Arianna appeared on Dylan Ratigan's MSNBC show this afternoon, all with Phil Angelides, the chair of the Financial Crisis Commission, to discuss whether Washington is capable of producing financial reform that will prevent big Wall Street banks from recklessly putting the entire system at risk.
Citing Tom Friedman, Arianna noted that in Washington
We have these major problems but we are only geared to produce sub-optimum solutions. We are constantly producing these sub-optimum solutions and they are not going to be good enough because the financial architecture is so flawed that unless we fundamentally change it, as even Chris Dodd admitted, we are not going to eliminate the possibility of a future meltdown of the magnitude that we faced before. And unless we deal with derivatives, and we really regulate derivatives and basically end the casino gambling -- what will happen is the casino gambling leads once again to the major meltdown that we faced in '08.
WATCH:
Greenspan and Rubin were completely irresponsible spoiled babies...Paulson too, and Geither and Bernanke just their understudies...
This could have almost really been fixed by now but Obama just couldn't do the right thing and listened to losers like Larry Summers who nearly bankrupted his alma mater...Harvard...
Schemers and liars use long complicated documents for cheating suckers.
Financial, health care, energy reforms and all legislation have now become scams for ripping off consumers and the Treasury.
Government bailouts of Wall Street and succeeding laws which jacked up credit card and other financial costs for consumers have been devastating.
Until we have fair and honest systems we will be unable to reform anything.
Financial, Wall Street and Government Clean Up Reforms
Establish an Elizabeth Warren version of the Consumer Financial Protection Agency, reinstate Glass-Steagle, which successfully protected banks and their customers for fifty years before its repeal in 1999, repeal Grahm-Leach-Bliley which allows the unbridled use of financial schemes of mass destruction, repeal the unlimited Christmas guarantees given to Fannie and Freddie, enact the pending legislation to audit the Fed, and make AIG’s records available for public review.
Put Eliot Spitzer in charge of an agency of Untouchables to perform hard nosed audits and investigations which will ascertain what roll criminal activity had in the destructive behavior which has decimated individual wealth, political fairness, and the United States Treasury.
Come to think of it, that vicious circle is why the American political culture is so dysfunctional today.
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In his new movie, "Capitalism: A Love Story," Michael Moore describes two leaked Citigroup memos to its wealthiest investors and I couldn't resist finding them online. I've provided the links below:
http://jdeanicite.typepad.com/files/6674234-citigroup-oct-16-2005-plutonomy-report-part-1.pdf
http://jdeanicite.typepad.com/files/6674229-citigroup-mar-5-2006-plutonomy-report-part-2-1-1.pdf
For those of you who think Capitalism is working, take a look at these and then ask yourself, "For who is it working?"
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http://iv-time.blogspot.com/2010/03/plutonomy-buying-luxury-explaining.html
But capitalism has advantages, like individual incentive. Those who worship free market refuse to see that it also tends toward certain consequences, like the consolidation of wealth and power. If that's not wanted, a force external to the market has to intervene - that would be government. If values other than money are wanted, like being environmentally responsible, a force external to the market (government) has to intervene.
I see the adamant ignorance of free market worshipers as a big problem in this country. Those who refuse to see that free market has disadvantages, shortcomings, consequences, etc.
The limitations, etc., of free market define possible government roles in the economy.
This means they also define what financial system reform should be.
At least this seems to make sense conceptually. I don't know how it would work in practice.
There is however, a problem that they point to, however stupidly. It is about freedom and liberty but it is more basic than any disgruntled and impotent individual portrays it. It can be solved in a genuine democracy; it is about who keeps the books, how they are kept and what is valuable.
People must force politicians to enact public financing of political campaigns. That is the only way that elected officials will support voters instead of perpetuating autocratic and failed institutions like banks, insurance companies, the Defense Department and Treasury.
Conservatives have no role in a democracy or in American government. All they want is power and to destroy all that gets in their way. They are in an all out war to rule, we are in a struggle for humanity, human rights, social justice and the realities of a complex civilization.
All that the tories mean by small government is that it will be easier for them to be in control and to ignore reality.
By the way, anyone who has been following the treasury secretary's efforts would know that this bill is not as strong as he would like it to be. And so, he could use a little support from everyone who says they are in favor of a strong financial regulatory regime.
Here's Geithner's statement on financial reform upon the release of Dodd's bill.
"This is a strong bill. We hope the Committee and the Senate will move forward quickly to pass comprehensive reform. We need a strong, independent consumer financial protection agency that is accountable for setting and enforcing clear rules across the financial marketplace. And we need strong authority to limit risk-taking and protect the taxpayer. Enacting reform will help reduce uncertainty about the rules of the road going forward. Passing strong reforms here at home will also give us the ability to put in place a level playing field internationally, with high standards. As the President said, as the bill moves forward, we will take every opportunity to work with Chairman Dodd and his colleagues to strengthen the bill and will fight against efforts to weaken it." ... Treasury Secretary Geithner
Another Janet Tavakoli piece, this one about the market for CDS on the United States.
I’d like someone to explain to me how trading a credit default swap on a U.S. Treasury note isn’t gambling. This is purely betting on crowd behavior — after all, nobody really thinks the U.S. will default.
It’s weird enough living in a country where a man can legally own an arsenal of machine guns, but his neighbor growing a pot plant will send a team of DEA agents kicking his door in with a no-knock warrant.
But this goes even beyond that. If I go online today to HaveNoLifeAndBetOnSports.com and bet fifty dollars on the Bucks against the Celtics tonight, I’m a criminal. But some gazillionaire firm in New York can legally bet against the United States of America in unlimited amounts in a trade that has nothing to do with anything, but a guess about how many other people will make the same bet.
Geesus, are we a weird country.
trueslant.com/matttaibbi · Cached page
Seriously, if these investigators really do their job they are very likely to find that evenyone was playing the Repo 105 two-step dance.
I suspect that the very companies that were making the most use of this loophole are the very companies that spent the most amount of money lobbying to get the Repo 105 loophole written into the law. I'm sure that the reaction of the companies using this loophole )which will probably be all of them) will be reminiscent of Captain Renault in Casablanca, "I'm shocked, shocked to find that gambling is going on in here!"
It is undeniable that politicians in Washington D.C. have been bought and sold for years by financial lobbyists in favor of Wall Street's interests at the expense of U.S. tax payers for many generations to come.
A most glaring abdication of duty by U.S. politicians indeed! (i.e.,.Paulson, Richard Shelby, Chris Dodd, Barney Frank, Geitner, Bernake, and both the Clinton and Bush Administrations, etc...).
One must ask the question who was responsible for supervising and overseeing the behavior of AIG and Wall St. firms while U.S. politicians basically rolled the dice in providing subsidized housing (i.e., Fannie/Freddie via Clinton's State of the Union Address)?
From the U.S. tax payer viewpoint, the actions of U.S. politicians and Wall St. are totally indefensible and is the apotheosis of utter incompetence, greed, and arrogance!
The smell of this egregious behavior by Wall St. and the U.S. permeates from Shanghai to Dubai!
Once again, the USA was just too exceptional to suffer any real harm!
Thanks for your concern but we're handling it in our own fashion!
As one top Chinese Economist said today: Where ever there is wealth in the U.S., the corrupt bankers and financiers of Wall St. will find a way to steal it! They're coming again soon. So, remember this: The invisible hand is more important than the unhidden hand!
The government would have a hard time keeping up with tax cheats and some banks would go under. I'd doubt I'd lose any sleep over it. Some will say you would be at more risk of being robbed but I'd rather take my chances of being robbed on the street than by the government and the banks.
I'm willing to go back to the basics as far as we can.