Category Archives: Uncategorized

By Pam Martens and Russ Martens: June 19, 2014 Outside of the Washington Times, there was a virtual corporate media blackout on the high frequency trading hearing held yesterday by the Senate Banking Subcommittee on Securities, Insurance and Investment – which came one day after Senator Carl Levin’s hearing on the same topic. The media blackout did a deep disservice to the brilliant perspectives brought to the table by Senators Elizabeth Warren and Mark Warner and two witnesses who deal every day of their lives with the corrupted and disfigured trading venues the SEC has allowed to evolve in what used to be the most trusted stock market in the world. On the Senate’s witness panel were Jeffrey Solomon, CEO of Cowen and Company, an investment bank with roots dating to 1918 and Andrew Brooks, Head of U.S. Equity Trading for T. Rowe Price (who has been a trader for … Continue reading →

By Pam Martens and Russ Martens: June 18, 2014 In 2008, the sprawling global bank, Citigroup, created under the controversial repeal of the Glass-Steagall Act, blew itself up with toxic debt hidden in the dark in the Cayman Islands in an exotic framework called Structured Investment Vehicles or SIVs. The unwilling taxpayer was forced into servitude to bail out this hubris that had occurred at the hands of captured regulators, infusing $45 billion in equity, over $300 billion in asset guarantees, and $2.5 trillion in below-market loans. At the time of its implosion, Citigroup had over 2,000 subsidiaries, affiliates or joint ventures, many of which operated in the dark in foreign locales. Flash forward to today: in March, the Federal Reserve said Citigroup had flunked its stress test and the Fed prevented it from boosting its dividend. (The so-called stress test is how the Fed measures a mega bank’s ability … Continue reading →

Senator Carl Levin opened today’s hearing on high frequency trading before the U.S. Senate’s Permanent Subcommittee on Investigations with this opening statement: ————- Senator Carl Levin: Opening Remarks, June 17, 2014 Conflicts of Interest, Investor Loss of Confidence, and High Speed Trading In U.S. Stock Markets Most Americans’ image of the U.S. stock market is shaped by a single room: the trading floor of the New York Stock Exchange, where traders await a ceremonial bell to kick off the day’s activity, then trade shares worth millions on scraps of paper. In reality, most shares are traded not on a floor in Manhattan, but in racks of computer servers in New Jersey. Trades happen not at the speed of a human scribbling on paper, but in the milliseconds it takes for an order to travel through fiber-optic cables. And increasingly, the money made on stock markets comes not from thoroughly assessing … Continue reading →

By Pam Martens: June 16, 2014  After Senator Carl Levin and members of the U.S. Senate’s Permanent Subcommittee on Investigations give their opening remarks tomorrow, the next thing you will hear are these words or something akin to them:  “Rule number 6 of the U.S. Senate’s Permanent Subcommittee on Investigations requires that all witnesses appearing before the Subcommittee testify under oath.” You might think that would be the rule at every Senate hearing involving Wall Street’s serial malfeasants, but, shockingly, it’s not. When the men on Panel Two finally take their places, there could be some sweating going on when those right hands are raised. This isn’t just any ole subcommittee; it’s the subcommittee that issued a 2013 scathing 307-page report on JPMorgan’s ethical and legal lapses in the London Whale derivatives trading scandal along with 98 exhibits including deeply incriminating emails. Equally sweat-producing, the subcommittee uses its subpoena power … Continue reading →

By Pam Martens and Russ Martens: June 12, 2014 Eric Cantor’s campaign may have eaten its way through $168,000 of steak dinners but big players on Wall Street are eating crow. Between 2000 and 2007, Goldman Sachs’ Chairman and CEO, Lloyd Blankfein, personally stuffed $73,500 into the Democratic Senatorial Campaign Committee to help elect Democrats to Federal office. But by 2012, Blankfein had decided that “Every Republican is Crucial” and gave just defeated Virginia Republican and House Majority Leader Eric Cantor’s leadership PAC by the same name $5,000 in 2012 and another $5,000 in 2013. In addition, Blankfein gave the Cantor Victory Fund $10,200 on December 6, 2013 according to receipts at the Federal Election Commission. In the 2013-2014 election cycle, Goldman Sachs’ employees and/or their family members gave a total of $88,500 to Cantor’s leadership PAC – which sluices money to Republican candidates around the country – and another … Continue reading →

By Pam Martens: June 11, 2014 Wall Street On Parade has been reporting for some time now that much of Wall Street’s past and current history has up and disappeared – either at the hands of high speed shredders on orders from the SEC, or through Courts sealing documents, or Wall Street’s private justice system preventing access to hearings, non-disparagement contracts when you change your job on Wall Street, or critical pieces of Wall Street history just go missing and no one can find out exactly why. Now we learn that a vital book on Wall Street’s history had vanished until an NYU Professor made it his mission to return it to the public’s hands. In 2011, Darcy Flynn, an SEC lawyer, told Congressional investigators and the SEC Inspector General that for at least 18 years, the SEC had been shredding documents and emails related to its investigations — documents … Continue reading →

By Pam Martens: June 10, 2014 Southern states are mad as hell and aren’t going to take it any more. After more than five years of watching their cities and towns suffer foreclosure and mortgage abuse from the biggest firms on Wall Street, rigged Libor swaps impoverishing local governments, and massive stock losses to municipal workers’ pensions, the South is rising up and suing Wall Street over its latest fleecing scheme – high frequency trading. And before anyone starts to chuckle about the chances of Southern lawyers outfoxing the mega Wall Street law firms in their own stomping ground in the U.S. District Court for the Southern District of New York, you should know this one salient detail: one of the key Southern lawyers involved is Michael Lewis. That’s not bestselling author Michael Lewis; that’s Big Tobacco Cartel suing and winning lawyer Michael Lewis who mightily assisted in bringing the … Continue reading →

By Pam Martens: June 9, 2014 Last week, three Federal appellate judges with lifetime appointments, meaning they will be receiving salary and benefits for as long as they choose on the taxpayer’s dime and then a nice, fat, secure pension also courtesy of the taxpayer, ruled that the very same public that makes their own existence so cushy is not entitled to truth or facts or justice when it comes to Wall Street. Truth, facts, justice are quaint relics of a bygone American past. Today, when it comes to Wall Street, Federal judges are simply there to rubber stamp the settlements of captured regulators and then quickly re-ink the stamp for the next shady settlement. To fully grasp what happened last week you will first need to purge your mind of everything you think you know about Federal District Court Judge, Jed Rakoff, rejecting a smelly deal fashioned between the … Continue reading →

By Pam Martens: June 5, 2014 Evidence of ‘clandestine’ documents has turned up which may make it rough-sledding for one of Wall Street’s biggest go-to law firms in the position they staked out last Friday in Federal court. R. Tamara de Silva, a lawyer representing three traders in a closely watched Federal class action lawsuit in Chicago, told the court in April that the world’s largest futures exchange has “entered into clandestine contracts with HFTs [high frequency traders] knowing that the activities of the HFTs would adversely affect all other individuals and entities…” (See High Frequency Trading Lawsuit Against CME Group, et al for the full text.) De Silva and lawyers from O’Rourke & Moody in Chicago are facing off against the 1600-lawyer strong Skadden, Arps, Slate, Meagher & Flom, LLP who are known for their splashy motions to dismiss — which come very close to libeling opposing counsel. They did not … Continue reading →

By Pam Martens: June 4, 2014 The regulator in charge of policing high frequency trading in the futures markets, the Commodity Futures Trading Commission (CFTC), held a “public meeting” yesterday to determine if the allegations raised in the Michael Lewis book, Flash Boys, relating to high frequency traders rigging the stock market might also be occurring in the futures markets. As is increasingly typical of the U.S. markets themselves, the public was no where to be found at this “public meeting” yesterday. There was no one speaking on behalf of a consumer federation; no one speaking on behalf of disenfranchised small farmers who hedge their crops in these markets; no one speaking on behalf of the union employee or teacher or public municipal worker who is watching their retirement plan assets fleeced on millions of trades daily by high frequency traders who have obtained a litany of high-speed perks, rebates … Continue reading →