Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Big Banks Face Another Round of U.S. Charges

dealbook.nytimes.com

Post reply on HN
Print view View original

21–30 of 46 posts

Re: Big Banks Face Another Round of U.S. Charges

#21

Post by jxm262 »

Hario wrote: post #11

I'm with Richard Stallman on this. http://blogs.reuters.com/great-debate/2013/02/04/fixing-too-... Banks have way too much power in both our politics and economy. We have to change that.

Thanks for the interesting read. I'm not 100% certain splitting the companies up would be the best alternative, but this definitely makes me ponder a bit. It makes sense to split up, but who would make the actual call? The shareholders? I'm assuming any CEO figure of the company would prefer to keep it growing so they can maximize their collective resources rather than splitting among smaller ones. Or maybe I'm missing some other incentives?

Re: Big Banks Face Another Round of U.S. Charges

#22

Post by not_that_noob »

res0nat0r wrote: post #17
not_that_noob wrote: post #10

Earlier quoted context omitted.

Popular sentiment is correct in this case. No one went to jail for reckless behavior that they had good reason to believe was wrong. Instead, they got to keep their bonuses to buy their mansions. Oh and in one final insult, the settlements with the banks will eventually be paid for out of bank revenues - which of course is generated by the public. I'm sure the bank execs are high fiving each other over that maneuver…

> No one went to jail for reckless behavior that they had good reason to believe was wrong. Unfortunately most of what the banks did that caused the 2008 crisis was not against the law.

Yes, see my previous comment. Bankers gave political contributions and laws were rewritten. And regulators were weakened.

Re: Big Banks Face Another Round of U.S. Charges

#23

Post by DMac87 »

nodata wrote: post #15
hackuser wrote: post #14

It's interesting, and troubling, that so many still trust these institutions: * Banks that have been caught repeatedly both intentionally defrauding people and acting with extreme incompetence (and who knows who often they haven't been caught). Yet most customers, from individuals and to large corporations continue to trust the banks with their money and to take the banks' advice. * They trust LIBOR and similar servi…

What alternatives do you personally use?

(Not original poster, but some suggestions) :

- Use a local credit union as opposed to big national bank. Yes, there may be minor inconveniences in service, but in this day of online banking, they should be minimal.

- Invest with a financial advisor you know and trust, who will pick up the phone when you call and explain things to any level of detail you desire (or who will bring in experts to do so if you won't). Barring that, invest in index funds for broad asset class exposure with low fees.

- Don't believe / vote in / listen to anyone (economist, politician or otherwise) who touts "free markets" without further explanation of how that market's regulators & insiders will work.

Re: Big Banks Face Another Round of U.S. Charges

#24

Post by rqebmm »

tibbon wrote: post #16

These companies (bank in specific) often repeatedly do these type of things trying to get away with m/billions in profit. When caught, the penalties just aren't enough to dissuade them from it. They probably get away with it most of the time, so there is no incentive to do otherwise. I really wish we would push for real penalties (jailtime, as we have done in the past during bank scandals) or even entire shutdown of…

This was only true up until recently. In the last year B of A and JP Morgan settled for $17b[1] and $13b[2] respectively. Each settlement was more than their net income for the preceding year. That hurts. A lot.

Furthermore, the settlements since 2008 have largely not precluded the banks from facing criminal charges[2]. The Justice department needs to get these initial settlements out of the way before they can pierce the corporate veil and pursue criminal action against individuals and these giant banks unsurprisingly have spent lots of money and lawyers dragging these investigations out for the last 6 years. I'm ever an optimist, but I think it's inevitable that some criminal charges are still coming. Those charges will likely fall on scapegoats, but still.

[1]http://www.masslive.com/business-news/index.ssf/2014/08/bank... [2]http://money.cnn.com/2013/11/19/investing/jpmorgan-mortgage-...

Re: Big Banks Face Another Round of U.S. Charges

#25

Post by jessaustin »

res0nat0r wrote: post #17
not_that_noob wrote: post #10

Earlier quoted context omitted.

Popular sentiment is correct in this case. No one went to jail for reckless behavior that they had good reason to believe was wrong. Instead, they got to keep their bonuses to buy their mansions. Oh and in one final insult, the settlements with the banks will eventually be paid for out of bank revenues - which of course is generated by the public. I'm sure the bank execs are high fiving each other over that maneuver…

> No one went to jail for reckless behavior that they had good reason to believe was wrong. Unfortunately most of what the banks did that caused the 2008 crisis was not against the law.

IMHO the far larger injustice is that the federal treasury bailed them out. I'm OK with Goldman Sachs assholes living outside a prison; it's the taxpayer-funded luxury in which they live that really bugs me.

Re: Big Banks Face Another Round of U.S. Charges

#26

Post by nitid_name »

rqebmm wrote: post #20
hackuser wrote: post #14

It's interesting, and troubling, that so many still trust these institutions: * Banks that have been caught repeatedly both intentionally defrauding people and acting with extreme incompetence (and who knows who often they haven't been caught). Yet most customers, from individuals and to large corporations continue to trust the banks with their money and to take the banks' advice. * They trust LIBOR and similar servi…

How does High Frequency Trading pervert the market? They are acting as middle-men.

I think the complaint against is generally that they're acting more akin to front runners than middle men.

Re: Big Banks Face Another Round of U.S. Charges

#27

Post by rqebmm »

nitid_name wrote: post #26
rqebmm wrote: post #20

Earlier quoted context omitted.

How does High Frequency Trading pervert the market? They are acting as middle-men.

I think the complaint against is generally that they're acting more akin to front runners than middle men.

Either way, they're not doing market-making.

Don't get me wrong, there's lots of market perverting going on, but HFT isn't party to it.

Re: Big Banks Face Another Round of U.S. Charges

#29

Post by geekpondering »

rqebmm wrote: post #20
hackuser wrote: post #14

It's interesting, and troubling, that so many still trust these institutions: * Banks that have been caught repeatedly both intentionally defrauding people and acting with extreme incompetence (and who knows who often they haven't been caught). Yet most customers, from individuals and to large corporations continue to trust the banks with their money and to take the banks' advice. * They trust LIBOR and similar servi…

How does High Frequency Trading pervert the market? They are acting as middle-men.

...middle-men that aren't providing any service or benefit to anyone except those that profit from those trades.

These "middle-men" are injecting themselves between buyer and seller to take their cut simply because they have the money, resources, and -- increasingly these days -- the geographic location to beat someone else to the punch.

Re: Big Banks Face Another Round of U.S. Charges

#30

Post by Retric »

rqebmm wrote: post #27
nitid_name wrote: post #26

Earlier quoted context omitted.

I think the complaint against is generally that they're acting more akin to front runners than middle men.

Either way, they're not doing market-making. Don't get me wrong, there's lots of market perverting going on, but HFT isn't party to it.

They if nothing else threy distort the market by adding noise. As in 99.9% of the time no new information is used when they make a trade.
Post reply on HN