The ROBS Act

[Octafish]

15. That peculiar odor...A Jobs Bill for Wall Street

This wasn't on tee vee. Yet, it's important to know. Wall Street didn't get everything its owners wanted.

That Peculiar Odor...

A Jobs Bill for Wall Street

by ROBERT HUNZIKER
CounterPunch MARCH 29, 2012

EXCERPT...

Imagine the facial expressions of Jeffrey Skilling, former CEO of Enron, who is serving a 24-year sentence in federal prison for a $60 billion fraud, and Bernard Ebbers, former CEO WorldCom, who checked into federal prison in 2006, serving a 25-year sentence for an $11 billion accounting fraud. They’re probably smiling ear-to-ear for the first time since behind bars, knowing Congress has opened the doors for them, assuming they get out early on good behavior. The capital markets need some rambunctious CEOs for job creation, and now it will be much easier to pocket funds from less-sophisticated investors. Wow! This will be a bonanza for guys who have fuzzy reputations.

Well, on the other hand, maybe Jeffrey and Bernie should consider stepping into the hedge fund business because the new JOBS Act opens the spigots up for creative upstart hedgies and the established hedgies raising new capital. Under existing law, private hedge funds are only allowed to market to a small defined group of sophisticated investors with whom they have a pre-existing relationship. However, under the new bill, hedge funds will be able to sponsor sporting events and/or begin advertising their funds in print, promoting their wherewithal to the general public at large. Thus, overturning a ban of marketing to the general public that dates back to the Securities Act of 1933.

The JOBS Act definitely makes it easier for hedge funds to raise capital from the more naïve general public, but one has to wonder if the new legislation will actually help create a lot of jobs, other than openings for Jeffrey and Bernie, and how about Madoff too, if, and when, they change colors from bright orange to subdued dark blue.

SNIP...

And, more authoritatively yet, according to Rep Spencer Bachus (R.Ala.), who famously, or rather infamously, purchased ‘puts’ on the market expecting it to crash, after secretly meeting with Treasury Secretary Paulson in 2008, in support of the bill, “You take the risk out, you take out the reward.” If you have any doubts about the sanctity of this new bill, this is extremely comforting, coming from a professional investor who is also a member of Congress.

CONTINUED...

http://www.counterpunch.org/2012/03/29/a-job-bill-for-wall-street/

Thanks, whatchamacallit. Very much appreciate that you give a damn.