Satire: The Federal Reserve Orders a Bloomberg Ban
New York City plans to enact a far-reaching ban on the sale of large sodas and other sugary drinks at restaurants, movie theaters and street carts, in the most ambitious effort yet by the Bloomberg administration to combat rising obesity. The proposed ban would affect virtually the entire menu of popular sugary drinks found in delis, fast-food franchises and even sports arenas, from energy drinks to pre-sweetened iced teas. The sale of any cup or bottle of sweetened drink larger than 16 fluid ounces - about the size of a medium coffee, and smaller than a common soda bottle - would be prohibited.... "Obesity is a nationwide problem, and all over the United States, public health officials are wringing their hands saying, ‘Oh, this is terrible,' " Mr. Bloomberg said in an interview on Wednesday in the Governor's Room at City Hall. "New York City is not about wringing your hands; it's about doing something," he said.
- New York Times, May 31, 2012
WASHINGTON - The Federal Reserve Board today announced a new regulatory action banning the Bloomberg terminal. The ubiquitous financial information service, for which Wall Street firms pay up to $1500 per month per terminal, is seen as enabling bad financial behavior and having contributed to the financial crisis.
"It is clear that America has serious financial problems," Federal Reserve Chairman Ben S. Bernanke stated at a packed news conference at the Fed's ornate headquarters. "Instantaneous financial information coupled with diabolically sophisticated analytic tools helped cause the banking crisis and threaten more systemic risks to our economy," he continued. "Bloomberg has been at the center of it all."
The Federal Reserve's research staff released a scathing 500-page report highlighting the many features of the Bloomberg service which it says pose an unacceptable danger to the economy. "Bloomberg terminals enable traders to track the prices of securities by the second, encouraging short term speculation and irresponsible investing habits," the report stated. The report cited the recent controversial initial public offering of Facebook as an example of the kind of mayhem and social unrest that Bloomberg creates. "Numerous interviews and investigation have shown that investors bought and sold shares without having done any real due diligence on the company or its financial prospects. Millions of shares changed hands in minutes simply on the premise that others might buy at higher prices later in the day. When the Bloomberg terminal indicated that prices were in fact declining, widespread disillusionment ensued, leading Facebook stock to decline from an IPO price of $38 to a recent low of $27," the report revealed. Many initially eager investors incurred substantial losses.
One of the bombshell revelations of the Fed's report was that the Bloomberg terminal provides tools for investors to study arcane financial characteristics of mortgages and other bonds. These mortgage-backed securities, or MBS, exacerbated the housing crisis. "Under our Dodd-Frank mandate," Mr. Bernanke sternly admonished, "the Federal Reserve can no longer stand by with the knowledge that people are openly performing ‘convexity analysis' and modeling ‘prepayment patterns,' the kinds of things that Bloomberg allows you to do by hitting a few green and yellow keys. The systemic risk is simply too high. The only solution is to remove the device that facilitates this anti-social and dangerous behavior: The Bloomberg terminal."
Mr. Bernanke stated that he was also asking the Federal Communications Commission to ban Bloomberg's cable television station from carriage in the United States. "The scrolling real time quotes and news content found on Bloomberg TV poses an unacceptably high risk to our population. Whether in hotel rooms or public places anyone might be unwittingly encouraged to buy or sell securities based on the flimsiest hunch," he warned. "They might invest in risky stocks and they might buy more than is prudent for their circumstances. In fact, we have evidence that this has happened." An FCC spokesman was not available for comment. The implications of the Fed's edict on the magazine Bloomberg Business Week, which is widely distributed on newsstands and often near schools, could not be immediately determined.
Reaction to the Fed's action was widely positive. European leaders, such as Luis De Guindos Jurado, the Economic Minister of Spain, hailed the initiative. "In recent months the Bloomberg terminal has incessantly transmitted to the world that our borrowing costs have skyrocketed above 6 percent. This has caused instability, panic and speculation. It would be much better for all concerned if this type of information was not known and people could not make irresponsible wagers - which Bloomberg also facilitates," the Minister commented from Madrid. "My government is confident that economic conditions in Europe will improve with Bloomberg out of the way. In fact we now foresee GDP growth of 3% this year."
Wall Street executives were outraged by the report's revelations. Jamie Dimon, the CEO of JP Morgan, said that his bank was looking into what role, if any, Bloomberg might have played in his firm's recent $2 billion trading loss. "I am disturbed by reports that our employees may have been lured into disastrous investments by this insidious portal," he said in a statement. "Action must be taken to prevent credit derivative traders from misusing Bloomberg information and losing money."
A senior managing director of Goldman Sachs, speaking on condition of anonymity because he acknowledged having used the Bloomberg in the past and feared retribution, said his firm was exploring a lawsuit against Bloomberg. "Without the Bloomberg, our Firm would still be a discreet private partnership providing merger advice and managing our partner's capital. Everything bad that has happened to our Firm in the past 20 years is because of that device."
Indeed, class action attorneys were already combing through the Fed's report for potentially litigable claims against Bloomberg. One plaintiff attorney gleefully noted that with all the markets on which Bloomberg provides data - currencies, commodities, equities and bonds - coupled with the transaction volumes in those sectors and the number of years that Bloomberg has been in existence, the potential damages are "incalculable....certainly in the tens of trillions and probably more than the GDP of the planet."
Approached on the steps of City Hall where he was sipping from a beverage container in a brown paper bag, New York Mayor Michael Bloomberg, the owner of Bloomberg LP, had no comment.
Mr. Shuchman is a New York money manager. He has used a Bloomberg terminal.
