Jeffrey Sachs Joins the Revolution

    I remember not too long ago people who said that Wall Street is full of crooks were considered to be off-kilter. At the same time, it was commonly understood that they were saying the obvious, but for some reason they weren’t supposed to say it.

    Things have changed.

    Have a listen to a speech recorded in the video below. The speech begins at 2:08, after the intro by the off-kilter guy in a t-shirt (don’t know who he is), and the speech was given at (of all places) the Philadelphia Federal Reserve by (none other than) economist Jeffrey Sachs, named by Time magazine as one of the 100 “Most Influential” people in the world.

    Sachs says that Wall Street is full of crooks.

    Not just that. Sachs said that, “I meet a lot of these people on Wall Street on a regular basis. I’m going to put it very bluntly. I regard the moral environment as pathological. I’m talking about the human interactions I have. I have not seen anything like this, not felt it so palpably…they have  no responsibility to their clients, they have no responsibility to counterparties in transactions. They are tough, greedy, aggressive, and feel absolutely out of control, in a quite literal sense. And they have gamed the system to a remarkable extent, and they have a docile president, a docile White House, and a docile regulatory system that absolutely can’t find its voice….We have a corrupt politics to the core.”

    Or in the DeepCapture vernacular, Washington has been “captured” by financial miscreants.

    Sachs also rails against (among others) Goldman Sachs and short seller John Paulson for manufacturing synthetic CDOs (i.e mortgage derivatives deliberately designed by short sellers to self-destruct). Basically, he says what we’ve been saying for years, but what most prominent economic professors dared not say in speeches at the Federal Reserve—not, anyway, until now. And when prominent economists start talking like this (he even criticizes fractional reserve banking) in speeches at the Federal Reserve—well, that’s a revolution in the making. Wait and see.

    Click here to listen to the speech.

     

     

     

     

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    38 Responses to “Jeffrey Sachs Joins the Revolution”

    1. Just Sayin says:

      All of this has been known for a long time, so he is probably only saying this now because he sees the house has now caught on fire and is burning down quickly around him and he wants to extricate himself so he can say, when he is surrounded by the people with torches, that he had nothing to do with it and that he tried to warn everybody.

      The other way they are trying to extricate themselves is through charges being filed and a consent decree being issued on the same day with a slap on the wrist for all their crimes. They think an argument of double jeopardy, when the torch bearers come, will save them. When you see a whole bunch of these criminal charge “deals” happen, you know the whole thing is about to come crumbling down. I would not be suprised if there have already been a lot of them with major criminals that have just not been announced.

      Finally, there is always the tried and true statute of limitations argument.

      But alas, I doubt the torch bearers will have any judges in their ranks and the courthouses will most likely be in cinders by that time anyway.

    2. Jay Booth says:

      Mark,

      Good to hear from you here again.

      I would like to comment on what Dr. Sachs was saying, at about the 14 minute mark of the video. He said the following.

      “If you look at the campaign contributions, which I happened to do yesterday for another purpose, the financial markets are the number one campaign contributors in the US system now. We have a corrupt politics to the core, I’m afraid to say…But what’s it’s lead to is this sense of impunity that is really stunning, and you feel it on the individual level right now…I’ve waited for a judge, for our President, for somebody (to react to the way the system has been gamed), and it hasn’t happened, and by the way, it’s not gonna happen, anytime soon, it seems.”

      What I have found is that Legislators who accept campaign contributions from the financial sector, create for themselves a conflict of interest, in dealing with abuses of the American equity market, perpetrated by their contributors. I think our only hope for systemic reform is through the Judiciary.

      But as you know, I have not merely waited for a judge. I have petitioned for relief from a Federal Judge to obtain electronic trading records, which I feel may expose the type of abuses which are destroying the lives of many investors in the American equity market. That relief has been granted, for the records of a company in which I am a shareholder.

      It is my hope now that this very sense of impunity, to which Dr. Sachs refers, will aid in my examination of the trading records that I have subpoenaed. In that regard, Dr. Sachs may be pleased to know that he is wrong. Judicial relief HAS been provided. It’s a start to systemic reform, and I am very grateful to the Judge who has made it possible.

    3. sean says:

      If you think that interview was scathing and vicious wait till you hear Professor Sachs latest.. It will blow your mind with his honesty and he even names one of the criminals by name!! A name if you have read Deepcapture over the years you will SURELY recognize and I did not mean to call anyone Shirley!! LOL!! Enjoy the video!! Thanks again to D.C. and Mark for your outstanding expose on these criminals/miscreants!!!

      http://live.huffingtonpost.com/r/segment/jeffrey-sachs-wall-street-crooks-docile-president/51815e022b8c2a152e000101

    4. Anonymous says:

      Most of the crooks turned out to be the ones crying about naked short selling

    5. iStandUp says:

      Video Link to Columbia Economist Dr. Jeffrey Sachs speaking to the FEDS:
      http://www.youtube.com/watch?feature=endscreen&v=hCCr-uiqtAY&NR=1

      Text below YouTube Video:
      Published on Apr 29, 2013
      http://www.LostOutputClock.com — Since 2008, the United States has missed out on over $4 trillion in National Income from unemployed workers and capital due to insufficient demand. Meanwhile, inequality and corruption is skyrocketing in our country.

      This is a wonderful speech about corruption in the United States: from Washington DC and Wall Street, including the entire financial/banking system.

      This video is being posted only for educational purposes and to have this important viewpoint as public record.

      From the event at the Philadelphia Fed on April 17th, 2013 (04/17/2013) conference segment “Fixing the Banking System for Good” .

    6. Anonymous says:

      Its full of crooks. Some even try to bring guns on planes.

    7. sean says:

      To the Miscreants.. J.A.I.L. and especially you Anon (with the gun comment) Because that time is coming soon!!!

    8. Anonymous says:

      Sean

      Do you pack a gun when you go on airplanes? Do you think that people that do carry guns should go to jail?

      Just wondering.

    9. sean says:

      Anon.. you are trying to jack the thread.. The question you should be asking here is.. Why is no one on Wall Street (your cohorts) in jail for destroying the U.S./ Global economy?That is the real crime here.. That is what you should be wondering about.. Capiche?

    10. sean says:

      Also would like to add this from an aquaintance (sp)of mine.

      all short-selling should be illegal.

      Remember one of the prime reasons to promote shortselling to even exist – “Oh, prices go too high without the correction of the shortselling, and we need to protect those (who aren’t in the stock market yet) from paying too much for an overinflated stock.”

      what ?

      So protect the confidence of the new entries to the markets so they more confidently plunk their money down on an NSS rollercoaster.

      I imagine things have gotten so squewed (i made that word up) there is a way (if i knew which financial instruments to use and who to pull the ropes for me) to sell my neighbor’s home SHORT at 1/2 the price, then oops it burned down. Ok i’ll buy it back now.

      Shortselling just encourages sabotage to little struggling businesses (the easiest targets)

      if the stock market is an investment, supply and demand can and will do just fine by itself without shortselling, thank you very much.

    11. Anonymous says:

      Here is another guy that had joined the revolution. Patrick Byrne even went on his radio station he owned MN1.

      Former Dallas Securities Broker Sentenced in Oklahoma to 84 Months in Prison for Role in Stock Manipulation Scheme

      WASHINGTON—A former stock broker was sentenced to prison today for his role in an extensive pump-and-dump stock manipulation scheme, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, United States Attorney Danny C Williams Sr of the Northern District of Oklahoma, Special Agent in Charge James E Finch of the FBI’s Oklahoma City Division, and Internal Revenue Service-Criminal Investigation (IRS-CI) Chief Richard Weber. Joshua Wayne Lankford, 39, of Dallas, was sentenced by United States District Judge James H Payne in the Northern District of Oklahoma to serve 84 months in prison. In addition to his prison term, Lankford was ordered to forfeit $250,000. Proceeds from forfeited assets will be used to partially restitute victims.

      On December 10, 2012, Lankford pleaded guilty to one count of money laundering. “Mr Lankford and his co-conspirators took advantage of innocent investors to the tune of millions of dollars, pumping and dumping penny stocks without regard to anything but their wallets,” said Acting Assistant Attorney General Raman. “As this case shows, stockbrokers and other professionals will be punished if they break the law. Lankford now faces substantial time in prison for his manipulation scheme.” “The United States Attorney’s Office and the Department of Justice are committed to identifying and prosecuting criminals who defraud investors and steal their savings,” said United States Attorney Williams.

      “Pump-and-dump schemes like these have a devastating financial impact on the victims and undermine public confidence in our nation’s financial system.” According to court documents and evidence presented at the 2010 trial, Lankford and his co-defendants manipulated the stocks of three companies: Deep Rock Oil & Gas Inc. and Global Beverage Solutions Inc ., formerly known as Pacific Peak Investments, both of Tulsa, Oklahoma; and National Storm Management Group Inc. of Glen Ellyn, Illinois. The defendants devised and engaged in a scheme to defraud investors known as a “pump-and-dump,” in which they manipulated publicly traded penny stocks.

      A penny stock is a common stock that trades for less than $5 per share in the over the counter market, rather than on national exchanges. Lankford and his co-defendants executed the scheme by obtaining a majority of the free-trading shares of stock of the company they intended to manipulate, using fraudulent and deceptive means to acquire the stock and/or remove the trading restrictions on the shares they obtained. “Stock manipulation and securities fraud are high investigative priorities of the FBI,” said FBI Special Agent in Charge Finch. “This case is the result of a lengthy investigation which involved outstanding cooperation between the FBI, IRS Criminal Investigations, and the SEC.

      The FBI will continue to work with our law enforcement partners to protect investors and bring those who commit these types of fraud to justice.” “Using fraud and deception to jeopardize the financial markets and launder funds are not victimless crimes,” said IRS-CI Chief Weber. “Mr Lankford and his co-defendants thought they latched onto a clever scheme to reap a vast wealth of illegal profits. Today, justice has been served. IRS-CI works in close alliance with our law enforcement partners, and together we will hold those who engage in similar conduct accountable.” According to court records, Lankford and other conspirators “parked” their shares with various nominees, such as friends, relatives or other entities that they owned and controlled.

      Subsequently, they engaged in coordinated trading in order to create the appearance of an emerging market for these stocks, after which they conducted massive promotional campaigns in which unsolicited fax and e-mail “blasts” were sent to millions of recipients. According to evidence presented at the 2010 trial, these blasts touted the respective stocks without accurately disclosing who was paying for the promotions, omitted that the defendants intended to sell their shares, and induced unsuspecting legitimate investors to purchase stock in the companies. The defendants and their nominees obtained significant profits by selling large amounts of shares after they had artificially inflated the stock price. For each of the three manipulated stocks, the conspirators’ sell-off caused declines of the stock price and left legitimate investors holding stock of significantly reduced value.

      According to Lankford’s guilty plea, he laundered $250,000 in proceeds derived from the stock manipulation scheme. Evidence presented in the 2010 trial showed that the overall scheme resulted in illegal proceeds of more than $43 million from more than 17,000 investor victims. Lankford was originally charged in a 24-count indictment unsealed on February 10, 2009, against five defendants. Prior to trial, Lankford fled to Costa Rica, where he remained until he was extradited to the United States in May 2012.

      James Reskin, 54, of Louisville, Kentucky, was sentenced today to serve five years of probation for his role in the scheme. Co-defendants George David Gordon and Richard Clark, were convicted by a federal jury in May 2010 for their roles in the scheme. Gordon was sentenced to serve 188 months in prison, and Clark was sentenced to serve 151 months in prison. The fifth defendant, Dean Sheptycki, remains a fugitive.

      The case is being prosecuted by Trial Attorneys Andrew Warren and Kevin Muhlendorf of the Criminal Division’s Fraud Section and Assistant United States Attorney Catherine Depew for the Northern District of Oklahoma. The case is being investigated by IRS-CI and the FBI. The department wishes to thank the Securities and Exchange Commission, which referred the matter for prosecution. The department also wishes to thank the Criminal Division’s Office of International Affairs, the United States Department of State and the United States Marshals Service for their work in securing Lankford’s extradition.

      This case is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 United States attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants.

    12. sean says:

      Anon.. and how does this affect us or the facts in this blog about Wall Street corruption? The fact that the real criminals of Wall Street have yet to be prosecuted for the crimes they have committed against the citizens of the U.S. and the Global Economy is what we have discussing here.. going after the low hanging fruit has always been the M.O. of our corrupt and inept regulators. Jim Cramer, Larry Kudlow and CNBC also hosted Patrick earlier on in this debacle.. when they are indicted are you going to come on and repeat this same venom? I thought not!! A hypocrite to the end huh big guy? I await your retort, Miscreant.

    13. Anonymous says:

      Sean,

      Did you go broke trading penny stocks?

      You should blame yourself for your own massive losses and not the naked short selling boogeyman

    14. sean says:

      Anon.. is OSTK, a penny Stock? Was the corrupt Enron or Worldcom penny stocks? Was Novostar or Dendreon penny stocks? Were most of the companies destroyed by your cohorts penny stocks.. yes but a lot of them were’nt. So there you go. I hit you with facts, you come back with questions and speculations!!! Too funny? The Jailor cometh!! LOL!!!!

    15. sean says:

      Zachery… wrong spelling JAIL!!!

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