By now, you’ve probably seen the Occupy Wall Street protests in New York City. Wall Street, where the iconic Morgan Stanley bull stands, is the very face capitalism. So I suppose it’s right that people who wish to make their displeasure with capitalism’s performance over the last few years known would choose Wall Street.
I’ll admit — I greeted the first reports of this protest with little more than a smirk. Yes, I was ready to dismiss this protest without even having my curiosity aroused. I can’t say exactly what prompted me to reverse course and do a little digging.
Maybe it’s the fact that I started to recall various predictions, by one of my analysts Jason Cimpl, of riots and protests certain to make their way to the U.S. that got me thinking. Jason runs a trading service for Wyatt Investment Research, but he also publishes his daily thoughts on the market. Sign up for his free daily e-letter, TradeMaster Market Forecast, here.
After all, we’ve seen economic-related violence in Greece, England and France. More serious demonstrations have created the Arab Spring in the Middle East, and led to outright war in Libya.
While I still find the notion of violent protest in the U.S. farfetched (despite some of the scenes from the WTO meetings in Seattle), maybe it’s not a good idea to dismiss the Occupy Wall Street Protests so readily….
In reading reports of the protests, I haven’t found any specific agenda. The protestors appear to be young and angry at bailouts, lobbyists, too big to fail, the widening income gap, globalization — anything that can be latched onto as a cause of the current economic situation.
And while I’m sure we will all see reports labeling the protestors as "hippies" or socialists or whatever, I have to ask — aren’t these issues ones that we are all a bit angry about?
In fact, it is these issues, in part, that gave birth to the Tea Party faction of the GOP.
Wall Street is also the face of the financial crisis. Since it was the banks that over-leveraged their mortgage bets and nearly collapsed (were it not for bailouts) when those bets went bad, it is very easy to point to the Lehman Brothers and Goldman-Sachs’ of the world — and by extension Wall Street — as the cause of the financial crisis and the current weak economy.
Of course, that’s an oversimplification. Regulators, ratings agencies, mortgage companies (like Countrywide) Congress and even the Fed (Alan Greenspan) are all complicit in the housing bubble that ended in the economic freefall of 2008.
And, as typically happens in a bubble, normally responsible individuals get swept up in greed. People were buying houses they couldn’t afford. It seems to me, there is enough blame for the financial crisis to be spread around.
Maybe protesting Wall Street is a bit misguided. But then any protest needs its metaphor, its symbol of injustice. So maybe Wall Street really is the best symbol for all that’s wrong with America: short-term profiteering, financial alchemy, campaign funding and outsourcing.
(I would also suggest that the failure to prosecute those in Wall Street who were directly responsible for the crisis was a big mistake by the Obama administration. Americans like justice. And we didn’t get any. In fact, some players are still in positions of power. That makes it tough to turn the page.)
Protests have come to America. Will they increase? Fade without much attention? Will there be violence?
It would seem unlikely. But if the economy worsens, we should expect violence would escalate.
One thing is for sure: Americans are still angry. And if the next election doesn’t result in political leaders who are more sensitive to the concerns of the average citizen, the anger will not go away.
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