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Reading list offers insight into economic situation

Posted: November 15, 2011 - 9:51am

The article in (the Nov. 11) Clarion on MF Global's dive reported that David Kotok, a money manager, asked "How did this happen?" This question has motivated me for several years to search for answers to that very question.

"A Colossal Failure of Common Sense" written by the Vice-President of Lehman Brothers, Larry McDonald,  explains answers to that question and to the question of "Could we have seen it coming?" with respect to the failure of Lehman Brothers.

He and others did see it coming and warned Richard Fuld, the CEO of Lehmans, who chose to ignore their warnings and their advice.

With respect to the financial crisis in the US and the world, two other educational books are "The Big Short" by Michael Lewis and "Hoodwinked"  by John Perkins. Both describe the fraud crimes committed by the major banks and members of Wall Street. In Hoodwinked, Perkins, a confessed and reformed economic hit man lays out how big corporate industries have practice predatory capitalism to hoodwink investors, our middle class, our government and government regulators to maximize their returns.

Insight into the question of "How we have gotten to this point?" is vividly described in "Tangled Webs" by the

Pulitzer Prize winner, James B. Stewart. His thesis is how false statements are undermining America. To illustrate his point he follows the trials of Martha Stewart for insider trading, the Scooter Libby trial for outing Valerie Plame, the Barry Bonds trial for steroid use, and the Bernard Madoff trial for perjury. I thought he did an excellent job of presenting the lies of each of these people and how investigators unraveled and disproved their lies.

My remaining question is "Why is our Attorney General, Eric Holder, not investigating and prosecuting Wall Street's fraud crimes?" One explanation recently offered in a New York Times is that Tim Geitner, Treasury Secretary, was fearful that prosecution of these crimes would damage our already shaky Wall Street markets and that he convinced Holder not to proceed. I find it very difficult to accept that we have come to this point.

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akal 11/15/11 - 10:32 am

could be the regulators are just as crooked as the investment bankers. and yes it has come all the way to this. it is important to realize that fraud is happening in the stock market in so many ways it defies the logical mind. when a country can print all the currency it wishes ,who are the real crooks? a head in the sand will not protect us from economic servitude. real goods and gold and silver may be the only hope some of us have for saving our funds.

witchwitch 11/15/11 - 12:32 pm
Morally they are crooks, but legally is another story...

Our government, from the top down, is designed to legitimize the corrupt practices of our Legislators, whether they are federal, state or local. "Process" is designed to give the appearance of legitimacy for governmental affairs, while protecting the power and influence of our elected officials.

People are beginning to realize this, as the results are glaringly obvious.

When the bottom falls out and there is no denying the fact that our government is corrupt, then we may work to fix the problem. Until then there will be continue to be false efforts to do so, which are simple cover so that the benefits of power are enjoyed by those firmly holding the reins.

When time comes to fix the problem, we will be in really bad shape, economically and morally. The fix is unlikely to restore equity, while many will suffer because of the excesses of the few. The "American way" will have a very different universal meaning in the next decade.

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