Angelides on the Radio, Hits Wall Street as "Gambling Casino" Hurting Real Economy
February 9, 2011 • 2:21PM

"I was just taken aback at the extent to which Wall Street has become a gambling casino, rather than a place that provides capital to build the American economy," the head of the Financial Crisis Inquiry Commission, Phil Angelides, told conservative radio host Michael Medved. As in other interviews, Angelides again emphasized Wall Street's destructive role with respect to the real economy, noting that Wall Street is no longer providing capital for our economy, or for companies that "make things."

Angelides pointed out that many of the flaws in our financial system that emerged before the 2008 crisis, still exist today, such as the shadow banking system, overnight lending markets which are very fragile and subject to runs, the concentration of power in a few large banks, and risky trading activities. "Wall Street really became a place where they were trading, trading, trading, rather than investing in America," Angelides said, adding, "I don't think much has changed; we've still in a very fragile situation."

Medved, a West Coast movie reviewer and commentator who has been closely associated with Rush Limbaugh, was surprisingly positive toward the FCIC Commission and toward Angelides personally, whom he described as "my friend," while at the same time asking a number of pointed questions about the partisan divide within the Commission.

Responding to these questions, Angelides singled out Peter Wallison for criticism, noting that the other three Republicans on the Commission agreed with much of what the majority said. "Our conclusions were nonpartisan," Angelides stressed. He attacked Wallison's dissent, which put all the blame for the crisis on Fannie Mae and Freddie Mac, and Angelides took note of the fact that Wallison's three GOP colleagues didn't even agree with him. (Wallison headed the American Enterprise Institute's project on financial deregulation for many years; Prof. William K. Black calls him "the leading apologist for financial deregulation in the world.")

On the Community Reinvestment Act (CRA, which many Republicans blame for the crisis), Angelides pointed out that nine of the ten commissioners found that the CRA did not cause the crisis, and the Commission found that the most aggressive, out-of-control subprime lenders — Ameriquest, New Century, etc. — weren't even covered by the CRA.

Medved reported (which EIR has confirmed), that the FCIC report is No. 5 on the Washington Post non-fiction bestseller list. Angelides said that the Commission wanted to make the report broadly available to the American people, so they can see what happened to our financial system. He also announced that there are also thousands of documents on the FCIC website, and that by end of week there will be hundreds of audio recordings of interviews; he urged people to read and listen for themselves, and to come to an informed conclusion.