MaggieMae
Reality bits
- Apr 3, 2009
- 24,043
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I'm sure another banking crisis is coming, but not for the reasons in the OP. The financial reform bill will mitigate another financial crisis, but Wall Street will find a way to leverage itself up to make enormous profits so they can pay themselves billions of dollars then collapse down knowing that the taxpayer will bail them out. It seems that many think this is OK, so they are opposed to the financial reform bill. Also, the Fed flooding the financial system with enormous amounts of money destabilizes the entire financial system.
The financial reform bill is only going to make it easier for the banks to be bailed out as the govt will be backing the entire process with their new "regulations". The 2 realities are that, #1,the banks are not really that upset about having a bigger safety net. #2 is that all this hatred toward the "big banks" and the desire to punish them with more regulations will ultimately trickle down to small business and the middle class in heftier fees and stricter loan criteria. We are the final losers in this but go ahead and lets get those evil rich companies and banks. What have we got to lose right?
My only problem with the bill as it currently is written is that $50 billion in accumulated fees charged to the mega banks (insurance against losses) isn't big enough. The amount should be twice that. $100 billion is a drop in the bucket for the big banks; there would be no need to pass on that added expense to community banks. But if they do, then they should be smacked around just like the credit card banks who charge ridiculous fees if you open their statement envelope the wrong way.