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The Iranian Threat?
15 years ago
Showing posts with label American economy. Show all posts
Showing posts with label American economy. Show all posts
Thursday, April 29, 2010
Thursday, April 15, 2010
The Great American Bank Heist
On the Day we Reach a Monthly Foreclosure Filing Record Banks Announce Record Profits and the Stock Market is up 80 Percent.
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It should be obvious the real economy is still a mess. The latest foreclosure data is merely a reflection of failed government programs but more importantly, the absolute greed and robbery committed by Wall Street:
Just look at that chart. We’ve had an 80 percent stock market rally in one year and today, we are at the peak of foreclosure filings. That is, Americans getting kicked out of their homes because they are unable to pay their mortgages. So much for banks using that money to help people stay in their homes and keeping the credit markets open as they preached. JP Morgan announced stunning profits for the first quarter. How did they make their money?
“(Yahoo!) NEW YORK – JPMorgan Chase & Co. reported a $3.3 billion first-quarter profit on big gains in the financial markets even as the Obama administration pressed for limits on banks’ trading of risky but lucrative investments.”$3.3 billion is fantastic. But how did they make that money?
“Investment banking, especially bond trading, generated the bulk of JPMorgan’s profits. The bank said that division earned $2.5 billion, up 50 percent from a year earlier.”
So their gambling division made up the bulk of their profits. How are they helping out consumers with those billions in taxpayer dollars?
“JPMorgan said it lost $1.3 billion on its real estate portfolios, slightly more than the $1.1 billion it lost the previous year. Signaling that it expects further credit weakness, the bank set aside $3.3 billion for real estate loan losses, up from $3.1 billion a year earlier.
The bank’s losses in its credit card business fell to $303 million, while provision for future credit card losses also dropped to $3.5 billion.”
The formula is simple for these banks. Use the taxpayer money to enrich their elite class under the guise of helping average Americans. They have robbed the American people and much of this was all legal. Yet we all know that there is something royally flawed in the financial system since it is the legislature that develops the laws and many are bought by the Wall Street crowd. So this 80 percent stock market rally if we dissect it is being propelled by banks gambling:
Source: Bloomberg
Notice how non-financials (i.e., the real economy) is only seeing a slight uptick in profits? This probably has to do with 15 million unemployed Americans and another 9 million working part-time looking for full-time work. But given there are 6 workers for every 1 job opening, things will be slow going. Unless you are the corrupt banking sector. In that case, you can borrow at zero percent and buy Treasuries, foreign currencies, stocks, or whatever it is and make money hand over fist while the real economy remains in the trough. Why would you expect anything to be different? We have yet to have one single piece of serious legislation hit the table for financial reform. These banks are back to their same antics.
So what should be done? Break the banks up. Commercial banking should become more boring and what it once was, the lubricant to get the real economy going. Right now it is merely a vampire sucking the blood out of the productive sectors. Investment banking will be pushed to the edges and if banks want to gamble their own money then that is fine.
But right now they are gambling taxpayer money trying to get back to even while shifting all the toxic credit out of their books. Privatize gains and socialize losses. With a system like that, is it any wonder the banks are back to record profits?
And you have to ask yourself how is it that banks while pushing a record number of foreclosure filings are back to record gains? It is actually very simple. They can shift the crap to taxpayers as they have through the FDIC, HAMP, suspension of mark to market, and other absurd gimmicks. Then, they can use taxpayer money primarily funded through the Federal Reserve and U.S. Treasury and then gamble on the stock market. But don’t be surprised when the market falls through again. And why wouldn’t it? The real economy isn’t really improving. For $13 trillion we sure got bunk but add up the Wall Street market cap and profits and you can see what occurred.
It is a simple formula to understand. And with no rules being changed, things are back to normal for the banks. Too bad the other 95 percent of Americans are still dealing with the repercussions of the actual economy.
Let The Sun Shine In......
Wednesday, April 14, 2010
Economy: ‘A Different Creature’
Nancy Pelosi, at lunch, was making the point that this latest recession was not a typical cyclical downturn.
The evidence is stark. More than 44 percent of unemployed Americans have been out of work for six months or longer, the highest rate since World War II. Perhaps more chilling is a new analysis by the Pew Economic Policy Group that found that nearly a quarter of the nation’s 15 million unemployed workers have been jobless for a year or more.
Everything in Washington is a heavy lift. The successful struggle to pass last year’s stimulus package fended off an even worse economic disaster, and the Democrats have managed to enact their health care initiative. But the biggest threat to the health of the economy — corrosive, intractable, demoralizing unemployment — is still with us. And the deficit zealots, growing in strength, would do nothing to counter this scourge.
Ms. Pelosi acknowledged that “there is always a calibration” between concerns about deficit reduction and the spending that is necessary to substantially reduce unemployment. But she believes there are several fronts on which Congress and the Obama administration can — in fact, must — still move forward: on infrastructure and green energy initiatives, for example, and assistance to states hobbled with fiscal crises of their own.
The crippling nature of the joblessness that has moved through the society like a devastating virus has gotten neither the attention nor the response that it warrants. One of the more striking findings of the Pew study was that a college education has not been much of a defense against long-term unemployment.
“Twenty-one percent of unemployed workers with a bachelor’s degree have been without work for a year or longer,” the report found, “compared to 27 percent of unemployed high school graduates and 23 percent of unemployed high school dropouts.”
Whole segments of the U.S. population are being left behind, even as economists are touting modest improvements in some categories of economic data, like the creation of 162,000 jobs in March. Jobless workers who are 55 or older are having a brutal time of it. Thirty percent have been jobless for a year or more.
Blue-collar workers are suffering through a crisis characterized as a “depression” by the Center for Labor Market Studies at Northeastern University in Boston. Blue-collar job losses during the so-called Great Recession surpassed 5.5 million, and many of those jobs will never be seen again. This disastrous situation will not be corrected, as analysts at the center have noted, “by a modest recovery of the U.S. economy over the next few years.”
We need to pay less attention to the Tea Party yahoos and more attention to the very real suffering of individuals and families trapped in an employment crisis that is unprecedented in the post-Depression era. I’ve been in inner-city neighborhoods where residents will tell you that hardly anyone at all is working at a regular job.
The recession only worsened an employment picture that was already bleak. In a speech at the Harvard Kennedy School last week, the A.F.L.-C.I.O. President Richard Trumka spoke movingly about Americans “trying to hold on to a good job in a grim game of musical chairs where every time the music stopped, there were fewer good jobs and more people trying to get and keep one.”
More than eight million jobs vanished during the recession, a period during which three million new jobs would have been needed to keep up with the growth of the population. “That’s 11 million missing jobs,” said Mr. Trumka.
Right now there is no plan that can even remotely be expected to result in job creation strong enough to rescue the hard-core groups being left behind. These include: long-term unemployed workers who are older; blue-collar workers of all ages; and younger people in the big cities, in the rust belt and in rural areas who are jobless and not well educated.
It is not possible to put together a thriving, self-sustaining economy while so many are being left out. As Mr. Trumka noted, “President Obama’s economic recovery program has done a lot of good for working people — creating or saving more than two million jobs. But the reality is that two million jobs is just 18 percent of the hole in our labor market.”
Ms. Pelosi spoke about “jobs creation” with a tone of urgency and commitment and seemed undeterred by the fact that a big new jobs bill seems hardly feasible in the current political environment.
“You can do smaller pieces,” she said. “You can break the task up into segments, into discrete pieces of legislation. If size is a problem, we should not let it be an obstacle.”
Copyright 2010 The New York Times Company
Let The Sun Shine In......
Wednesday, April 7, 2010
Nobody should be too big to fail, so......
Robert Reich
Monday, April 5, 2010
A fight is brewing in Washington – or, at the least, it ought to be brewing – over whether to put limits on the size of financial entities in order that none becomes “too big to fail” in a future financial crisis.
Some background: The big banks that got federal bailouts, as well as their supporters in the Administration and on the Hill, repeatedly say much of the cost of the giant taxpayer-funded bailout has already been repaid to the federal government by the banks that were bailed out. Hence, the actual cost of the bailout, they argue, is a small fraction of the $700 billion Congress appropriated.
True, but the apologists for the bailout leave out one gargantuan cost — the damage to the economy, which we’re still living with (witness the latest unemployment figures). Leave it to the Brits to calculate this. Andrew Haldane, Bank of England’s Financial Stability Director, figures the financial crisis brought on by irresponsible bankers and regulators has cost the world economy about $4 trillion so far.
So while the bailout itself is gradually being repaid (don’t hold your breath until AIG and GM repay, by the way), the cost of the failures that made the bailout necessary totals vast multiples of that.
Needless to say, the danger of an even bigger cost in coming years continues to grow because we still don’t have a new law to prevent what happened from happening again. In fact, now that they know for sure they’ll be bailed out, Wall Street banks – and those who lend to them or invest in them – have every incentive to take even bigger risks. In effect, taxpayers are implicitly subsidizing them to do so. (Haldane figures the value of that implicit subsidy to be about $60 billion a year for each big bank.)
Congress and the White House tell us not to worry because financial reform legislation will contain what’s called a “resolution” mechanism allowing regulators to wind down any big bank that gets into trouble. (Think bankruptcy with more safeguards against runs by bank by creditors wanting to get their money out right away.) By virtue of this resolution authority, they say, future bank creditors will have to price in the possibility of the bank being allowed to fail. Hence, the implicit subsidy for risk-taking will disappear. At least that’s the theory.
But the theory isn’t likely to work in practice. Do you really believe bank regulators will use the resolution authority — especially if two or more giant banks are endangered at the same time? Multiple threats are almost certain because each big bank races to copy any gambling technique that pays off big for any other. The reality is, they’ll get bailed out.
Even if the resolution authority were combined with an array of new regulations designed to cover all the “shadow banking” operations of the giant banks — requiring that they put up more capital and thereby limit their leverage – there’s no way such regulations can succeed. The giant banks already hire fleets of lawyers, accountants, and financial entrepreneurs to find loopholes in every existing regulation.
Finally, consider the political power of the big Wall Street banks. They and their executives and employees are now among the biggest contributors to both parties. Wall Street lobbyists are crawling over Capitol Hill. The banks and their lobbyists will ensure that regulatory loopholes are built into regulations from the start. Remember: They dismembered Glass-Steagall (with the help of their friends in the Fed, on the Hill, and in the Clinton White House), and fought off derivative regulation (ditto).
As long as the big banks are allowed to remain big, their political leverage over Washington will remain big. And as long as their political leverage remains big, the taxpayer and economic tab for the next mess they create will be big.
By all means, give regulators resolution authority and also impose the tightest regulations possible. But Congress and the White House shouldn’t stop there. Limits should be placed on how big big banks can become.
How big? No one has been able to show significiant efficiencies over $100 billion in assets. Make that the outside limit.
To be sure, smaller banks might still be subject to runs. That’s why the Federal Deposit Insurance Corporation was created in the 1930s – to ensure depositors in the event a bank gets into trouble, so they won’t have to run to protect their savings. And why the Glass-Steagall Act was passed – to separate commercial banking (where depositors put their money) from investment banking (where betting is done). We could expand insurance to certain categories of bank creditor, and we should resurrect Glass-Stagall.
But the only way to make sure no bank it too big to fail is to make sure no bank is too big. If Congress and the White House fail to do this, you have every reason to believe it’s because Wall Street has paid them not to.
Let The Sun Shine In......
Break Up The Banks
Monday, April 5, 2010
A fight is brewing in Washington – or, at the least, it ought to be brewing – over whether to put limits on the size of financial entities in order that none becomes “too big to fail” in a future financial crisis.
Some background: The big banks that got federal bailouts, as well as their supporters in the Administration and on the Hill, repeatedly say much of the cost of the giant taxpayer-funded bailout has already been repaid to the federal government by the banks that were bailed out. Hence, the actual cost of the bailout, they argue, is a small fraction of the $700 billion Congress appropriated.
True, but the apologists for the bailout leave out one gargantuan cost — the damage to the economy, which we’re still living with (witness the latest unemployment figures). Leave it to the Brits to calculate this. Andrew Haldane, Bank of England’s Financial Stability Director, figures the financial crisis brought on by irresponsible bankers and regulators has cost the world economy about $4 trillion so far.
So while the bailout itself is gradually being repaid (don’t hold your breath until AIG and GM repay, by the way), the cost of the failures that made the bailout necessary totals vast multiples of that.
Needless to say, the danger of an even bigger cost in coming years continues to grow because we still don’t have a new law to prevent what happened from happening again. In fact, now that they know for sure they’ll be bailed out, Wall Street banks – and those who lend to them or invest in them – have every incentive to take even bigger risks. In effect, taxpayers are implicitly subsidizing them to do so. (Haldane figures the value of that implicit subsidy to be about $60 billion a year for each big bank.)
Congress and the White House tell us not to worry because financial reform legislation will contain what’s called a “resolution” mechanism allowing regulators to wind down any big bank that gets into trouble. (Think bankruptcy with more safeguards against runs by bank by creditors wanting to get their money out right away.) By virtue of this resolution authority, they say, future bank creditors will have to price in the possibility of the bank being allowed to fail. Hence, the implicit subsidy for risk-taking will disappear. At least that’s the theory.
But the theory isn’t likely to work in practice. Do you really believe bank regulators will use the resolution authority — especially if two or more giant banks are endangered at the same time? Multiple threats are almost certain because each big bank races to copy any gambling technique that pays off big for any other. The reality is, they’ll get bailed out.
Even if the resolution authority were combined with an array of new regulations designed to cover all the “shadow banking” operations of the giant banks — requiring that they put up more capital and thereby limit their leverage – there’s no way such regulations can succeed. The giant banks already hire fleets of lawyers, accountants, and financial entrepreneurs to find loopholes in every existing regulation.
Finally, consider the political power of the big Wall Street banks. They and their executives and employees are now among the biggest contributors to both parties. Wall Street lobbyists are crawling over Capitol Hill. The banks and their lobbyists will ensure that regulatory loopholes are built into regulations from the start. Remember: They dismembered Glass-Steagall (with the help of their friends in the Fed, on the Hill, and in the Clinton White House), and fought off derivative regulation (ditto).
As long as the big banks are allowed to remain big, their political leverage over Washington will remain big. And as long as their political leverage remains big, the taxpayer and economic tab for the next mess they create will be big.
By all means, give regulators resolution authority and also impose the tightest regulations possible. But Congress and the White House shouldn’t stop there. Limits should be placed on how big big banks can become.
How big? No one has been able to show significiant efficiencies over $100 billion in assets. Make that the outside limit.
To be sure, smaller banks might still be subject to runs. That’s why the Federal Deposit Insurance Corporation was created in the 1930s – to ensure depositors in the event a bank gets into trouble, so they won’t have to run to protect their savings. And why the Glass-Steagall Act was passed – to separate commercial banking (where depositors put their money) from investment banking (where betting is done). We could expand insurance to certain categories of bank creditor, and we should resurrect Glass-Stagall.
But the only way to make sure no bank it too big to fail is to make sure no bank is too big. If Congress and the White House fail to do this, you have every reason to believe it’s because Wall Street has paid them not to.
Let The Sun Shine In......
Friday, October 23, 2009
Nearly 1 in 6 Americans Lives In Poverty
"The level of poverty in America is even worse than first believed," the AP reports. The National Academy of Science finds that "approximately 47.4 million Americans last year lived in poverty, 7 million more than the government's official figure." The new calculations put the poverty rate at 15.8 percent, or nearly one in six Americans.
Exceedingly shocking that the number is this high. But I can't say that I'm surprised about the economic disaster which is still unfolding. Like quite a few others, I saw this coming as far back as '04.
The Bush administration ran two wars off of a credit card, allowed war profiteering like no one has ever seen, gutted the SEC and other financial regulatory agencies; all aided by a republican congress dating back to 1994. Hedge funds and the derivative market have never been regulated, thanks to Phil Graham and company in 1998 when they refused all reasoned demand to regulate these these outlaw funds and economic tactics designed, it seems, to rob from the middle class and give to the wealthy. I won't even say what this has done to the poor.
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Let The Sun Shine In......
Exceedingly shocking that the number is this high. But I can't say that I'm surprised about the economic disaster which is still unfolding. Like quite a few others, I saw this coming as far back as '04.
The Bush administration ran two wars off of a credit card, allowed war profiteering like no one has ever seen, gutted the SEC and other financial regulatory agencies; all aided by a republican congress dating back to 1994. Hedge funds and the derivative market have never been regulated, thanks to Phil Graham and company in 1998 when they refused all reasoned demand to regulate these these outlaw funds and economic tactics designed, it seems, to rob from the middle class and give to the wealthy. I won't even say what this has done to the poor.
IN ACCORDANCE WITH TITLE 17 U.S.C. SECTION 107, THIS MATERIAL IS DISTRIBUTED WITHOUT PROFIT TO THOSE WHO HAVE EXPRESSED A PRIOR INTEREST IN RECEIVING THE INCLUDED INFORMATION FOR RESEARCH AND EDUCATIONAL PURPOSES. PELICAN BLOGS HAS NO AFFILIATION WHATSOEVER WITH THE ORIGINATOR OF THIS ARTICLE NOR ARE PELICAN BLOGS ENDORSED OR SPONSORED BY THE ORIGINATOR.
"VIEW SOURCE ARTICLE" LINKS ARE PROVIDED AS A CONVENIENCE TO OUR READERS AND ALLOW FOR VERIFICATION OF AUTHENTICITY. HOWEVER, AS ORIGINATING PAGES ARE OFTEN UPDATED BY THEIR ORIGINATING HOST SITES, THE VERSIONS POSTED ON THIS BLOG MAY NOT MATCH THE VERSIONS OUR READERS VIEW WHEN CLICKING THE "VIEW SOURCE ARTICLE" LINKS.
Friday, June 19, 2009
ARE OBAMA'S FINANCIAL PROPOSALS A ROAD TO REAL REFORM?
June 18, 2009
By Danny Schechter
Bloomberg surveyed the wreckage: “Financial firms worldwide have recorded more than $1.4 trillion in writedowns and credit losses since 2007 as the U.S. housing market collapsed and the economy sank into recession.”
Former Investment Banker Nomi Prins: “The plan makes no mention of reconstructing the financial system.”
IN ACCORDANCE WITH TITLE 17 U.S.C. SECTION 107, THIS MATERIAL IS DISTRIBUTED WITHOUT PROFIT TO THOSE WHO HAVE EXPRESSED A PRIOR INTEREST IN RECEIVING THE INCLUDED INFORMATION FOR RESEARCH AND EDUCATIONAL PURPOSES. PELICAN BLOGS HAS NO AFFILIATION WHATSOEVER WITH THE ORIGINATOR OF THIS ARTICLE NOR ARE PELICAN BLOGS ENDORSED OR SPONSORED BY THE ORIGINATOR.
"VIEW SOURCE ARTICLE" LINKS ARE PROVIDED AS A CONVENIENCE TO OUR READERS AND ALLOW FOR VERIFICATION OF AUTHENTICITY. HOWEVER, AS ORIGINATING PAGES ARE OFTEN UPDATED BY THEIR ORIGINATING HOST SITES, THE VERSIONS POSTED ON THIS BLOG MAY NOT MATCH THE VERSIONS OUR READERS VIEW WHEN CLICKING THE "VIEW SOURCE ARTICLE" LINKS.
By Danny Schechter
THE OBAMA FINANCIAL REFORMS: ROAD TO CHANGE OR PERDITION?
Stabilizing A Flawed System is Not The Same As Restructuring Or Remaking It
By Danny Schechter
Author of Plunder
A recent study cited by the Editor of the Financial Times argues that we are now in a Depression although no one wants to use the term or face the music.
Recall that it took the National Bureau of Economic Research a full year to recognize the reality of a recession that analysts at investment banks had been acknowledging for as long. Despite everything that has happened, and is continuing to occur on the economic front---a rise in unemployment claims, mounting foreclosures, and escalating bankruptcies—the sense of crisis is being downplayed to stoke confidence and encourage the belief in “green shoots” and an emerging recovery.
The Obama Express is in full motion with new announcements, proposals, and laws signed daily. Yet, something’s missing. Au Contraire, Mr. Maher, there is no lack of audacity, just a failure to recognize that cosmetic alterations do not fundamental change make. What we have is a political elite that is more Clintonesque than Rooseveltesque. (If only the Repugs were right with their fears of the Socialist menace!)
These proposals, described as “new rules for the road,” were mostly embraced by the banks, a sign they are not tough enough. The Congress will probably approve them quickly because they were “hammered out” through a process of negotiations that seems to have heard more from the industry than public interest advocates.
The Washington Post tells us:
“Time and again, lawmakers, regulators and industry lobbyists pressed their concerns behind closed doors at the White House and the Treasury Department, according to participants.
“Turf-conscious regulators opposed the idea to consolidate banking oversight agencies and took their appeal over the Treasury directly to the White House. Ultimately the administration spared all but one agency.
“A few key lawmakers argued against merging the two federal agencies that oversee the stock and commodity markets. That did not happen.
“Insurance companies fought over whether a national regulator should oversee them. The White House dropped the proposal.”
Etc. Etc. Etc, ad nuseum.
So now we have 88 pages of financial reforms as if the authors of this compromised and consensualized agenda were being paid by the word. The President is telling us that “mistakes” were made as if massive crimes, theft, fraud and unregulated greed were not involved in causing the calamity at the heart if the crash of the economy.
Bloomberg surveyed the wreckage: “Financial firms worldwide have recorded more than $1.4 trillion in writedowns and credit losses since 2007 as the U.S. housing market collapsed and the economy sank into recession.”
Billions spent to unlock credit and get banks lending again have led nowhere. The financial news service quotes Tim Backshall, chief strategist at Credit Derivatives Research LLC in Walnut Creek, California.
“It is becoming clearer that banks are not as willing to lend,” he said in an e-mailed message. “With their risk rising once again, risk premiums on non-financials must rise commensurately.”
They don’t see a recovery around the corner either, “The broad sense is we have not seen the bottom there yet,” said Bert Ely, a banking consultant in Alexandria, Virginia. “For later this year, and into next year, there are just big question marks out there.”
Question marks indeed.
What are the questions we should be asking? What happened to changes for ratings agencies that gave high marks for bogus mortgage securities? Why trust the Fed which, in the words of one critic “started the fire” through low interest rates to extinguish it
Simon Johnson, the ex-IMF Chief now at MIT asks some others:
•Has the President really been briefed on the supposed benefits of having large financial institutions with great economic power and pervasive political influence? Don’t just claim that these are a good thing – tell us, in detail and preferably with numbers, what we the public gain from the presence of these behemoths among us. Keep in mind that “everyone has them” is no kind of argument – something so manifestly dangerous is not to be blindly copied.
•Why was executive and other compensation so notably absent from the latest Geithner-Summers joint statement of our problems and likely solutions? Does the President really expect us to believe that any set of reforms will work if they do not directly constrain the amounts that can be earned from misunderstanding risk today and hoping that the consequences do not appear on your watch? Does he have any idea of how the people who run big financial firms will game whatever controls try to limit their risk-taking?
•. Can President Obama finally talk about the much broader break down of corporate governance in this country, with boards of directors serving no discernible purpose in terms of limiting the excesses of corporate executives in the financial sector but also more broadly? Surely, without a reform package that includes measures to address this core issue, we will get exactly nowhere.”
Perhaps “exactly nowhere” is the real destination” in the sense that the real goal of the Geithner-Summers-Obama “reform” package seems to be to restore the old financial order, not restructure it, or heavens forbid, bring it under public control and accountability. New Rules and regulations are great, but do they add up to real reform?
Have the banks really acknowledged their role in the demolition derby that wrecked the economy? Not really, even as Llloyd Blankfein of Goldman Sachs admits, "We know that we have an explicit contract with our shareholders to be responsible stewards of their capital . . . we regret that we participated in the market euphoria and failed to raise a responsible voice."
Have the banks really acknowledged their role in the demolition derby that wrecked the economy? Not really, even as Llloyd Blankfein of Goldman Sachs admits, "We know that we have an explicit contract with our shareholders to be responsible stewards of their capital . . . we regret that we participated in the market euphoria and failed to raise a responsible voice."
Is that all they are copping to? A few weeks back. Goldman paid $60 million to Massachusetts to settle a complaint that they funded mortgages “designed to fail.” They admitted no wrong-doing, in a practice so common when Wall Street gets its fingers caught in the cookie jar of criminality.
Tell that to the millions losing their homes.
After helping to fund the subcrime market, Goldman was hailed as a visionary for turning against it. “it made $4bn profit from betting against the sub-prime mortgage market, and because - bar the fourth quarter of 2008 - it has continued to make a profit throughout.”
Clearly the profiteers are far more secure than their victims. Here are the thoughts of some knowledgeable people who want progressive change and who are in the know:
Former Investment Banker Nomi Prins: “The plan makes no mention of reconstructing the financial system.”
Marshall Auerback sees an opportunity for real reform squandered.
“As with so much of the Obama administration, great-sounding words, but nothing in the way of substantive change. Particularly disturbing are the moves on derivatives, notably “credit default swaps”. Excuse us for not liking a market that is rigged in favor of the sellers, the monopoly dealers, who even today refuse to allow open price discovery in credit default swaps among and between other dealers. True to their Wall Street ethos, Summers and Geithner have capitulated on the most important aspect of derivatives, by refusing to place these instruments on a regulated exchange, where transparency and standardization would be far more operative.
A New Way Forward: “It’s not enough to try to patch up the current system. We demand serious reform that fixes the root problems in our political and economic system: excessive influence of banks, dangerous compensation systems, and massive consolidation. And we demand that the reform happen in an open and transparent manner.”
“You go to war,” the not missed Mr. Rumsfeld once said “with the army you have.” Unfortunately in the case of Financial Reform, we are being led by Generals at the top but there are no troops or people’s army below to hold them accountable, much less push them to emulate a more aggressive approach a la FDR,
Organizing put this president in office. Only organizing can push him to do what must be done. Can we get the Congress to toughen up these uneven and timid proposals?
News Dissector Danny Schechter, blogger in chief at Medichannel.org, is making a film based on his book PLUNDER (Cosimo) news.dissector.com/plunder. Comments to Dissector@mediachannel.org
Author's Bio: News Dissector Danny Schechter is blogger in chief at Mediachannel.Org He is the author of PLUNDER: Investigating Our Economic Calamity (Cosimo Books) available at Amazon.com. See Newsdisssector.org/store.htm. IN ACCORDANCE WITH TITLE 17 U.S.C. SECTION 107, THIS MATERIAL IS DISTRIBUTED WITHOUT PROFIT TO THOSE WHO HAVE EXPRESSED A PRIOR INTEREST IN RECEIVING THE INCLUDED INFORMATION FOR RESEARCH AND EDUCATIONAL PURPOSES. PELICAN BLOGS HAS NO AFFILIATION WHATSOEVER WITH THE ORIGINATOR OF THIS ARTICLE NOR ARE PELICAN BLOGS ENDORSED OR SPONSORED BY THE ORIGINATOR.
"VIEW SOURCE ARTICLE" LINKS ARE PROVIDED AS A CONVENIENCE TO OUR READERS AND ALLOW FOR VERIFICATION OF AUTHENTICITY. HOWEVER, AS ORIGINATING PAGES ARE OFTEN UPDATED BY THEIR ORIGINATING HOST SITES, THE VERSIONS POSTED ON THIS BLOG MAY NOT MATCH THE VERSIONS OUR READERS VIEW WHEN CLICKING THE "VIEW SOURCE ARTICLE" LINKS.
Let The Sun Shine In......
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