The Reckoner!

With the whole OWS angle, this one is mighty close to The Reckoner's stated 'no politics' line, but let's see how it goes before Reckonbot hits the big red button.

The Financial Crisis. Should somebody go to the slammer?

So this whole 2008 financial crisis was quite the fix.  And with the news in Europe, things just seem to get deeper.  Recently, we learned that Goldman Sachs helped Greece cook their own books to get into the EU under faulty financial pretenses, and there just seems to be no light at the end of the tunnel.

Yet recently, on 60 Minutes, I learned that no one (Bernie Madoff aside) has actually gone to the slammer for any of this.  No one from Lehman Brothers, nobody from AIG, nobody from Goldman Sachs, nobody.

The question here is, is that right?  Could it be possible that all this went down without somebody doing something that should've landed them in lockup?

Reckoning Results!
Jail some bastards
Nothing was illegal.
Couldn't all be legal.
All within the law
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Reckoning Comments!

Criminal laws really don't do this whole 'financial' crime thing all that well, and I suspect that the legal code and precedent there is nebulous enough that it just wasn't worth prosecuting anybody who didn't do something as blithely bad as Madoff did. And heck, it took Madoff decades to get caught (despite the SEC having plenty of warning), and even then, it only happened when his scheme went bust.

So while I think it'd be cathartic and satisfying to jail some bastards, I don't really think there's a strong legal justification to do so.  The key here would be to establish new regulations for next time, but I think we blew that opportunity pretty badly.

How 'bout them Sixers, eh?

Part of the problem with the Financial Crisis IS that it was all within the law.  People complain about "de-regulation", but government privilege is just as bad as government restrictions.  So the real problem ultimately falls to our government and how they try to handle the economy.  The privileges granted to the Federal Reserve are a large part of it, as the Fed has so much control over the money supply and interest rates.


"60 Minutes" did a show a few weeks ago where they talked to internal auditors at CountryWide who said that fraudulent mortgage applications were routinely put through and that executives at all levels knew about and encouraged these frauds. Financial reports were loaded with known untruths. One internal auditor said she would name people who knew of and approved fraudulent activities...but she was never interviewed by investigators.

Many, many people were involved with this financial scam at all levels yet no-one broke any laws?  Don't believe it.

The Reckoner!