60 percent of people in a poll think the megabanks are taking excessive risk or breaking the law.
This isn’t be so striking until they note (buried in paragraph 9) that it is a poll of “investors, analysts and traders who are Bloomberg subscribers.” That is, Wall Street insiders.”A majority said they lacked or had little confidence that the biggest institutions are taking prudent risks and conforming to laws. ”
But, on further reflection, the real surprise is the 40% of Wall Street that believe the biggest institutions are law-abiding.
The US recently showed that the “biggest institutions” are immune from prosecution — “Too Big to Jail” even when they do horrible things. When they are caught, the fines meted out are slaps on the wrist. It is easier to make money if you aren’t constrained by laws. Bankers are very responsive to financial incentives.
So, what would a good analyst conclude?
Here is what Neil Barofsky has to say: “We are telling the executives in these institutions ‘Crime pays’.”
Perhaps the headline should be “40% of Wall Street analysts fail simple test of logical reasoning”.
Must see video of Jon Stewart’s reaction to Too Big to Jail