Does America Need Wall Street?

georgephillip

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Dec 27, 2009
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From the Washington Post:

"The warm glow that Wall Street once seemed to have hid how much bad investment it made in the past 40 years.

"From the Federal Reserve bailout of bankers for bad South American loans made in the 1970sto the 1980s savings and loan crisis, from the 1990s East Asian financial crash to the bursting of the dot-com bubble in 2000 and the 2008 collapse of the housing and financial markets, Wall Street has been largely responsible for nearly every financial calamity — and yet has still profited off the next boom.

"So do we need Wall Street?
"Could there be a smarter way to pick and fund a handful of winning companies?"

http://www.washingtonpost.com/opinions/does-america-need-wall-street/2011/11/16/gIQAcQmHYN_story.html?utm_source=Daily+Digest&utm_campaign=91ee86b1e5-DD_11_21_1111_21_2011&utm_medium=email
 
Hell yes.

1. prohibit short sales
2. prohibit derivatives
3. prohibit flash-trades
4. tax every transaction on wall street
5. take withholding tax off every sale on wall street, 30% on profits zero on net losses
6. bring back Glass-Stegall
7. make the SEC like the FBI and go after off-shore tax cheats
8. get tax breaks for US jobs created
 
The real question is does Wall Street need the middle class? They never had any use for the poor and it seems they have lately abandoned the middle class after looting what they could. Guess they have decided that being a casino for millionaires is profit enough and damn the world economy. Capitalization for the middle class will have to come from a new direction or not at all, The big banks are going to sit on their money until we are properly chastened and ready to give up all thoughts of regulation or upward mobility.
 
The real question is: do we need Liberals (aka: Progressives, Marxists, neo-Fascists, Socialists, Democrats)?
 
But you see how the American Left is to the left of ChiComs and Vietnamese Communists, who have embraced Free markets, right?
 
When people say "wall st." they mean the major banks. Without our banks, you have no savings, no loans, so of-course we need wall st.. Banks are the economic engine for our nations small business, big businesses, and private citizens.

People can bitch all they want about TARP, but most banks paid the money back, with interest. This country will never get the money back from porkulos, so which is worse??

The culprits in the market are the high frequency traders skimming pennies on the dollar from every investor. Regulate that aspect of trading, and tighten rules on leverage.
 
When people say "wall st." they mean the major banks. Without our banks, you have no savings, no loans, so of-course we need wall st.. Banks are the economic engine for our nations small business, big businesses, and private citizens.

People can bitch all they want about TARP, but most banks paid the money back, with interest. This country will never get the money back from porkulos, so which is worse??

The culprits in the market are the high frequency traders skimming pennies on the dollar from every investor. Regulate that aspect of trading, and tighten rules on leverage.

Who needs kapital, Komrade? The State will provide!
 
Need to break those banks up because they're STILL too big to fail in no small part due to the bank's water-carriers (Republicorp)
http://www.washingtonpost.com/wp-dyn/content/article/2010/04/20/AR2010042003323.html
McConnell and Sen. John Cornyn (R-Tex.) met with financial chiefs in New York this month, on the eve of the Senate debate on a regulatory reform bill
http://www.bloomberg.com/news/2011-11-15/fed-s-fisher-regulators-should-break-up-behemoth-banks.html
By Caroline Salas Gage - Nov 15, 2011 12:30 PM ET
Federal Reserve Bank of Dallas President Richard Fisher said regulators should break up so- called too-big-to-fail financial institutions to curtail the risk they pose to financial stability.
 
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Hell yes.

1. prohibit short sales
2. prohibit derivatives
3. prohibit flash-trades
4. tax every transaction on wall street
5. take withholding tax off every sale on wall street, 30% on profits zero on net losses
6. bring back Glass-Stegall
7. make the SEC like the FBI and go after off-shore tax cheats
8. get tax breaks for US jobs created
Hell, yes!

Our current version of Wall Street plunders the savings of Americans to make risky trades designed to enhance bankers' profits. It seems to have little use for free-market practices, trades complex securities in secret with rampant conflict of interests and charges monopoly fees for its dirty work.

"Its practices have driven speculation through the roof in every decade since the 1980s, always ending with a crash."

And they are coming back for more in Europe, as we speak.

Does America need Wall Street? - The Washington Post
 
The real question is does Wall Street need the middle class? They never had any use for the poor and it seems they have lately abandoned the middle class after looting what they could. Guess they have decided that being a casino for millionaires is profit enough and damn the world economy. Capitalization for the middle class will have to come from a new direction or not at all, The big banks are going to sit on their money until we are properly chastened and ready to give up all thoughts of regulation or upward mobility.
The next new global economy will only require the richest 20% of consumers in order to maintain 1% lifestyles. Direct marketing is already moving in that direction. In some of its polling, American Express doesn't even ask for the opinions of Americans earning less than $100,000 per year.

I don't think this can be changed at the polls by "choosing" between Republican OR Democrat.

Both parties exist to serve the 1%.
 
Who else is going to finance all the Tea Parties?
And create all those new jobs.

"...(b)ut on balance, few of its actions have led to more prosperity for America, as the losses enumerated above suggest.

"Herb Allison, a former president of Merrill Lynch and former chief executive of investment manager TIAA-CREF, writes in a new e-book, 'The Megabanks Mess,' that big banks have been a net drag on the economy for years.

"Even when Wall Street was on a tear in the 2000s, fewer jobs were created than in any other comparable period over any business cycle since World War II.

http://www.washingtonpost.com/opinions/does-america-need-wall-street/2011/11/16/gIQAcQmHYN_story_1.html
 
The real question is: do we need Liberals (aka: Progressives, Marxists, neo-Fascists, Socialists, Democrats)?
At least as much as all those free-market conservatives who claim to respect transparent competition and fair compensation. Conservatives like Alan Greenspan and Hank Paulson and Phil Gramm.

Remember them?
 
When people say "wall st." they mean the major banks. Without our banks, you have no savings, no loans, so of-course we need wall st.. Banks are the economic engine for our nations small business, big businesses, and private citizens.

People can bitch all they want about TARP, but most banks paid the money back, with interest. This country will never get the money back from porkulos, so which is worse??

The culprits in the market are the high frequency traders skimming pennies on the dollar from every investor. Regulate that aspect of trading, and tighten rules on leverage.
How would you alter the behavior of private credit ratings agencies?

"And, judging by the findings of a Senate investigative committee and the Financial Crisis Inquiry Commission, Wall Street has bought favorable credit ratings from Standard & Poor’s and Moody’s.

"Its practices have driven speculation through the roof in every decade since the 1980s, always ending with a crash."

Does America need Wall Street? - The Washington Post
 
When people say "wall st." they mean the major banks. Without our banks, you have no savings, no loans, so of-course we need wall st.. Banks are the economic engine for our nations small business, big businesses, and private citizens.

People can bitch all they want about TARP, but most banks paid the money back, with interest. This country will never get the money back from porkulos, so which is worse??

The culprits in the market are the high frequency traders skimming pennies on the dollar from every investor. Regulate that aspect of trading, and tighten rules on leverage.

Who needs kapital, Komrade? The State will provide!
Labor created capital, Comrade.

Most of the investment during this country's industrialization came from corporate profits, not money raised by Wall Street. How many of those IPOs that came to market through Wall Street in the '90s were done in by speculation and died ignoble deaths within a few years?
 
Hell yes.

1. prohibit short sales
2. prohibit derivatives
3. prohibit flash-trades
4. tax every transaction on wall street
5. take withholding tax off every sale on wall street, 30% on profits zero on net losses
6. bring back Glass-Stegall
7. make the SEC like the FBI and go after off-shore tax cheats
8. get tax breaks for US jobs created

1, 2 and 4 are horrible ideas.

Short sales are important in price discovery. We should be doing more to encourage short sales, not less.

Prohibiting derivatives is another really, really bad idea. Derivatives play a critical part in distributing risk within the economy.

Taxing every transaction on Wall Street will just take more trading business away from America. They tried it in Sweden in the 90s to "pay" for their banking crisis. It was a disaster
 
When people say "wall st." they mean the major banks. Without our banks, you have no savings, no loans, so of-course we need wall st.. Banks are the economic engine for our nations small business, big businesses, and private citizens.

People can bitch all they want about TARP, but most banks paid the money back, with interest. This country will never get the money back from porkulos, so which is worse??

The culprits in the market are the high frequency traders skimming pennies on the dollar from every investor. Regulate that aspect of trading, and tighten rules on leverage.

There are about 8000 banks in America. Most of them were profitable throughout the financial crisis. However, the American banking system was essentially insolvent because about two dozen banks had stuffed their balance sheets - and off their balance sheets - with garbage.

HFT is a sideshow. And though I agree that it is a problem, it has nothing to do with the mess we are in.
 
From the Washington Post:

"The warm glow that Wall Street once seemed to have hid how much bad investment it made in the past 40 years.

"From the Federal Reserve bailout of bankers for bad South American loans made in the 1970sto the 1980s savings and loan crisis, from the 1990s East Asian financial crash to the bursting of the dot-com bubble in 2000 and the 2008 collapse of the housing and financial markets, Wall Street has been largely responsible for nearly every financial calamity — and yet has still profited off the next boom.

"So do we need Wall Street?
"Could there be a smarter way to pick and fund a handful of winning companies?"

Does America need Wall Street? - The Washington Post

"Wall Street has been largely responsible for nearly every financial calamity."

Wall Street is certainly very culpable but to blame them for nearly every financial calamity is nonsense.

You can't have bubbles without
- Cheap money
- Willing participants.

The government largely sets the price of credit. The Tech Bubble and the Housing Bubble are woven from the same string. Had the Fed, i.e. the government, not priced credit excessively cheap and created too much of it, then the Tech and Housing Bubbles almost certainly would not have happened.

This also couldn't have happened if millions and millions of Americans hadn't suspended all traces of disbelief and hope against logic that two year old dotcom companies with $10 million in revenues were really worth a billion dollars, and the price of their homes really could rise 15% a year forever.

The finance industry has to be reigned in but to point fingers at Wall Street and say "You are responsible" while absolving others is ridiculous.
 

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