Tomorrow sees the start of the great circus, the insider-trading trial of Raj Rajaratnam of Galleon Group. It should have everything the Justice Department and the media craves: wire taps,a hugely rich defendant and, with luck, maybe even some sex. But most important, it will deflect attention from the real scandal here, the refusal of the Justice Department to pursue the people behind the financial collapse of 2008.
Country Wide’s Mozillo, a friend of Dodd? No criminal charges. Dodd himself? Off to collect $1.5 million per year as a lobbyist in California. Dick Fuld? Jamie Diamon? Fannie Mae’s execs? Are you kidding me? It can be argued, and I do, that insider trading causes no harm to investors – the same can not be said for what establishment Wall Street and Washington’s pals in the mortgage business did. But the latter have political protection, Raj does not.
So enjoy the spectacle, but don’t lose sight of the fact that this is all intended to create the illusion that our government is policing Wall Street when in fact it is doing nothing of the sort.