Boehner: Failing To Raise The Debt Limit Puts Economy In Great Jeopardy

[SFC Ollie]

Boehner is just another self-serving politician....and I'm an 'r'. I hope Ohio bounces his ass the next time he's up for reelection.

I say to the young 'r's we put in last November..........STICK TO YOUR GUNS!!!!!!!!!!!!

You've obviously never seen his district.

 

[Modbert]

that's the scary part. they had the power and didn't do what was necessary to keep future problems from happening.

Who's they? Congress or the Democrats?

 

[elvis]

that's the scary part. they had the power and didn't do what was necessary to keep future problems from happening.

Who's they? Congress or the Democrats?

well either. but the dems had the power for two years and didn't do enough to put the regulations back in place. the current congress, well, we know what they'll do.

 

[rckirby]

I don't have to educate myself in just the last couple years.....I've self-educated myself for the last 200+ years.....have you? .

You're over 200+ years old? Teach me your ways of keeping one's youth!

I re-read my post and new I mis-spoke and figured someone would call me out on it.

Let me re-phrase for you.........I've self-educated myself ABOUT the last 200+ years.

Better now?

 

[FactFinder]

Authored by Repubs but yes, sadly, signed by Clinton.

Yes it was. That was one of the biggest problems of the bubbles. It gave off the idea that we finally figured out the markets and could beat it. So therefore, deregulation would just be a swell idea. And then only a few years later, that myth came out crashing down hard.

And considering the lack of regulation to come out of the crisis, I wouldn't be surprised to see another similar incident happen in the future.

iT'S STILL HAPPENING WITH ENERGY BEING THE CURRENT BUBBLE.

 

[Dot Com]

Authored by Repubs but yes, sadly, signed by Clinton.

Yes it was. That was one of the biggest problems of the bubbles. It gave off the idea that we finally figured out the markets and could beat it. So therefore, deregulation would just be a swell idea. And then only a few years later, that myth came out crashing down hard.

And considering the lack of regulation to come out of the crisis, I wouldn't be surprised to see another similar incident happen in the future.

that's the scary part. they had the power and didn't do what was necessary to keep future problems from happening.

The Repubs demanded any legislation relating to bank regulation be thoroughly watered down no?

 

[Modbert]

well either. but the dems had the power for two years and didn't do enough to put the regulations back in place. the current congress, well, we know what they'll do.

Oh, it's no surprise to me that the Democrats as a whole didn't do much. While there are some more progressive Democrats who wanted tighter regulation, there are still plenty of Democrats in Congress who are beholden to Wall Street. Especially to one of the worst offenders of this financial crisis, Goldman Sachs.

As George Carlin said, the politicians are really irrelevant. Both parties have long been bought and paid for by the corporations.

Here's a good example of one of the best things proposed that should have become a law out of this crisis but didn't:

Al Franken - Wikipedia, the free encyclopedia

In May 2010 Franken proposed a financial reform legislation amendment which would create a board to select which credit rating agency would evaluate a given security; currently any companies issuing a security may select which company evaluates the security.[74] The amendment was passed; however, the financial industry lobbied to have Franken's amendment removed from the final bill.[75] Negotiations between the Senate and House of Representatives, whose version of financial reform did not include such a provision,[76] resulted in the amendment's being watered down to require only a series of studies being done upon the issue for two years.[77] After the studies, if the SEC has not implemented another solution to the conflict of interest problem, Franken's solution will go into effect.[78][79]

And you can bet that some useless solution will be put in place instead.

Essentially, the rating agencies had a conflict of interest to give a security the best rating they could. Why? Because the companies could shop around and get the best offer for their security. And the rating agencies only got paid when the companies took their rating.

It's such a blatant conflict of interest and shows why junk 'subprime' mortgages were given AAA ratings by Moody's, etc. AAA ratings are reserved for the best of the best.

 

[elvis]

Yes it was. That was one of the biggest problems of the bubbles. It gave off the idea that we finally figured out the markets and could beat it. So therefore, deregulation would just be a swell idea. And then only a few years later, that myth came out crashing down hard.

And considering the lack of regulation to come out of the crisis, I wouldn't be surprised to see another similar incident happen in the future.

that's the scary part. they had the power and didn't do what was necessary to keep future problems from happening.

If your talking about Clinton, he signed it because we don't have effective campaign finance regulation. Even less so after Citizens United, thanks to Robert's. They, the politicians, know where the campaign $ comes from and act accordingly. There are a few who aren't beholden to business interests but they are in the minority.

I'm talking about obama and the democrats of 2009-2011.

 

[rckirby]

that's the scary part. they had the power and didn't do what was necessary to keep future problems from happening.

Who's they? Congress or the Democrats?

well either. but the dems had the power for two years and didn't do enough to put the regulations back in place. the current congress, well, we know what they'll do.

The Dems have been in power in the house AND senate since '06.........they had GW licking their boots until he was booted.....then they had BO from '09 until 11/10.

Bush sucked big time his last couple years...........he could have vetoed the crap the D's were doing...........but he didn't.

IMO, Bush was AWOL his second term..just like BO is now.........

 

[Dot Com]

that's the scary part. they had the power and didn't do what was necessary to keep future problems from happening.

If your talking about Clinton, he signed it because we don't have effective campaign finance regulation. Even less so after Citizens United, thanks to Robert's. They, the politicians, know where the campaign $ comes from and act accordingly. There are a few who aren't beholden to business interests but they are in the minority.

I'm talking about obama and the democrats of 2009-2011.

I edited my reply after re-reading the post. My comment still stands inre: Glass Steagall repeal though. No effective campaign finance= the best government $ can buy.

 

[Moonglow]

Boner my boy, you've done it again....

 

[elvis]

well either. but the dems had the power for two years and didn't do enough to put the regulations back in place. the current congress, well, we know what they'll do.

Oh, it's no surprise to me that the Democrats as a whole didn't do much. While there are some more progressive Democrats who wanted tighter regulation, there are still plenty of Democrats in Congress who are beholden to Wall Street. Especially to one of the worst offenders of this financial crisis, Goldman Sachs.

As George Carlin said, the politicians are really irrelevant. Both parties have long been bought and paid for by the corporations.

Here's a good example of one of the best things proposed that should have become a law out of this crisis but didn't:

Al Franken - Wikipedia, the free encyclopedia

In May 2010 Franken proposed a financial reform legislation amendment which would create a board to select which credit rating agency would evaluate a given security; currently any companies issuing a security may select which company evaluates the security.[74] The amendment was passed; however, the financial industry lobbied to have Franken's amendment removed from the final bill.[75] Negotiations between the Senate and House of Representatives, whose version of financial reform did not include such a provision,[76] resulted in the amendment's being watered down to require only a series of studies being done upon the issue for two years.[77] After the studies, if the SEC has not implemented another solution to the conflict of interest problem, Franken's solution will go into effect.[78][79]

And you can bet that some useless solution will be put in place instead.

Essentially, the rating agencies had a conflict of interest to give a security the best rating they could. Why? Because the companies could shop around and get the best offer for their security. And the rating agencies only got paid when the companies took their rating.

It's such a blatant conflict of interest and shows why junk 'subprime' mortgages were given AAA ratings by Moody's, etc. AAA ratings are reserved for the best of the best.

moral hazard and/or capturing.

 

[elvis]

Who's they? Congress or the Democrats?

well either. but the dems had the power for two years and didn't do enough to put the regulations back in place. the current congress, well, we know what they'll do.

The Dems have been in power in the house AND senate since '06.........they had GW licking their boots until he was booted.....then they had BO from '09 until 11/10.

Bush sucked big time his last couple years...........he could have vetoed the crap the D's were doing...........but he didn't.

IMO, Bush was AWOL his second term..just like BO is now.........

there's no way Bush ever would have put something like Glass Steagall back in place. my point is after this crash, the dems of 2009-2011 who were supposed to have the power, did nothing.

 

[rckirby]

I don't know why I let myself get sucked into 'partisan' threads like this.

Let me put this forth:

D's and R's aka 'politicans' SUCK.

If you can't take back your local freedoms about where you can build a shed on your property, you/me have no business whining about the over reach of the feds.

 

[FactFinder]

well either. but the dems had the power for two years and didn't do enough to put the regulations back in place. the current congress, well, we know what they'll do.

The Dems have been in power in the house AND senate since '06.........they had GW licking their boots until he was booted.....then they had BO from '09 until 11/10.

Bush sucked big time his last couple years...........he could have vetoed the crap the D's were doing...........but he didn't.

IMO, Bush was AWOL his second term..just like BO is now.........

there's no way Bush ever would have put something like Glass Steagall back in place. my point is after this crash, the dems of 2009-2011 who were supposed to have the power, did nothing.

Further proof that they are all bought and paid for by Wall Street.

 

[Dot Com]

Oh, it's no surprise to me that the Democrats as a whole didn't do much. While there are some more progressive Democrats who wanted tighter regulation, there are still plenty of Democrats in Congress who are beholden to Wall Street. Especially to one of the worst offenders of this financial crisis, Goldman Sachs.

As George Carlin said, the politicians are really irrelevant. Both parties have long been bought and paid for by the corporations.

Here's a good example of one of the best things proposed that should have become a law out of this crisis but didn't:

Al Franken - Wikipedia, the free encyclopedia

In May 2010 Franken proposed a financial reform legislation amendment which would create a board to select which credit rating agency would evaluate a given security; currently any companies issuing a security may select which company evaluates the security.[74] The amendment was passed; however, the financial industry lobbied to have Franken's amendment removed from the final bill.[75] Negotiations between the Senate and House of Representatives, whose version of financial reform did not include such a provision,[76] resulted in the amendment's being watered down to require only a series of studies being done upon the issue for two years.[77] After the studies, if the SEC has not implemented another solution to the conflict of interest problem, Franken's solution will go into effect.[78][79]

And you can bet that some useless solution will be put in place instead.

Essentially, the rating agencies had a conflict of interest to give a security the best rating they could. Why? Because the companies could shop around and get the best offer for their security. And the rating agencies only got paid when the companies took their rating.

It's such a blatant conflict of interest and shows why junk 'subprime' mortgages were given AAA ratings by Moody's, etc. AAA ratings are reserved for the best of the best.

this is true. The rating agencies were complicit and so far, seemed to have gotten off. I read this book over the Spring:
[ame=http://www.amazon.com/Big-Short-Inside-Doomsday-Machine/dp/0393072231/ref=cm_lmf_tit_1]Amazon.com: The Big Short: Inside the Doomsday Machine (9780393072235): Michael Lewis: Books[/ame]

Eventually I'll get this one but financial reading can be monotonous:
Griftopia: Bubble Machines, Vampire Squids, and the Long Con That Is Breaking America
[ame]http://www.amazon.com/Griftopia-Machines-Vampire-Breaking-America/dp/0385529953/ref=sr_1_1?s=books&ie=UTF8&qid=1310177996&sr=1-1[/ame]
Its basically- capitalism unplugged (unregulated)

 

[Modbert]

moral hazard.

This sort of thing was going on all around Wall Street. JP Morgan has gotten fined twice in the past month for fraud cases. Goldman Sach also got fined fairly recently.

Goldman Sachs Fine in Fraud Case: Wall Street Firm Can Afford It

It sounds like a ton, and indeed the Securities and Exchange Commission says the $550 million fine imposed on Goldman Sachs to settle a civil fraud case is the largest penalty ever paid by a Wall Street firm. But for the company, one of the largest investment banks in the world, it amounted to about two weeks of profit. After all, the firm made $3.3 billion in the first quarter of 2010.

Pro Publica, the non-profit investigative reporters group, did the math after the SEC announced the settlement Thursday. The government had charged Goldman Sachs with misleading investors, who put millions of dollars in a subprime mortgage deal in 2007, just as the housing market was about to collapse. In effect, the unwary investors bet on mortgages that Goldman Sachs expected to fail.

JPMorgan to pay $153.6 million in SEC fraud case | Reuters

(Reuters) - JPMorgan Chase & Co agreed to pay $153.6 million to settle U.S. Securities and Exchange Commission charges that it defrauded investors who bought mortgage securities sold just before the nation's housing market collapsed.

The regulator's complaint against the banking giant was larded with excerpts from internal JPMorgan communications that indicated bankers sold a collateralized mortgage obligation in 2007 to ensure that it could get credit-scarred mortgage securities off its books.

"We are soooo pregnant with this deal, we need a wheel-barrel to move around," the head of CDO distribution wrote in a March 22, 2007 email to the sales staff. "Let's schedule the cesarian, please!"

Both cases involved charges that banks let hedge fund clients structure complex securities -- and then bet against them -- without disclosing their involvement to investors.

JPMorgan unit fined for bid rigging - Business - CBC News

A subsidiary of Wall Street giant JPMorgan agreed Thursday to pay $228 million US to settle civil fraud charges that it rigged dozens of bidding competitions to win contracts from U.S. cities and counties.

The Securities and Exchange Commission said J.P. Morgan Securities LLC made secret deals with companies that conducted the competitions, allowing it to see rival offers.

The bids were for contracts to advise municipalities on how to invest money to earn a return before it is paid out for projects.

Press Release: SEC Charges Bank of America for Failing to Disclose Merrill Lynch Bonus Payments; 2009-177; Aug. 3, 2009

Washington, D.C., Aug. 3, 2009 — The Securities and Exchange Commission today charged Bank of America Corporation for misleading investors about billions of dollars in bonuses that were being paid to Merrill Lynch & Co. executives at the time of its acquisition of the firm. Bank of America agreed to settle the SEC's charges and pay a penalty of $33 million.

If you haven't read it, this article is worth reading (6 pages).

The People vs. Goldman Sachs | Rolling Stone Politics

Some highlights:

But beginning in the mid-Nineties, when former Goldman co-chairman Bob Rubin served as Bill Clinton's senior economic-policy adviser, the government began moving toward a regulatory system that relied almost exclusively on voluntary compliance by the banks. Old-school criminal referrals disappeared down the chute of history along with floppy disks and scripted television entertainment. In 1995, according to an independent study, banking regulators filed 1,837 referrals. During the height of the financial crisis, between 2007 and 2010, they averaged just 72 a year.

But spiking almost all criminal referrals wasn't enough for Wall Street. In 2004, in an extraordinary sequence of regulatory rollbacks that helped pave the way for the financial crisis, the top five investment banks — Goldman, Merrill Lynch, Morgan Stanley, Lehman Brothers and Bear Stearns — persuaded the government to create a new, voluntary approach to regulation called Consolidated Supervised Entities. CSE was the soft touch to end all soft touches. Here is how the SEC's inspector general described the program's regulatory army: "The Office of CSE Inspections has only two staff in Washington and five staff in the New York regional office."

Among the bankers who helped convince the SEC to go for this ludicrous program was Hank Paulson, Goldman's CEO at the time. And in exchange for "submitting" to this new, voluntary regime of law enforcement, Goldman and other banks won the right to lend in virtually unlimited amounts, regardless of their cash reserves — a move that fueled the catastrophe of 2008, when banks like Bear and Merrill were lending out 35 dollars for every one in their vaults.

To recap: Goldman, to get $1.2 billion in crap off its books, dumps a huge lot of deadly mortgages on its clients, lies about where that crap came from and claims it believes in the product even as it's betting $2 billion against it. When its victims try to run out of the burning house, Goldman stands in the doorway, blasts them all with gasoline before they can escape, and then has the balls to send a bill overcharging its victims for the pleasure of getting fried.

In many ways, Timberwolf was a perfect symbol of the insane faith-based mathematics and blackly corrupt marketing that defined the mortgage bubble. The deal was built on a satanic derivative structure called the CDO-squared. A normal CDO is a giant pool of loans that are chopped up and layered into different "tranches": the prime or AAA level, the BBB or "mezzanine" level, and finally the equity or "toxic waste" level. Banks had no trouble finding investors for the AAA pieces, which involve betting on the safest borrowers in the pool. And there were usually investors willing to make higher-odds bets on the crack addicts and no-documentation immigrants at the potentially lucrative bottom of the pool. But the unsexy BBB parts of the pool were hard to sell, and the banks didn't want to be stuck holding all of these risky pieces. So what did they do? They took all the extra unsold pieces, threw them in a big box, and repeated the original "tranching" process all over again. What originally were all BBB pieces were diced up and divided anew — and, presto, you suddenly had new AAA securities and new toxic-waste securities.

And finally, as mentioned earlier, the bit by George Carlin:

[ame=http://www.youtube.com/watch?v=hYIC0eZYEtI]YouTube - ‪George Carlin -"Who Really Controls America"‬‏[/ame]

 

[Modbert]

this is true. The rating agencies were complicit and so far, seemed to have gotten off. I read this book over the Spring:
Amazon.com: The Big Short: Inside the Doomsday Machine (9780393072235): Michael Lewis: Books

Eventually I'll get this one but financial reading can be monotonous:
Griftopia: Bubble Machines, Vampire Squids, and the Long Con That Is Breaking America
Amazon.com: Griftopia: Bubble Machines, Vampire Squids, and the Long Con That Is Breaking America (9780385529952): Matt Taibbi: Books
Its basically- capitalism unplugged (unregulated)

I haven't read The Big Short yet (it's on my list) but I have read Griftopia. If you haven't read it yet, do so immediately. It is one of the best books on the financial crisis and how we got there.

 

[Dot Com]

this is true. The rating agencies were complicit and so far, seemed to have gotten off. I read this book over the Spring:
Amazon.com: The Big Short: Inside the Doomsday Machine (9780393072235): Michael Lewis: Books

Eventually I'll get this one but financial reading can be monotonous:
Griftopia: Bubble Machines, Vampire Squids, and the Long Con That Is Breaking America
Amazon.com: Griftopia: Bubble Machines, Vampire Squids, and the Long Con That Is Breaking America (9780385529952): Matt Taibbi: Books
Its basically- capitalism unplugged (unregulated)

I haven't read The Big Short yet (it's on my list) but I have read Griftopia. If you haven't read it yet, do so immediately. It is probably the best book on the financial crisis and how we got there.

The author worked in the sector before leaving in dismay. It was ground-breaking as it was written before the bust
http://en.wikipedia.org/wiki/Michael_Lewis_(author)

After working for a while at Salomon, Lewis described his experiences there in his first book, Liar's Poker (1989).

I think the book is well written for the layman. Not Liar's Poker but the Big Short. Haven't read Liar's Poker

 

[Modbert]

iT'S STILL HAPPENING WITH ENERGY BEING THE CURRENT BUBBLE.

Didn't see this post. Ah yes, oil speculation is still quite rampant on Wall Street. The current gas prices definitely cannot be attributed to solely supply and demand.