Punishing Wall Street

I was glad to hear that Fannie Mae and Freddie Mac leaders are being prosecuted for their role in the worldwide financial meltdown. But what about the private companies in the financial services industry that were as culpable, if not worse. How about the banks and other mortgage companies that talked mortagees into deals that that they couldn't afford and then sold their subprime junk to the FMs?  When their gamble failed, the banks then used fraudulent robosigning to hurry foreclosure on mortgaged homes. Or, how about the corporations that bundled the junk into derivatives, took their cut and re-sold the garbage on the international markets. Goldman Sachs was dumping these derivatives on their customers to clear their books while simultaneously buying other securities that would shoot up if the junk derivatives failed. And don't forget the rating companies that are paid by the companies that they rate.  They blithely rated Lehman Bros. bonds as AAA shortly before its collapse. 

The fact is that our financial services industry has turned the financial markets into a corrupt, rigged casino. Unfortunately, Republican and Democratic presidents from Reagan to Obama have surrounded themselves with advisors from the worst corporate scofflaws in this industry who have repeatedly advised against prosecution of agregious offenders under existing laws and against further strengthening of financial regulations. This is what has led to the financial meltdown, not just the actions of Fannie Mae and Freddie Mac.