrome is “an emotional attachment to a captor formed by a hostage as a result of continuous stress, dependence, and a need to cooperate for survival.” Regulatory capture – where big banks are actually the ones calling the shots to their regulators – appears to have morphed into Stockholm Syndrome based on a Congressional hearing yesterday.  House Financial Services Committee Chairman Jeb Hensarling dropped a bombshell on Federal Reserve Chair Janet Yellen in opening questions yesterday on the Fed’s role of supervising the largest, most systemically dangerous banks. Hensarling queried if the Fed had crossed the line from being regulator to manager. We think the question should have been has the Fed devolved from regulator to emotionally-attached hostage. (There’s plenty of evidence for the latter as we’ll explain later in this piece.) The exchange … Continue reading →