The Occupy Wall Street protesters and their sympathizers are catching a lot of grief from well, people who work on Wall Street, and from some members of the media friendly with those who work on Wall Street. They say the protests lack reasonable goals and there is no clear end-point. One might also surmise there is a sense of unease about having several hundred people who don’t like you and despise your line of work camped outside your office day-in and day-out.
And yet, it’s not just the camped-out protesters who sense things are amiss in the world of finance. Paul Brodsky of QB Asset Management told Barron’s the protesters are “credible,” and that they represent “a ‘disenfranchised majority that is quickly growing disenchanted’ with our financial system and its workings.”
Kynikos Associates’ Jim Chanos and PIMCO’s Bill Gross have said they understand the protests. Chanos told Bloomberg on Oct. 11, “People are angry, they feel the game is rigged and they didn’t get their fair shake.”
Citigroup’s Vikram Pandit called the protesters’ sentiments “completely understandable.”
And just today, Leon Cooperman of Omega Advisors without explicitly saying he supported Occupy Wall Streetâ€”who knows, maybe he doesn’tâ€”leveled some of his own criticism of the markets. Cooperman said at the Value Investing Congress in Manhattan that high-frequency trading “has turned the market into a casino,” and that he supports the return of the uptick rule to do away with it, as well as limits on who can participate in the credit default swap markets and reining in speculation in exchange-traded funds.
“â€¦ [T]here’s a lot of speculative activity going on between high-frequency trading, the slicing and dicing of ETFs and the credit default swapsâ€”this kind of casino environment that has been created in the New York Stock Exchangeâ€”and I don’t think that’s healthy for capital formation,” Cooperman said. “It has driven the public out of the stock market. It’s raised the cost of capital to business. I think the SEC should deal with it and apparently they’re not willing to do so.”
But it isn’t until the 3:53 mark of a four and a half-minute video that we hear Cooperman say this. Which reflects the skewed way the media sometimes deals with figures like Cooperman. The first three and a half minutes of the video consist of Cooperman, a successful investor, giving his views on stock and bond investments. As if he’s going to give away some secret to making money. And somehow this is more important than his contention that parts of the capital markets are broken. Shoot, man, that’s the headline, not a footnote.
I’m not calling Cooperman an OWS sympathizer. I don’t know if he is or isn’t. And, really, it doesn’t matter. What does matter is that he’s been around this business a long time (as have Chanos, Gross and Pandit), and if he thinks something is wrong doesn’t that sort of lend credence to the Occupy Wall Street protests, however unfocused they appear at times? Certainly there are plenty of industry veterans on the other side of the issue, who feel the protests are a sham and not credible at all. There’s a good conversation to have about how investment banking, finance and the capital markets have evolved. It seems like we’re trying to have that debate, but right now it’s being muted by a lot of finger pointing and useless shouting.