That'll teach 'em, won't it?

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Jim Hightower's Radio Lowdown
Jim Hightower's Radio Lowdown

That’ll teach ’em, won’t it?

The SEC, Wall Street’s top regulator, has whacked the mighty Goldman Sachs with one of the largest penalties in financial history. The high-strutting banking conglomerate will pay more than half-a-billion bucks for selling a complex investment scheme that was designed to fail. “This settlement is a stark lesson to Wall Street firms,” a stern SEC official stated. They will pay “a heavy price,” he warned, if they violate “the fundamental principles of honest treatment and fair dealing.”

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Atta boy – go get those self-serving, narcissistic banksters!

But, wait – on the day that SEC officials imposed this supposed “humbling” penalty, Goldman’s stock price went up by five percent. Far from being deterred by the penalty, high-rolling speculators saw it as a vindication of Wall Street’s casino ethic. “It looks like a big win for Goldman,” gloated one financial analyst, adding that SEC’s $550 million assessment “seems like a paltry sum.”

Now, I could never put “$550 million” and “paltry” in the same sentence, but if you do the Wall Street math, you can see his logic. Goldman hauls in half-a-billion dollars in profit every 15 days. In fact, that one-day five-percent boost that Goldman got in its stock price added far more than $550 million to its market value – so the giant actually made money off the deal!

What we have here is not punishment, but blatant political favoritism for the most politically-connected bank in our country. Goldman Sachs is not merely a huge bank, but a longtime inside-Washington player that literally helps bend the regulator rules for its personal gain. To help push structural reforms that really can restore “fair dealing” to our financial system, contact Americans for Financial Reform:

“JP Morgan’s chief Jamie Dimon gets $18m pay package,”, February 5, 2010.

“Its Fight Ended, Wall St. Is Already Working Around New Regulations,” The New York Times, July 16, 2010.

“With Settlement, Blankfein Keeps His Grip,” The New York Times, July 16, 2010.

“Congress Passes Major Overhaul of Finance Rules,” The New York Times, July 16, 2010.

“S.E.C. Setting Its Complaints With Goldman,” The New York Times, July 16, 2010.

I’m making moves!

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