Written by Econintersect
Can You Destroy $20 Billion in Wealth Without Committing a Crime?
That is the question that leads a post on theAnalysis.news 05 April 2021. The question refers to the margin call default on 26 March 2021 of the $10 billion Archegos Capital Management firm. The margin calls came from several global investment banks, including Credit Suisse, Nomura Holdings, Goldman Sachs, and Morgan Stanley.
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William K. Black, J.D., Ph.D. is Associate Professor of Law and Economics at the University of Missouri-Kansas City. Bill Black has testified before the Senate Agricultural Committee on the regulation of financial derivatives and House Governance Committee on the regulation of executive compensation. He was interviewed by Bill Moyers on PBS, which went viral. He gave an invited lecture at UCLA’s Hammer Institute which, when the video was posted on the web, drew so many ‘hits’ that it crashed the UCLA server. He appeared extensively in Michael Moore’s documentary: – Capitalism: A Love Story. He was featured in the Obama campaign release discussing Senator McCain’s role in the “Keating Five”. (Bill took the notes of that meeting that led to the Senate Ethics investigation of the Keating Five. His testimony was highly critical of all five Senators’ actions.) He is a frequent guest on local, national, and international television and radio and is quoted as an expert by the national and international print media nearly every week. He was the subject of featured interviews in Newsweek, Barron’s, and Village Voice.
In this interview, Bill discusses how a $10 billion dollar fund created losses of $20 billion (and possibly more). The story includes the disclosure of perverse incentives for Wall Street bankers, and the financial manipulations that lead to failures such as Archegos. The story is one that goes back more than 20 years and exposes that this is not a new phenomenon, but one that has occurred over and over – and will continue to happen if the rules of finance are not tightened to the equivalent of what they were for the 50 years from the early 1930s to the early 1980s.
The video is just under 25 minutes long.
Source: YouTube
Further reading: The Dumbest Financial Story of 2021 (Slate)
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