Business as usual


To the editor,


Recently federal prosecutors brought charges against SAC Capital Advisors for securities fraud. Insider trading is business as usual. Hundreds of millions in excess profits is business as usual. If profits are the bottom-line then the distinction between crime and business becomes meaningless. Hedge Funds are the use of investment strategies in derivatives or leveraged investments setting informal agreements between two or more parties under which payments, or payoffs, are to be made between the parties often on future investments that have not yet been secured. In order to borrow heavily then to buy still more shares to sell them at a profit. A firm with more debt than equity is leveraged. All of the above is speculating of future profits with no direct tie to jobs, community services or raising the standard of living of the bottom sixty per cent of the population. 

Wall street is the problem. A large amount of liquid capital that flows on a daily basis from one firm to another is absurd. Market speculation is criminal. This speculation is not tied to any commitment to product quality of community service. Family business is in it for the long haul, good times and bad. Public employees the true heroes of America are service workers. Economies should be designed to meet the needs of real people particularly those on the bottom.

Hedge funds, overproduction, use of advanced investment strategies in derivatives, leveraged investments, unprotected selling of securities from a third party, bilateral contracts transferring risks to some one else and ultimately the government and on the backs of working class tax payers is a crime that is legal but immoral.

There should be a stiff tax levied on the financial transactions of large investment firms. There should be a double tax on all Wall Street bonuses with no deductions. Additional taxes placed on high-speed trading, on equity and bond trading, all traded derivatives all of which is part of the speculative market. Taxes should be steep on any private investments not tied directly or indirectly to real production or jobs. The body of proof should always be on the large investment holdings. Until we change our worldview from wealth and power as an end, to public service and pride in the craft crime will be legal and human decency will be utopian. 


Michael Francisconi,