The Corporate Observer Blog : Consumer Protection, Corporate Abuse : Class Action Lawyer & Attorney : Steven Berk Law Firm

As unemployment continues at an uncomfortable nine-plus percent, you’d think Wall Street would share the pain and bonuses would be down.  Nope.  They don’t create jobs, they don’t add value. Instead they profit, they leverage, they figure out the spread and increasingly they use more and more risk to accomplish “profits” and bonuses.  But don’t listen to me; consider the recent words of Nobel laureate Paul Krugman:

What’s going on here?  The answer, surely, is that Wall Street’s Masters of the Universe realize, deep down, how morally indefensible their position is.  They’re not John Galt; they’re not even Steve Jobs.  They’re people who got rich by peddling complex financial schemes that, far from delivering clear benefits to the American people, helped push us into a crisis whose aftereffects continue to blight the lives of tens of millions of their fellow citizens.

Paul Krugman Op Ed, October 11th.

Finance a new bridge, a factory, a school that teaches engineering and science for a new generation of students entering the work place.  No; instead, we see newfangled derivative swaps, “quant trading”, a panoply of something called “synthetic derivatives”, and who knows what else?  The derivatives market hit a value of $600 trillion in 2008, and I regret to confirm that “T” in trillion is not a typo.  Sadly those newly minted Ivy League graduates want to make “bank” and they want to do it now.  No time for long term value investing or pedestrian returns of six to eight percent per year.  Heck, for these hot shots 6-8% per month is not enough.  Where will it end?

Wall Street: put people to work, and then collect your bonuses with your heads held high.  And stop trying to destroy any sensible speed limits and caution signs (such as the Volcker Rule).  Regulation keeps cars on the road. Without it we are doomed to repeat the mistakes of the last boom…

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The OCC’s decision to protect the banks and their burgeoning sub-prime mortgage portfolios from scrutiny was a major cause – yes cause – of the 2008 meltdown and Great Recession that followed.

The Corporate Observer has not named a person of the week award for several months so this is kind of special…  Drum roll please.  New York Times columnist Joe Nocera is our Person of the Week.  He joins an illustrious crew including early Madoff reporter Harry Markopolos, Supreme Court Justice Elena Kagan, pharmaceutical whistleblower Cheryl Eckard, and numerous others.  Mr. Nocera is the new op ed columnist at the Times, ostensibly replacing the venerable Frank Rich.  He comes to the column from the business pages where he distilled complicated stories into readable and at times compelling theater.

Mr. Nocera snags the award this week because his column on the continued failure of the Office of the Comptroller of the Currency to objectively regulate the banking industry exposes new levels of absurdity.  Yes absurdity.  Save the rating agencies (and of course good old greed on Wall Street), the OCC’s decision to protect the banks and their burgeoning sub-prime mortgage portfolios from scrutiny was a major cause – yes cause – of the 2008 meltdown and Great Recession that followed.

Based on his street smarts and years of experience, Mr. Nocera does not mince words in his appraisal of the OCC.  The following quote alone earns him the Person of the Week award:

“Calling the Office of the Comptroller of the Currency a “regulator” is almost laughable.  The Environmental Protection Agency is a regulator.  The O.C.C. is a coddler, a protector, an outright enabler of the institutions it oversees.”

Go Joe.  He continues to call out the OCC for brandishing legal preemption ("federal law trumps state law") like King Arthur’s Excalibur, in an effort to defeat hard-working, earnest state attorney generals from designing reforms and bringing fairness to foreclosures.  He reminds his Times readers that the OCC remains steadfast in its defense of “sloppy, callous and often illegal practices” of an unapologetic banking industry.

The CO can’t get enough of his hard-hitting, take-no-prisoners approach.  Charge on Joe.  Keep using that prestigious column to challenge conventional wisdom.

For your efforts to date, we name you our Person of the Week.

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