Aug. 7, 2011 (Bloomberg) -- What will it take for Americans to finally get the message that much of Wall Street, in its current form, is a corrupt enterprise in need of a top-to-bottom overhaul, a task that the year-old Dodd-Frank law, for all its verbosity, barely attempts?
There is ample evidence in the detritus left behind by the ebb tide of the worst financial crisis since the Great Depression. There are the thorough -- and thoroughly damning -- reports (along with thousands of pages of accompanying internal Wall Street documents) produced by the Financial Crisis Inquiry Commission and the Senate’s Permanent Subcommittee on Investigations. More was exposed by Anton Valukas, the chairman of the Chicago law firm Jenner & Block LLP, in his investigation of the accounting shenanigans engaged in by a handful ofLehman Brothers Holdings Inc. (LEHMQ)’s executives in the months leading up to that firm’s spectacular bankruptcy in September 2008.
Each examination revealed layer upon layer of behavior that should make us seethe with anger. These include the decision to manufacture and sell mortgage-backed securities that were stuffed with loans of questionable value, plus the worthless AAA ratings placed on them by ratings services paid by Wall Street to do so. Also the business model that encouraged bankers and traders to take asynchronous risk with other peoples’ money with the knowledge that by the time things went wrong, billions of bonus dollars would be paid out, and no effort would be made to hold anyone accountable.
