Skip to main content

View Diary: How Occupy has defined the election (290 comments)

Comment Preferences

  •  I disagree (1+ / 0-)
    Recommended by:
    joe from Lowell

    The Occupy movement zeroed in on banks, when it should have zeroed in on the top corporate class in general.  Worse, it vilified the very banks who remained most responsible through the run-up to the bubble (i.e., where lending was the tightest).  It could have vilified hospitals, corporate officers at insurance companies, &c.  Or it could have scapegoated the real villains: CountryWide, IndyMac, Washington Mutual, AIG, Wachovia.  No, it scapegoated their reluctant wards.

    And that was where it lost its momentum.  Anyone who has a mortgage at a bank does not consider themselves to be either the 99% or the 1%.  They consider themselves to be in between, part of a shrinking middle class that nobody seems to want to listen to anymore.  And that is about 45% of America, living in owner-occupied homes.

    And worse still--the movement knew absolutely nothing about banking, which is a very exacting trade filled with honest workers and hard workers.  The average salary at a bank is about the same as the average salary at a hospital, and below the average salary at a corporate law firm.  Occupy was not huge, simply noisy, and it often alienated the very people it was trying to reach, even while offering little real information.

    "Hibernate between 45 and 65 if you can."--VS Pritchett

    by joseph on Sun Aug 12, 2012 at 08:27:00 AM PDT

    •  While true, this is a such a minor point. (2+ / 0-)
      Recommended by:
      laurnj, judyms9

      Occupy functioned as a blunt instrument.  It went after the financial system as a whole, and shifted the debate over that sector and its political clout in the right direction.

      Yes, their message sometimes lacked nuance in the areas you describe, but it's not as though they were drafting legislation.

      Art is the handmaid of human good.

      by joe from Lowell on Sun Aug 12, 2012 at 08:54:17 AM PDT

      [ Parent ]

    •  They knew nothing (3+ / 0-)
      Recommended by:
      Odysseus, Nada Lemming, One Opinion

      about banking?  

      I would submit that the real situation here is that it is you who does not know much about Occupy.

      Have you followed Occupy the SEC and Alexis Goldstein and her writings on Dodd-Frank and the Volcker Rule?

      http://www.occupythesec.org/...

      I've talked with countless other people from Occupy in three different Occupy encampments, actually four now since I spent some time on several different days at the Occupy National Gathering last month.  Without exception, every person I talked to was highly informed, much more informed than the average American citizen. They get it. And they know what the solutions are to the problems, as do many people who have made proposals over the past few years and longer. Some have been warning about what would happen for more than a decade.

      I find this part of your comment to be baffling:

      it vilified the very banks who remained most responsible through the run-up to the bubble
      Can you explain what you mean by that?  Responsible?  Unprecedented risks were taken based on the assumption that real estate values would never go down. And when they did, these banks came crashing down and they had made so many bets that they took the economy down with them.  And then they had no intention of being held accountable for any of it.  They were bailed out and they continue to operate in largely the same way today, they are 30% bigger than they were when they were too big to fail in 2008. They are still taking outrageous risks and JP Morgan is the latest example of that, while trying to hide their massive hedge fund business in an obscure department of their operations.  This is one of the big banks that was painted as being so responsible.  This is happening in a commercial bank whose customer accounts are backed by the FDIC.

      That is really only scratching the surface. There are numerous books and documentaries that could help you understand the situation better.


      "Justice is a commodity"

      by joanneleon on Sun Aug 12, 2012 at 09:16:12 AM PDT

      [ Parent ]

      •  Baffling? (0+ / 0-)

        Responding to joanneleon:

        •  •  •

        I find this part of your comment to be baffling:

            it vilified the very banks who remained most responsible through the run-up to the bubble

        Can you explain what you mean by that?  Responsible?

        •  •  •

        Sure.  The banks that inherited the problems were not the banks that caused them.  I identified CountryWide, IndyMac, WaMu and Wachovia.  Those banks created most of the mortgage defaults, and there was a run on at least two of them, and the Feds had to hand them over to other banks--banks who did not over-extend themselves in the run-up to the debacle, notably Wells, BofA, Citi and Chase.  These latter four were banks that did not overextend themselves in the run-up to the degree the other three did (Wachovia was a special case, that needed to be taken over for other reasons).  Ironically, the Occupy people have conflated the latter four with the former four, who were at least stable enough to receive the nation's headaches.

        As for your patronizing comment about "understanding the situation better," I am retired from commercial banking myself, so I have enough time to read another good book on the subject.  In the meantime, to give you my own real-time view of the situation, I might refer you to my diary entry here from the very day in 2008 IndyMac failed.  Maybe some people with Occupy might like to read it too, if you're still in touch.

        IndyMac and the dismantling of consumer protection

        "Hibernate between 45 and 65 if you can."--VS Pritchett

        by joseph on Sun Aug 12, 2012 at 09:28:08 AM PDT

        [ Parent ]

        •  Are you going to completely ignore (1+ / 0-)
          Recommended by:
          Nada Lemming

          the issue of the big Wall Street banks creating a ravenous demand for mortgages that they could package up and pass off as AAA rated?  Why do you think they were issuing mortgages like crazy?  Where were those mortgages going?

          And are you going to ignore the credit default swaps?  Will you also ignore the "shitty deals" that were sold as a good product when it was known that they were dogs and when Goldman, for example, was betting against their own clients who they sold these deals to?  Is that responsible behavior?

          The organizations that you identify were only part of the problem.  I can't understand why you are entirely ignoring the role of the investment banks and the massive level of risk they took (and still take).  They designed this delusional separation of risk and investment too and then let it run wild.  

          I don't see how a person with your knowledge of banking can ignore these elephants in the room and claim that the big banks on Wall Street were not to blame for this and that they acted responsibly.  Do you include Citi, Merrill and BofA in that number?


          "Justice is a commodity"

          by joanneleon on Sun Aug 12, 2012 at 09:51:21 AM PDT

          [ Parent ]

          •  But I haven't. (0+ / 0-)

            I haven't completely ignored "the issue of the big Wall Street banks creating a ravenous demand for mortgages that they could package up and pass off as AAA rated."   Ravenous demand is a function of a market, which doesn't scare me.  It's the second part that did.  It was indeed the lack of serious ratings and serious compliance and serious insurance that led to 80% of this crisis--which had little to do with ravenous demand (there is ravenous demand somewhere in the market every second).

            But the banks didn't do that--big commercial banks didn't decimate compliance--the Greenspan regulatory climate, the auditors, and the insurance companies did.

            You also ask "Why do you think they were issuing mortgages like crazy?  Where were those mortgages going?"  I think they [the big four] were not issuing obviously bad mortgages and liar loans anywhere near the degree CountyWide, IndyMac and WaMu were.  I think what they [investment banks and big four banks] were rather doing were taking bundles of mortgages that were issued by these liar-loan banks and using them as collateral on newly constructed bonds they could buy or sell.

            An investment bank a bunch of junk mortgages coming in and says, "oh boy, here comes another boatload of mortgages that are all guaranteed by US government at the institutional level in case of failure.  So let's get someone to insure this as a bond or a derivative, and sell that bond/derivative."  The only problem was, the insurers weren't doing the math necessary to offer real insurance.  There were no actuarial tables on any of these products, no real insurance being offered at all.  So compliance was a total joke.  Yes, people were being compliant--but compliance meant absolute nothing especially after 9/11, when there was real pressure to keep money flowing, and it got even worse through the decade.

            One day, a banker I knew was trying to put together a new (and really innocuous) product.  He came to me and I said, "compliance will need you to get that product insured, do you have backing yet?" He didn't. But he came back two days later and XXX had insured it for $250 million.  I said, "How is that possible in two days?"  He said, with a completely straight face, "Oh, XXX just figures that if we can't cover a failure [within our own bank] ourselves, then it's all melted down anyway."  Naturally, it was a real estate banker.  And naturally, I said, "But that's not insurance."  And it wasn't.  Yet it was "compliance."  And he could have easily done it the right way.  But that's what compliance was in the Bush era: 'insurance" that had no actuarial basis, backing products that were indeed compliant simply because an insurance company was willing to make them so.  And I hate to say it, but it started under Clinton.  But it just got completely bananas under Bush.  And it was driven by the auditing companies, the insurance companies, and as soon as Bush got the wheel, the regulators themselves.

            "Hibernate between 45 and 65 if you can."--VS Pritchett

            by joseph on Sun Aug 12, 2012 at 12:19:38 PM PDT

            [ Parent ]

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site