Too Big to Jail...

I have not blogged in couple of months now.  But I had to come out of hiding for this one...The current U.S. Attorney General Eric Holder let the cat out of the bag.  Or should I say he said something that all of us already know - you cannot prosecute high finance.  The reason ?  The possibility of causing a world wide financial panic, where global markets freeze because of an indictment of a CEO at a major financial firm.

Today's upper echelon of financial institutions are the modern day rulers of society.  They own everything, including the law.  They cannot be controlled.  They cannot be punished.  They are above the law.  And they are without flaw.

Now, of course, I personally don't agree with this idea. The only way this reasoning works is because our society allows it.  Some people just get an automatic pass for bad behavior because they are a athlete, a rock star, a congressman or a investment banker.  And this, of course, is wrong.  This is what makes the general public feel like they are not important, or they don't matter in the overall scheme of things.

You know, lately these "icons" of society have suffered with their fair share of public scrutiny, with prosecution and jail time being the result, in some cases.  And many have fallen out of favor in the public eye.  It's time for a major prosecution of some of the individuals and groups that conspired to fraud their neighbors, their cities, and their country by privately gambling with other peoples money, and betting against their own possibility of a loss or failure. 

I will be frank - because of their shenanigans, these people have made my job lot harder.  I am a loan originator, and after five years, it's still difficult to give a easy, simple loan to a person who has a 811 credit score that just wants to refinance his primary home.  This is ridiculous.  Heads should roll.  Or at least ONE HEAD should roll.  Take your pick as to which one it should be - it doesn't matter to me.

I know that newly elected Senator Elizabeth Warren is a polarizing figure, but she sure has one thing right - if you screw up your firm, you cease to exist as an entity.  If this possibility exist, it will automatically lead to more sincere accountability, and large "too big to fail" banks and businesses will start making more sound judgments and financial decisions about how they operate their businesses, and how to manage the risk associated with running that business.

So, how do you get rid of concept of "too big to fail" ?  Who knows ?  Break up the banks.  Restrict banks from being allowed to conduct business as investment and or insurance firms.  I don't know.  But we have to do something as a society, and do something now.  The punishable must be punished.  The guilty businesses must be put on alert - if you play with fire and get burned, you are out of business, never to put your risky way of conducting business as a burden to the public.  I am afraid if we don't do something, and something soon - there will be no lessons learned.  And without the lessons of the past, history has a a way of repeating itself...