Wall Street Scam
Update
The Wall Street Con Game set new records for
perfidiousness in 1998:

The heads of Merrill Lynch,
Goldman, Sachs, J.P. Morgan and others were prodded by "Federal" Reserve chairman Alan Greenspan to bail out Long-Term Capital Management, the Connecticut hedge fund that had leveraged $2.2 billion of other people's money to make trades worth $1.25 trillion


" A.R. Baron is now defunct, thirteen of its executives having plead guilty to or been convicted of defrauding investors of $75 million by lying, manipulating markets, and making unauthorized trades. Some clients lost their life savings, others, like New York University, down $600,000. merely lost fortunes."
Ted C. Fishman, "Up In Smoke," Harpers, December, 1998

45 million American households - nearly half of all Americans - are involved in the stock market, either through direct ownership of stocks or indirectly through mutual funds, pension plans, and similar scams. As of January, 1998, state and local government retirement plans had $1.3 trillion - 62% of their $2.1 trillion in total assets - invested in Wall Street. Private pension funds had $1.8 trillion in securities - 49% of their $3.6 trillion in assets.

The Derivatives Bubble

There is now over $140 trillion in derivatives worldwide. A derivative is a financial instrument whose value is determined by the value of the financial instruments or measurements upon which it is based. Derivatives traded on exchanges are fairly uniform, while those traded "over-the-counter" are completely arbitrary. Derivatives are supposedly used as a "hedge" against risks, with the most common being used to hedge against fluctuations in currencies and interest rates. A derivative, let's say, might pay off if interest rates go up. Most of the loss in the Long-Term Capital Management fiasco was through speculation in derivatives.



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