Liz Warren: Too-Big-to-Ask?

Legitimate (0.00 / 0)

Ms. Warren's performance art should be applauded. She sets up a false premise for her headline grabbing performance.

First Warren says, "Tell me a little bit about the last few times you've taken the biggest financial institutions on Wall Street all the way to trial."

The answer to that is, as she knows, never.  Never, because the shake down by the Feds in settlement is risk free cash to the feds.  How many times have we seen AG Coakley's house of pain go for the shake down?

Let's look at Citibank in 2007.

The SEC accused Citigroup of marketing a $1 billion CDOs to investors in 2007 and didn't tell the buyers that Citigroups traders were betting against the CDOs.  SEC's complaint said that Citigroup made $160 million on the deal.

Well slap my hands: Citigroup agreed to pay $285 million, including a $95 million fine,

So what to do?  Take Citigroup to trial and risk a loss or settle with the golden goose.

In light of Warren's grandstanding position, it's legitimate and convenient to ask Ms. Warren:  Mr. Lew was COO in 2007 for Citibank.  Will you vote to i) confirm him or ii) convict him.  

Elizabeth Warren: a bankruptcy professor, bankrupt of ideas

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by: gary @ Fri Feb 15, 2013 at 18:37:57 PM UTC

What you call extortion, others call a slap on the wrist. (0.00 / 0)

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by: Simple J. Malarkey @ Fri Feb 15, 2013 at 23:10:36 PM UTC

[ Parent ]

Everyone wins (0.00 / 0)

The systems is this:

Warren grandstands and wins praises, even though her position is pretty stupid:  take banks to trial and risk the cash settlements.

Citibank gets a slap on the wrist and wins because the profits exceed the fines.

Government wins because it gets cash from a settlement without trials.

But the question remains, and you ignored it:  Does the first native american massachusetts senator vote for Jacob Lew?  


Elizabeth Warren: a bankruptcy professor, bankrupt of ideas

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by: gary @ Sat Feb 16, 2013 at 03:08:33 AM UTC

[ Parent ]

I'm in general agreement with Yankee pundit... (4.50 / 2)

...and it is my biggest criticism of Obama...if let the foxes "rescue" the henhouse, allowing Gienther and Summers to prop up banks like CitiBank instead on a orderly liquidation.  

I'd still be in favor of dismantling to big to fail (although I think many on the right would keep them big and when the f-up, let them fail and accept the calamity that follows).

But aside from getting in a cheap shot about Warren voting for Lew or not, I'm not sure what the point of this post is about.  Yes Lew worked for Citibank during the bubble.  I've seen nothing to suggest (from credible sources) he acted in any questionable way while at Citibank.

You folks seem to be arguing that ANYBODY that worked for a large financial institution during the boom period should be disqualified as Sec of Treasury.  If this were a Republican administration and I made that argument, folks around here (led by you) would be jumping all over me.   But this is a Democratic administration and a Democratic MA Senator you all spent the last year demonizing.  So, it clear that you want to make political hay out of this.  Have fun.  You guys lost the national election.  You lost the MA Senate election.  Hell you lost to Tierney and even lost state rep seats.  So if the only way you can feel powerful is to take cheap shots @ Warren...go for it.  

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by: Simple J. Malarkey @ Sat Feb 16, 2013 at 13:57:01 PM UTC

[ Parent ]

you don't get it (5.00 / 1)

The issue is this.  Bank regulators, SEC, AGs...go after corporations for the money.  The DOJ lawyers walk into the room with the threat that if you (you being the corporation) doesn't cough up the cash, then criminal charges will issue against individuals.

To no surprise, the corporations cough up the cash.  That's the extortion I've posted about.

Warren steps into the spotlight and with head-bobbing greatness asks "how many banks have you taken to trial?" ... "anyone?", knowing of course, that the regulator would be an idiot for having taken the corporations to trial.  To do so would risk losing and more importantly, risk losing the extortion cash.

So, you call it a cheap shot; I call it fair.  Lew was the COO when Citibank was selling products to its customer and at the same time, betting against its product.

Confirm him or indict him?

Does she really believe that taking bankers to trial is productive?  That's what she implies.  Or, is she simply grandstanding?  Her vote for or against Lew will be telling.

Elizabeth Warren: a bankruptcy professor, bankrupt of ideas

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by: gary @ Sat Feb 16, 2013 at 14:19:14 PM UTC

[ Parent ]

Bank regulators should go after corporations for breaking laws, not for the money (0.00 / 0)

That is the issue.  And that is why Warren is clearing the air and setting this tone out of the gate.

You claim that Warren knows that "the regulator would be an idiot for having taken the corporations to trial.  To do so would risk losing and more importantly, risk losing the extortion cash."

I think you are dead wrong on this point, and not sure your evidence for claiming that, by default, regulators always fear the risk of losing a trial as a part of any "extortion" calculus.  

I believe you also miss Warren's point entirely...  

Through this little Socratic display she is laying the groundwork for the case that -- oh yes -- regulators MUST, at least some of the time, take big banks to trial.  And why should they?  

1) By carrying a reputation for never wanting to go to trial, regulatory bodies have less leverage when it comes to negotiating a settlement;

2) Settlements don't work because the dollar amount is too small to provide any practical incentive for highly-profitable corps to correct illegal behavior in the future;

3) The legal, historical, and media records all miss an opportunity to collect, as Warren put it, "days and days and days of testimony  about what those financial institutions had been up to" -- which results in this domain of case-law barely evolving, as well as lost months of media attention that a trial would have received, thus contributing to popular amnesia about profoundly large-scale white collar crime that have enormous consequences for the national and world economies.

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by: amfriedman @ Mon Feb 18, 2013 at 04:36:47 AM UTC

[ Parent ]

Pie in sky (5.00 / 2)

You claim that Warren knows that "the regulator would be an idiot for having taken the corporations to trial.  To do so would risk losing and more importantly, risk losing the extortion cash."

I think you are dead wrong on this point, and not sure your evidence for claiming that, by default, regulators always fear the risk of losing a trial as a part of any "extortion" calculus.  

Evidence for settling in lieu of trial:

Tobacco settlement agreement, asbestos settlements, thalidomide settlements, BP settlement. 2011, ATT settled for a billion because it was stealing cash from its customers and calling it a tax. Boeing, 2012.  Boeing was charging the Feds for work done on the Chinook but the employees were working on other projects.

I can go on and on and on.  The only thing different about Ms. Warren's grandstanding is that she's grandstanding against banks.  Not much distinction between banks and other corporations when it comes to wrongdoing.

Are you so naive to not understand the dynamics:

-Fed wants cash with no risk of losing at trial, because,

-DOJ lawyers want a resume that shows successes and have the leverage to threaten criminal prosecutions against individuals in exchange for a settlement, and

-To reach a settlement, corporate employees spend corporate cash (other people's money) to payoff the DOJ lawyers, but because

-Senators like the spotlight, and

-Ms. Warren is a senator,

-Her low information fans pass around the youtube video and bobble their heads in agreement.


Elizabeth Warren: a bankruptcy professor, bankrupt of ideas

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by: gary @ Mon Feb 18, 2013 at 13:26:52 PM UTC

[ Parent ]

Pie in sky (0.00 / 0)

You claim that Warren knows that "the regulator would be an idiot for having taken the corporations to trial.  To do so would risk losing and more importantly, risk losing the extortion cash."

I think you are dead wrong on this point, and not sure your evidence for claiming that, by default, regulators always fear the risk of losing a trial as a part of any "extortion" calculus.  

Evidence for settling in lieu of trial:

Tobacco settlement agreement, asbestos settlements, thalidomide settlements, BP settlement. 2011, ATT settled for a billion because it was stealing cash from its customers and calling it a tax. Boeing, 2012.  Boeing was charging the Feds for work done on the Chinook but the employees were working on other projects.

I can go on and on and on.  The only thing different about Ms. Warren's grandstanding is that she's grandstanding against banks.  Not much distinction between banks and other corporations when it comes to wrongdoing.

Are you so naive to not understand the dynamics:

-Fed wants cash with no risk of losing at trial, because,

-DOJ lawyers want a resume that shows successes and have the leverage to threaten criminal prosecutions against individuals in exchange for a settlement, and

-To reach a settlement, corporate employees spend corporate cash (other people's money) to payoff the DOJ lawyers, but because

-Senators like the spotlight, and

-Ms. Warren is a senator,

-Her low information fans pass around the youtube video and bobble their heads in agreement.


Elizabeth Warren: a bankruptcy professor, bankrupt of ideas

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by: gary @ Mon Feb 18, 2013 at 13:52:56 PM UTC

[ Parent ]

My real point (0.00 / 0)

is a criticism of the Boston media.  They just won't ask Elizabeth warren a tough question.  If it were a Republican in the same position, you can bet that the Boston Globe and WCVB would be all over it.  So why the silence form the Boston media when it comes to Democrats?  Don't bother, we all know the answer to that one.

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by: yankeepundit @ Sun Feb 17, 2013 at 12:40:09 PM UTC

[ Parent ]

Why do you think the Herald is in on it too? (0.00 / 0)

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"That it ceased to exist, I'll grant you, but whether or not it failed cannot be definitively said." - Metropolitan (1990)

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by: Patrick @ Sun Feb 17, 2013 at 14:03:24 PM UTC

[ Parent ]

Malarkey (0.00 / 0)

And if raising the issue of Mr. Lew's investments in funds in the Cayman islands is a cheap shot, wasn't it also a cheap shot when Obama raised the same issue regarding Mitt Romney?  http://www.youtube.com/watch?v...

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by: yankeepundit @ Sun Feb 17, 2013 at 14:47:48 PM UTC

[ Parent ]

Lets go to the video... (5.00 / 1)

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by: Simple J. Malarkey @ Fri Feb 15, 2013 at 23:14:20 PM UTC

Quite a contrast from... (0.00 / 0)

One of Wall St.'s favorite senators.

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"That it ceased to exist, I'll grant you, but whether or not it failed cannot be definitively said." - Metropolitan (1990)

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by: Patrick @ Sat Feb 16, 2013 at 01:19:21 AM UTC

[ Parent ]

Suckers (5.00 / 2)

Grandstanding.  She wants the regulators to take the banks to trial and give up the lucrative risk free cash settlements?  Really?

Elizabeth Warren: a bankruptcy professor, bankrupt of ideas

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by: gary @ Sat Feb 16, 2013 at 03:13:20 AM UTC

[ Parent ]

Playing to Her Low Information Base. (0.00 / 0)

...who applaud from the cheap seats like trained seals on crank.

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by: geo999 @ Sat Feb 16, 2013 at 03:45:01 AM UTC

[ Parent ]

thats well a d fine (4.00 / 1)

But what about her stance on the crimes of Ameriquest whike  Deval Patrick was on the board? outlined now inmultiple books?  Or will she continue to give her political allies a pass.  I woukd have great respect for her, and might even vote to reelect her, if she actually took her original stance on those involved at Ameriquest.  You know the stance she f ook in 2006 in the Huffington Post. That those involved with Ameriquest should be in jail.

Full Disclosure


http://www.redmassgroup.com/pr...

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by: Rob "EaBo Clipper" Eno @ Sat Feb 16, 2013 at 12:27:15 PM UTC

[ Parent ]

Grandstanding (0.00 / 0)

This won't do anything.  Has she voted for Jack Lew for the head of treasury yet ?

Talk is cheap

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by: roarkarchitect @ Sat Feb 16, 2013 at 12:41:37 PM UTC

[ Parent ]

The answer to her questions (0.00 / 0)

Q:  have you taken anyone to trial...

A:  no, but we have settled many cases with restitution paid to the victims and fines to the government.  Surely, you can't be second guessing the regulators and DOJ on these settlements.  As a lawyer, you're aware how difficult it is to win a complicated white collar fraud case?

p.s.  Seriously, with all her head bobbing, does she have Parkinson's or something?

Elizabeth Warren: a bankruptcy professor, bankrupt of ideas

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by: gary @ Sun Feb 17, 2013 at 17:56:10 PM UTC

Does anyone at RMG believe that we have a problem with banks? (2.00 / 2)

Just curious.

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by: MannyGoldstein @ Tue Feb 19, 2013 at 03:25:38 AM UTC

Problem with banks (5.00 / 1)

...do you think that corporate malfeasance by banks is somehow different from wrongdoing by other corporations?

Do you think that taking corporate execs to trial, as opposed to settling, is a solution to limiting corporate wrongdoing?

Does Elizabeth Warren have parkinson or simply a twitch manifested by perpetual head bobbing?

Do you support Rep. Campbell's proposal that the big banks must have greater equity than smaller banks?

Should the COO of Citibank be prosecuted for Citibank's decision to market CDOs while at the same time Citibank's traders were shorting CDOs?

AG Martha Coakley sued BOA in 2011, then settled in 2012.  Was she wrong to do so?

Elizabeth Warren: a bankruptcy professor, bankrupt of ideas

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by: gary @ Tue Feb 19, 2013 at 13:15:31 PM UTC

[ Parent ]

That doesn't really answer my question (0.00 / 1)

But thanks.

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by: MannyGoldstein @ Wed Feb 20, 2013 at 01:02:30 AM UTC

[ Parent ]

In other words (0.00 / 0)

In other words, you post an open ended, trollish question, with no point other than to inflame.  You receive some questions that you completely ignore.

Answer the questions, troll.

Elizabeth Warren: a bankruptcy professor, bankrupt of ideas

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by: gary @ Wed Feb 20, 2013 at 03:14:51 AM UTC

[ Parent ]

LOL - Does anyone think we have a problem with XYZ ... (0.00 / 0)

Basically one could find a problem with anything on this planet.  Nice detection of the open ended question gary!  Manny has left the building!  

Molon Labe

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by: Republican Ram Rod Radio @ Wed Feb 20, 2013 at 16:41:03 PM UTC

[ Parent ]