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Donkey Konger's avatar

Interesting prompt. Lets single out investment bankers.

One ought to do some sort of lesser apologia for MOST M&A bankers. Example: Sherman ain't the bad guy many here wish he was---and most investment bankers, per capita, almost surely aren't. They are analysts and thinkers that drive investment decisions, or salesman helping gramps sell the quick-lube franchises. Many participants are totally above board. And in the defense of the entire industry, the best twitter handle of all time @DisneyTuxPepe was an investment banker.

And yet it wouldn't be bad policy to death penalty some of the guys involved in very very bad things with clear harms known beforehand, eg 2008 people selling shitty CDOs, or Robinhood & other brokerage execs saving Melvin Capital from an EVEN WORSE short squeeze by disabling buying of Gamestop - there's evil people in the industry for sure, and market manipulation aplenty. You can observe how multiple market participants collude in real time when multiple retail brokers prohibit buying of a stock that is being short squeezed to hell when their *friends* opened the short position. These carny games are a real risk that impose serious harms on the average retail investor. Mantras to "just put it in SPDR or a mutual fund" in part emanate not just from the sheer difficulty of stockpicking but the riggedness of the system.

Impassioned people who will argue contra this say that IB market participants are merely responding rationally to imperfectly designed incentives. This is true! And we definitely *could* fix those incentives in a utopian theoretical world where both major political parties were not totally beholden to the banking cartel.

To the above points, america's newest market dominant minority have become somewhat ingratiated with the unsavory parts of the investment banking cartel and emulate its worst behaviors with total impunity, even claiming innocence after conviction. https://twitter.com/arctotherium42/status/1768089462246900134

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Sherman McCoy's avatar

“After making a fair bit of cash in the hotel and restaurant business, Lan secured government permission to merge three existing small banks into the brand-new Saigon Commercial Bank. (“Which,” the dumb-ass international press loves to note, “is located in Ho Chi Minh City.”) Using hundreds of proxies and shells, many in the names of complicit relatives, she evaded a Vietnamese law limiting her to 5% of bank ownership and assumed effective sole control of SCB.”

This part is not really that salacious. There was no apparent need to consummate a three-way merger to achieve her “goals,” but whatever. It is extremely common for people or institutions to purchase a greater portion of a public company than they are “allowed” to without disclosing it. Elon Musk did this when he bought Twitter - I’m sure plenty of Jack’s fellow liberals would love to seem him executed!

“Then she loaned herself… 44 billion dollars, representing 93% of the bank’s loan portfolio.”

This part is the actual crime. She would have been better off looting an insurance company (less scrutiny), like this guy - https://www.wsj.com/articles/alexander-chatfield-burns-young-financier-whose-empire-collapsed-found-dead-11635514529

Obviously, I don’t know anything about Vietnamese securities or banking “laws.”

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