2008 financial meltdown perps walk

It's best to have tough hands if you work in the financial industry nowadays. How else could you endure all the wrist slapping, handwashing and high-fiving that's sweeping board rooms from one end of Wall Street to the other?

Last month, JPMorgan Chase became the latest financial firm to squirm out of swindling clients at a cost that amounts to only a tiny fraction of its annual profits. In addition to paying a $154 million fine for a hedge fund scheme, the bank's Wall Street division is admitting bid-rigging from 1997 to 2006 and paying a $211 million settlement with municipalities in 25 states.

JPMorgan reported a $17.37 billion profit last year.

"School districts, nonprofits and municipalities in this case were all defrauded by Wall Street," California AG Kamala Harris, one of 25 attorneys general involved in the bid-rigging case, said of the settlement deal. "This settlement brings a measure of restitution, justice and closure to the victims."

JPMorgan is the third bank to cut a bid-rigging deal in recent months. UBS paid $160 million in June and Bank of America paid $137 million in September.

And JPMorgan was fined $154 million in June for a 2007 hedge fund scheme, with victims including a not-for-profit Lutheran insurer and a manager of General Motors pensions.

JPMorgan's fine and settlement are relatively small measures that combine wrist slapping, handwashing and banker high-fiving as essential ingredients. The bid-rigging settlement amounts to 1.2 percent of the bank's profit last year, and the firm is shamelessly bidding for absolution by blaming the scheming on a mid-level executive who pleaded guilty in the scams.

Investigations linked to the 2008 financial industry meltdown that severely damaged the U.S. and global economy are bearing fruit. But most shoppers would pass on this rotten harvest.

Financial industry fines and settlements for fraud perpetrated in the leadup to the 2008 meltdown will likely amount to a few billion dollars. In contrast, the national and world economy remains hobbled with losses, debts and financial needs measured in trillions of dollars. The U.S. housing market -- the 2008 meltdown flashpoint and backbone of middle class wealth -- remains in shambles and poses a seemingly insurmountable obstacle to economic recovery.

The value of a survival-of-the-fittest approach to a healthy marketplace is ingrained in American business mythology. Weak and flawed businesses presumably fail, their assets are redistributed and stronger businesses step forward to serve the market. Wall Street is apparently immune from this kind of evolutionary pressure: The same institutions and individuals who brought down the economy remain in place, waiting to collect their next bonus check.

PBS Frontline has produced several excellent documentaries on the financial meltdown, and they're well worth your time:
The Warning
The Card Game
Breaking the Bank
Inside the Meltdown

Maybe I was wrong about needing tough hands on Wall Street. A hard heart seems more useful.