The banksters probably aren't even half as smart as they think they are -- and a lot less smart than Elizabeth Warren

"The problem is not that I don't understand the global banking system. The problem for these guys is that I fully understand the system and I understand how they make their money. And that's what they don't like about me."

-- Sen. Elizabeth Warren, on HuffPost's "So That Happened" podcast

by Ken

Can you guess which financial-sector genius Senator Warren was responding to on the HuffPost podcast?

If you guessed Jpmorganchase's Jamie "I'm So Smart, I Make Myself Sick" Dimon: right the first time. And as ThinkProgress's Bryce Covert put it in the title of his post yesterday: "A Bank CEO Said Elizabeth Warren Doesn’t Understand Wall Street. Her Response Was Perfect." Yes indeed, absolutely perfect.

It's a timely reminder both of how arrogant these bankster bastards are and of how much less smart they are than they think they are. Jamie D thinks he's some kind of genius. What he actually is is an insatiably greedy scumbag who gets his way most of the time by parlaying that greed along with his utter lack of principle and the financial clout of his company, especially in league with his international brethren. If you have the collective clout to back up your greed, and the requisite ruthlessness, yes, you can get used to getting what you want, and think you actually deserve it.

With reference to that phrase I just used, "the international brethren," no, there aren't a lot of sisters in the International Bankster Fraternity. And it occurs to me that this very likely has something to do with why it comes so easily to a half-witted slimesack like Jamie D to assume he's so much smarter than the senator. After all, she's only a grr-l.

However, as Bryce pointed out in his post (links onsite):

Warren’s résumé comes with nearly 20 years of experience teaching corporate law at Harvard University, publishing nine books, chairing the Congressional Oversight Panel that oversaw the bank bailouts in 2008 (of which JP Morgan was a beneficiary), and coming up with the idea for and helping to create the Consumer Financial Protection Bureau, which has already helped consumers avoid numerous predatory lending schemes and recouped more than $4.8 billion through its enforcement actions.

None of that happened because the senator doesn't understand the international banking system, but -- as she said -- because she does. And it seems to altogether likely that, as she said, that's why she makes the international banking fratboys so darned mad. Outsiders aren't supposed to be familiar with their secret handshakes -- and financial pillaging and plundering. The nerve of her!

And they're certainly not wrong about her having plenty of nerve -- thank goodness! From what we know of her history, that nerve didn't come quickly or easily, but was built up, and earned, over decades of close scrutiny of the actual practices of the financial-services industry. By and large the people who put that kind of time and effort into figuring out how all those pieces fit together expect some kind of payoff for their labors, and usually the only way to score that kind of payday is by getting on the bankster payroll in one fashion or another. I think it would be safe to say that Jamie D and his brethren don't trust the financial bona fides of people who aren't on their payroll.

Talk about somebody who doesn't know her place! Here's Bryce again (and again, links onsite):

She has also become widely known for her tough critiques of the banking industry. She has questioned why the government didn’t break up the biggest banks, like JP Morgan, when it offered bailout money in 2008 and joined a group of Senators in 2013 to propose reinstating a Depression-era rule that separated commercial and investment banking. She’s been a staunch supporter of the 2010 Dodd-Frank financial reform bill and stood in opposition to Republicans’ attempts to roll parts of it back.

She’s long criticized regulators’ reluctance to go after the biggest banks for their misconduct. She questioned the Securities and Exchange Commission, Justice Department, and Federal Reserve on the lack of prosecutions for banks’ misdeeds that led up to the financial crisis, saying, “If large financial institutions can break the law and accumulate millions in profits and, if they get caught, settle by paying out of those profits, they do not have much incentive to follow the law.” She proposed a bill that would have made settlements between banks and these regulators more transparent in an effort to tamp down on the government’s exaggerations. Just last week, she sent a letter to the SEC chairman voicing her disappointment in the agency’s failure to enforce existing rules governing the financial industry and its slow pace in writing new rules as mandated by Dodd-Frank.

And she’s also stuck it to JP Morgan itself. In 2013, the bank announced that one of its traders in London, who came to be known as the “London Whale,” had made a series of bad bets that ended up costing the bank $6 billion. The bank was eventually made to pay $900 million in fines and “admit its traders acted recklessly” when it was found the trades violated rules against banks making such bets with their own capital and against market manipulation.

As the episode unfurled, Warren said it made the case for a return to “boring banking” and the institution of the Volcker Rule, which would separate investment and commercial banking, in order to alleviate the risk such trades pose to the industry as a whole.

Now the bankster boys aren't that stupid. They're well familiar with the shenanigans they've grown used to getting away with, which would be pretty much everything this side of murder -- aka "the international banking system." Which apparently makes them that much madder when this darned grr-l talks about this stuff publicly, and even tries to do something about it. How disrespectful!

Yes, the lack of respect rankles the brethren. Bryce recalls that in March Warren Buffett took aim at Senator Warren, not for her lack of understanding but for her lack of tact, for being, as Bryce put it in the title of a post he wrote at the time, "Too 'Angry' and 'Violent' With Rich People." Oh, the horror! Bryce goes on to note:

Banks have also been fighting viciously against her, threatening to withhold campaign donations to all Senate Democrats to protest her. JP Morgan told Democrats that donations hinged on a friendlier atmosphere for banks.

As Howie has pointed out frequently, the banksters have had no difficulty finding takers for their bitching, with Sen. Chuck Schumer enthusiastically taking up the cause of creating that "friendlier atmosphere for banks" by lining up as many Democratic Senate candidates as he can who, if elected, would be there to offset the unfriendliness of troublemaker senators like Elizabeth Warren. Which just goes to show that she must be doing something right!

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No More Teddy Roosevelts in The GOP-- and Too Few Franklin Roosevelts Among The Beltway Democrats

Last night I was watching a PBS showing of Ken Burns' The Roosevelts-- An Intimate History, when J.P. Morgan's ugly mug popped up on the screen. A social parasite who our political elites failed to protect society from, Morgan blurted out, "I owe the public nothing" ... which is pretty much the way Wall Street still feels. Today's Republicans are not Teddy Roosevelt and they are not going to hold to fire to the feet of predators like Morgan. Alas, neither are most Beltway Democrats. Sure, you have a few good guys-- like Bernie Sanders, Elizabeth Warren, Sherrod Brown, Jeff Merkley, Brian Schatz in the Senate, and Alan Grayson, Donna Edwards, Raul Grijalva, Mark Pocan, Ted Lieu, Judy Chu, Keith Ellison, Jan Schakowsky in the House. But power in Congress is in the hands of Wall Street-owned shills like Chuck Schumer and Steve Israel who will never take the side of their own constituents over the interests of the big Wall Street banksters.

That helps explain why Schumer hand-picks Wall Street-owned hacks like Patrick Murphy (FL) and Ted Strickland (OH) to run for Senate seats and why Israel is always finding opportunistic Republicans to "switch" parties and run as though they were Democrats (the way Murphy did and they way Michael Derrick is trying to do in New York's North Country). Schumer and Israel are responsible for bringing in cash from the crooked banksters, and the crooked banksters are freaking out over Elizabeth Warren, Sherrod Brown and Bernie Sanders and warning the Beltway power brokers that they're going to cut the DSCC and DCCC off. 

Yesterday, for example, Bernie sent this message to his supporters about this era's JP Morgan, which is to say Goldman Sachs. It was clear and straightforward-- and exactly what the banksters come crying about to their allies Schumer and Israel.(Keep in mind, Wall Street has given Schumer bigger bribes than anyone else in the history of Congress who hasn't run for Congress-- $21,052,681-- and given Israel $4,068,416.) The banksters are demanding they make stuff like this go away. But here's Bernie:

It's time to break up the banks.

The greed, recklessness, and illegal behavior on Wall Street drove this country into the worst recession since the Great Depression. Their casino-style gambling has helped divert 99 percent of all new income to the top one percent. And it has contributed to the most unequal level of wealth and income distribution of any major country on earth.

In the midst of all of this grotesque inequality sits a handful of financial institutions that are still so large, the failure of any one would cause catastrophic risk to millions of Americans and send the world economy into crisis.

If it's too big to fail, it's too big to exist. That's the bottom line.

I introduced legislation in Congress that would break up banks that are too big to fail... Banking should be boring. It shouldn't be about making as much profit as possible by gambling on esoteric financial products. The goal of banking should be to provide affordable loans to small and medium-sized businesses in the productive economy, and to Americans who need to purchase homes and cars.

That is not what these financial institutions are doing. They're instead creating an economy which is not sustainable from a moral, economic, or political perspective. It's a rigged economy that must be changed in fundamental ways.

Let's be clear who we're talking about: JPMorgan Chase, Bank of America, Citigroup, Goldman Sachs, Wells Fargo, Morgan Stanley, and other institutions; they're all too big to fail. So they must be broken up.

Wall Street can't be an island unto itself separate from the rest of the productive economy whose only goal is to make as much money as possible. I fear very much that the financial system is even more fragile than many people may perceive.

Millions of Americans are working longer hours for lower wages, while virtually all new income goes to the people who need it the least. In fact, the top 14 wealthiest people saw their wealth grow more last year than the bottom 130 million have in total.

...I'm running for President of the United States because I believe that it is incumbent on us to try to take back our country from the billionaires and make it thrive again for the working and middle class. Breaking up the banks is a critical part to making that a reality.

Thank you for all of your support.

Senator Bernie Sanders

If you'd like to see Bernie in the White House, rather than another Wall Street-financed Bush or Clinton-- you can contribute whatever you feel you can afford here via ActBlue. And if you want to help congressional candidates who will put working families before banksters, here are the Senate candidates and here are the House candidates.

Did Bernie Sanders Team Up With Goldman Sachs? Of Course Not

There are a dozen Republican kooks on the Senate Budget Committee, all right-wing ideologues who worship at the alter of low taxes for the wealthy and torture for ordinary working families. All 12-- Mike Enzi (WY-chair), Chuck Grassely (IA), Jeff Sessions (AL), Mike Crapo (ID), Lindsey Graham (SC), Rob Portman (OH), Pat Toomey (PA), Ron Johnson (WI), Kelly Ayotte (NH), Roger Wicker (MS), Bob Corker (TN) and David Perdue (GA)-- are advocates of Europe's disastrously-failed Austerity agenda. To counter the right-wing insanity, the Democrats have 10 members on the committee and they appointed Bernie Sanders ranking member. His ideas are as far from the anti-middle class jihad the Republican are waging as one could hope for. Problem for Bernie, however, is that his side of the table isn't united behind progressive ideas-- not by a longshot. The banking industry may be grousing about Bernie Sanders' position but they know full well that economic royalists like Mark Warner (VA), Tim Kaine (VA), and Angus King (ME) will work more closely with Mike Enzi than with Bernie Sanders.

Earlier this month, Noah Bierman warned Boston Globe readers that Sanders can expect to be undercut by conservative Democrats on the committee and by paid shills of the financial services industry-- Congress' top paymasters-- from K Street and Wall Street. Bremen singled out one of the worst, G. William Hoagland, a senior vice president for the grotesquely corrupt right-wing, ostensibly "Bipartisan" Policy Center (bipartisan meaning conservative Republicans plus conservative Democrats).

“If you are actually setting fiscal policy for the future, it is a very unpleasant thing to talk about either tax increases or spending increases,” said G. William Hoagland, a budget hawk who is senior vice president for the Bipartisan Policy Center, a centrist think tank.

Hoagland said he has talked to a couple of Democratic senators, whom he would not name, who are wary of making Sanders a prominent voice on the budget.

Hoagland said he believes moderate Democrats on the committee-- including Mark Warner and Tim Kaine of Virginia and Angus King, a Maine independent who caucuses with Democrats-- will prevent Sanders from taking too hard a line.

“They will definitely pull him back to the left of center as opposed to the far left of center,” he said.

I bet Hoagland and his cronies don't know what to make of Senator Sanders' weighing into the dispute between banksters at Goldman Sachs and JP Morgan.

Sen. Bernie Sanders (I-Vt.) doesn't often find common cause with Goldman Sachs. But when it comes to breaking up the world's biggest bank, Sanders is on the same page as a team of Goldman analysts.

“Goldman Sachs is right," Sanders said Thursday in a statement provided to HuffPost. "J.P. Morgan should be broken up."

Last week, Goldman's research department issued a report making the case that rival JPMorgan Chase would be more valuable to shareholders if it were broken into multiple banks. Since regulators have increased JPMorgan's mandated capital levels above that of some slightly smaller peers, Goldman analysts claimed the bank would be worth up to 25 percent more if it were split into as many as four separate entities. The smaller banks would have to hold less capital, since they would not pose as great a threat to the financial system in the event of failure, according to the analysis. Lower capital requirements would allow the smaller banks to profit more handsomely from riskier operations.

"Our analysis suggests that a breakup-- into two or four parts-- could unlock value in most scenarios, although the range of outcomes we assessed is wide, at 5 - 25 [percent] potential upside," the report reads.

Bank reform advocates have long proposed tough capital standards to encourage big banks to break up, but the levels contemplated are typically much higher than those currently imposed on JPMorgan. Sens. Sherrod Brown (D-Ohio) and David Vitter (R-La.) introduced legislation in 2013 that would coax the breakup of big banks by dramatically raising their capital requirements. The legislation never came up for a vote.

Goldman's report did not target all big banks, which are subject to more stringent capital rules than smaller banks. Instead, it focused on disparities between JPMorgan and other large banks, where it noted that JPMorgan faces more rigorous requirements than other behemoths. According to the Goldman report, regulators recently imposed tougher capital standards on JPMorgan, because it devotes an unusually large portion of its activities to risky businesses, including securities trading and derivatives operations.

...For many financial watchdogs off Wall Street, of course, such intra-Too-Big-To-Fail rivalries are unimportant. In his statement to HuffPost, Sanders argued for breaking up the six largest U.S. banks-- a list that includes Goldman itself.

"Our biggest banks all need to be broken up," Sanders said. "Today, the largest banks in this country are much bigger than they were before taxpayers bailed them out. The top six banks today have over $9.8 trillion in assets, equivalent to almost 60 percent of the GDP of the United States … It's time to break up these behemoths."

JPMorgan Executives Caught Stealing Millions From California Electricity Users

If you watched the History Channel series, The Men Who Built America you may recall that JP Morgan backed Thomas Edison and made a bid to control the electric industry in America. The clip above is just an introduction and doesn't go into Morgan's ruthlessness. Today JP Morgan is an even more powerful Wall Street firm than the founder could have ever imagined-- and, once again, ruthless in its quest to make money from electricity. Like Enron before them, the Morgan criminal banksters are manipulating California's electricity markets to enrich themselves while rate payers are fleeced.

In an official notice, the Federal Energy Regulatory Commission alleged that the bank had engaged in "eight manipulative bidding strategies" in California and Midwestern markets.

The strategies led to payments to JPMorgan "of tens of millions of dollars at rates far above market prices," according to the notice. JPMorgan is expected to pay a massive fine related to the allegations.

The strategies allegedly worked like this. In California, for example, the bank would bid to deliver electricity to a utility the next day at a low price of $30 per megawatt hour. When the next day came, JPMorgan would change its offer to a much higher price of $999 per megawatt hour, assuring the power did not get bought, according to the notice.

California ISO, the state's power-grid operator, would then have to compensate the bank for the cost of making the bid, under California's "make whole provision," which requires ratepayers to cover certain costs incurred by energy sellers.

Still too big to jail? Fines-- paid by shareholders-- don't do anything at all to put a stop to the criminal behavior of these Wall Street sociopaths. I know the sensitivities of most of us don't allow for firing squads but... what about some hard prison terms for the top executives? That would put a stop to this kind of behavior-- at least for a while.This is from a press release I got yesterday from Elizabeth Warren and Ed Markey. And this is what Blue America was talking about when we promoted the idea of this incredible team:

Massachusetts Senators Elizabeth Warren and Edward J. Markey today asked the head of the Federal Energy Regulatory Commission how his agency was protecting consumers and prosecuting JPMorgan Chase following the agreement by the company to pay $410 million in penalties and surrendered profits to settle allegations of market manipulation in electricity markets. In a letter sent to FERC Chairman Jon Wellinghoff, the two Massachusetts Democrats ask how FERC determined the financial punishment for JPMorgan, how harm to consumers was evaluated, and whether this incident is part of an increasing trend of energy market manipulation.

“While this fine is large in absolute terms, the total penalties are equal to roughly 1.3 percent of JPMorgan’s 2012 profits,” write the Senators. “We are concerned about whether the settlement includes adequate refunds to defrauded ratepayers and also concerned that the individual executives who sought to impede the Commission’s investigation will not be punished. It is critical that government settlements provide appropriate relief for consumers and deter future law-breaking.”

...According to FERC allegations, a JPMorgan energy-trading unit engaged in 12 deceptive bidding strategies in wholesale energy markets from September 2010 to November 2012 in California and the Midwest, resulting in tens of millions of dollars in overpayments from the grid operators. Of the $410 million JPMorgan will pay, $125 million consists of disgorged profits that will go to ratepayers in California and the Midwest and $285 million civil penalties.