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View Diary: ENOUGH (189 comments)

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  •  well (9+ / 0-)

     I put it in nice, tidy order, right? Now all I need is to arrange some facts, dates, times, actions, etc and then it's perilously close to an ... indictment. Sure, needs a real attorney to go through it and convert English to legalspeak, but it ain't that hard to write an inductive proof, and that's basically what a criminal complaint is.

    •  Um, no (9+ / 0-)

      A criminal indictment is not basically an inductive proof.

      Just stop and think a moment. Remember how hard it was to get Scooter Libby? You can't go into court with feelings, rumors, an injured sense of justice, etc. You need proof that is admissible in court.

      There's a reason they had to go after Al Capone on a tax evasion charge. It had to do with evidentiary issues, too.

      And not only do you need admissible evidence, but you need enough evidence so that you prove the elements of your case (the specific statutory offense) such that you meet the standard of proof for a criminal conviction.

      Unfortunately, most of the Wall Street hijinks were not against any existing laws. And that's the place where our real attention should be focussed. If what they did wasn't against the law, we ought to be passing new laws to make it so for the future.

      •  Wow, I didn't know that (0+ / 0-)

        Is that true?  That all the hijinks were pretty much legal?

        So it was all the fault that law that the Republicans passed with Clinton in 1999.

      •  I'd say selling CDOs based on the (7+ / 0-)

        'high value' rating the Fund offering them gave the shares, which as it turns out consisted basically of just guessing at their valuation (and those Wall Street brokers always guessed high)...

        which in plain English is the equivalent of a Ponzi-scheme dressed up as a Solid Investment...

        I'd say that there are likely some actionable activities to pursue criminal charges over, in the Wall Street collapse.

        We simply need an Attorney General and a DOJ which are willing to investigate, charge and prosecute illegal activities, even if the person(s) under investigation happen to be the same folks writing the big checks to the DC elite for their re-election campaigns.

        I like paying taxes... with them, I buy Civilization

        by Angie in WA State on Mon Apr 18, 2011 at 12:58:25 PM PDT

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        •  You'd say that (1+ / 0-)
          Recommended by:
          citizen k

          based upon what, exactly? Any specific statutory reading you'd like to refer us to?

          If anything, the buyers of the securities might have a securities action, but that typically would be a civil, not a criminal claim. And I would imagine the risks of the securities were, in fact, described in the offering statement for the securities. Have you ever read a public offering statement? I have, and twenty years ago I even wrote a few. Believe me, investment risks are routinely spelled out.

          I understand the sentiment, honestly I do. But tarring and feathering public officials (Democratic ones, to boot) for not prosecuting actions that were not actually crimes isn't terribly helpful to anyone.

          •  What statute did they charge Bernie (4+ / 0-)
            Recommended by:
            3goldens, Cliss, blueoasis, BMarshall

            Madoff under?

            How is what these Funds did materially different than what he did?

            Both parties overinflated, without any factual basis the value of what they were selling their clients.

            Madoff evidently told people something to the tune of, "Look at my history, I'll make you more money than anyone else can." The fact that he was paying those early investors with later investor funds was not included in his portfolio descriptions, nor that what he was really running was a simple Ponzi scheme.

            The CDO (collateralized debt obligation) Funds produced a product which they self-rated (by all accounts which I've read). They based these ratings on, what? Not the actual value of the mortgaged properties which the fund is made of up, obviously.

            They then marketed these Fund shares at that inflated value to their Investors - while the Fund itself took out CDO insurance (CDS - Credit Default Swaps) - on the bet that the CDOs would fail to produce the value they told their clients it would.

            Per Michael Lewis' The Big Short: Inside the Doomsday Machine, which I've read, it appears that there might have been a plan to make money specifically by running this Fund-based valuation - and then create a fortune (for the Fund Managers only) from the CDS (credit default swaps). While only speculation, a reading of what actually did happen in 2007-2009 in the RE segment with CDOs and CDSs only helps to make this speculation very believable.

            If I'm mistaken here, I'll gladly take a lesson from you.

            I like paying taxes... with them, I buy Civilization

            by Angie in WA State on Mon Apr 18, 2011 at 02:50:34 PM PDT

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            •  I'm pretty sure Mr. Madoff (0+ / 0-)

              didn't hand his investors an OS (offering statement) that explained to them that their investment would be paid off only if he was able to convince subsequent investors to pony up. That's a Ponzi scheme; there isn't any actual underlying investment.

              Valuation of an investment is a quite different kettle of fish. There's no real "factual" basis to valuation in the ordinary sense of that word. Take real estate valuation. When you get an appraiser to value your home, they're not promising you that you can get the appraised value for it when you sell. Would you say there's no "factual basis" for their appraisal? No, it's an opinion, based on recent comparable sales.

              If you get an appraisal on Monday, but the market collapses on Tuesday and you find you can't sell your house at all on Wednesday, have you been defrauded? No. The same kind of thing, on a massive, massive scale, happened to the CMO market

          •  Gee, elmo, are you a spokesperson for the Wealthy (1+ / 0-)
            Recommended by:
            blueoasis

            Thieves?

            "Is that all there is?" Peggy Lee.

            by jm214 on Mon Apr 18, 2011 at 06:04:39 PM PDT

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          •  The risks should relate to if they are triple A (2+ / 0-)
            Recommended by:
            blueoasis, jayden

            rated or if they are junk rated.

            When you sell junk off rated AAA
            somebody did something wrong

      •  exactly - the CFMA (3+ / 0-)
        Recommended by:
        Cliss, BMarshall, Lisa Lockwood

        Commodity Futures "Modernization" Act  CFMA Wrangled through the Senate by Phil Gramm. And don't get me started on Phil's wife Wendy, former of The Commodity Futures Trading Commission and Enron...

        the CMFA Removed regulation that had been there before, and the    Gramm-Leach-Bliley act allowed banks to do stuff they used to be prevented from doing.

        Notice whose name appears in both places?

        Goldman-Sachs and their lawyers aren't stupid. They got the laws changed, then did bad stuff that used to be illegal. Not any more. And the recent Financial oversight stuff hasn't really done much. Banks own the congress.

        Legally.

        Without geometry, life is pointless. And blues harmonica players suck.

        by blindcynic on Mon Apr 18, 2011 at 02:37:19 PM PDT

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