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How the Teamsters Beat Goldman Sachs

By ANDREW COCKBURN

Among the causes of the ongoing financial meltdown, many experts cite the Commodity Futures Modernization Act, smuggled through Congress late on a December evening in 2000. The law exempted Credit Default Swaps (CDS) which are essentially bets on the value of securities from all regulation, including state gambling laws. This allowed Wall Street to conclude that any risk could be hedged with a bet. The result, of course, was disaster, with economic consequences that we will be feeling for a very long time.

“When I wrote part of that legislation with these hands on my little keyboard,” a former financial industry lobbyist who helped craft the law recently told me, “I didn’t realize that this was going to make people lose their jobs, pension funds their reserves, universities their endowments. But that’s what happened”

There are now shelves full of books describing the disaster caused by the enabling of Wall Street as a wide open casino. Butt amidst the wreckage and plaintive cries for “reform,” Wall Street is full tilt in the business of destroying companies and throwing thousands of men and women out of work in order to turn a quick profit on a CDS trade.

In recent weeks the 30,000 employees of YRC Worldwide, one of the nation’s largest trucking companies, discovered that they had unwittingly been drafted as chips in the casino. The company, built up through a series of misguidedly overpriced takeovers in the years of the credit bubble, had hit a financial wall thanks to the fall off of business in the recession. Unless investors holding the company’s bonds could be persuaded to swap their debt for equity, the company would go bankrupt and its employees thrown out of work.
 
and whos fault would a bankruptcy have been? these financial institutions that are in business to make money for their stockholders and were doing what they're supposed to do or the idiots at yrcw that put themselves in this situation to start with. why does'nt the union threaten to expose the higher ups at yrcw for the idiots they really are and stop passing the buck.
 
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