If Google
is so clever and so good at knowing me, my desires and my needs,
why is it giving me ads in Dutch when I read the newspapers this
week? Does it not even remember what language I deal in?
I'm in
Bloemendaal a wealthy little town just south of Haarlem. The
wealthiest in The Netherlands, I believe. Yesterday I had lunch in a
restaurant called Rusthoek which translates as Rest Corner.
Which sounds to me like a funeral parlour. Ironically, there's an old
folks' home opposite it on the other side of the street. So, maybe
Rest Corner sounds less threatening in Dutch.
Bloemendaal
is very pretty and serene, with few cars but plenty of bikes. Though
one occasionally sees an older form of transport.
Here's a couple of more
Spain-relevant lists from The Local:-
- Things that Spaniards Want to Know about Britain and the Brits. Side-splittingly funny[?].
- Spain'sHidden Gems. Again.
The
Catalan chess game sees another move this week, with the trial of an
ex-president for initiating a secession referendum vote there. As
this article asks, how far is Madrid prepared to go to stop this
happening this year.
Meanwhile,
over in La La Land . . . If you can fool Youtube into
believing you're in the USA, take a look at this hilarious spoof of Trump's press guy, Sean Spencer. If not, try the internet or wait a
few days for Youtube to make it generally accessible.
More seriously, read
here about how Trump has already resiled on one of his biggest –
'Big. Really, really big' – promises - on taming Wall Street and
the banks. It was originally in Rolling Stone. In case you have
problems seeing it, I've added the text at the end of this post.
I'm off to
Hilversum today, a name only known from the radio sets of my youth.
Finally
. . . Cervantes is reputed to have said: Tell me the company you keep
and I will tell you who you are. When I look at the 40+ people
I'm seeing in the UK and Holland this 5 weeks, I'm led to conclude
he'd have his work cut out in my case. I'm very proud to say.
Extreme
Vetting, but not for Banks: Trump
proves he’s a tool for Wall Street after all
By Matt
Taibbi
Donald
Trump, the man who positioned himself as the common man's shield
against Wall Street, signed a series of orders today calling for
reviews or rollbacks of financial regulations. He did so after
meeting with some friendly helpers.
Here's how
CNBC described the crowd of Wall Street CEOs Trump
received, before he ordered a review of both the Dodd-Frank Act and
the fiduciary rule requiring investment advisors to act in their
clients' interests:
"Trump
also will meet at the White House with leading CEOs, including
JPMorgan's Jamie Dimon, Blackstone's Steve Schwarzman, and
BlackRock's Larry Fink."
Leading
the way for this assortment of populist heroes will be former Goldman
honcho Gary Cohn, now Trump's chief economic advisor.
Dimon,
Schwarzman, Fink and Cohn collectively represent a rogues gallery of
the creeps most responsible for the 2008 crash. It would be hard to
put together a group of people less sympathetic to the non-wealthy.
Trump's
approach to Wall Street is in sharp contrast to his tough-talking
stances on terrorism. He talks a big game when slamming the door on
penniless refugees, but curls up like a beach weakling around guys
who have more money than he does.
The two
primary disasters in American history this century (if we're not
counting Trump's election) have been 9/11 and the 2008 financial
crisis, which cost 8.7 million people their jobs and may
have destroyed as much as 45 percent of the world's wealth.
The
response to 9/11 we know: major military actions all over the world,
plus a radical reshaping of our legal structure, with voters
embracing warrantless surveillance, a suspension of habeas corpus,
even torture.
But the
crisis response? Basically, we gave trillions of dollars to bail out
the very actors who caused the mess. Now, with Trump's election,
we've triumphantly put those same actors back in charge of
non-policing themselves.
In
between, we passed a few weak-sauce rules designed to scale back some
of the worst excesses. Those rules presumably will be tossed aside
now.
Trump's
"extreme vetting" plan for immigrants and refugees is based
upon a safety argument – i.e., that the smallest chance of a
disaster justifies the most extreme measures. Infamously this week,
administration spokesdunce Kellyanne Conway resorted to citing a
disaster that never even happened – the "Bowling
Green Massacre" – as a justification for the crazy visa
policy.
This makes
Trump's embrace of the Mortgage Crash Dream Team as his advisory
panel for how to make Wall Street run more smoothly all the more
preposterous.
The crisis
was caused by the financial equivalent of open borders. Virtually no
one was monitoring risk levels or credit worthiness at the world's
biggest companies.
The
watchdogs who are supposed to be making sure the morons on Wall
Street don't blow up the planet all failed: the compliance people
within private companies, the so-called self-regulating organizations
like the NYSE, and finally the government agencies like the OCC and
the OTS.
These
companies are now so enormous that they can't keep track of their own
positions. Also, in sharp contrast to the propaganda about what
brainy people they all are, many of them lack even the most basic
understanding of the potential consequences of deals they might be
making.
The
leadership of AIG, for instance, basically had no clue how
its derivatives portfolio worked, despite the fact that they had $79
billion worth of exposure. Similarly, then-CEO Chuck Prince of
Citigroup told the Financial Crisis Inquiry Commission that a $40
billion mortgage position "would not in any way have excited my
attention." Both companies ended up needing massive bailouts.
Not only
can they not keep track of their own books, they already blow off
regulators whenever they get the chance. Take JPMorgan Chase's
"London Whale" episode, in which some $6.2 billion in
losses in one portfolio accumulated practically overnight. In
that case, Dimon simply refused to give the federal regulators
routine, required reports as to what was going on with his bank's
positions, probably because he himself had no idea how big the hole
was at the time.
"Mr.
Dimon said it was his decision whether to send the reports
to the OCC," a regulator later told the Senate.
This is
the same Jamie Dimon about whom Trump said today, "There's
nobody better to tell me about Dodd-Frank than Jamie Dimon, so thank
you, Jamie."
The
enduring lesson of the financial crisis is that in markets as complex
as this one, the most extreme danger is in opacity. The big problem
is that these egomaniacal Wall Street titans want markets as opaque
as possible.
This is
why they want to get rid of the fiduciary rule, because they don't
think it's anyone's business if they choose to bet against their
clients (as Cohn's Goldman famously did), or overcharge them, or
otherwise screw them.
They don't
want to have to submit to even the most basic capital
requirements, or be classified a systemically important company, or
have to keep their depository businesses separate from their gambling
businesses, or have to have a plan for dissolution if they melt down,
or really deal with any intrusions at all.
Trump –
a man who doesn't want you to see what's going on underneath his
hair, let alone in his books – naturally sympathizes with Wall
Street's efforts to keep the markets opaque. The obvious conclusion
is that these orders will eventually lead us back to ballooning risk,
overheated markets (the NYSE is already soaring) and speculative
bubbles.
If we're
very lucky, it won't crash soon. But can we at least put an end to
the "drain the swamp" nonsense?
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