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Why didn’t any Wall Street CEOs go to jail after the financial crisis? (2019)

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Re: Why didn’t any Wall Street CEOs go to jail after the financial crisis? (2019)

#121

Post by AnimalMuppet »

pwned1 wrote: post #77
bawolff wrote: post #5

Articles like this never seem to make the case for which crimes were specificly commited. They always talk about the fallout of the financial crisis (losing money on wall street isnt a crime afaik). Idk much about this topic, so im sure crimes could be involved, but its weird how these articles dont start with why didn't someone go to jail for .

The problem was that everyone was in on it. I spoke to quite a few people in that time period, from mortgage brokers to borrowers to bankers. They all knew what was happening. A friend tried to sell me on getting a NINJA loan (No Income, No Job, No Assets) where, I was told "just tell them any number for your income on the application." It was all done with a wink and nod and everyone in the pipeline knew what was ha…

Who gets thrown in the clink? How about "as many as possible, and the higher up the better"?

"We can't jail them all" does not imply "therefore jail none of them".

Precedents matter. The precedent that was set is "widespread fraud is fine; if enough people are in on it, nobody can be jailed". Is that really the precedent we want?

Re: Why didn’t any Wall Street CEOs go to jail after the financial crisis? (2019)

#122

Post by [deleted] »

actually_a_dog wrote: post #84
AnimalMuppet wrote: post #76

Earlier quoted context omitted.

You know, you keep saying what socialism isn't . I agree with you that rspoerri's definition is too expansive, but we could have a more useful discussion if you supplied a definition, instead of just saying "no, that isn't it". (And "crack a book" isn't a definition.)

Sorry, but I'm not in the mood to get flagged today. I cut it off with "crack a book," because if you go one more step down the road beyond that, that leads to something you can't discuss rationally on Hacker News.

[deleted]

Re: Why didn’t any Wall Street CEOs go to jail after the financial crisis? (2019)

#123

Post by rspoerri »

AnimalMuppet wrote: post #115
actually_a_dog wrote: post #84

Earlier quoted context omitted.

Sorry, but I'm not in the mood to get flagged today. I cut it off with "crack a book," because if you go one more step down the road beyond that, that leads to something you can't discuss rationally on Hacker News.

Fine. Then I will. (Been downvoted plenty lately, what's some more?) Socialism is social ownership of the means of production . It's not government healthcare. It's not government bailouts (unless the government keeps ownership of the businesses). It's not "government doing things". It's not government using taxes to pay for doing things. It's government owning the means of production, or else the people owning it in…

Thank you AnimalMuppet for your point of view.

I do agree that "Socialism is social ownership of the means of production" is one aspect of socialism. But its only one of many aspects that fall under socialism. Socialism has been reduced to that aspect in the recent years, but that doesnt invalidate the other aspects. (see my above post with the 4 aspects of socialism)

Id argue govermental healthcare does produce something and it's govermentally owned. So especially that should, even under the "Socialism ... means of producton", be socialistic.

A loan is usually a product that banks provide. Afaik usually the goverment does not give loans. So id assume even that qualifies as "Socialism ... means of producton".

You could argue that the goverment is not "social ownership". But in my opinion that is exactly the base of what a democracy constitutes.

I'd wonder where you dont agree.

Re: Why didn’t any Wall Street CEOs go to jail after the financial crisis? (2019)

#124

Post by AnimalMuppet »

rspoerri wrote: post #123
AnimalMuppet wrote: post #115

Earlier quoted context omitted.

Fine. Then I will. (Been downvoted plenty lately, what's some more?) Socialism is social ownership of the means of production . It's not government healthcare. It's not government bailouts (unless the government keeps ownership of the businesses). It's not "government doing things". It's not government using taxes to pay for doing things. It's government owning the means of production, or else the people owning it in…

Thank you AnimalMuppet for your point of view. I do agree that "Socialism is social ownership of the means of production" is one aspect of socialism. But its only one of many aspects that fall under socialism. Socialism has been reduced to that aspect in the recent years, but that doesnt invalidate the other aspects. (see my above post with the 4 aspects of socialism) Id argue govermental healthcare does produce some…

I agree that government is social ownership. But it's mainly about the bulk of things. Does the government own 1% of the factories? Probably not really socialism. Does it own 30%? 70%? 99%?

So, to your examples, the government giving out a loan might be considered socialism for that one loan. But what percentage of the banks does the government own? Or, what percentage of the loans does the government originate? Not a very high percentage. (And, when the government takes over a failing bank, they usually do it not to own the bank, but to get it off their hands as soon as they can.) So I don't see lending as being socialism, even if the government does a few loans here and there.

Medicine... there's Medicare and Medicaid. That's not really socialized medicine. How many doctors' offices does the government own? How many hospitals? What's really socialized is a big section of medical insurance.

Another thing that's largely (but not totally) socialized is higher education. Also airports, but not airlines.

So as you look around at, say, the US, it's not really characterized by socialism. It is, to some degree in some sectors, but the whole economy is not characterized by the government owning the means of production.

[Edit: This means that economies are not binary: socialist/not socialist. They are often a mix of some socialism (government ownership) and some not. We call an economy socialist when the government fraction of production (not purchasing) becomes significant, though there is no bright line (above X% it's definitely socialist).]

Re: Why didn’t any Wall Street CEOs go to jail after the financial crisis? (2019)

#126

Post by ksec »

bawolff wrote: post #5

Articles like this never seem to make the case for which crimes were specificly commited. They always talk about the fallout of the financial crisis (losing money on wall street isnt a crime afaik). Idk much about this topic, so im sure crimes could be involved, but its weird how these articles dont start with why didn't someone go to jail for .

People really need to watch Margin Call.

Re: Why didn’t any Wall Street CEOs go to jail after the financial crisis? (2019)

#127

Post by ksec »

taway2021s wrote: post #31
bawolff wrote: post #5

Articles like this never seem to make the case for which crimes were specificly commited. They always talk about the fallout of the financial crisis (losing money on wall street isnt a crime afaik). Idk much about this topic, so im sure crimes could be involved, but its weird how these articles dont start with why didn't someone go to jail for .

Sure. Lets start with an easy example. Why didnt any Directors at Goldman Sachs serve prison time for knowingly bundling Synthetic CDOs with bad CDS that they internally know were garbage? They sold these to pension funds, and other public entities. There were documented losses. There are documented emails with full internal discussion on how bad these investments were. (documented with emails.) Note there was a civi…

There are buy side and sell side. And the financial world and regulation make them more like two separate entity. When the world simply known them as one called GS.

Re: Why didn’t any Wall Street CEOs go to jail after the financial crisis? (2019)

#128

Post by soco »

nickff wrote: post #110
mojomark wrote: post #90

Earlier quoted context omitted.

> You dont necessarily need to charge the Wall Street CEOs. You can charge the Senior Managing Director of Structured Products. You can delegate authority, not responsibility. This fundamental rule of hierarchical organizations is why CEO's need to be held accountable. CEO's are responsible for creating the environment, culture and rules that allow such activities to take place. Failure within an organization on a CE…

The problem is that it is impossible to delegate authority, but no responsibility. Realistically, the CEO of a large company cannot know everything that happens under the umbrella, much like the President of the USA cannot know what every government employees does. In both situations, some subordinates will inevitably commit crimes in the name of the organization (eventually), and holding the person at the top comple…

And this is why exactly none is ever held responsible for any crime done by an organization with more than two levels of authority. In my opinion, the problem is not the organization, but the lack of legal framework to put them all in jail. Then you'd see how all subordinates and CxOs would scramble to fix their shady practices. But I guess a clean business environment wouldn't be "competitive" or what's the word of the month...

Re: Why didn’t any Wall Street CEOs go to jail after the financial crisis? (2019)

#129

Post by rspoerri »

AnimalMuppet wrote: post #124
rspoerri wrote: post #123

Earlier quoted context omitted.

Thank you AnimalMuppet for your point of view. I do agree that "Socialism is social ownership of the means of production" is one aspect of socialism. But its only one of many aspects that fall under socialism. Socialism has been reduced to that aspect in the recent years, but that doesnt invalidate the other aspects. (see my above post with the 4 aspects of socialism) Id argue govermental healthcare does produce some…

I agree that government is social ownership. But it's mainly about the bulk of things. Does the government own 1% of the factories? Probably not really socialism. Does it own 30%? 70%? 99%? So, to your examples, the government giving out a loan might be considered socialism for that one loan . But what percentage of the banks does the government own? Or, what percentage of the loans does the government originate? Not…

Id never assume that usa is socialistic. Neigther is switzerland where the goverment might own 3% of the industry, which is where im from. Id assume only kuba might be considered a socialistic country if you look at these values.

My original point was, that rescuing the banks by the goverment was a socialistic act. Thats where the discussion started and i still need to see an explanation why this is not the case. But i think you might even agree to this.

For all other points i fully agree with you. The goverment does only parts of these functions (healthcare insurance, etc.) . Which doesnt make the country socialistic, but these functions the goverment provides are. (In my point of view)

My key takeaway from this discussion is that in europe socialism is defined broader then in the usa. At least for an average of the people. The part of „govermentally controlled production“ has never really a been part of what i assume to be socialism. I think of it much more in the way as our second largest party the sozialdemokraten do (sp schweiz). But describing that would blow this topic completely.

Thanks for the discussion.

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