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Revenge Of The Blondes

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My vintage iPhone sputtered, stammered and finally stalled out as I tried to access an article about derivatives trading after clicking on the link.  The process got as far as the appearance of the URL, which indicated that the source was The New York Times.  I assumed that the piece had been written by Gretchen Morgenson and that I could read it once I sat down at my regular computer.  Within moments, I was at The Big Picture website, where I found another link to the same article.  This time it worked and I found that the piece had been written by Louise Story.  “Wrong blonde”, I thought to myself.  It was at that point when I realized how much the world had changed from the days when “dumb blonde” jokes had been so popular.  In fact, a vast amount of the skullduggery that caused and resulted from the financial crisis has been exposed and explained by women with blonde hair.  After a handful of unscrupulous Wall Street bankers brought the world’s financial system to the brink of collapse, an even smaller number of blonde, female sleuths set about unwinding this complex web of deceit for “the Average Joe” to understand.  Here are a few of them:

Yves Smith

All right  .  .  .   It’s an old picture from her days at Goldman Sachs.  Cue-up Duran Duran.  (It’s almost as old as the photo of Ben Bernanke in my fake Chandon ad, based on their  “Life needs bubbles” theme.)  On most days, the first blog I access is Naked Capitalism.  Its publisher and most frequent contributor is Yves Smith (a/k/a Susan Webber).  At the Seeking Alpha website, a review of her recent book, ECONned: How Unenlightened Self Interest Undermined Democracy and Corrupted Capitalism, began this way:

ECONNED is the most deeply researched and empirically validated account of the financial meltdown of 2008-2009 and how its unaddressed causes predict similar crises to come.  As a long-time Wall Street veteran, Yves Smith, through her influential blog “Naked Capitalism” lucidly explains to her over 2500,000 unique visitors each month exactly what games market players use and how their “innovations” evolved over the years to take the rest of us to the cleaners.  Smith is that unusual combination of scholar, expert, participant and teacher, who writes with a clarifying sense of moral outrage and disgust at the decline of ethics on Wall Street and financial markets.

Smith’s daily list of Links at Naked Capitalism, covers a broad range of newsworthy subjects both within and beyond the financial realm.  I usually find myself reading all of the articles linked on that page.

Gretchen Morgenson

Gretchen Morgenson is my favorite reporter for The New York Times.  She has proven herself to be Treasury Secretary Turbo Tim Geithner’s worst nightmare.  Ms. Morgenson has caused Geithner so much agony, I would not be surprised to hear that he named his recent kidney stone after her.  With Jo Becker, Ms. Morgenson wrote the most revealing essay on Geithner back in April of 2009.  Once you’ve read it, you will have a better understanding of why Geithner gave away so many billions to the banksters as president of the New York Fed by way of Maiden Lane III.  Morgenson subsequently wrote her own article on Maiden Lane III here.

Ms. Morgenson has many detractors.  Most prominent among them was the late Tanta (a/k/a Doris Dungey) of the Calculated Risk blog, who wrote the recurring “Morgenson Watch” for that site.  Yves Smith of Naked Capitalism (see above) accurately summed up the bulk of the criticism directed against Gretchen Morgenson:

Gretchen Morgenson is often a target of heated criticism on the blogosphere, which I have argued more than once is overdone.  While her articles on executive compensation and securities litigation are consistently well reported, she has an appetite for the wilder side of finance, and often looks a bit out of her depth.  Typically, she simply runs afoul of finance pedants, who jump on misapplication of industry jargon or minor errors when those (admittedly disconcerting) errors fail to derail the thrust of the argument.

A noted example of this was Morgenson’s article of March 6 2010, in which she explained that Greece was hiding its financial obligations with “credit default swaps” rather than currency swaps.  The bloggers who vigilantly watch for her to make such a mistake wouldn’t let go of that one for quite a while.  Nevertheless, I like her work.  Nobody is perfect.

Louise Story

As I mentioned at the outset of this piece, Louise Story wrote the recent article for The New York Times, concerning anticompetitive practices in the credit derivatives clearing, trading and information services industries.  Discussing that subject in a manner that can make it understandable to the “average reader” (someone with a high school education) is no easy task.  Beyond that, Ms. Story was able to explain the frustrations of regulators, who had hoped that some degree of transparency could be introduced to the derivatives market as a result of the recently enacted, “Dodd-Frank” financial reform bill.  It’s an important article, which has drawn a good deal of well-deserved attention.

Last year, Ms. Story co-authored a New York Times article with Gretchen Morgenson, concerning collateralized debt obligations (CDOs) entitled, “Banks Bundled Bad Debt, Bet Against It and Won”.  As I pointed out at the time:  Pay close attention to the explanation of how Tim Geithner retained a “special counselor” whose previous responsibilities included oversight of the parent company of an investment firm named Tricadia, Inc.  Tricadia has the dubious honor of having helped cause the financial crisis by creating CDOs and then betting against them.

These three women, as well as a number of their non-blonde counterparts (including:  Nomi Prins, Janet Tavakoli and Naomi Klein) have exposed a vast amount of the odious activities that caused the financial crisis.  They have helped inform and educate the public on what the “good old boys” network of bankers, regulators and lobbyists have been doing to this country.  The paradigm shift that took us beyond the sexist stereotype of the  “dumb blonde” has brought our society to the point where women – often blonde ones – have intervened to alert the rest of us to the hazards caused by what Paul Farrell of MarketWatch described as “Wall Street’s macho ego trip”.

If you should come across someone who still tells “dumb blonde” jokes – ask that person if he (or she) has read ECONned.


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Invoking Thomas Paine

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August 24, 2009

In January of 1776, Thomas Paine wrote a 48-page pamphlet, entitled:  Common Sense, in which he argued the case that the American colonies should be independent from Britain.  He published the pamphlet anonymously, providing only a hint of authorship with the statement:  “Written by an Englishman”.  This aspect of Paine’s pamphlet brings to mind the debate over the issue of anonymity in the blogosphere, which became quite heated-up this past weekend.  As it turned out, a writer for one of Rupert Murdoch’s newspapers, who uses the surname “Whitehouse”, targeted the Zero Hedge website, accusing its publisher (who uses the pseudonym:  Tyler Durden  —  i.e. Brad Pitt’s character from the movie Fight Club) of being a fellow who was “banned from the securities industry” for making $780 on an “insider” trade.  For whatever reason, Naked Capitalism’s Yves Smith (whose real name is Susan Webber) saw fit to write a posting (now removed from the site) critical of the “messianic zeal and strident tone” of the material at Zero Hedge, despite the fact that Tyler Durden has written many guest posts for her own Naked Capitalism site.  She also criticized the use of pseudonyms by bloggers, particularly at financial sites — because the practice “raises questions about credibility”.  She differentiated her own situation with the explanation that her true identity could be ascertained with only “a modicum of digging”.  Making a point more supportive of Zero Hedge, she shared her suspicion about the motive behind the attempt to identify Tyler Durden as a disgraced trader:

. . . this story is appearing now precisely because Durden is getting to close to some even more damaging stories than he has provided thus far.

Ms. Smith (or Webber) believes that “Tyler Durden” is actually a pseudonym used by a number of writers at Zero Hedge.

As a result of that posting, Naked Capitalism lost one of its best contributors:  Leo Kolivakis of Pension Pulse, whose final contribution to Naked Capitalism can be found here.  Mr. Kolivakis then immediately joined the team at Zero Hedge, providing this explanation.  When reading his posting, be sure to read the comments, which are always entertaining at Zero Hedge.

I enjoy both Naked Capitalism and Zero Hedge and I will continue to keep them both on my blogroll, despite this dust-up.  In response to the intrigue concerning the identity of Tyler Durden, his cohort, Marla Singer submitted this proposed op-ed piece to The New York Times, reminding readers of the anonymous writings by Thomas Paine.

This past weekend brought us another invocation of Thomas Paine, with the publication of a piece entitled:  “Common Sense 2009”, which appeared in The Huffington Post.  The author did not conceal his identity, since he has made a point of generating controversy about himself throughout his life.   He was none other than Larry Flynt.  Flynt began with the explanation that last fall’s financial crisis was caused by the fact that “the financial elite had bribed our legislators to roll back the protections enacted after the Stock Market Crash of 1929”.  He rightfully criticized President Obama for attempting to lay part of the blame for this disaster on “Main Street”.  Beyond that, he noted how Obama continues to facilitate the same bad behavior that started this mess:

To date, no serious legislation has been offered by the Obama administration to correct these problems.

Instead, Obama wants to increase the oversight power of the Federal Reserve.  Never mind that it already had significant oversight power before our most recent economic meltdown, yet failed to take action.  Never mind that the Fed is not a government agency but a cartel of private bankers that cannot be held accountable by Washington.  Whatever the Fed does with these supposed new oversight powers will be behind closed doors.

Obama’s failure to act sends one message loud and clear:  He cannot stand up to the powerful Wall Street interests that supplied the bulk of his campaign money for the 2008 election.  Nor, for that matter, can Congress, for much the same reason.

Larry Flynt then offered a bold solution to break the hold of the plutocracy that has been controlling our country for too long:

I’m calling for a national strike, one designed to close the country down for a day.  The intent?  Real campaign-finance reform and strong restrictions on lobbying.  Because nothing will change until we take corporate money out of politics.  Nothing will improve until our politicians are once again answerable to their constituents, not the rich and powerful.

Let’s set a date.  No one goes to work.  No one buys anything.  And if that isn’t effective — if the politicians ignore us — we do it again.  And again.  And again.

This initiative is a much more effective and constructive use of populist rage than what saw at recent “town hall” meetings and “teabagging” events.  Besides:  If anyone knows what can and cannot be accomplished by “teabagging” –  it’s Larry Flint.