Bernie Sanders in Washington Square Park in Manhattan, where he went to the fierce attack on big banks like Goldman Sachs on Wednesday. Photo: Mary Altaffer / AP & amp; Richard Drew / AP
NEW YORK. This Wednesday evening was Bernie Sanders, presidential candidate and left senator from Vermont who based much of his campaign on the harsh criticism against Wall Street’s big banks, in a park in Manhattan packed with young voters.
– Bad news for Wall Street: we saved them from the financial crisis. Now it’s time for the banks to rescue ordinary Americans, declared Sanders before cheering supporters, and went on to talk about his “speculation tax” to get the banks to finance free college in the United States.
While Sanders bank attack in Washington Square Park, the new criticism of the banking houses which plays straight into his hands. Five of America’s eight largest banks have no “credible” plans for how to dismantle themselves in the event of acute crisis, according to two audit agencies, the US Federal Reserve and the Federal Deposit Insurance Corporation, FDIC.
put another way: If a new crisis would strike today, so would the federal government and the taxpayers once again have to save them to avoid financial panic.
Washington Square Park in Manhattan, where Sanders attacked banks on Wednesday. Photo: Mary Altaffer / AP
The background to critique from the Fed and the FDIC is a rule that says that banks now need to submit a statement, called the “living will”, on how to enter the orderly liquidation in the event of a crisis. The rule is listed in the renowned Dodd-Frank Act of 2010, as the club was established by Congress to prevent a new Lehman Brothers failure and avoid a falling banks damage the economy.
They are now criticizing the banks are Bank of America, JP Morgan Chase, Wells Fargo, State Street and Bank of New York Mellon. They and other banks’ assets during the seven-eight years since his return after the financial crisis has grown larger than ever and again is “too big to fail”, too big to be allowed to crash uncontrollably. It is contrary to what was thought.
“The goal to end ‘too big to fail” and to protect US taxpayers from not having to bail out banks in crisis is still just that: a goal, “the FDIC: Vice Chairman Thomas M Hoenig said in a statement.
the banks have until October 1, in which to present the new plans for how they intend to handle an emergency.
criticism of the plans is far from the only circulating the USA’s major banks. Bernie Sanders took on Wednesday also points to the latest of a series of settlements with banks about a billion fine for their cheating business in the run up to the US mortgage bubble, which gave the world financial crisis.
Earlier this week, announced the Department of Justice and other agencies that a settlement has been reached with Goldman Sachs for $ 5.1 billion (about 45 billion) in fines. In the end, the bank will not have to pay the full amount, according to the New York Times.
But the deal does still a clear evidence that the banking houses acted irresponsibly and possibly criminally for their own benefit and the expense of investors and the public. However, virtually no conviction come out of the legal system for the dubious bond transactions, and several of the banks’ top executives is still there.
– This agreement demonstrates to the world that Goldman Sachs acted criminally, said Bernie Sanders a speech a week before supporters.
Goldman Sachs is the last American big bank to conclude a settlement with the Justice Department about a billion fine by the authorities.
in the autumn of 2013 forced JP Morgan to pay a record sum 13 billion dollars, about 90 billion according to the then dollar exchange rate, for their cheating shops where obviously useless package of mortgage bonds were resold under the pretense that they were high-quality investments.
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