The Pirates of Basel, The Pirates of Manhattan
One thing this author realized is that when you look under the hood of finance, not only are Wall Street banks at the heart of the financial crisis, banks from the Euro Zone are as well, and regrettably intricately connected into Wall Street and the asset management industrial complex.
Bankers, as Napoleon once warned, show no motherland, their reach is enormous and not about the benefit of the country it serves, but about making money. What do I mean by this? It has been known for years that the Rothschild banking dynasty had the nasty habit of financing both sides of warring countries. British Rothschild’s financed the British, French Rothschild’s financed the French, The Germans financed the Germans.
Today in America international bankers treat the United States as their economic playground. BNP Paribas owns San Francisco based Bank of The West. Societe Generale owns the mutual fund giant TCW out of Los Angeles. Deutsche Bank AG not only makes most of its money in the U.S. and London, it owns a mutual fund giant DWS, the former Scudder. Barclay’s bank is still big in ETFs, yet its old iShares business is now at the heart of BlackRock. Allianz, the giant German financier, owns not only Allianz insurance group, but the giant mutual fund manager PIMCO, which has used Alan Greenspan and Neel Kashkari, the Goldman Sachs banker who was Hurricane Hank Paulson’s right hand man when the U.S. Treasury bailed out Wall Street, is a key employee at PIMCO. Citigroup and General Electric, both major banks, not only enjoy taxpayer bailouts, but most of their revenues and growth come from outside the U.S.
Regrettably at the end of the day, bankers, The Pirates of Basel number one concern is making money, period. If this financial crisis has taught us anything, bankers make money in good times, and in bad times they get bailed out to pay themselves outrageous sums.
Recent research by this author found out that Robert Kelly, now former president of Bank of New York Mellon, who was chief financial officer of Wachovia, when it bought the idiotic purchase of Golden West financial for $25 billion, which now resides in the belly of Wells Fargo, walked out of Bank of New York Mellon with a $33 million payday. Bank of New York Mellon was a major recipient of TARP bailout money, and just this month was sued by the city and State of New York as well as the Department of Justice for overcharging its pension customers $2 billion in currency transactions.
Scott Powers, President of State Street Global Advisors, another recipient of TARP funding made $13.5 million in 2010 while President of State Street, Joseph Hooley, took home $12.9 million in 2010. Yet State Street is being sued by Arkansas and California for overcharging its customers on currency transactions as well.
Finally, there is Sallie Krawcheck, who was the head of wealth management for Bank of America Merrill Lynch. Krawcheck, who reported took home $15 million a year when she was overseeing the wealth practice at Citigroup Smith Barney, was kicked out of Bank of America Merrill Lynch the other week. But bankers never go home with an empty bail. Krawcheck got around $6 million in a total exit package while the Bank of America itself paid no federal taxes in 2010.
Nassim Taleb, an NYU Professor did a great interview on the banker compensation problem. This is not just an American problem, it is The Pirates of Basel problem. Deutsche Bank AG investment bank compensation in the U.S. paid its 15,893 employees an average $514 thousand in 2010. It is The Pirates of Basel, The Pirates of Manhattan.
Click on the link to Nassim Taleb’s interview. Taleb on bankers, bonuses, and Occupy Wall Street Video OWS (video)