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A Damning Statement On the Bank One-J.P. Morgan Merger
In the June 23rd edition of The Washington Post, Steven Pearlstein states, "Federal Reserve Chairman Alan Greenspan--complained bitterly of how misdeeds by corporate executives had undermined the system by which free markets allocate capital to the highest and best use... There has been too much gaming of the system ... capitalism is not working. There has been a corrupting of the system."

Pearlstein goes on to question why this concern was not even mentioned in the Fed's review of the J. P. Morgan-Bank One Merger. "Given that biting critique and passionate concern about the future of capitalism, it came as something of a surprise last week when I managed to catch up with the Greenspan Fed's unanimous decision approving J. P. Morgan Chase's purchase of Bank One."

"Nowhere in the 63 page opinion is there even a footnote taking note of the $135 million J. P. Morgan had agreed to pay to settle with the Fed and other regulators for its involvement in the Enron scandal, alone with its billions of dollars in additional exposure brought by Enron shareholders and creditors".

Winston thinks that the problem is simply that Wall Street and banking profits are so large, even the government can not take them on. Penalties and fines are just a cost of doing business.

As for Mr. Greenspan, Mr. Pearlstein states: "Like Greenspan, they [the Senate] like to rail against those who "game" and "corrupt" the system, but in the end undercut the reform effort by allowing some of the worst offenders to keep their jobs, build their empires and collect their obscene pay packages".


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