Wall Street Greed
Many people get sucked into the excitement of new stocks or Wall Street buzz, and forget a critical truth: Wall Street is inherently greedy, and ordinary folks frequently get run over by the excesses and crooked dealings of Wall Street hot shots. This was the initial feeling behind the Occupy Wall Street movement, and whatever you think of what the movement has become, they do have one thing right: Wall Street doesn’t care about the little guy, and sadly, most politicians don’t want to make their cronies on Wall Street pay for any crooked dealings.
Take these examples for instance:
MF Global
This was the 8th largest bankruptcy in U.S. history and was run by Obama crony Jon Corzine, who made astounding amounts of money before the company collapsed. Currently an investigation is pending – although no charges have been filed.
Facebook
Anyone who rushed onto the Facebook bandwagon probably bought way too high at $42/share. Many advisors were told to not even bother getting into this fray, and ordinary people to got involved were taught a quick, painful lesson. CNBC was whipped up in a frenzy over this, thinking it was going to quickly make investors wealthy, but the IPO was pushed too high by greedy underwriters and soon collapsed. The moral of the story is that ordinary investors who listened to “experts” and bought during the excitement quickly lost money because of Wall Street’s greed and impatience.
JP Morgan Chase
Jamie Dimon is finally admitting a $2 billion loss through JP Morgan – some people are saying it’s as much as $5 billion. Now, unlike in 2008, shareholders will shoulder this loss and not the taxpayer, but it reminds us all of what happened in 2008, when taxpayers had to bail banks out.
All of this proves our point: Wall Street is greedy to a fault, and the markets are extremely volatile. Risk is high and common-sense appears to be low, so stay educated and be careful with your hard-earned capital.
This is a podcast summary. For more complete details, please listen to the full podcast here.
