You owe it to yourself to watch the new Frontline two part special, Money, Power and Wall Street. It is as fine an understanding of where we are and how we got here as anything in our media system today. Part Two comes on next week, but already the major themes are becoming clear.
- Complexity-No one except the “Quants” (the mathematical geniuses in the Big Investment Banks) who designed the Credit Default Swaps that grew to a $50 Trillion market in 8 years, knew how the securities operated or how risky they really were.
- Transparency-The only reason the spreads were so big on the CDS market was that it was a totally Dark Market. There was no transparency. No one could tell the real values of the securities.
- The Committee to Save the World-Rubin, Summers, Paulson, Blankfein, Dimon and Geithner were all part of a club that was going to make sure that none of their members would have to take a haircut on all the crap they owned. The Democrats are just as guilty as the Republicans that this happened.
If Obama’s second term looks like Teddy Roosevelt’s second term and he turns into the trust buster populist President, then eventually this wrong doing will be punished. Until then, watch this show and get really pissed off.