By Pam Martens: June 19, 2013 In years past, a prominent mutual fund company published an annual chart showing how each of the components of the Dow Jones Industrial Average had performed over the past 70 years versus the performance of its star fund. The chart was buried inside a flashy brochure. Over many years, I studied this chart, double checked it, marveled at it and theorized why there were these fascinating anomalies. I wasn’t curious about the mutual fund, mind you. I was astonished by the vast incongruities in the performance of those 30 stocks. One stock that was always among the top performers was Procter and Gamble. One stock that was always among the bottom performers was IBM. And yet, IBM was the legendary Big Blue; it was revered by millions as the quintessential blue chip stock. Each year I put the new chart in a plastic sleeve and … Continue reading →

 By Pam Martens and Russ Martens: June 17, 2013  A review of deeds and mortgages in some of the toniest towns on the East Coast reveals that not only is New York University financing luxury Manhattan brownstones and high rise condos for its faculty and administrators out of its nonprofit coffers, it has also been secretly financing country homes for a select group. These extravagances have fallen directly on the shoulders of financially struggling students. NYU ranks fourth in Newsweek’s 2012 list of the least affordable colleges.    In September 2009, the New York Times published a remarkable exercise in inanity, profiling John Sexton, President of NYU, relaxing at his Fire Island beach house. Sexton calls his summer getaway a “rather large, wonderful house” in the interview. We learn what Sexton eats for breakfast (black coffee and yogurt), the name of his dog (Legs), how long it takes him to walk … Continue reading →

By Pam Martens: June 17, 2013 (This column, with updates, runs periodically at Wall Street on Parade. Please consider emailing it to friends and family members.) A study conducted by Edward N. Wolff for the Levy Economics Institute of Bard College in March 2010 made the following findings: The richest 1 percent received over one-third of the total gain in marketable wealth over the period from 1983 to 2007. The next 4 percent also received about a third of the total gain and the next 15 percent about a fifth, so that the top quintile collectively accounted for 89 percent of the total growth in wealth, while the bottom 80 percent accounted for 11 percent. Debt was the most evenly distributed component of household wealth, with the bottom 90 percent of households responsible for 73 percent of total indebtedness. Wealth concentration in too few hands while the general populace is … Continue reading →

By Pam Martens: June 14, 2013  MIT’s President is supporting the plan, but it doesn’t take rocket scientists to understand the crisis. On July 1, if Congress does nothing between now and then, the interest rate charged on subsidized Stafford loans to college students will double from 3.4 percent to 6.8 percent.    On May 8 of this year, Senator Elizabeth Warren introduced her first piece of legislation, the Bank on Students Loan Fairness Act, which would allow students to borrow at the same interest rate on their student loans from the government as big banks pay when they borrow from the Federal Reserve’s discount window – a rate currently set at .75 percent. The rate would last for one year to allow Congress to enact a long term solution. Congressman John Tierney introduced a corresponding bill in the House of Representatives.  Fifteen organizations have signed on as supporters to the … Continue reading →

By Pam Martens: June 13, 2013  Cleta Mitchell is one of the attorneys suing the IRS on behalf of tax-exempt “conservative” groups – the word “conservative” having become a euphemism for corporate money masquerading as free speech. Her baggage is endemic to the real problem.  The billionaire Koch brothers, majority owners of the big oil, chemicals and paper company, Koch Industries, fund the “conservative” tax- exempt group, Americans for Prosperity, which then morphs into an octopus of other “conservative” tax-exempt groups.  The Cato Institute, a so-called conservative tax-exempt organization spewing out public policy research with a pro big business agenda, was secretly owned by Charles Koch for 35 years and by David Koch for 20 years, along with a few other men. The secret of billionaires owning a conservative tax-exempt organization, subsidized by you and me, while it pushes a corporate agenda, became public in the spring of last year. … Continue reading →

By Pam Martens: June 12, 2013  The American Civil Liberties Union has acted swiftly against the revelation that the National Security Agency (NSA) is interpreting Section 215 of the Patriot Act to allow it to collect metadata on every phone call made and received in the United States. Calling it akin to “snatching every American’s address book,” the ACLU together with the New York Civil Liberties Union (NYCLU) filed a federal lawsuit yesterday in the U.S. District Court for the Southern District of New York, challenging the lawfulness of the program and asking for the phone records to be purged from the government’s databases.  The lawsuit was fueled by Edward Snowden, a 29-year old former contractor for the NSA, who turned over Top Secret documents showing the Obama administration is using Section 215 of the Patriot Act to broadly spy on Americans, rather than abiding by the limited scope the … Continue reading →

By Pam Martens: June 11, 2013 “Ick” is a word that comes to mind far too often when writing about New York University under the tutelage of its President, John Sexton. In February, we wrote about how U.S. Treasury Secretary, Jack Lew, got sweetheart deals while serving as NYU’s Chief Operating Officer, including a $1.4 million mortgage that was completely or partially forgiven, depending on which way you calculate his departing gift of $685,000.  During his tenure, students saw their tuition skyrocket by 40 percent. In 2011, Amanda Fairbanks, an investigative reporter at the Huffington Post, revealed that in order to meet the burgeoning costs for room and board and tuition, 498 young women at NYU were moonlighting as prostitutes to wealthy sugar daddies through an online match-making service. Yesterday, we reported on NYU’s financing of multi-million dollar brownstones for law professors – tossing out these outlandish perks like penny … Continue reading →

By Pam Martens: June 10, 2013 According to documents unearthed in a month-long search of public records, NYU Law School has created an array of nonprofits to funnel money into lavish perks for its professors. The money has been used by professors to buy multi-million dollar brownstones and condos in Manhattan and Brooklyn with portions of some loans forgiven over time. In some cases, even the interest charged on the loans has been reimbursed. The decision to use nonprofit funds to enhance the lifestyles of a select handful of professors and administrators rather than assisting students is under investigation by Senator Chuck Grassley at the Senate’s Judiciary Committee. A referral has also been made by the NYU chapter of the American Association of University Professors to the New York State Attorney General’s Charities Bureau which oversees nonprofit organizations. From the hundreds of records examined, NYU, under the leadership of President … Continue reading →

By Pam Martens: June 7, 2013 Following yesterday’s report by Glenn Greenwald in The Guardian newspaper that the U.S. government was engaged in data mining tens of millions of telephone calls, today both The Guardian and the Washington Post carry reports of a Top Secret federal government program called PRISM which allows snooping into the contents of emails, live chats and Skype communications of both Americans and foreigners. According to the Washington Post, a career intelligence officer was so deeply disturbed by first hand experience with the program that he turned over 41 PowerPoint slides and other documents about PRISM to the newspaper. The Post reports the officer stating: “They quite literally can watch your ideas form as you type.” The slides are marked Top Secret, ORCON for Originator Controlled, and NOFORN meaning no foreign access. The government is already striking out at the release of the classified information. Late yesterday, James … Continue reading →

By Pam Martens: June 6, 2013  Last evening, The Guardian newspaper published a document classified by the U.S. government as Top Secret, revealing that the Obama administration is engaged in a domestic surveillance program involving the phone records of tens of millions of Americans.  The Guardian article is written by Glenn Greenwald, formerly a columnist for Salon and author of the 2011 book With Liberty and Justice for Some: How the Law Is Used to Destroy Equality and Protect the Powerful. The publisher describes the book as a no-holds-barred indictment of a two-tiered system of justice that “ensures that the country’s political and financial class is virtually immune from prosecution, licensed to act without restraint, while the politically powerless are imprisoned with greater ease and in greater numbers than in any other country in the world…[Greenwald] shows how the media, both political parties, and the courts have abetted a process … Continue reading →