Evil Syndicated (James Howard Kunstler )

[Tace]

James Howard Kunstler -- World News Trust

July 27, 2009 -- By now, everyone in that fraction of the world that pays attention to something other than American Idol and their platter of TGI Friday's loaded potato skins knows that Goldman Sachs has been caught at another racket in the stock market: front-running trades.

What a clever gambit, done with the help of the markets themselves -- the Nasdaq in particular -- in which information on trades is held back a fraction of a second from public view, while the data is shoveled to the computers of privileged subscribers who can execute zillions of programmed micro-trades before the rest of the herd makes a move. This allows them to vacuum up hundreds of millions of dollars by doing absolutely nothing of value. The old-fashioned method used by brokers was called "churning," in which stocks were bought and sold incessantly (by phone) from the portfolios of inattentive clients merely to generate commissions. In any sensible society -- i.e. a society with an instinct for self-preservation -- it would be against the law and the people doing it would be sent to prison.

I'm not a lawyer, but I've got to think that the actions at the Nasdaq end -- shoveling the data to the privileged subscribers a fraction of a second early -- is patently illegal in the first place, since the whole purpose of an exchange is to create a fair trading space. Where both parties are concerned, it should amount to a plain vanilla criminal conspiracy to commit stock trading fraud. Maybe the larger question is: since when did we become a society lacking the instinct for self-preservation -- that is, a society bent on suicide? Or maybe the question is better put to Goldman Sachs's CEO Lloyd Blankfein.

Since this racket was made public, there has been chatter all over the Web about how angry the American public is about Wall Street in general, and increasingly about Goldman Sachs in particular. Nobody has summed it up better than Rolling Stone's Matt Taibbi, calling the company "... a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money." And Taibbi's fierce article about Goldman Sachs came out weeks before this latest outrage. As we turn the corner toward autumn, President Obama looks increasingly like a dupe, a tool, or a co-conspirator of Goldman Sachs. If he doesn't instruct the Justice Department to commence investigations of the company, and if he doesn't dissociate himself from their alumni hanging around the White House, the Treasury Department, and elsewhere in the government, he's going to become the object of an awful public wrath. Obama has no other choice at this point except to clean house -- to fire Larry Summers, Robert Rubin, Tim Geithner, and all other former Goldman Sachs employees in positions of power and influence around him.

Actually, it's not necessary for the whole general public to be fed up with this situation. According to the Pareto 80-20 rule, it only takes one-fifth of the public to set social actions in motion, and only one-fifth of that one-fifth to do the heavy lifting.

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http://worldnewstrust.com/commentary/3526-evil-syndicated-james-howard-kunstler-

[ixion]

1. it is way past time for us to remove this beast from our face

and send it packing, IMO.

And I agree with Kunstler: What GS did amounts to insider trading, and they should be indicted for it.

[Champion Jack]

2. Goldman must Go

[Demeter]

3. Second That With Stars!

[nashville_brook]

4. big honking kick and rec -- with more from the article: Pareto 80-20 rule...

Actually, it's not necessary for the whole general public to be fed up with this situation. According to the Pareto 80-20 rule, it only takes one-fifth of the public to set social actions in motion, and only one-fifth of that one-fifth to do the heavy lifting. I think we've reached that point. The sentiment is now overwhelmingly tipped against Goldman Sachs (and Wall Street generally) and the only questions are whether the President of the United States ends up lumped in with them, and whether we'll see orderly prosecutions or disorderly persecutions. At this point, it even begins to look as though Mr. Obama is taking cover behind the health care reform debate to avoid answering for his government's association with Goldman Sachs.

The trouble is, if the thoughtful and trustworthy members of the "Pareto 20 percent" don't stir themselves into action over Goldman's behavior, then sooner or later the thoughtless and reckless will take over. Bill Moyers hosted a fascinating report on his most recent podcast about the savagery of right-wing broadcasting and how it had led, in one instance, to the murder of a doctor who performed abortions. What bothers me is that, sooner or later, the conduct of Goldman Sachs will lead the growing ranks of the unemployed, foreclosed, disentitled, and hopeless into the hands of a savage right wing seeking mindless vengeance, for instance, against "the Jews," (as represented by Goldman Sachs), or brown-skinned people (as embodied by a vilified president).