Forum Post: I constantly hear "bankers broke laws." What laws were broken, when were they broken, and by whom?
Posted 13 years ago on Oct. 16, 2011, 1:49 p.m. EST by objectiveobserver
(21)
This content is user submitted and not an official statement
If someone can quit the brainless and generic finger-pointing and add some substance to this "Occupy Wall Street" ordeal, you might actually gain some traction.
Packaging junk mortgages into mortgage-backed securities that were then magically rated AAA (fraud #1), and then, while knowing full well that these mortgage-backed securities were going to tank, not only encouraging your customers to load up on them, but surreptitiously shorting them in anticipation of their collapse (fraud #2). And that was JUST Goldman Sachs! Don't get me started--Wall Street is a PIGSTY and a WHOREHOUSE. It's the Mafia in better clothes. And if you already think Wall Street is bad, you need to multiply that by about ten times to even get close to the truth. Wall Street is SCUM. And yes, I've worked there...
Actually, the housing criss was caused by the Community Reinvestment Act, Fannie Mae and Freddie Mac.
Legislation that weakened the requirements it took to purchase a get a loan for a home. Thus, all of these people who could not afford a home went and got mortages they obviously could not afford. You should be protesting the government.
You are simply an idiot if you think it was because of "Wall Street greed" - do your research
Right wing propaganda. I suggest you diversify your news sources. They were just prey an easy target. Do you think repealing Glass Steagall wedged the door open just a bit?
there is no left wing propaganda - only right wing prop.
There is left wing propaganda too. It's important for one to know his/her history before embracing political or economic theories. I've been right wing my whole life. Although the past few years I have been moving more and more to the left. After Studying my opposition thoroughly, I've found that many of the views I had been defending were half truths or economic strategies that failed over 100 years ago.
Sorry--a 2008 study by the Fed showed that loans issued under the CRA performed as well or better than other mortgages issued by those same banks. I'll be happy to provide a link if you can't find it--just let me know...
why are 52% of freddie mac loans sub prime? oh - they are looking for another multi biillion dolar bailout by the way
FNMA and FHLMC delinquency rates are about 6%. Private label subprime securitizations are at about 50%. Blaming the Community Reinvestment Act is simply wrong. CDOs, the ultimate expression of the credit bubble, were mostly made up of lower-rated private label bonds. FN and FH did not do these. They are what blew up Citi, Merrill and AIG. Do your research.
@Vooter: yes, Wall St. made oodles of money packaging bad debt. Their out is that the risk was fully disclaimed. Securities law is based on "caveat emptor" meaning that if you buy something risky and that risk is disclosed, don't come complaining when the something blows up.
Goldman Sachs may have disclosed that they were passing off tranches of subprime and Alt-A mortgages as AAA securities, but they didn't disclose that they were shorting the same products that they were furiously pedaling to their own clients. Their excuse was that their clients would have "expected" them to do it. In other words, whatever they did was correct, no matter what the result was...LOL....
hmm....... what do you call those trading firms that buys clothes and televisions and what have you from overseas and attempts to sell them locally? why don't they use their own televisions that they buy? why are the selling the same thing that they are buying?? i'm sure they know their own items are crap that's why they are trying to sell it.
That's a cop out. If you have insider information on a financial product and you short it isn't that tantamount to insider trading? Which I believe is still illegal in this country. Not to mention the disgusting lack of business ethics involved with said activity. Although you would be right in saying that it is not "illegal" to do many of the things these banks did, they still shouldn't have done them. Of course, it is the federal government which is at fault ultimately for allowing these things to be legal. I can't understand how you are trying to defend these scum bags though...just because you don't break a law doesn't mean you're not a scum bag. Same as the mechanic who charges you an arm and a leg just cause he can...dishonest, manipulative scumbags.
i feel that i am free to choose not to patronize their business if they are giving me shit products and shit service.
i don't hate them. i just won't pay them.
You can't fault GS for being on the right side of a trade. That's why they didn't need a bailout, even though they got one anyway. That is entirely separate from brokering trades which blew up.
This is true
sorry - did I miss the answer to my earlier question somewhere?
so answer the question - did they break any laws?
Right-On!!!
The securities business, also known as investment banking, also known as Wall Street, is very complicated and requires specialized knowledge. People in the industry have to take and pass difficult exams to obtain a variety of licenses required for certain postions. Without having the same knowledge, the public is vulnerable.
The securities business is regulated. Everyone rolls their eyes but it's true. The Glass Steagall Act of 1932, the Securities Act of 1933, the Securities Act of 1934 and the Investment Advisors Act of 1940 kept the industry safe for decades. The most important provisions of the Glass Steagall Act were repealed in 1998, and even though the others are still in effect, that deregulation has been disastrous.
I encourage you to read the case that the SEC filed against GoldmanSachs which resulted in a $550 million fine (biggest ever) paid by Goldman in 2010. Ask yourself whether justice was really done? The allegation was that Goldman defrauded its clients and breach of fiduciary duty was the second offense. Goldman was allowed to settle the case before it was fully tried. They were allowed to agree to the fine without admitting or denying guilt. They also had to promise to modify their business pratices. I wonder who's checking on that. The individuals skated which is generally the way in the securities business. Why? The industry is built on a mandatory system of supervision that doesn't allow anyone to work alone. Take one person out, and the next person up the chain is responsible too. And so forth till you reach the CEO. So they spin it around and claim that the individual was acting for the firm, not on their own. And the punitive action is confined to the firm.
This case is a textbook of everything that's wrong with Wall Street today. It's a system which is thoroughly compromised, including the SEC which is supposed to regulate. The industry is extremely smart and knows how to circumvent the rules so they aren't technically breaking any laws in much that they do. That's why the fallback goes to very broad standards like fraud and fiduciary duty.
Read up: http://www.google.com/#hl=en&sugexp=gsihc&cp=45&gs_id=b6&xhr=t&q=%22Goldman+Sachs%22+%26+%22SEC%22+%26+%22%24550+million+fine%22&pf=p&sclient=psy-ab&source=hp&pbx=1&oq=%22Goldman+Sachs%22+%26+%22SEC%22+%26+%22%24550+million+fine%22&aq=f&aqi=&aql=&gs_sm=&gs_upl=&bav=on.2,or.r_gc.r_pw.,cf.osb&fp=4bc23f8df9681a44&biw=1192&bih=543
My god, since all this drama started you are the first person to mention Glass Steagall (not saying it hasnt been mentioned, just havent personally seen it). Kudos.
Didnt bother to read the rest of your post, but if your mentioning that act you have (at the very least) an elementary understanding of what caused the collapse (well...part of it at least) so sure its safe to assume the rest of what you said is good :)
We need reform so that it doesn't happen again. It was done in the 1930's. Why not now? I know you know the answer.
[Deleted]
"looks the other way"....
meh
http://tinyurl.com/CFTCFines ------- http://tinyurl.com/FERCFines ------- http://tinyurl.com/FINRAFines --------- http://tinyurl.com/SECFines1 (search terms: market manipulation judgements , enforcement)
Then would it not be more productive to protest the SEC and tell them to do their job?
[Deleted]
Then why is no one there? OWS is a sham and is starting to piss people off for their lack of any message or consistancy. I give them twinkles down
I agree. Frankly, the #OWS is conspicuous by its absence in massive numbers in the seat of power, Washington DC. That is where the cesspool of deceit is at. Many posters on this Board and around the country are asking the same question. I keep reading that the #OWS is basically an activist arm of the Democratic Party and, therefore, doesn't want to embarrass its man in the White House by demonstrating in large numbers in the capital. If that's the game plan, then #OWS is a loser. I hope this suspicion is incorrect.
That is exactly what the outside population sees, a democratic party shill. The only thing 99% about OWS is the number of people who will vote democrat.
If so, the 99% will endorse the same politicians who got us into this mess and can expect more of the same. The 99% are nothing but useful idiots to incumbents if they vote for them, whether they be Democrats or Republicans.
Unobjective Observer, do you believe that billion dollar bailouts should be legal? Do you need me to cite that particular event?
How about I cite our Constitution allowing us to elect public officials who ENACT THE LAWS IN QUESTION. Buy "Government for Dummies." It'll help you immensely.
On a final note, were the wealth redistribution payments by Obama legal? Of course they were because since you likely received a freebie payment, they suddenly became acceptable.
Read the Financial Crisis Inquiry Report if you don't "get" how Wall Street screwed over everyone else: http://fcic.law.stanford.edu/
riethc, a lot of people "believe" abortion should be illegal, but the law says it is. you can believe anything you want, but it doesnt make anything legal or illegal. But if you're talking abour right or wrong, that's a different subject.
Objectiveobserver is probably just a troll. I'm not going to argue with this premise where he takes the upper hand of being judge and jury. Laws are written, rewritten, obfuscated, interpreted, reinterpreted, misinterpreted, etc. There are obviously "very bad things" going on in the financial system, if he doesn't know that by now, he is either a troll or a moron.
Read the Financial Crisis Inquiry Report to get the details: http://fcic.law.stanford.edu/
Right-On!!! Just read the conclusions if you want the cliff notes.
So what if they did or did not break laws? Jesus and Socrates were legally executed, slavery at one time was legal, and the French, Russian, and Irish peasant system was legal prior to their society's breakdown.
Certainly prosecute existing laws, however if laws are unfair, change 'em. Ordinary folks in American desire to hope and believe they have a chance at the brass ring, the American dream, or "success."
I'm tired of wealthy and powerful interests throwing up barriers in our path akin to Marie Antoinette's (purported) statement, "Let them eat cake."
the crisis was not a natural disaster, but the result of high risk, complex financial products; undisclosed conflicts of interest; and the failure of regulators, the credit rating agencies, and the market itself to rein in the excesses of Wall Street. The crisis was avoidable and was caused by: Widespread failures in financial regulation, including the Federal Reserve’s failure to stem the tide of toxic mortgages; Dramatic breakdowns in corporate governance including too many financial firms acting recklessly and taking on too much risk; An explosive mix of excessive borrowing and risk by households and Wall Street that put the financial system on a collision course with crisis; Key policy makers ill prepared for the crisis, lacking a full understanding of the financial system they oversaw; and systemic breaches in accountability and ETHICS at all levels. - The United States Senate issuing the Levin–Coburn Report and The U.S. Financial Crisis Inquiry Commission
If you choose to be narrow minded, then what laws are the Foodstamp and unemployment recipients breaking? You know those pesky hippies who wont get a job but live off the government tit. What's good for the geese are good for the ganders.
MERS, bitchez !!!
MERS Mortgage Transfers Deemed Illegal by Federal Judge
http://www.totalmortgage.com/blog/mortgage-rates/mers-mortgage-transfers-deemed-illegal-by-federal-judge/10184
I think where there were actual laws broken were when banks employed the use of the practice known as "rowboat signing". Also, there are thousands of illegal foreclosures happening. Illegal meaning there is no documentation to prove the legality of the foreclosure.
fraud is not a crime
if i sell you a diamond ring and it turns out to be glass -
... thats under- regulated capitalism.
georgies yellowcake wasn't fraud -
...thats under- regulated capitalism.
dickies halliburton showers weren't fraud
...thats under- regulated capitalism.
ronnies iran contra wasn't fraud
...thats under- regulated capitalism.
jail is too good for all of them
lets put them all on Alcatraz island with no food - and play survivor
I have never claimed that the banks broke any laws. I am sure they probably did but not in the egregious manner that is often implied. On the contrary I have since long before all of this went down stated openly that in effect the banks write the laws. Why do they need to break them?
This where Regulation should be as tight as regulations can get. That being said, don't sink the ship because it's leaking. Regulated Capitalism is a good thing. Socialism is a bad thing. Look at Greece.
This whole problem started in 92, ACORN sued Citibank in Chicago. Citi bank lost and was fined 1 Billion dollars by the Government. Other banks took notice and started making Risky loans because they didn't want to be sued and loose a billion dollars either. Barrak Obama was an attorney involved with the Citi suit. All banks started to make these risky loans, bundle some risky with some good, they were then bought and sold in the houses of high finance on Wall Street. 2004 and 2006 during the Bush Years, the CBO and Congress called hearings into the finances of Fannie Mae and Freddie Mac. The Democrats at the hearings Maxine Waters and Barney FRank called the CBO and the Congressman holding the hearings Rascists.
The housing Bubble of the 90's is something that should have never happened, if people had to put 20% down to get a loan we wouldn't here now !
The real Whores are Fannie and Freddie, and most of all The Federal Reserve Bank, a private Bank that loans money to the Government at interest.
If you want to protest, demand that the Federal Reserve Bank be audited !!!!
Broke the law, Gamed the system.... who cares... they used their access to our elected representatives to create a false bubble of value whose toxic assets were hidden in complex financial instruments, and then positioned themselves short on those assets because they knew they were toxic. Brainless tools who have no clue as to what is the driving force behind the OWS should stop embarrassing themselves with ignorant comments like the one that started this thread
You might want to read "Griftopia," by Matt Taibbi. Also, watch the Academy Award winning documentary, "Too Big to Fail."
http://www.thedailyshow.com/watch/mon-april-19-2010/these-f--king-guys---goldman-sachs
Along with:
Man Who Had No Mortgage Faced Foreclosure Anyway: Ann Woolner - http://www.bloomberg.com/news/2010-10-08/man-who-had-no-mortgage-faced-foreclosure-anyway-ann-woolner.html
And another one.
Bank of America forecloses on house that couple had paid cash for - http://www.tampabay.com/news/business/realestate/bank-of-america-forecloses-on-house-that-couple-had-paid-cash-for/1072632
And still more:
"The Cordosos, Portuguese immigrants who are in their 50s, are now suing Bank of America for allegedly seizing the wrong home, and they're not alone: Two other homeowners, one earlier this month in Texas and another last October in Kentucky, also have filed lawsuits alleging that Bank of America attempted to foreclose on their homes even though the bank did not own or service mortgages for the properties." Source: No Mortgage, Still Foreclosed? Bank of America Sued for Seizing Wrong Homes - http://abcnews.go.com/Business/bank-america-sued-foreclosing-wrong-homes/story?id=9637897
Bank of America Allegedly Forecloses on Wrong House, Cuts Off Power, and Locks Out Couple . . . But Insists Lawsuit Has “No Merit” - http://jonathanturley.org/2010/01/12/bank-of-america-allegedly-forecloses-on-wrong-house-cuts-off-power-and-locks-out-couple-but-insists-lawsuit-has-no-merit/
Bank of America Forecloses on Wrong House, Abducts Macaw - Homeowner jumps through hoops to get bird back - http://www.consumeraffairs.com/news04/2010/03/bofabird.html
Bank of America, Sticky Fingers, Seizes SECOND Wrong House for Foreclosure - http://dallasdirt.dmagazine.com/2010/01/18/bank-of-america-sticky-fingers-seizes-second-wrong-house-for-foreclosure/
Lawsuit accuses bank of seizing wrong house - http://galvestondailynews.com/story.lasso?ewcd=4e1cfb1bebbf31e1
Among other things...
I'm not sure that they broke laws. They had the laws made in their favor by buying politicians.
I'm happy you put your arguement in the form of a question. There's a lot on knowledge here. I'll let my fellow 99.83%ers drop some knowledge for you
Whats the truth? I keep hearing it was the Government,it was Wall St. It was the banks it was all of them in cahoots etc etc etc. If crimes were committed then lobby the feds to press charges.In the mean time I think we should work within the system and restore fiscal responsibility. Not create chaos and point fingers .Two years ago I seen people losing there homes and jobs and you know what I started a little researching and it seems the government is 14 Trillion in debt and has no answers to raise unemployment. So this is the best idea I could come up with because it seems to me about 8 or 9 Trillion of the 14 Trillion is directly from the Federal Government trying to protect us almost 4 Trillion to the new Homeland Security Agency since 2001 the wars and ensuing bailouts some directly from events on 9/11/2001(airlines industry for example) We all count on the Government when times are bad but here we are supposed to be the Government I say we saddle up and take care of this together Rich, Poor, remaining Middle Class. Its a partial fix but it would 1.help the feds(us,you know we the people)2.unite all of us before things get out of control and we end up a third world country3.show the world we will sacrifice not just with the military but with our wallets to make this a better world, restore confidence. 4 Put us back to work so we can as usual be the consumers restoring global trade. visit the web site explains it better www.nationalday911.org P.S. no one here is running for office this is an idea to help sincerely www
You are correct. Bankers didn't break any laws because they use legalized corruption. If you want to do something that is illegal, buy a Senator or two, get a law passed or repealed that makes it legal, then do it. That's exactly what is going on in America today. The uber-wealthy just write laws that make what they do legal. Simple.
I'm not aware of any laws they have broken, but that doesn't mean they have either acted responsibly or ethically. That is the real root of the problem, that banks are only accountable to laws - largely ones that they have written and/or lobbied heavily for. If I could write the laws, I might be rich, too. If I valued money over integrity, that is.
Just the mere fact that YOU were bailed-out... and the People had no VOTE... no SAY... and there was no accountability of HOW MUCH you were given and WHY. Well, sir, that is ILLEGAL and AGAINST the Constitution. It is like the man who knowingly buys stolen goods. When he is caught, he says "But officer! I didn't STEAL the goods... I merely took what was offered to me!". In such a scenario, both the giver and the taker are THIEVES!!!
Try to go to the documentary sections, they can tell you more in a documentary than in a newsflash. Inside Job explains a lot. Frontline has one...Breaking the Bank. I think you might be able to watch that free on PBS website. otherwise netflix has a great documentary section that has all of this stuff.
DEAR INDIVIDUAL READING THIS, What must we as people do to fight this grave injustice inflicted upon us, by the ones who lust for power? How can we end the reign of the wicked and immoral and mete JUSTICE upon the oppressors as we have suffered from their hands-their blood stained hands... An idea of REVOLUTION-no, the act of revolution enacted by the proletarians! Must we as individuals ,as is always done, remain pawns to these people, these monoliths that we alone as individuals cannot surmounted...I surmise that we are not ignorant to the woes inflicted upon us by their enormities? We must UNIFY! Unity will be the way in which we assert ourselves!...While I realize all are not are not without income or funds and many cannot unify with this growing movement do to reasons of possible opposition and they being the people I'm question who we oppose (Wall Street), and many have responsibility they must tend to that take precedence. We must rise and vanquish this behemothto restore the equilibrium, for when disturbed it causes much chaos and strife in the hearts of man( man being neutral to represent all genders) in his mind and when mans mind and soul are in chaos as many are they rise to vanquish the pestiferous wealthy. However we should not just target these individuals, each of us individually must confront the corruption in our hearts, how can we judge the corrupt and deem them so when we cannot be amenable for ourselves we will surely be deemed hypocrites as we will be.....I am not meaning to say that this protest is in any way unjust, for far too long have we suffered, I mean that we are expected to expiate our sins -assume our parts in the problems we face and how we may have caused it. Yes, the Bankers on Wall Street are corrupt in ways we don't have evidence of without an investigation. But as we suffer soshall they, for we will make it so. But what of our government I say, my fellow citizens do not neglect to Confront the complicit in this affair for the roots of corruption are deeply seated, we have silent enemies amongst us-be warned that although succession in our goals will happen we may face a greater threat to our rights granted unto us from birth be prudent and circumspect. Another issue I wish to address is the idea of mans continual corruption as all things will be permeated with this darkness Inside our hearts.......when a system is created it always deviates from the righteous path, for nations we have learnt of in our education are littered with tales of nations that became corrupt and faded Into the ruin of collapse, we know that a society without corruption is utterly inconceivable, impossible in ways each and everyone of us know...for as long as men exist so shall our inner evil....but I digress from my original Intent of this passage and I ask forgiveness as we must forgive all in all eventual....the rising potentiality of this movement is quite an astonishment, I thought we were not capable of such things and thus I admit I had less faith in my fellow man. I see that we have all come to the realization of the need to bring the greedy to justice, although the reasons for your protesting may be unique to you, you share many goal, I had prognostications, inklings seems more appropriate of a term, that one day man would wake to realize the greater truth outside of his/her reality, and break the cycles of obsession with superficial base needs and trite motives, a dull and predictable lot we were but we've surpassed that I hope....for if not we will founder and fall Into the patterns we had grown so accustomed to, living such prosaic pedestrian lives stultified by the elite and of our own ignorance we always have the means to educate ourselves in this age, we have no limits to what we may learn based on our status in society, the powerful can no longer succeed in keeping us stupefied we have freewill to reason and learn and form our own ideas, ideas that would otherwise have died by the hands of the bigots! Our endeavours shall be crowned with fruition of our goals for our will allows it, we have broken free from the will of the oppressors......as Desmond Tutu stated "If you are neutral in situations of injustice, you have chosen the side of the oppressor." YOURS TRULY-Aaron Thomas Bridge
That is what I have been trying to do!!
On another thread I bring up the fact that while perhaps unethical wall street bankers didn't break any laws.
And even if we pass laws to make such behavior illegal (and I am not suggesting we do) it will only apply to new actions under the new law. Because the constitution forbids ex post facto laws.
I enjoy the question "What specific laws were broken?", I guess the answer should be obvious. The movement is about change, the rules and regulations that are in place to control the 1% that have caused major finacial issues for tax paying Americans were written by politicians that have been bought and paid for by the banking industry and major corporate interest. Tell me why the American tax payers who bailed out the banking industry durring the housing crisis are losing their homes while these same banks refuse to rewrite mortgages so Americans can keep their homes and the economy can recover? This movement isn't looking for "traction" we are searching for major change. If your still looking to find out what was "broken", it wasn't the laws and regulations written by the rich for the rich, it is the system itself. I cannot tell you exactly when the system started to break, but rest assured it needs to be overhauled and those responsible for corrupting the system need to be held accountable.
I enjoy the question "What specific laws were broken?", I guess the answer should be obvious. The movement is about change, the rules and regulations that are in place to control the 1% that have caused major finacial issues for tax paying Americans were written by politicians that have been bought and paid for by the banking industry and major corporate interest. Tell me why the American tax payers who bailed out the banking industry durring the housing crisis are losing their homes while these same banks refuse to rewrite mortgages so Americans can keep their homes and the economy can recover? This movement isn't looking for "traction" we are searching for major change. If your still looking to find out what was "broken", it wasn't the laws and regulations written by the rich for the rich, it is the system itself. I cannot tell you exactly when the system started to break, but rest assured it needs to be overhauled and those responsible for corrupting the system need to be held accountable.
LOL... Answer a simple question with a question. Geez OWS folks. Do you have anything substantive to share. The "system," "rules and regulations"- can you offer ANY information whatsoever?????
Arrest and indict the bankers,hedge fund investors, and politicians..for RICO and criminal fraud! They don't commit their crimes with guns.....they use residential mortgages and financial instruments to steal wealth/property and rape the citizens.
Are you just vomiting anarchist talking points?
One more thought- if laws are actually being broken, and I assume you are frustrated they are not being prosecuted, shouldn't your beef be with the justice system? In other words, shouldn't you be protesting in front of DA's offices and courthouses?
Shouldn't people be just as angry with those who commit fraud, as they are with the government that fails to prosecute those who committed fraud?
perhaps they broke them by paying the congress to change them
AIG seems to think BOA engaged in fraud and is suing them:
http://www.reuters.com/article/2011/08/08/us-bankofamerica-aig-lawsuit-idUSTRE7772LN20110808
The head of countrywide was investigated but never indicted:
http://www.washingtonpost.com/wp-dyn/content/article/2011/02/18/AR2011021807930.html
You have to understand the problems at the core to really cause change.
My finger has been pointed at bank of the banks the whole time. The problem is our Federal Reserve giving out money to anyone who needs. Thats how they basically own our economy and we've let them. Blaming BOA or Goldman Sachs is childish considering they all are apart of the much bigger conglomerate we call the central bank. (FRB)
None.
Mutual funds: 10 questions to test your IQ
By Associated Press
April 9, 2010 1:43 pm ET
Mutual funds are a cornerstone of retirement planning. Yet they're widely misunderstood and investing ignorance can really cost you. Do you know the difference between an expense ratio and a turnover ratio? What about an open-end fund versus a closed-end? Try this quiz, and check out the answers at bottom:
(a) 10 percent; (b) 27 percent; (c) 43 percent
(a) 1929; (b) 1933; (c) 1934; (d) 1940
(a) Nearly 1,000; (b) Nearly 4,000; (c) Nearly 8,000
(a) The sales fee paid when you invest in a fund, expressed as a percentage of how much you invest;
(b) The total fees charged to manage the fund and cover ongoing expenses, expressed as a percentage of the fund's assets;
(c) The fee you pay to a broker who sells you the fund
(a) A measure of how often a fund's manager is replaced; (b) How frequently the fund trades stocks or other investments in and out of its portfolio; (c) How often the fund gets new investors and loses existing clients
(a) True; (b) False
(a) True; (b) False
(a) True; (b) False
(a) True; (b) False
(a) 10 percent; (b) 35 percent; (c) More than 50 percent
ANSWERS:
(c) A survey by the Investment Company Institute, a fund industry organization, found 43 percent of U.S. households owned mutual funds in 2009, down from 45 percent a year earlier. Those households represent some 90 million individual fund shareholders.
(d) The main law is the Investment Company Act of 1940, although mutual funds also are subject to the Securities Act of 1933 and the Securities and Exchange Act of 1934.
(c) The Investment Company Institute counted 7,677 funds in February, holding nearly $11 trillion. Two common types are stock funds, numbering about 4,900; and taxable bond funds, with more than 1,800.
(b) A fund's expense ratio covers the fund company's costs before distributing earnings to investors. This amount can have a much bigger impact than any upfront sales costs -- also known as loads, or commissions -- since expenses can eat into returns for years to come.
(b) The turnover ratio measures the percentage of a fund's holdings that have been replaced over the past year. If the manager makes smart trades, a higher ratio can boost short-term returns. But a fund with high turnover increases fund trading costs, and can boost an investor's tax bill.
(a) True. Traditional open-end mutual funds are structured so that they can add investors and assets. Far less common are closed-end funds, where a fund company decides up front how many fund shares will be issued, limiting the number of investors. Those initial investors can later trade shares to others.
(b) False. While it's true that in the long run stocks generally outperform bonds, there are times where the opposite is true. As we've seen during the recession, the stock market can post dramatic losses while bond investors are generally protected. For example, over the last decade, the Standard & Poor's 500 stock index lost an average 0.95 percent per year. Meanwhile, a broad taxable bond index, the Barclays Capital Aggregate, returned a positive 6.3 percent per year.
(b) False. Regulations limit how much mutual funds can borrow to invest in derivatives, such as futures and options. But, depending on the guidelines in its prospectus, a fund can adopt some of the same strategies that hedge funds use, including short-selling.
(a) True. These funds generally employ the same strategies as many hedge funds to smooth out returns in good times and bad. But you can still lose money, even if you'll fare better than most investors in a downturn. The same goes for stable value funds.
(c) A Morningstar study found a majority of funds did not count managers among their shareholders. For example, 59 percent of foreign stock funds had no manager ownership in the fund. The figure was 65 percent for taxable-bond funds, 70 percent for balanced funds owning stocks and bonds, and 78 percent for municipal bond funds. The exception was U.S. stock funds, where just 46 percent of funds had no manager ownership.
"Wall Street is a PIGSTY and a WHOREHOUSE"
So what? Keep away frrom the pigsty (which we need to make bacon), and the whorehouse (legal in some jurisdictions). The whole point is to try to make money, and there are risks and benefits involved. Intelligent people who invest know this, and yes there are occasionally frauds. That is what the courts are for, and and that is what hedge funds are for. If someone is marketing a fraud, there are people out there trying to detect it (the hedge funds). If the thing blows, they make money. If they were wrong and the business is solid, they lose money.
There will always be risk, seen and unforseen. We already have laws regarding securities trading and accounting principles. Will these be broken? Yes, there will always be criminals.
No society can ratchet these things out entirely.
What is OWS saying? No private property? That seems to be the implication. Because if you own property, you should be able to sell it. The stock and securities exchanges are just one big market to sell these things. If you don't want to own this sort of property fine. A lot of people want to own it, and more who don't have these investments would love to own them.
This is so silly, because millions own these types of investments, and we, the 99% ar about to let the tiny slice of the 1% {the OWSers] change this. The OWSers are idiots living in a very small echo chamber, but have no idea how small that echo chamber is. Not only do millions of individuals and families own stocks and mutual funds (with a net worth of $11 trillion), but public retirement corporations own these things (teachers retirement funds, municipal workers, police etc.) as well as universities. We are not stupid in making a choice to own these things, and know both the risks and benefits.
Get a life.
Get a job.
Get a shower, please. OWS: the 1% of 1% of 1%.
The banksters broke constitutional laws when they wrote laws that did not follow the will of the people or support the nation. They did not break the laws of the 1%, but those are bullshit laws anyway.
The Federal Reserve Act is a violation of the constitution. Bankers created a law to break constitutional law in 1913. Look up Jekyll Island, formation of the federal reserve, and check out the youtube videos, "The American Dream" and "Money as Debt".
There is no law against lending money to people with no ability to pay it back.
That said, there are plenty of scumbags that should be in jail. http://www.theatlantic.com/business/archive/2011/01/e-mails-suggest-bear-stearns-cheated-clients-out-of-billions/70128/
There might not be laws against lending to people who can't pay it back. But there is a conflict of interest by packaging these up as AAA securities and selling them. These were labeled AAA, but were obviously not safe investments. Withholding that information from the buyers of these securities is a crime.
Didn't the dips shits on wall st need bail outs because they retained billions of that crap? Defrauding themselves must've been part of the plan.
They made a lot of money along the way before the bailouts and made even more profits after they got bailed out. They made a shitload of profits without any of the risk. We are pissed about the bailouts on Wall Street. What the hell are you missing here?
Agreed. But what is this whole OWS thing about aside from, "let's all get on t.v.?"
This is where the convo should have ended. Right here. They don't get it.
It is a front for socialist workers party of America, you dumbass.