By Pam Martens: September 21, 2022 ~ Yesterday, Gurbir Grewal, the Director of Enforcement for the Securities and Exchange Commission, said that the manner in which Wall Street mega bank, Morgan Stanley, had allowed the personal information of its clients to be auctioned off online on hard drives was “astonishing.” Grewal is not someone who can be easily astonished. Grewal came to the SEC from his post as Attorney General of New Jersey. Before that he had been the Bergen County Prosecutor. Prior to that he held various positions in the Justice Department’s U.S. Attorney’s Office for the District of New Jersey, including his last position there as Chief of the Economic Crimes Unit. Exactly what was it that astonished Grewal? According to the SEC’s Cease and Desist Order, here’s what happened: The retail brokerage unit of Morgan Stanley known as Morgan Stanley Smith Barney wanted to decommission two of its … Continue reading →

By Pam Martens and Russ Martens: September 20, 2022 ~ There are eight Global Systemically Important Banks (G-SIBS) in the U.S. They are: JPMorgan Chase, Citigroup, Bank of America, Goldman Sachs, Bank of New York Mellon, Morgan Stanley, State Street and Wells Fargo. These are the banks that pose the greatest risk to the stability of the U.S. financial system and are monitored under the Federal Reserve’s stress tests. Five of those eight banks pose the greatest risk to financial stability because together they hold $200.18 trillion (yes trillion) in notional derivatives (face amount) or 86 percent of all derivatives held by all of the nation’s banks, according to the Office of the Comptroller of the Currency – the federal regulator of national banks. Those banks are: JPMorgan Chase, Citigroup, Goldman Sachs, Morgan Stanley, and Bank of America. In any Senate Banking or House Financial Services Committee hearing that is going … Continue reading →

By Pam Martens and Russ Martens: September 19, 2022 ~ The Federal Election Commission (FEC), a federal agency, states that its mission is to “protect the integrity of the federal campaign finance process by providing transparency and fairly enforcing and administering federal campaign finance laws.” So last week Wall Street On Parade sent an email inquiry to the FEC, asking the following: “The fossil fuels conglomerate, Koch Industries, which is privately-owned by billionaire Charles Koch and the heirs of his late brother, David, owns a massive voter database, data mining, get-out-the-vote operation, etc. called i360. “As you will see from the FEC link below, i360 is selling its services to a multitude of Republican candidates for seats in the House and Senate, as well as to PACs that in turn support those candidates. “My question is, how is it legal for a privately-owned fossil fuels conglomerate to operate i360, effectively a more … Continue reading →

By Pam Martens and Russ Martens: September 16, 2022 ~ Yesterday, mainstream media was touting that the largest Initial Public Offering (IPO) of the year, Corebridge Financial, had just finished its first day of trading. The IPO was priced at $21 and closed at $20.73 (ticker: CRBG), not an illustrious start. Corebridge Financial is the life insurance and annuity business of the giant insurer, AIG. In 2008, AIG required a $180 billion bailout from the U.S. government because of its derivatives and stock loan deals with the big trading houses on Wall Street – many of the same ones that are now underwriting this IPO. If that’s not enough to make you suspicious, consider the fact that the word “derivatives” is mentioned 371 times in the prospectus for Corebridge Financial. (More on that in a moment, but first some background.) When the Financial Crisis Inquiry Commission wrote its final report for … Continue reading →

By Pam Martens and Russ Martens: September 15, 2022 ~ The nonpartisan watchdog group, Accountable.US, has released the results of an investigation into how committed to democracy the 100 largest corporations in America are. The corporations were graded on support for voting rights, the electoral process, and American democracy. The results were provided in an interactive resource called the American Democracy Scorecard. Researchers looked at 14 key criteria. Seven elements of the criteria involved making pro-democracy statements, being affiliated with pro-democracy organizations, and taking other pro-democracy actions. Seven other criteria involved corporate contributions to elected officials who are undermining democracy and voting rights. Three of the largest mega banks on Wall Street, JPMorgan Chase, Morgan Stanley, and Wells Fargo, flunked the democracy test, each receiving a score of “F.” Goldman Sachs received a “D.” Bank of America and Citigroup received a “B” grade, but, clearly, that was based on very recent … Continue reading →

By Pam Martens and Russ Martens: September 14, 2022 ~ The Dow Jones Industrial Average dropped 1,276 points yesterday for a decline of 3.94 percent. The Dow’s losses were outpaced by the tech-heavy Nasdaq, which gave up 632.8 points for a drop of 5.16 percent. The sharp selloff was triggered by the 8:30 a.m. report yesterday morning, an hour before the opening bell of the New York Stock Exchange, that inflation had come in hotter than expected in August. Wall Street had been looking for a 0.1 percent decline in the Consumer Price Index (CPI). Instead, the August reading showed an increase of 0.1 percent. The year-over-year rate slowed to 8.3 percent from 8.5 percent in July. The Fed is set to meet next Tuesday and Wednesday and with the CPI number coming in hotter than anticipated, there is now talk of the Fed slamming on the brakes more than anticipated, … Continue reading →

By Pam Martens and Russ Martens: September 13, 2022 ~ Two new nonfiction books are being released today. Bestselling author and anthropologist Sarah Kendzior’s book, They Knew, describes Donald Trump as a “transnational career criminal.” The book from the former top federal prosecutor in the Southern District of New York under the Trump Justice Department, Geoffrey Berman, a Republican, reinforces Kendzior’s thesis with the revelation that Trump’s Justice Department was weaponized “to aid the President’s friends and punish his enemies,” both foreign and domestic. One of the most outrageous demands from the Justice Department, writes Berman, was “pressure to pursue baseless criminal charges against John Kerry, who had served in the Obama administration as secretary of state.” Berman writes the following in Holding the Line: Inside the Nation’s Preeminent US Attorney’s Office and Its Battle with the Trump Justice Department: “Throughout my tenure as U.S. attorney, Trump’s Justice Department kept demanding that I use my office … Continue reading →

By Pam Martens and Russ Martens: September 12, 2022 ~ Sarah Kendzior turned 44 on September 1. She has already had two bestselling books. She holds a Ph.D. in anthropology from Washington University with a focus on authoritarian regimes.   We mention this as background because Kendzior’s latest book, They Knew: How a Culture of Conspiracy Keeps America Complacent, to be released tomorrow by Flatiron Books, needs to be read as the work of a serious scholar. Six years ago Kendzior correctly predicted in numerous articles what the rise of Trumpism would bring to the United States. On August 3, 2016, three months before the presidential election, Kendzior wrote the following for Foreign Policy under the headline: “Welcome to Donald Trump’s America”: “For over a year, pundits — especially Republicans who have a stake in legitimizing their party’s abject surrender — have been claiming that Trump will eventually pivot from his extremist positions. They … Continue reading →

By Pam Martens and Russ Martens: September 8, 2022 ~ Bailing out the Wall Street megabanks that are serially fined and hit with felony counts appears to be catching on as a major career advancement strategy at the New York Fed. On August 22, Lorie Logan began her big promotion as President of the Dallas Fed, a position that paid $440,700 at the end of 2020. That’s $40,700 more than the salary of the President of the United States. Prior to joining the Dallas Fed, Logan was the Manager of the System Open Market Account (SOMA) at the New York Fed, effectively the Fed’s trading floor. As part of her job, Logan oversaw the trillions of dollars that were electronically created at the New York Fed to bail out Wall Street trading houses in the fall of 2019 and through the middle of 2020. (See our related report The Fed Appears … Continue reading →

By Pam Martens and Russ Martens: September 8, 2022 ~ The Fed would appear to have violated both the spirit and the letter of the Dodd-Frank financial reform legislation in the second quarter of 2020, according to new repo loan data released by the New York Fed for the second quarter of 2020. The data shows that Citigroup received 96 percent of all repo loans made by the Fed between June 24, 2020 and June 30, 2020. Citigroup also dwarfed all other borrowers in the Fed’s repo loan program during the full second quarter of 2020. Citigroup borrowed a cumulative total of $454,751,000,000 from the Fed between April 1 and June 30, 2020. Of the 24 firms that borrowed during the second quarter of 2020 from the Fed’s repo loan program, Citigroup’s share amounted to more than the combined total of 19 firms. (See charts above and below.) Congress and the … Continue reading →