The New York Fed In Its Own Words: Hall Pass For Goldman

 

There is no question that some of the most astute and ambitious individuals on the planet are attracted to the immense wealth generation which takes place on Wall Street.  On that score, those that stake their claim at the hub of global capital formation are no different than any of us in their thirst to make money.  After all, the innate craving to quench parched lips in aggregate has always been precisely what drives America’s spectacular success story.

The desire to better one’s lot in life is the collective fuel that advances the ferocious frenetic free market locomotive. The primal quest for cash greases the skids which make the capitalist wheels go round and round, without that deeply ingrained human need to succeed the free market express freight train would slow to a constricted comatose crawl.

The unapologetic harnessing of man’s innate ambition and aspiration is fundamental to what made America the most dynamic and prosperous nation to have ever lifted humankind. So no, I have no problem with enterprise motivated by personal gain, I vigorously applaud it!

However, unlike Wall’s Street’s perennial poster board, Gordon Gekko, I do have a distinct problem with unabashed avarice and wanton greed.  To handsomely profit from one’s hard fought achievements in the private sector is to be commended as a personal triumph to be proud of.  On the other hand, to be part of a firm which conspicuously and relentlessly siphons funds off of the public trust is a deplorable disgrace and decidedly un-American.

Friday’s revelations via the internal tape recordings of Carmen Segarra, a Goldman Sach’s embedded Fed regulator who was simply doing her job, once again demonstrates for all to see just how far we have fallen down the ravenous rabbit hole.  See the excerpt below from our usually deferential main street media, you know something is going down when even they feel compelled to join in on the outrage:

More than four dozen hours of recordings, made by Carmen Segarra, a former Fed examiner, suggest that the Fed was far from the neutral, objective, evenhanded regulator it is supposed to be. Instead, the recordings show how red flags raised in a secret report done in 2009 by an independent investigator tasked with critiquing the New York branch appear to have been ignored even three years later. The report by the independent investigator, David Beim, a Columbia University finance professor, was commissioned as a warts-and-all review by New York Fed President William Dudley, a former Goldman Sachs partner, in late 2011. – Newsweek 9/26/14

Ask yourselves. Why was her viable investigation thwarted by the Federal Reserve itself?  The very institution, whose stated mission is to carefully scrutinize and cautiously monitor Wall Street’s integrity, simply scuttled the mere notion of legitimate inquiry. Goldman was simply given a free pass, same as it ever was.  Perhaps it is too much to ask of the Federal Reserve to police the very entities that it serves.

Now for the the “Coup de Grâce“, the Fed summarily fired Ms. Segarra for doing her job by actively pursuing a potentially glaring conflict of interest at GS.  Apparently, The Street’s securities sheriff is more interested in policing its deputies then chasing down the actual perpetrators.  The giant vampire squid’s sugar daddy is now actually eating its own young.

The country requires change.  We demand the enlightened capitalism that our forefathers manifested, not the crony capitalism that Goldman Sachs espouses and deploys with ruthless duplicitous abandon.  And no, it certainly can not be characterized as doing God’s work.  The time for substantive change beckons…………haven’t you seen and had enough yet?

David Stockman's Contra Corner is the only place where mainstream delusions and cant about the Warfare State, the Bailout State, Bubble Finance and Beltway Banditry are ripped, refuted and rebuked. Subscribe now to receive David Stockman’s latest posts by email each day as well as his model portfolio, Lee Adler’s Daily Data Dive and David’s personally curated insights and analysis from leading contrarian thinkers.

Get Access