Is Jail enough for reckless bankers who bring an entire economy to its knees like they did in 2008? (leave your comments below).
Some would argue that perhaps the ultimate punishment for banks should be to stop bailing out and rescuing them with public money every time they screw up!
Alessio Rastani appeared recently on Russia Today (RT) to explain his views. This is against the background of recent plans by UK chancellor, George Osbourne, to jail reckless British bankers.
Alessio argues that perhaps the banks should remember that the most important currency in the world is NOT the dollar, sterling (British Pound), the Euro or gold, but TRUST…
The banks have justifiably lost credibility and trust with the public. What will it take to restore this trust when the market is rigged against the average investor?
Leave your comments below and let us know what YOU think!
See also Trader Says “Market Is Rigged” On Live News .
Throw the bankers in jail and chuck the key away! Why do we put up with criminals?
Bailing them out will result in bankers repeating their behaviors. Only way is to get to the bottom of this shit and let people know the banks which they can trust and not.
Audit and regulate to level which stops banks from creating artificial bubbles.
Nice job Alessio! Great video. I totally agree with what you said about the market being rigged against the average Joe out there.
excellent video and excellent comments .
There certainly needs to be some accountability.
Totally right on the money Alessio!
But next time there will be no more money (or credit rather) left for us to bail them out – and the lunatics are still in charge of the asylum.
Nicholas Naseem Taleb also has much to say about how the crisis was mishandled and the moral hazards resulting. Most people are too preoccupied with survival to keep angry enough about this and much of the initial anger/indignation has now dissipated.
You asked for a comment so here is mine.
It looks to me as though it is not enough to prove recklessness.
I had just over 100 000 euros which I spent on oil futures. The high margin means 1 million euros worth of oil (just enough for price fixing to be considered criminal). I held the position for one week, on my account I had now over 200 000 euros as the price of oil had increased by 10%. I placed an order to sell my 1500 contracts at the market price, but the market maker only bought 3 or so of my contracts. I left to do some shopping and on my return found that my contracts had been sold 10% bellow market price! So my account balance came back to 100 000 euros despite the market price having remained stable all day.
I complained to the police and they spent 5 months investigating this. Their conclusion was that it was hard to prove beyond all doubt that I had not placed the order myself. But they refused to let me know from which computer the order to sell at market price had been changed. Due to this they said price fixing was evident but not criminal!
I told the police that the bank was not a charity and so was not allowed to accept cash gifts, but they refused to reply.
So it looks like price fixing is not criminal.
That banks can swipe money from any account and get away with it.
All this happened in Russia.
Jail alone is no deterrent, the terms will be short or even non existent base on time served during very lengthy trials. Bankers, especially seniors, know they will receive large pay offs and pensions regardless of performance. This is an area that should be targeted, subject them to the fear that most of us have especially in the private sector, of retiring with a poor pension. In my job if I screw up or break the law I am goosed! No pay offs, pension pot slashed, certainly makes you think hard about you own performance when a comfortable future and cosy retirement is not assured!
Well said Alessio.
You’re right. The market is rigged against the average person. It’s amazing how many people do not know that.
You’re right! Banks should not be bailed out with public money! There should be an independent financial regulator giving to each bank a real quotation as to their strenght, past and present reputation to allow their customer to decide wether or not they want to deal with them.
Regards. Kamochris
PS Why can I rogue trader be criminaly convicted and not a banker?
You look so smug at the end of that clip!
All markets are rigged! You have to remember that all the exchanges have a super computer linked in and they make a % on every transaction BEFORE it gets to Joe public. These guys make £££££ each minute, without any risk. No wonder the market is a zero sum game.
J
Of course the market is rigged! its rigged with monetized debt at the cost to the man and woman in the street! trouble is there is nobody in the street’s to put a stop to it! they are so punch drunk and suffering from stock market syndrome (financial stockholm syndrome) they are no longer able to tell the difference from some thing real? and a derivative! lets be honest about this for once eh! if the fed and central banks pulled the qe plug out? the whole thing will crash and if that happens? we all crash! and they wont do that till some other different system is ready to take its place? fraudulent bankers are key players in all this! so why will they put them in jail? not going to happen! but some day in the future they will pull the plug? and guess what 99% wont see it coming! no matter how clever they think they are? this is why i have withdrawn from the whole game already and no longer recognize that currency as any sort of wealth, and if you cant figure how that is possible? you are all ready sunk!
Well spoken,Alessio!
Surely `mens rea`(mindful intent),though difficult to prove in Law, is `prima facie` after the fact of `cui bono`; after all, these banks and politicians are `experts` in charge of other people`s money! Surely Law can prove the criminality between what is said and what is done. But, of course, we can all `make a mistake`, `forget` or accidentally transfer money to an off-shore account. Or misinterpret settting Libor rates.
Hi Alessio.
Generally speaking I think incompetence should not be rewarded, maybe if the bankers had all their assets seized and ended up living on benefits on a council estate that would be punishment enough.
But is it incompetence? there are two sides to every trade and if somebody loses then somebody else wins ( I assume,correct me if I’m wrong).so who did the winning?
Also you once said that Goldman Sachs rules the world.don’t you think it a strange coincidence that the head of the Bank of England, the Head of ECB and the head of the New York Fed are all ex Goldman Employees, and lets not forget the Politicians some of them have links to the banks either before or after office.
Peh, forget the jail; why don’t we just have Zimmerman be the security guard for these bankers? Maybe at night, he’d mistake them for thugs in the hood. 😛
Prison does little to nothing for changing human behavior; only in prison does the behavior change. But when they leave you can’t control the behavior at that point. Perhaps if we educated people out of their ignorance, then maybe we could move forward. But if we continue to deal violently with people, then we will continue to see war, poverty, and unnecessary human suffering.
Well said Alessio, and thank you for being honest with us…..the market is rigged……..bold very bold……
It’s true its “rigged”! Solving the world’d financial sector issues is a bit like achieving world peace. Go ahead and set up the United Nations and/or whatever institutions you want but ultimately they will fail..the only solution/way to true paece, for example, is by achieving it one person at a time.Like “trust” in banking and “doping” in sport, legislation is necessary but not sufficient…it comes down to the individual, until each person is in peace there can be no real world peace and until each person overcomes greed for money and/or winning races etc solutions to those problems will be limited too…but we soldier on!
The bank trading on our money(I realize they think it is theirs legally, when we deposit it with them), will continue until a LAW prevents this. Retail banking should be separate and operate by a reasonable spread, boring but much safer. Investment banking should be TOTALLY divorced from the retail trade and treated accordingly. Yes, markets are there for people to outguess other people using whatever advantage at their disposal, and in that sense are rigged. Brokers will work the bid and ask to their benefit.Limit orders in low volume markets are essential, but you are still in their hands. Most people dont seem to realize that the object is to TAKE your money, again inthat context the markets are rigged. FRAUD IS SOMETHING ELSE AND IS SUPPOSED TO BE CRIMINAL.
Agree with lots of points, but not all.
Side note: This seemed more like an episode of the bachelor than financial news… flirt.
I wouldn’t want to be a lawyer trying to prove intent.
In NY, USA, Spire law group tried to prove intent against bankers and politicians for $43 Trillion on Oct. 25 2012.
But YO… no charges stuck.
Will anything ever change? Why the cynical and smug NO?
Should we just keep playing musical chairs for the rest of our time?
Is stock or bond speculator really the best job for a bright philosophical mind?
I hope not…
Good interview Alessio. Excellent point about trust being a vital component in banking; however, thanks to government intervention, the markets are not working the way they are supposed to…usually corrupt banks would fail, and there would be a flight of capital from those who are reckless, to those who careful with other people’s money.
Keep up the good work! People like you remind me that honesty may not yet be out of fashion.
Sadly Alessio is right. The markets are rigged against the average person indeed. When I found out, I decided to step out their system as much as possible. The so called white collar crooks will always be bailed out and protected, untill the day comes that the mayor public wakes up and doesn’t accept it anymore. I hope this time will come sooner rather than later.
Of course its rigged. What’s sad is how most people don’t really believe it even though they will agree the systems are rigged(legislative, political, financial). However,I think that a thoughtful movement of poverty arbitrage co ops and concentrated boycotting could shake the very foundations.
Well said Alessio, it’s such a pity that the “market” is now a puppet market. Starting to eerily look like the stock market crash when companies were no longer based on how sound their foundations are and future prospects.
The problem is not so much a lack of laws in the banking system, but rather the lack of ENFORCEMENT of these laws both in the UK and the US. I’m sure everyone can think of at least 10 examples off the top of their head where some actual laws were broken by banks or bankers and the whole thing was either swept under the rug or settled for a tiny “penalty” which usually ends up being ~1% of the profit made by the illegal action.
This is the type of thing that enables recklessness. More laws won’t help if the willingness to ENFORCE them is lacking.
WHEN CRIME NO LONGER PAYS (on a cost/benefit analysis) then we will see less of it.
When people actually have to serve time in real prison, they’ll think twice. Or when a bank actually loses its charter due to continued criminal behavior and STOCKHOLDERS FEEL THE LOSS, they might actually put managers in charge that will obey the laws.
’till then…. just a cost of doing business
A punishment of not bailing banks out with public money would fit the crime. Bankers love nothing more than money, especially their own money. But will this stop bankers from doing the crime again? I think not. They will just find an even more sly way of doing their dirty deeds. I’m not sure if there even is a single complete solution to “banksters”.They seem to always find another way to get around the system. Actually, they help build the system so its more of a “cat mouse” game. We the public trying to expose their wrongful actions. The only real way to give jail time to these “banksters” is for someone to infiltrate their establishments and get hard evidence, if anyone is bold enough. You’ll most likely become a target afterwards.
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