Bank Super Lawyer, Rodgin Cohen of Sullivan & Cromwell, Says Regulatory Capture is a Myth

Naked Capitalism has the story Bank Super Lawyer, Rodgin Cohen of Sullivan & Cromwell, Says Regulatory Capture is a Myth.

Yesterday, the Wall Street Journal ran a credulity-straining account of how Rodgin Cohen, the dominant bank regulatory lawyer in the US, was trying with a straight face to convey a line that legitimates his role: move along, there is no such thing as regulatory capture.

The article refers to another Naked Capitalism article, Stanford Law School Covers Up SEC’s Andrew Bowden’s Embarrassing Remarks by Deep-Sixing Conference Video.

Fortunately, our Richard Smith, based on his considerable experience with scammers removing incriminating evidence from the Internet, had the presence of mind to download the entire presentation. NC has restored it to YouTube, and, unless Stanford Law School’s next tacky goof is to get cute with DMCA requests, you will always be able see it here.

I always thought that having the right wing nuts of the Hoover Institute on the Stanford campus was an embarrassment to Stanford.  Now I see that it fits quite nicely with the Stanford philosophy.

The embarrassing video had SEC regulator Bowden marveling at the huge profits of the private equity business.  One of the comments pointed out an obvious fact.

An actual regulator might find those large profit margins worthy of a second look…….

When I see all the stories of hedge fund managers going to jail for insider trading, I realize that the reason that hedge funds used to make such out sized returns for their investors was that they were cheating.  Since it is well known that it is next to impossible to beat the market averages over the long term, one must look askance at how some individuals defy this.  Many have done this by cheating.  You have to wonder if there are any who achieve this high level of performance honestly.

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