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12/26/2008

Incest in Wall Street

Was Wall Street a victim of incestuous relationship? All the evidences pointed towards that direction. The regulators not doing their job to regulate, the auditors slept on their job or not doing their due diligence and got away with murder, and the con men allowed to con their way through, duping all the Americans, including foreigners, rich and poor. And they did what they did for years. In the meantime everyone was celebrating the greatness and genius of these supertalents. This is the other part, other than incestuous relationship, the state of delusion. The madness of idolizing the big earners who were cheating all the way by paying themselves crazy was seen as good, all worthy of their huge pay packets and demanding more everyday to justify their worth. The combination of incestuous relationship and delusion is a potent concoction. The former prevented the checks to be conducted expeditiously by the people tasked with the jobs, the watchdogs afraid to bark for fear of being muffed, and the law enforcers turned a blind eye thinking that supertalents cannot be wrong. And every year end would be time for their big bonus handouts, everyone laughing all the way to the banks. And despite the fraud being exposed, they are still laughing all the way to the banks. The delusion is still unshaken. The same formula of success is still intact. The supertalents will still be paid their supertalent salaries and bonuses. And in the New Paper SEC's CEO Christopher Cox regretted for banning the short selling of financial stocks which he might think would have saved the market from falling. His position, a very familiar one, was to do nothing. "What we have done in this current turmoil is stay calm, which has been our greatest contribution - not being impulsive, not changing the rules willy nilly, but going through a very professional and orderly process that takes into account unintended consequences and gives ample notice to market participants." This kind of non action is only good when the system is sound and not flawed. When it is flawed, when there is non regulation or closed one eye regulation, when there are frauds, it is the surest and shortest cut to destruction. And exactly because of his non action that Madoff could pull off his con job for so long. The kind of mess that minibond would have caused, and more serious if not abruptly exposed, to our investors. It will happen to our stock market and financial system too if we do not repair the damage to the system and pretend that everything is fine and do just nothing, like Cock. Oops I mean Cox.

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