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Posts Tagged ‘BANKS’

“SCARFACE” AND REAL-LIFE BANKSTERS

In Business, History, Law, Law Enforcement, Social commentary on March 3, 2017 at 10:37 am

It’s a scene familiar to anyone who’s seen Scarface, the 1983 classic starring Al Pacino as a Cuban drug dealer who makes it big in the cocaine business.

Scarface - 1983 film.jpg

Tony Montana (Pacino) is holding court in his Florida estate.  His visitor is a WASP-ish banker.

Bankers as a rule don’t make house calls. But Tony is no ordinary customer–his men literally haul bags full of bills into the bank when making deposits.

Except that now the banker has some unpleasant news for Tony:

We’re not a wholesale operation.  We’re a legitimate bank.  The more cash you give me……the harder it is for me to rinse.

“The fact is I can’t take any more of your money unless I raise the rates on you.”

TONY: You gonna raise…

BANKER: I gotta do it.

BANKER: The IRS is coming….

TONY: Don’t give me that shit! Let’s talk. I’m talking. I go low, you go high. I know the game. This is business talk.

BANKER: Let me explain something. The IRS is coming down heavy on South Florida. There was a Time magazine story that didn’t help. 

There’s a recession. I got stockholders I got to be responsible for.  I got to do it, Tony.

TONY: We’ll go somewhere else.  That’s it.   

BANKER: There’s no place else to go. 

TONY: Fuck you, man! Fuck you! I’ll fly the cash myself to the Bahamas.  BANKER: Once maybe. Then what? You’ll trust some monkey in a Bahamian bank with millions of your hard-earned dollars? Come on, Tony. Don’t be a schmuck. Who else can you trust? That’s why you pay us what you do. You trust us.

Stay with us. You’re a well-liked customer. You’re in good hands with us.

(At this point, movie audiences burst into laughter.  The line, “You’re in good hands with us” seemed directly lifted from the slogan used by Allstate Insurance: “You’re in good hands with Allstate.”)

Now, fast forward to 2014.

A Reuters news story dated May 21, 2014 noted that investigators from the Federal Securities and Exchange Commission (SEC) were probing Charles Schwab and Bank of America Corporations Merrill Lynch brokerage.

The SEC wants to determine if these brokerages violated anti-money laundering rules that require financial institutions to know their customers.

Broker-dealers are required to establish, document and identify customers and verify their identities in compliance with the Bank Secrecy Act.

In 2012, David Cohen, the U.S. Treasury Undersecretary for Terrorism and Financial Intelligence David Cohen, ordered regulators to guarantee that financial institutions are identifying the true beneficial owners of their accounts.

The reason: Drug cartels and terrorist groups have become highly creative in hiding and transferring their illegal funds.

According to sources close to the investigation, Charles Schwab and Merrill accepted shell companies and persons with phony addresses as clients.

In both cases, some of the accounts were eventually linked to drug cartels.  Some of those accounts held hundreds of thousands of dollars; others held millions.

A Texas rancher and Charles Schwab client transferred money to a holding company that was actually a shell company.

Most of the Schwab clients being investigated lived near the Mexican border. Some were linked to Mexican drug cartels.

Click here: Exclusive: SEC probes Schwab, Merrill, for anti-money laundering violations – sources | Reuters

No further stories could be found on the Internet to update the progress of these investigations.

In fact, the government should have assumed long ago that brokerage companies were engaging in such behavior.

As Niccolo Machiavelli warned in The Discourses, his landmark book on how to preserve freedom within a republic:

All those who have written upon civil institutions demonstrate…that whoever desires to found a state and give it laws, must start with assuming that all men are bad and ever ready to display their vicious nature, whenever they may find occasion for it. 

Portrait of Niccolò Machiavelli by Santi di Tito.jpg

Niccolo Machiavelli

If their evil disposition remains concealed for a time, it must be attributed to some unknown reason; and we must assume that it lacked occasion to show itself. 

But time, which has been said to be the father of all truth, does not fail to bring it to light.

Whenever the creating of wealth becomes an end in itself, all other ends are sacrificed to this.

Greed begins in the neurochemistry of the brain. A neurotransmitter called dopamine fuels our greed. The higher the dopamine levels in the brain, the greater the pleasure we experience.

Harvard researcher Hans Breiter has found, via magnetic resonance imaging studies, that the craving for money activates the same regions of the brain as the lust for sex, cocaine or any other pleasure-inducer. 

But snorting the same amount of cocaine, or earning the same sum of money, does not cause dopamine levels to increase. So the pleasure-seeker must increase the amount of stimuli to keep enjoying the euphoria.

Federal investigators need to view large concentrations of wealth as sources for at least potential corruption.

And they should ruthlessly–and routinely–investigate those sources, whether in the vaults of the Mafia or of major financial institutions.

HERMAN CAIN: “IT’S ALL YOUR FAULT”

In Business, Politics, Social commentary on June 9, 2014 at 12:57 am

Herman Cain may run for President again.

Yes, on May 31, he told the annual Republican Leadership Conference in New Orleans that he might once again take up the Presidential quest in 2016.

The kicker: if God calls upon him to do so.

“I do not know what the future holds,” said the onetime CEO of Godfather’s Pizza, “but I know who holds the future. And I trust in God.”

The last time Cain ran for President–in 2011–his campaign ended in scandal.  Multiple women came forward to accuse him of making aggressive and unwanted sexual advances.

Cain’s longtime wife, Gloria, chose to stand by him.  But millions of female voters chose other candidates to vote for.

Cain dropped out of the race in December, 2011, before any actual votes were cast.

Herman Cain

Aside from his apparent inability to keep his hands–and penis–confined to his marriage, there’s another reason why voters should think twice about voting for him.

At the Republican Presidential candidates’ debate in Las Vegas, on October 18, 2011, a telling exchange occurred between CNN journalist and moderator Anderson Cooper and GOP candidate Herman Cain.

COOPER: “How do you explain the Occupy Wall Street movement happening across the country? And how does it relate with your message?

“Herman Cain, I’ve got to ask you, you said–two weeks ago, you said, ‘Don’t blame Wall Street, don’t blame the big banks. If you don’t have a job, and you’re not rich, blame yourself.’”

“That was two weeks ago. The movement has grown. Do you still say that?”

CAIN: “I still stand by my statement, and here’s why.  They might be frustrated with Wall Street and the bankers, but they’re directing their anger at the wrong place.

“Wall Street didn’t put in failed economic policies. Wall Street didn’t spend a trillion dollars that didn’t do any good. Wall Street isn’t going around the country trying to sell another $450 billion. They ought to be over in front of the White House taking out their frustration.”

* * * * *

So, there you have it.  If you’re one of the estimated 14 to 25 million unemployed or under-employed Americans, don’t look to Herman Cain for help or even sympathy.

It’s all your fault.

It’s your fault that, today, more than 2 million Americans have been unemployed for at least 99 weeks—the cutoff point for unemployment insurance in the hardest-hit states.

It’s your fault that the longer a person is out of work, the less likely s/he is to find an employer willing to hire.

It’s your fault that corporations across the country are now sitting atop $2 trillion in profits. 

It’s your fault that their CEOs are using those monies for enriching themselves, their bought-off politicians, their families—and occasionally their mistresses.

It’s your fault that CEOs are using those monies to buy up their corporate rivals, throw even more Americans into the streets, and pocket their wages.

It’s your fault that CEOs are using those profits to create or enlarge companies outside the United States—solely to pay substandard wages to their new employees.

It’s your fault that the one expense CEOs refuse to underwrite is hiring their fellow Americans.

It’s your fault that CEOs want to escape American employee-protection laws–such as those mandating worker’s compensation or forbidding sexual harassment.

It’s your fault that CEOs want to escape American consumer-protection laws–such as those banning the sale of lead-contaminated products (a hallmark of Chinese imports).

It’s your fault that CEOs want to escape American laws protecting the environment–such as those requiring safe storage of dangerous chemicals.

It’s your fault that mass firings of employees usually accompany corporate mergers or acquisitions.

It’s your fault that many employers victimize part-time employees, who are not legally protected against such threats as racial discrimination, sexual harassment and unsafe working conditions.

It’s your fault that many employers refuse to create better than menial, low-wage jobs.

It’s your fault that right-wing politicians encourage corporate employers to extort “economic incentives” from cities or states in return for moving to or remaining in those areas.

It’s your fault that such “incentives” usually absolve employers from complying with laws protecting the environment and/or workers’ rights.

It’s your fault that many employers refuse to provide medical and pension benefits—nearly always in the case of part-time employees, and, increasingly, for full-time, permanent ones as well.

It’s your fault that crime rates are now rising, due to rising unemployment.

It’s your fault that such employers want, in short, to enrich themselves at the direct expense of their country. 

It’s your fault if you’ve forgotten that, in decades past, such conduct used to be called treason–and punished accordingly.

And it’s your fault if you vote for GOP politicians who support such corrupt and ruinous policies.

IT’S ALL ABOUT THE EGO

In Bureaucracy, Business, History, Politics, Social commentary on October 29, 2013 at 12:58 pm

Why do so many CEOs hate President Barack Obama?

It isn’t because they’re being over-taxed and -regulated,d as so many on the Right would have you believe.

According to a January 16, 2013 story published in Bloomberg:

  • U.S. corporations’ after-tax profits have grown by 171% under Obama.
  • This is more than has existed under any President since World War II.
  • Corporate profits are now at their highest level, relative to the economy, since the government began keeping records in 1947.
  • Profits are more than twice as high than during Ronald Reagan’s Presidency.
  • They are more than 50% greater than during the late-1990s Internet boom.

Click here: Corporate Profits Soar as Executives Attack Obama Policy – Bloomberg

So if money isn’t the issue, what is?

In a word: Ego.

Jonathan Alter, author of The Center Holds: Obama and His Enemies, provides some eye-opening insights into relations between the President and business leaders.

He notes, for example, that even before taking office as President in 2009, Obama pushed through Congress the second $350 billion portion of the $700 billion Troubled Asset Relief Program (TARP)

And he stablilized the almost-wrecked American financial system with stress tests and regulatory reforms.

So Obama believed that business CEOs would be grateful for his efforts on their behalf.

And what did the President get in return?

  • The rise of the Tea Party, angered by government bailouts to mega-corporations–and the subsequent loss of a Democratic House of Representatives; and
  • Ingratitude and resentment from the very CEOs whose corporations he had saved.

CEOs visiting the White House often believed the President didn’t take them seriously.

For example, many of them wanted a tax amnesty on their overseas earnings.  And Obama would ask: How will the government make up for the lost Treasury revenues that would come from such a huge tax break?

Many CEOs thought he was not taking them seriously.

Obama was in fact being serious, and was hoping that his greed-obsessed visitors would help him find an answer that would satisfy both parties.

What the President apparently didn’t understand was this: Most CEOs weren’t used to being dealt with on an equal basis.

They were used to people cowering before them, or instantly agreeing with anything they said.

For Obama, who had taught Constitutional law at the University of Chicago from 1992 to 2004, such  intellectual querys were routine.  He had enjoyed the cut-and-thrust of such exchanges with his law students.

But his law students had not been billionaires with billionaire-sized egos.

One Wall Street CEO charged that Obama regarded intellectuals as a cut above political operatives–and two cuts above businessmen.

As Alter writes: “Being worth a billion dollars wasn’t going to get the President…to believe that your insights were better than anyone else’s.”

Obama was angered that many CEOs felt that nothing should change–even after the excesses of greed-fueled banks almost destroyed the nation’s economy in 2008.

Thus, bank CEOs had furiously opposed the Dodd-Frank bank re-regulations that had been imposed to prevent a recurrence of such abuses.

Obama felt that bankers were ungrateful for his pushing through the second part of the TARP program that had saved their corporations from the CEOs’ own self-destructive greed.

As Alter sums up: “The complex psychology of business confidence was only partly about their tax rates and the threat of regulation; the real problem was personal.

“They [businessmen] had an intuitive sense that Obama didn’t particularly like them, and they responded in kind.”

These are not the kinds of insights you’ll get by reading the highly sanitized bios of corporate chieftains.

As a result, during the 2012 Presidential race, Mitt Romney received nearly $150 million, or more than 15% of his total money raised, from New York.  Which meant mostly from Wall Street.

“We got a lot of Barack Obama’s Wall Street money,” said Spencer Zwick, Romney’s finance director, after the campaign.

A passage from Finley Hooper’s classic Roman Realities puts an ancient-world spin on Obama’s relations with wealthy businessmen.

Assessing the reasons for why so many patricians hated Julius Caesar, Hooper writes:

“Caesar…like a teacher, seemed always to be directing affairs in a world of children–chiding one, patting another–yet too far above them all to care about hurting any.

“To less gifted men, however, his aloofness, even if mixed with kindness, was thought to be patronizing.  They could not believe that in his heart he really cared about them.

“Caesar never bothered to ask for another man’s opinion.  He lacked the tact by which a talented person might reasure others that they have worth, too.

“Pardons, jobs or favors did not completely satisfy the recipients’ craving for attention….

“Caesar…was a supreme egotist wrapped up in his own sense of well-being and good service to the state.

“…For all his experience and sophistication, he had never learned how ungrateful men can be–especially those who feel ignored.”

It has been President Obama’s bad luck–like that of Julius Caesar– to find himself at odds with powerful men whose profits he has greatly expanded.

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