Category Archives: Financial Reform
I ain’t buying BP’s newest bs that they stopped the leak. First off, if the pipe under the ocean floor now explodes, the Gulf of Mexico will become another Dead Sea.
Second, their stock prices went up at least 7% today, and frankly…that is all they give a shit about…who is kidding who here?
Third…the corporate media is covering BP’s ass to the hilt…which is why they aren’t talking about the possibility of the BP pipeline under the ocean floor now taking a huge shit. No need to worry the common folks…or as BP likes to refer to us…the little people.
Fourth…the wetlands, the people who live there and the 10,000 birds that are dying off the coast of Louisiana, not to mention my friend RJS’s post on the toxic dispersants permanent effects on all living things… What-the-fuck will BP do to ‘make them whole’ again? Yeah right…
Enough on BP and their victory..The Obama/Dodd/ Frank Financial Reform bill has passed..whoopee-fuck. That watered down horseshit won’t change most of the casino-style bullshit the Wall Streeter’s pulled to get us into this mess. From Dean Baker’s statement, someone I usually listen to on financial shit:
“The final bill passed by the Senate today and already approved by the House of Representatives will improve regulation in the financial sector. However, given the severity of the economic crisis caused by past regulatory failures, the public had the right to expect much more extensive reform.(emphasis mine)
“The requirement that most derivatives be either exchange-traded or passed through clearinghouses is also an important improvement in regulation. However, important exceptions remain, which the industry will no doubt exploit to their limit.
“The creation of resolution authority for large non-bank financial institutions is also a positive step, although the fact that no pre-funding mechanism was put in place is a serious problem. Also, the audit of the Federal Reserve’s special lending facilities, as well as the ongoing audits of its open market operations and discount window loans, is a big step towards increased Fed openness.
“On the negative side, there is little in this legislation that will fundamentally change the way that Wall Street does business. The rules on derivative trading will still allow the bulk of derivatives to be traded directly out of banks rather than separately capitalized divisions of the holding company. The Volcker rule was substantially weakened by a provision that will still allow banks to risk substantial sums in proprietary trading.
“More importantly, there is probably no economist who believes that this bill will end the risks of too-big-to-fail financial institutions. The six largest banks will still enjoy the enormous implicit subsidy that results from the expectation that the federal government will bail them out in the event of a crisis.
“Also, the fact that no regulators, most obviously Ben Bernanke at the Fed, were fired for failing to prevent the crisis leaves in place serious doubts about the structure of incentives for regulators. Cracking down on reckless behavior by politically powerful financial institutions will always be difficult for regulators. On the other hand, if regulators know that failing to crack down carries no consequences, even when it leads to disastrous outcomes, we can expect that regulators will have a strong bias toward ignoring reckless behavior.
Yes, we had every right to expect more from those fuckers..so don’t expect me to get giddy over this horseshit ok boys?
On the homefront…yuppie sista is going crazy with Dad at her house…welcome to my world for the last two months chica. She is still giving me orders although we did have a huge come to jesus-type headbutting yesterday…and I came out on top. But, all in all…it’s still a fucking mess. I am talking to the Escondido Director of the Humane Society (Her name withheld by me since it took me forever to work my way up to her level) in an effort to figure out what the fuck to do with Dad’s wonderful grey cat that is still in that fucked up complex with a fucking money-grubbing whackjob hopefully feeding him.
Hugs to all that read my bs…fuck the rest of ya. 😉
Daniel Indiviglio is a former investment banker and consultant who now writes about that industry for The Atlantic. His recent article explains how the lobbyists influenced, or as I call it, wrote the financial reform bill that Dodd and Frank pushed like crack dealers. From his writeup:
There are easily dozens of sections where their persuasion can be felt, but here are several striking examples.
Auto Dealer Exclusion
Perhaps one of the most egregious lobbyist influences was a key exclusion from the Consumer Financial Protection Bureau. When you think about consumer credit, a few products immediately come to mind: mortgages, car loans, and credit cards. But wait! Car loans — one of the most prevalent types of consumer loan — are excluded entirely from the Bureau’s reach. While it isn’t likely that auto loans will ever cause a financial crisis, neither will credit cards. Yet there are certainly auto loan shops that could use dastardly tactics worthy of as much attention as the regulator pays to credit card companies.
Derivative Spin-Off Provision
To see a truly strange legislative effort, check out how one of the more controversial derivatives provisions in the bill turned out. Initially, all banks would be forced to put their derivatives business in a separately capitalized subsidiary. That is, until lobbyists got their hands on it. Now, banks can create certain sorts of derivatives, but not other sorts. Foreign exchange and interest rate swaps, for example, are okay. But commodities and energy swaps aren’t. Is corn riskier than the euro? Probably not. So what’s the explanation? One industry source I spoke with theorized that futures exchanges may have pushed for the ban on commodity and energy derivatives created by banks. The over-the-counter derivatives (a market run by banks) market ate away at exchanges’ market share once banks started getting into the business. Now banks are out of the picture regarding these products.
Another extraordinarily watered-down provision compared to the original conception is the so-called “Volcker Rule,” meant to limit proprietary trading by banks. The final bill limits the amount of money dedicated to this function to 3% of a bank’s Tier 1 Capital. That should allow all but a few banks to proprietary trade in the same way they have in the past. Moreover, the rule inexplicitly limits the amount of a private equity venture or hedge fund that a bank can own to 3%. This ultimately benefits banks, because they need less skin in the game to convince outside investors to participate in a venture or fund.
It’s a good read, so I suggest you click the link and read his entire piece. He talks about ‘too big to fail’ and Frannie and Freddie as well. For a nitwit like myself, it’s well written and easy for me to comprehend. This…cough…bill…is weaker than my bladder after an evening of boozing it up.
Look, I will admit upfront that I can not find my ass w/both hands when it comes to the world of finance, stocks and derivatives..not to mention hedge funds.
Say what you will about the bluedog Blanche Lincoln, hell I take her name in vain a LOT. She is a c#nt on healthcare and many other social issues..but the bitch (I mean that in a good way) gets it on Financial Reform.
On the other hand, Barney Frank is rolling over. I can’t friggin believe it. He wants to weaken the FR bill even more…wtf dude????
Dylan Ratigan has some great guests on daily that are specialists on derivatives, stocks, investors and the whole ball of wax when it comes to fixing our banking system.
The bill and various amendments are being debated now. The fuckers are pulling the rug out from under Financial Reform. It’s downright fucking pathetic m’dear reader.
I just got home after a week w/my father. I poured a stiff drink (it was after noon) and turned on my favorite political show lately, Dylan Ratigan. All it did was stress me out…and I just spent a week stressed out with my father who keeps having major senior moments. Sigh…heavy sigh.
Video is out.