Report from a meeting of Wall Street's secret, tasteless plutocrats' club


In the process of writing his just-released book Young Money, an investigative look at the bankers who've joined Wall Street since the crash of 2008, author Kevin Roose snuck into a meeting of the secretive Kappa Beta Phi club -- an organization of hyper-rich Wall Street bankers.

Roose recorded the captains of of industry, whose shady dealing had crashed the world economy and plunged millions into untold misery, cavorting on stage, making jokes about poor people and Hillary Clinton, dressing up in drag, and singing an anthem about how much bailout money they'd suckered out of the feds, to the tune of Dixie: "In Wall Street land we’ll take our stand, said Morgan and Goldman. But first we better get some loans, so quick, get to the Fed, man."

New York Magazine has a membership roll of the Kappa Beta Phis, which is a who's who of the richest, most powerful men on Wall Street.

Read the rest

The UK Gold: riveting documentary on the deep, ingrained corruption of the UK's banking centre, the City of London

Jeff writes, "Featuring a brand new soundtrack from Radiohead's Thom Yorke, Massive Attack and Elbow, and narrated by Dominic West (The Wire), journalist Marke Donne has put together a riveting documentary exposing the tax avoidance 'industry' operated by the highly secretive, centuries old institution, The City of London.

With a permanent office in Parliament, a budget of $1.2 billion and the media-avoiding tactics of the super-rich, the City relies on lobbying and silence to carry out it's offshore tax avoidance, robbing the state of tens of billions in revenue every year."

Read the rest

For sale: Swiss Scrooge McDuck swimming pool/vault full of shiny coins


If you've ever dreamed of owning a bank-vault mounded high with shiny coins in which you can bathe like Scrooge McDuck, now is your chance. A Swiss bank-vault filled with 8 million Swiss 5-cent pieces is up for auction. The vault was made in 1913 for the Schweizer Volksbank. The coins -- 15 tons' worth -- were used in a 2013 installation in which they were dumped in a public square, with no security, as an exercise in public trust. The coins and the safe are presently in Basel. You will have to relocate them.

Read the rest

HSBC settlement approved: no criminal charges, 5 weeks' profit in fines, deferred bonuses for laundering billions for narco-terrorists


Remember when HSBC got caught laundering billions for Mexican narco-terror cartels? Remember how they offered to pay five weeks' profits in fines and to defer their executive bonuses to escape criminal charges?

The crime-fighting legal eagles at the Department of Justice approved the settlement last week. Remember, though, if you are suspected of laundering money or selling drugs, the DoJ will take your house away and put you in jail for the rest of your life. Nice to be "too big to jail." Still, deferring multimillion-dollar bonuses has gotta hurt, huh?

Read the rest

Feds spend more subsidizing undergrads than undergrads pay in tuition


Here's an analysis of the New America Foundation's Federal Education Budget Project, a wide-ranging and thorough look at the way the government spends on education. It shows that the total take from American universities in tuition for undergraduate programs is $62.6B, while the Federal government is spending $69 billion on grants, aid loans, tax breaks and other funding.

The implication is that it would be cheaper to give away university education than to charge for it, but that's not quite right (federal education funding pays for more than tuition -- it also includes housing, food and other expenses, and the feds are already subsidizing colleges out of their $69B spend). But it does suggest that the education system is really screwed up, an expensive boondoggle that is optimized for paying bondholders who own student debt, rather than turning out an educated, resilient and adaptable nation.

Read the rest

South Dakota: the Bermuda of the prairie, letting billionaires avoid millions in estate tax


America's billionaires are able to avoid paying millions in inheritance taxes by renting empty storefronts in South Dakota in order to give their trust-funds an SD address, from which they can exploit a deliberate loophole in state tax-law. Over $121 billion in trust-funds is administered through South Dakota, mostly for out-of-state families -- a figure that's tripled in four years. South Dakota's corrupt tax laws also allow for avoiding millions in tax from ordinary investments by the richest people in NY and MA.

South Dakota itself has some dire poverty -- two of the 10 poorest counties in America are in SD -- and lawmakers describe their project to turn the state into "the Bermuda of the prairie" as an economic development project, creating jobs for lawyers and bankers, and "[forging] ties with prosperous families that may one day decide to build a factory or a warehouse here."

The project has failed. The entire trust industry only employs about 100 South Dakotans, but Republican Governor Dennis Daugaard, a former banker, says it's worth it: "If you've got several hundred well-paying jobs, it's worth it to us."

Read the rest

Apps come bundled with secret Bitcoin mining programs, paper over the practice with EULAs


Researchers at Malwarebytes have discovered that some programs covertly install Bitcoin-mining software on users' computers, papering over the practice by including sneaky language in their license agreements allowing for "computer calculations, security."

The malicious programs include YourFreeProxy from Mutual Public, AKA We Build Toolbars, LLC, AKA WBT. YourFreeProxy comes with a program called Monitor.exe, which repeatedly phones home to WBT, eventually silently downloading and installing a Bitcoin mining program called "jhProtominer."

Read the rest

JP Morgan's "Twitter takeover" seeks questions from Twitter, gets flooded with critiques of banksterism #AskJPM

When JP Morgan's Twitter account announced last month that "VC Jimmy Lee" take questions from the net with the #AskJPM hashtag, they should have been able to predict what was coming next: a stream of hilarious, vicious critiques of late-stage capitalism, banksterism, and financial corruption. One day later, the Q&A was cancelled. The astonishing thing isn't how predictable this was, but how anyone at JP Morgan failed to see it coming -- the greatest irony isn't the questions raised, it was the hubris in thinking that these questions wouldn't be raised at all.

The fiasco is being called one of the worst social media disasters in corporate history, and has spawned lots of creativity, including this video of Stacy Keach and a sock puppet performing the tweets and a Matt Taibbi-sponsored haiku contest.

Read the rest

Pope blasts capitalism


In a new Evangelii Gadium, Pope Francis has condemned doctrinaire capitalism, "deified markets," trickle-down economics, and the finance industry. He decried the growing gap between the rich and the poor, tax evasion by the wealthy, and characterized ruthless free-market economics as a killer that was inherently sinful.

Read the rest

$147M Bitcoin transaction

A Bitcoin address with a history of large transactions just conducted a transfer worth $147M, more or less.

Rob Ford's exaggerated and imaginary savings to the taxpayers of Toronto

Rob Ford claims that he should be excused for his crack-fuelled, drunken rages while serving as mayor of Toronto, because of the billion dollars he's saved the city. But as a line-by-line analysis of Laughable Bumblefuck's fiscal claims demonstrates, he's just another politician, cooking the books. Cory 13

How would you short London?

Here's a finance riddle: how would you short London's property bubble? House prices are up GBP50K in the last six months, our freeholder is making noises about either buying or forcing us out in order to build a giant tower, and they sold off Scotland Yard (!). They say the market can stay irrational longer than you can stay solvent, and I've been marvelling at the irrationality of London's property market since I moved there in 2003. Just for the sake of argument, if you wanted to put a bet down on a property value crash, how would you make it? Cory 91

HOWTO make $200,000 off of the above-inflation USPS postage hike


The USPS is planning a rare, above-inflation postage stamp price-hike on Jan 26, 2014; and they're also selling "forever-stamps" that can be used at any time. Allison Schrager and Ritchie King show how these two facts in combination offer a significant arbitrage opportunity, and set out a plan to buy 10 million stamps at $0.46 and sell them at $0.48, netting $200,000 in profit, at 4.3 percent.

It's pretty thoroughly thought-through, with a detailed finance and distribution plan. I'd love to see them try it.

Read the rest

Someone in Chicago used a FTL drive to play the market (or cheated)

Last Wednesday's Fed announcement that it would not taper its bond-buying program triggered huge orders on exchanges everywhere. Several of those orders on Chicago exchanges were placed 2-3 milliseconds after the announcement, which is a good 7 milliseconds faster than the speed of the light-cone emanating from DC, suggesting that either someone in Chicago has a time-machine, or can travel faster than the speed of light, or is a crooked son-of-a-monkey.

Read the rest

After the Meltdown: tracking the fortunes reaped by the bankers who tanked the economy

The Center for Public Integrity's After the Meltdown series documents the fate of the regulators, executives, and firms that were most directly responsible for the subprime meltdown, and demonstrates that the top bankers for firms like Lehman got unbelievably rich due to their failures, and are still in business with lucrative consulting firms (for example, Lehman CEO Richard Fuld walked away with several hundred million in cash and now has homes in three states and a personal consulting outfit). Consumerist's Chris Morran has done a great job of summarizing the findings:

Read the rest