For 40 Years I Watched ‘Rampant Fraud’ on Wall Street Destroy Capitalism, Covid-19 Nailed Its Coffin Shut
- For 40 Years I Watched ‘Rampant Fraud’ on Wall Street Destroy Capitalism, Covid-19 Nailed Its Coffin Shut
By Mitchell Feierstein, investor, banker, and author of Planet Ponzi: How we got into this mess, what happens next, and how to protect yourself. He spends his time between London and Manhattan.
The Covid-19 market turmoil set off a chain of flashbacks in my mind, from crisis to crisis over the past 40 years. They all fit together in a picture of Wall Street fraud and criminal policies, with the virus as the last straw.
Last week, I spoke with a young stock trader currently working on Wall Street. I remember saying: “The last time I remember seeing volatility like this in markets, my 40-year Wall Street career flashed in front of my eyes. I was like a deer in the headlights.”
Thirty seconds of silence followed before I added: “Well, actually, the volatility we have seen since mid-February is unprecedented; in history, nothing like this has ever happened. It’s a case of 12 years of climbing up the staircase only to be pushed down the elevator shaft – with more downside ahead.”
Later that evening, thinking about my conversation, I recalled the highly-rated Wall Street crashes I saw during my career. In 1982, the fraud at Drysdale Government Securities INC. made one of our traders on the floor frantic. He was wildly flailing his arms, jumping up and down, and threw the handset of his phone to the floor, smashing it to pieces. All the while, he was shrieking: “F**king Drysdale has gone f**king bust. They will take down Chase Manhattan Bank with them, and the entire global f**king banking system. Repo is finished.”