Tom Adams Discusses Criminal Investigation of Goldman on BNN Posted on May 1, 2010 by Yves Smith Enjoy! You can view the segment here. Post navigation ← Chase Doth Speak With Forked Tongue Bill Black on Bill Moyers → Subscribe to Post Comments 8 comments LeeAnne May 1, 2010 at 8:48 am I hadn’t seen Tom Adams before but I instinctively trust him. He just couldn’t use the simple word ‘gamble’ or ‘unregulated’ CDO market that would make his position understandable to any interested party and not just professionals in his own circle. Proof that insiders (those making a living opposed to those not) feel they must be complicit in the worst crimes of the civilized world this century for their own survival. Killing with over cautiousness. I have in mind the urgent need for the public to unravel the confusion sown by TPTB so they can protest effectively by all peaceful means possible for the end of this system that is torturing the lives out of all of us. I just this minute clicked onto the Huffington Post Adams/Yves CDO article. I hadn’t seen it before. So, back to the Rubin hugging link I criticized this morning. It is now obvious to me why the link to the Huffington article in spite of being so beneath the standards of this blog. Everyone of us must be as careful to avoid ‘capture’ as much as we avoid biting the hand that feeds us. Its not easy. Its all about integrity vs ego -a constant struggle. Blurtman May 1, 2010 at 11:51 am So where has the Main Street Media (MSM) been in covering unethical and illegal behavior on Wall Street these past years? They blew it big time on their coverage of the Iraq War II. Even the NY Times. It has been obvious to even many non-financial types like myself what has been going on for several years now. But not a peep from the MSM. What good are they, except for reporting car accidents and fires? During the Iraq War II, there were credible reports of CIA employees working at CNN. Makes one wonder…. Glen May 1, 2010 at 2:15 pm Like you, I could not understand the housing bubble. House prices rose all out of proportion with reality and incomes, yet people were in a mad frenzy to buy even more. I suspect since I’m no genius that MANY saw the exact same thing, and the Wall St types were smart enough to ride the market up and down to make massive money from our imploding economy. We may even find that the SEC lawsuits will show how Wall St helped pump and pop the bubble, certainly that was the intent of the GS ABACUS deal. Why did no one report it? I would guess Chuck Prince gave the insider’s opinion: everybody had to dance until the music stopped. It was the only game in town. Everybody apparently also knew the SEC would do nothing too. The Bush II SEC made it very clear they did not even believe in regulation. Well, so be it, but we really went off the rails when these same failed banks were bailed out and turned into zombies. Why didn’t the MSM report it? Probably some did, but not enough for it to get traction in the general public. I’ve actually been seeing the best report from McClatchy – they reported that the Iraq war rational was a sham, and even reported on the housing bubble: http://www.mcclatchydc.com/ As for most of the MSM, these guys seem to have lost their edge. Maybe being owned by large corporations with close ties to Wall St has tied their hands. They seem to have morphed into bread and circuses for the masses. I have come to rely more on blogs like naked capitalism for news. LeeAnne May 1, 2010 at 5:22 pm Blurtman, I recommend this video to you The Death and Life of American Journalism Feb 16, 2010 Free Press here –a panel and book introduction on the importance of journalism in a democracy, its American history and an optimistic vision toward solving the Internet business model dilemma. The panel include authors John Nickols and Robert Chesney + Jane Hamsher of firedoglake.com. Hope you enjoy it. The authors argue that the area of commercial journalism is ending and a new era of journalism that is unapologetically partisan and subsidized by the government must emerge. The event was in Washington, D.C. readerOfTeaLeaves May 1, 2010 at 5:44 pm First, how much does a reporter make, compared to one of those Wall Street execs who testified last week? Who has more power? Who has more resources? Not to defend sloppy journalism for an instant; too many journalists have been captured by sources. But nevertheless, I know people who worked mightily (and still are) in smaller communities trying what could only be described as ‘valiantly’ to keep local papers alive. In the 1980s (Reagan era), many newspapers were viewed as ‘cash cows’ and were bought up by larger entities. That meant that perfectly fine papers suddenly had harrowing amounts of debt service — no matter how well their reporters wrote, they couldn’t find the resources to stay abreast of the times, buy up new equipment, and stay current technically. That was not the fault of reporters, and I know a few who gave years of their lives to write about things relevant to the health and well-being of their communities. Like others who come here, I saw the bubble. In the 1990s and 2000s, the sprawl was unstoppable and people who’d been making $35,000 as teachers or nurses suddenly went into real estate and started making $350,000+. Some of them got used to it in a hurry; then things tanked. Meanwhile, there were many people who made a lot of money writing different forms of paper: contracts, titles, marketing copy… people were making more money than they’d ever made. So there were plenty of ‘boots on the ground’ to feed Wall Street’s frenzy, and the low interest rates can be placed at the foot of the Fed. But a lot of those people making all that money — they were voting for GWBush. And acting like Al Gore was some kind of granola worshipping tree hugger. Ten years later, we have a huge oil spill, Bush is discredited by his own actions — and the work of some valiant bloggers and a few remaining tough media types (Jeremy Scahill, Maddow, and even some NYT reporting). Up until about 2007, trying to point out that the sprawl creation was aiding AQ terrorists fell on deaf ears where I live. Most people were happy and getting fatter. Many of us now rely on blogs – I certainly do. But that is not at all the fault of good reporters. That is the fault of crap political policies, which were driven by financial interests that wanted to create mega-information-news networks. They got laws changed in order to be able to do that; as those laws were changed, experienced (often middle-aged) employees were laid off, and younger cheaper employees remained. Then Craigslist came along and knocked out the main revenue stream of most newspapers: classified ads. I get plenty mad at MSM laziness, so I sympathize with your points. But it’s not that simple, and it’s also not wise to blame talented, hard-working people who happened to be in the path of social and economic (and political) changes completely beyond their personal control. The question going forward is: how do we make sure that phenomenal resources like Yves (and other excellent bloggers) have enough revenue stream to continue providing the quality of information that require years of expertise and insider experience to develop? readerOfTeaLeaves May 1, 2010 at 5:49 pm Apologies, I went wayyyy OT to LeeAnn. Whoops! As for Tom Adams, the interview was helpful in assisting listeners to understand that a synthetic CDO has no useful value in terms of economic activity. I was also intrigued that he said when he began investigating CDOs, he didn’t believe that Wall St would ever be charged with fraud; I think that is important for the public to understand. My interpretation: “It’s so bad that once we actually started looking into it all, it was so bad that even though it is almost impossible to prove, it was so outrageous that the idea of fraud charges is now being floated.” That’s an important shift, and a new one. tom May 1, 2010 at 6:25 pm Thanks for the comments. When he asked that question, what I was really thinking was: when I first started this analysis and making these arguments about CDOs, it was an incredible uphill battle and virtually no one agreed with me. The shift in tides from last fall, when most of the press and the industry believed this was the stuff of crackpots, to now is incredible. My old company and job got blown up by CDOs so I started analyzing out of a personal obsession to find out how it happened and what I had gotten wrong. I knew I had made mistakes, but I wanted to learn why. I was amazed by what I learned and what I continue to learn about how corrupt the market was before the bubble and during the bailouts. readerOfTeaLeaves May 1, 2010 at 10:18 pm Interesting… it speaks well of your persistence and ability to remain focused, IMVHO. I personally find it fascinating that you lost your job to CDO’s, and if you can figure out how to say that in under 1 minute, I think that it would be helpful to viewers — hopefully, you’ll have additional requests for interviews. You can’t be the only person this has happened to (by a long shot). I’d be curious how you connected your own job loss to CDOs. That would probably help future viewers see the breadcrumb trail in their own lives, or friends’ lives. Because, at a very fundamental level, every one of us is getting screwed by these fraudsters. FWIW, and I’m only one person, but last Tuesday I never imagined at 8 am that I’d be keeping one eye — often both! — on streaming C-SPAN. I found those hearings just mind-boggling, and not because the fraud was so ‘obvious’; indeed, they sure covered it up with enough ‘complexity’ and sanitized language to make it all appear quite respectable. But I never supposed that those witnesses would be so wooden, so astoundingly deep in denial about their actions and the ramifications. I’m sorry to say that I found it riveting. Then had to spend Wed catching up… But I don’t think that I’m the only one. At least you’re trying to figure it all out – and explain it to the rest of us. Deeply appreciated. Comments are closed. Tip Jar Please Donate or Subscribe!