The criminal conviction of Credit Suisse is long overdue. But it's a lame sop to Elizabeth Warren, not a significant ramp-up in enforcement.
For Credit Suisse, other than the fines and the reputational stain of being a felon, the implications are likely to be limited. The bank may lose some clients but is otherwise expected to survive largely unscathed. [Emphasis added]Modern investment banking is tantamount to organized crime.
- Cream profits off the top by selling fraudulent securities and then betting against their customers in the market. Check.
- Launder billions for drug cartels. Check.
- Criminally seize properties without title using forged documentation and perjury. Check.
- Manipulate the LIBOR to steal from borrowers. Check.
- Do business with outlaw regimes internationally. Check.
- Crash the economy and through political influence take no haircut at all. Check.
The banksters are not going to change their racket until they feel the hot breath of the law on their well-groomed necks. Eric Holder only wants us to think he's breathing on them so that we stop breathing on him. He's not trying to change the banking racket.
This "industry" probably shouldn't be burned to the ground and started over. The consequences of killing available credit for conscientious citizens and their value-creating enterprises would be too dire.
But investment banking as a whole should be seized, its management imprisoned, and each institution's continued existence made contingent upon its ability to operate without criminality.
Does this sound radical? It should. We have got to cut this cancer of criminal greed out of our economy before it kills us.
