Republicans On Wrong Course On Financial Regulation Bill - It Will Show In November!

[Toro]

Please show us exactly where there is an "implied guarantee" in the bill.

Be sure to give us the exact location.

As far as I can tell, the government is making the banks set up a system between themselves to stop individual banks from failing.

Apparently the concept of "implied" is lost on you.

Creating a $50 (to begin with) billion dollar fund for bailouts for companies that are considered too big to fail amounts to an implicit guarantee that they will not be allowed to fail without government intervention. That guarantee will cause investors to rely on that implied guarantee, and like Fan and Fred these companies will grow faster than those without that guaranteee, thus they will be presumed to be already too big to fail. They know it, the Congress knows it, and anyone who does business will recognize it.

Notice that Fanny and Freddy are still intact, and remain too big to fail with their implicit guarantee, such that they aren't even mentioned in the legislation. They were and are GSEs (government Sponsored Enterprises) which endowed them with an implied guarantee which was the subject of warnings even into the late nineties.

It does not matter that the funding for that guarantee will come in part from the companies themselves, the guarantee is the same.

The Republicans would prefer to take action to see that they don't get that big in the first place, and a good way to accomplish that is to dismember them now.

im·ply - 1 obsolete : enfold, entwine
2 : to involve or indicate by inference, association, or necessary consequence rather than by direct statement <rights imply obligations>
3 : to contain potentially
4 : to express indirectly <his silence implied consent>

This bill will be funded by the banks, not by taxpayers. Wall Street doesn't want it because they would have to pay for it. They would rather you, the taxpayer, pay for their losses, just like they have over the past two years. They keep the profits, you pay for the losses.

The idea that this would somehow increase the amount of risk taking is sheer nonsense. Wall Street has already levered up the global derivatives market to the tune of $700 trillion - that's $700,000,000,000,000, 5 times the size of the global economy - without a bailout fund. Wall Street already is a giant casino. Governments already bailout and support financial firms, and will do so in the future. I'd rather have Wall Street take the first $50 billion hit than the taxpayers. But the Republicans don't.

The Republican Party is also fighting breaking up the big banks. The big banks want to keep things as is because they make an egregious amount of money already, knowing full well that the government will come in and bail them out if they get into trouble. So they are pouring tons and tons of it into DC to fight this bill, most of which is winding up in the coffers of the Republican Party.

 

[The T]

You have to appreciate Progressive Ironic Humor:

FDR presiding over worst economy in human history, eclipising the 7 Biblical Lean Years is "Great"

Racist redneck peckerwood "I'll have them ******* voting Democratic for 200 years" LBJ is a Civil Rights hero

and Countrywide Dodd writes a Financial Reform Bill.

LOL

And thinks he'll be absolved of GUILT when we crash, and it is investigated and he is found to be one of the perps of the collapse by no RUNNING for Congress.

He and Bawney are in for a WORLD of hurt and JAIL TIME for what they've done to this Republic.

 

[American Horse]

Apparently the concept of "implied" is lost on you.

Creating a $50 (to begin with) billion dollar fund for bailouts for companies that are considered too big to fail amounts to an implicit guarantee that they will not be allowed to fail without government intervention. That guarantee will cause investors to rely on that implied guarantee, and like Fan and Fred these companies will grow faster than those without that guaranteee, thus they will be presumed to be already too big to fail. They know it, the Congress knows it, and anyone who does business will recognize it.

Notice that Fanny and Freddy are still intact, and remain too big to fail with their implicit guarantee, such that they aren't even mentioned in the legislation. They were and are GSEs (government Sponsored Enterprises) which endowed them with an implied guarantee which was the subject of warnings even into the late nineties.

It does not matter that the funding for that guarantee will come in part from the companies themselves, the guarantee is the same.

The Republicans would prefer to take action to see that they don't get that big in the first place, and a good way to accomplish that is to dismember them now.

im·ply - 1 obsolete : enfold, entwine
2 : to involve or indicate by inference, association, or necessary consequence rather than by direct statement <rights imply obligations>
3 : to contain potentially
4 : to express indirectly <his silence implied consent>

This bill will be funded by the banks, not by taxpayers. Wall Street doesn't want it because they would have to pay for it. They would rather you, the taxpayer, pay for their losses, just like they have over the past two years. They keep the profits, you pay for the losses.

The idea that this would somehow increase the amount of risk taking is sheer nonsense. Wall Street has already levered up the global derivatives market to the tune of $700 trillion - that's $700,000,000,000,000, 5 times the size of the global economy - without a bailout fund. Wall Street already is a giant casino. Governments already bailout and support financial firms, and will do so in the future. I'd rather have Wall Street take the first $50 billion hit than the taxpayers. But the Republicans don't.

The Republican Party is also fighting breaking up the big banks. The big banks want to keep things as is because they make an egregious amount of money already, knowing full well that the government will come in and bail them out if they get into trouble. So they are pouring tons and tons of it into DC to fight this bill, most of which is winding up in the coffers of the Republican Party.

This EDIT confined in the quote below) was added to my post after you posted the above; Geithner doesn't agree with you that it wouldn't add to risk taking:

Apr 16, 2010

By Major Garrett - FOXNews.com

<SNIP>
The Senate Republican leader, Mitch McConnell of Kentucky, offered mute praise for the administration&#8217;s formal dismissal of a so-called bailout fund.

&#8220;I appreciate the Obama administration&#8217;s recognition of the need to substantively improve this bill,&#8221; McConnell said from Louisville. &#8220;And I hope we can work with them to close the remaining bailout loopholes that put American taxpayers on the hook for financial institutions that become &#8216;too big to fail.&#8217;&#8221;

The administration has never been a fan of the bailout reserve fund, a mechanism in both the House-passed bill and legislation passed out of the Senate Banking Committee. The House passed it as a populist move to tax big financial firms up front in case there is a need to finance a liquidation. Sen. Chris Dodd, D-Conn., included a version of the fund in the Senate bill.

Treasury Secretary Geithner testified before the House Financial Services Committee on Oct. 26, 2009, that big Wall Street firms should finance liquidations after they happen (through what&#8217;s called an ex-post fund), not build up a rainy day fund (known as an ex-ante fund) in case a failure occurs.

&#8220;Such an ex-post funding mechanism has several advantages over an ex-ante fund,&#8221; Geithner said. &#8220;Most notably, it would generate less moral hazard because a standing fund would create expectations that the government would step in to protect shareholders and creditors from losses. In essence, a standing fund would be viewed as a form of insurance for those stakeholders.&#8221;

What do you offer besides opinion that Rs get more money is pouring into Republican Party Coffers or to any individual Republicans from these firms?

A fifty billion dollar fund from the industry would be a charge to all of them and they would see it as a level playing field; I don't think they would be very much perturbed, and in fact see it as being to their benefit. The medicine in this bill is not at all nasty tasting for these firms. It's more a case of Brer Bear and Brear Rabbit, and "don't throw me into the briar patch"

Virtually all the CEOs of these firms matriculated from the same Ivey League schools as the most liberal members of congress, and are in the same camp philosophically and politically.

I've heard from several sources that the Republicans would prefer to prevent these companies from becoming too big to fail, even if it means breaking them up at some point.

 

[rdean]

As usual the Republicans are protecting the thieves on Wall Street.

And it was Phil Gramm who wrote the legislation that caused the collapse, which was caused by a derivative bubble, not the housing industry.

You will never convince Republicans of that. They have swallowed the Party line hook, line and sinker. They could surf the Internet and find out the truth. But, who am I kidding? They could also turn off Fox and come back to this reality, like that's going to happen.

This generation of Republicans is too far gone. Many still believe Saddam was behind 9/11. That the housing collapse was because of Barny Frank. That Obama is from Kenya. That Bill Ayers wrote Obama's book. They are scared and pathetic, gullible fools that will drag down the country just to prove that "things" are going bad.

 

[Toro]

I would prefer they not be allowed to become too big to fail, but I highly doubt that is going to happen. Why? Because Wall Street doesn't want it to happen.

As for Geithner's argument, we already expect the government to step up and bail out Wall Street because, you know, they already did.

I remember conversations we used to have back in the day on whether or not the government would step in and bail out Freddie and Fannie if they ever got into trouble. I never imagined that they would step in to bail out pretty much all of Wall Street. The idea that there isn't already moral hazard is utterly bizarre. Take the moral hazard argument of 2007 and multiple it by 100.

I have no idea why Goldman bonds are, or were on Friday, trading at 170 over Treasuries. Its essentially risk free debt backed by the US government.

 

[rdean]

Creating a $50 (to begin with) billion dollar fund for bailouts for companies that are considered too big to fail amounts to an implicit guarantee that they will not be allowed to fail without government intervention. That guarantee will cause investors to rely on that implied guarantee, and like Fan and Fred these companies will grow faster than those without that guaranteee, thus they will be presumed to be already too big to fail. They know it, the Congress knows it, and anyone who does business will recognize it.

Notice that Fanny and Freddy are still intact, and remain too big to fail with their implicit guarantee, such that they aren't even mentioned in the legislation. They were and are GSEs (government Sponsored Enterprises) which endowed them with an implied guarantee which was the subject of warnings even into the late nineties.

It does not matter that the funding for that guarantee will come in part from the companies themselves, the guarantee is the same.

The Republicans would prefer to take action to see that they don't get that big in the first place, and a good way to accomplish that is to dismember them now.

im·ply - 1 obsolete : enfold, entwine
2 : to involve or indicate by inference, association, or necessary consequence rather than by direct statement <rights imply obligations>
3 : to contain potentially
4 : to express indirectly <his silence implied consent>

This bill will be funded by the banks, not by taxpayers. Wall Street doesn't want it because they would have to pay for it. They would rather you, the taxpayer, pay for their losses, just like they have over the past two years. They keep the profits, you pay for the losses.

The idea that this would somehow increase the amount of risk taking is sheer nonsense. Wall Street has already levered up the global derivatives market to the tune of $700 trillion - that's $700,000,000,000,000, 5 times the size of the global economy - without a bailout fund. Wall Street already is a giant casino. Governments already bailout and support financial firms, and will do so in the future. I'd rather have Wall Street take the first $50 billion hit than the taxpayers. But the Republicans don't.

The Republican Party is also fighting breaking up the big banks. The big banks want to keep things as is because they make an egregious amount of money already, knowing full well that the government will come in and bail them out if they get into trouble. So they are pouring tons and tons of it into DC to fight this bill, most of which is winding up in the coffers of the Republican Party.

This EDIT confined in the quote below) was added to my post after you posted the above; Geithner doesn't agree with you that it wouldn't add to risk taking:

Apr 16, 2010

By Major Garrett - FOXNews.com

<SNIP>
The Senate Republican leader, Mitch McConnell of Kentucky, offered mute praise for the administration’s formal dismissal of a so-called bailout fund.

“I appreciate the Obama administration’s recognition of the need to substantively improve this bill,” McConnell said from Louisville. “And I hope we can work with them to close the remaining bailout loopholes that put American taxpayers on the hook for financial institutions that become ‘too big to fail.’”

The administration has never been a fan of the bailout reserve fund, a mechanism in both the House-passed bill and legislation passed out of the Senate Banking Committee. The House passed it as a populist move to tax big financial firms up front in case there is a need to finance a liquidation. Sen. Chris Dodd, D-Conn., included a version of the fund in the Senate bill.

Treasury Secretary Geithner testified before the House Financial Services Committee on Oct. 26, 2009, that big Wall Street firms should finance liquidations after they happen (through what’s called an ex-post fund), not build up a rainy day fund (known as an ex-ante fund) in case a failure occurs.

“Such an ex-post funding mechanism has several advantages over an ex-ante fund,” Geithner said. “Most notably, it would generate less moral hazard because a standing fund would create expectations that the government would step in to protect shareholders and creditors from losses. In essence, a standing fund would be viewed as a form of insurance for those stakeholders.”

What do you offer besides opinion that Rs get more money is pouring into Republican Party Coffers or to any individual Republicans from these firms?

A fifty billion dollar fund from the industry would be a charge to all of them and they would see it as a level playing field; I don't think they would be very much perturbed, and in fact see it as being to their benefit. The medicine in this bill is not at all nasty tasting for these firms. It's more a case of Brer Bear and Brear Rabbit, and "don't throw me into the briar patch"

Virtually all the CEOs of these firms matriculated from the same Ivey League schools as the most liberal members of congress, and are in the same camp philosophically and politically.

I've heard from several sources that the Republicans would prefer to prevent these companies from becoming too big to fail, even if it means breaking them up at some point.

Isn't that government interference?

 

[The T]

I would prefer they not be allowed to become too big to fail, but I highly doubt that is going to happen. Why? Because Wall Street doesn't want it to happen.

As for Geithner's argument, we already expect the government to step up and bail out Wall Street because, you know, they already did.

I remember conversations we used to have back in the day on whether or not the government would step in and bail out Freddie and Fannie if they ever got into trouble. I never imagined that they would step in to bail out pretty much all of Wall Street. The idea that there isn't already moral hazard is utterly bizarre. Take the moral hazard argument of 2007 and multiple it by 100.

I have no idea why Goldman bonds are, or were on Friday, trading at 170 over Treasuries. Its essentially risk free debt backed by the US government.

Who gives a shit. Old-Fashioned economics. If a compant fucks up and falls out of favour by their practices? LET THEM FAIL. Nature abhores a vacuum. It will level out naturally.

Government needs to let it happen and stay the Hell out of it regardless. To get involved upsets that vbalance...and isn't that WHY we are here? *By Government interference*? Sure...it's OK to say *YES*

 

[The T]

This bill will be funded by the banks, not by taxpayers. Wall Street doesn't want it because they would have to pay for it. They would rather you, the taxpayer, pay for their losses, just like they have over the past two years. They keep the profits, you pay for the losses.

The idea that this would somehow increase the amount of risk taking is sheer nonsense. Wall Street has already levered up the global derivatives market to the tune of $700 trillion - that's $700,000,000,000,000, 5 times the size of the global economy - without a bailout fund. Wall Street already is a giant casino. Governments already bailout and support financial firms, and will do so in the future. I'd rather have Wall Street take the first $50 billion hit than the taxpayers. But the Republicans don't.

The Republican Party is also fighting breaking up the big banks. The big banks want to keep things as is because they make an egregious amount of money already, knowing full well that the government will come in and bail them out if they get into trouble. So they are pouring tons and tons of it into DC to fight this bill, most of which is winding up in the coffers of the Republican Party.

This EDIT confined in the quote below) was added to my post after you posted the above; Geithner doesn't agree with you that it wouldn't add to risk taking:

Apr 16, 2010

By Major Garrett - FOXNews.com

<SNIP>
The Senate Republican leader, Mitch McConnell of Kentucky, offered mute praise for the administration&#8217;s formal dismissal of a so-called bailout fund.

&#8220;I appreciate the Obama administration&#8217;s recognition of the need to substantively improve this bill,&#8221; McConnell said from Louisville. &#8220;And I hope we can work with them to close the remaining bailout loopholes that put American taxpayers on the hook for financial institutions that become &#8216;too big to fail.&#8217;&#8221;

The administration has never been a fan of the bailout reserve fund, a mechanism in both the House-passed bill and legislation passed out of the Senate Banking Committee. The House passed it as a populist move to tax big financial firms up front in case there is a need to finance a liquidation. Sen. Chris Dodd, D-Conn., included a version of the fund in the Senate bill.

Treasury Secretary Geithner testified before the House Financial Services Committee on Oct. 26, 2009, that big Wall Street firms should finance liquidations after they happen (through what&#8217;s called an ex-post fund), not build up a rainy day fund (known as an ex-ante fund) in case a failure occurs.

&#8220;Such an ex-post funding mechanism has several advantages over an ex-ante fund,&#8221; Geithner said. &#8220;Most notably, it would generate less moral hazard because a standing fund would create expectations that the government would step in to protect shareholders and creditors from losses. In essence, a standing fund would be viewed as a form of insurance for those stakeholders.&#8221;

What do you offer besides opinion that Rs get more money is pouring into Republican Party Coffers or to any individual Republicans from these firms?

A fifty billion dollar fund from the industry would be a charge to all of them and they would see it as a level playing field; I don't think they would be very much perturbed, and in fact see it as being to their benefit. The medicine in this bill is not at all nasty tasting for these firms. It's more a case of Brer Bear and Brear Rabbit, and "don't throw me into the briar patch"

Virtually all the CEOs of these firms matriculated from the same Ivey League schools as the most liberal members of congress, and are in the same camp philosophically and politically.

I've heard from several sources that the Republicans would prefer to prevent these companies from becoming too big to fail, even if it means breaking them up at some point.

Isn't that government interference?

It needs to STOP. Free enterprise isn't a pretty game. And when Government [POLITICIANS] become involved? It pretty much means they're *INVESTED* in the enterprise...and don't wish to LOSE anything.

These Government assholes should take their lumps with the rest of us and CEASE using their power of control to change the fucking game to their GAIN.

 

[American Horse]

I've heard from several sources that the Republicans would prefer to prevent these companies from becoming too big to fail, even if it means breaking them up at some point.

Isn't that government interference?

Republicans recognize the need for necessary "interference" preferring it to incentivising "moral hazard," which is what it would be to fail to take into account recent painful history.

Painful as it may be, allowing firms to fail restores discipline, responsibility, and balance to the system. Pevention of replicating more Fan/Freds is essential as Republicans are well aware. They are equally aware that their base holds Rs as well as Ds responsible for the failing to rein in F&F.

Unfortunately much of the Democratic base is in complete denial about the role those two just played in the recent debacle, which accounts for canards like the one you just raised. While it's true that it is a facet of Republican principles to restrain gov't from interfering, even to a fault, it is an all to common failure of Democrats, whether deliberately or inadvertantly to not take incentives into account.

 

[Harry Dresden]

You will never convince Republicans of that. They have swallowed the Party line hook, line and sinker. They could surf the Internet and find out the truth. But, who am I kidding? They could also turn off Fox and come back to this reality, like that's going to happen.

oh geezus you are a piece of work Dean....you saying the Republicans have swallowed the party line Hook,Line and Sinker.........YOU have swallowed the Far-Left Bullshit so much its sticking out of your ass.....oh Christ you make these threads fun....

 

[The T]

I've heard from several sources that the Republicans would prefer to prevent these companies from becoming too big to fail, even if it means breaking them up at some point.

Isn't that government interference?

Republicans recognize the need for necessary "interference" preferring it to incentivising "moral hazard," which is what it would be to fail to take into account recent painful history.

Painful as it may be, allowing firms to fail restores discipline, responsibility, and balance to the system. Pevention of replicating more Fan/Freds is essential as Republicans are well aware. They are equally aware that their base holds Rs as well as Ds responsible for the failing to rein in F&F.

Unfortunately much of the Democratic base is in complete denial about the role those two just played in the recent debacle, which accounts for canards like the one you just raised. While it's true that it is a facet of Republican principles to restrain gov't from interfering, even to a fault, it is an all to common failure of Democrats, whether deliberately or inadvertantly to not take incentives into account.

Yep.

And of Course MUCH of the Democratic BASE will tell you that THEY are for the working people...What the Democratic [Statist Corporatists] won't TELL YOU by their 'Devine' Intervention...and delving into LAW(s) that screw up the Free-Enterprise system?

Is simply this:[And *I* Stated this to a good friend via PM]

The only reason for intervention is that these politicians are invested in the enterprise, or the enterprise has invested in them.

And it upsets the natural balance...If a company screws up and loses? LET THEM LOSE. Better luck next time.

Nature abhores a vacuum. The Vacuum will fill up with someone that can do it better. It's the AMERICAN WAY.

Suprising this is lost in the vitriol against Corporations.

Thing is folks? Corporations keep things moving in a healthy economy...and more importantly> Does the Investment in them by PEOPLE whom buy...meaning US...the People...(Remember us)?

Kill the Corps? You kill US.

*See Last Statement in my SIGLINE*

And TURDS are what Obama and the Democrat Statists are harvesting.

~NUFF SAID. Don't TREAD on US...or we'll HURT YOU come Election time.

 

[Vast LWC]

What do you offer besides opinion that Rs get more money is pouring into Republican Party Coffers or to any individual Republicans from these firms?

A fifty billion dollar fund from the industry would be a charge to all of them and they would see it as a level playing field; I don't think they would be very much perturbed, and in fact see it as being to their benefit. The medicine in this bill is not at all nasty tasting for these firms. It's more a case of Brer Bear and Brear Rabbit, and "don't throw me into the briar patch"

Virtually all the CEOs of these firms matriculated from the same Ivey League schools as the most liberal members of congress, and are in the same camp philosophically and politically.

I've heard from several sources that the Republicans would prefer to prevent these companies from becoming too big to fail, even if it means breaking them up at some point.

Where in this post are you proving that Wall street would receive one red cent from the government?

They would be paying into a fund themselves to insure their own welfare, thus saving the taxpayers from having to bail them out.

How is that bad? How is that an implication of a government bailout?

 

[boedicca]

This bill will be funded by the banks, not by taxpayers. Wall Street doesn't want it because they would have to pay for it. They would rather you, the taxpayer, pay for their losses, just like they have over the past two years. They keep the profits, you pay for the losses.

$50B is an extremely small amount and window dressing. If it were a sufficient pool to cover systemic risk, we would not have spent several hundred billion dollars on TARP.

There is also language in the bill that requires banks to repay the government for funds received from the government. Think about what that means.

 

[The T]

What do you offer besides opinion that Rs get more money is pouring into Republican Party Coffers or to any individual Republicans from these firms?

A fifty billion dollar fund from the industry would be a charge to all of them and they would see it as a level playing field; I don't think they would be very much perturbed, and in fact see it as being to their benefit. The medicine in this bill is not at all nasty tasting for these firms. It's more a case of Brer Bear and Brear Rabbit, and "don't throw me into the briar patch"

Virtually all the CEOs of these firms matriculated from the same Ivey League schools as the most liberal members of congress, and are in the same camp philosophically and politically.

I've heard from several sources that the Republicans would prefer to prevent these companies from becoming too big to fail, even if it means breaking them up at some point.

Where in this post are you proving that Wall street would receive one red cent from the government?

They would be paying into a fund themselves to insure their own welfare, thus saving the taxpayers from having to bail them out.

How is that bad? How is that an implication of a government bailout?

HOW is it BAD? I'll tell you...Once the Fed gets their claws upon anything? It sets precident for them to do ANYTHING they like...or aren't you into Historical FACT?

The Government should stay OUT of it. Let them FAIL. The Free Market will replace the failure in due course with others that will do it better...or don't *YOU* trust the market?

"Too Big To Fail*?

Would that INCLUDE the Government that continues to GROW at the Nation's detriment? [And BY their own design...and purpose]?

[And the MARKET *IS* the people].

Your post is crap.

 

[Vast LWC]

Where in this post are you proving that Wall street would receive one red cent from the government?

They would be paying into a fund themselves to insure their own welfare, thus saving the taxpayers from having to bail them out.

How is that bad? How is that an implication of a government bailout?

HOW is it BAD? I'll tell you...Once the Fed gets their claws upon anything? It sets precident for them to do ANYTHING they like...or aren't you into Historical FACT?

The Government should stay OUT of it. Let them FAIL. The Free Market will replace the failure in due course with others that will do it better...or don't *YOU* trust the market?

"Too Big To Fail*?

Would that INCLUDE the Government that continues to GROW at the Nation's detriment? [And BY their own design...and purpose]?

[And the MARKET *IS* the people].

Your post is crap.

You know T, that's exactly what they said in the 1920's, and that worked out pretty damn well, didn't it?

The FDIC served as a stopgap to prevent another depression pretty damn well for 70 years. Now these financial firms are essentially serving as banks, so the Government is trying to make sure they don't fail by making them insure themselves.

How in God's name you see this as a bad thing is beyond me. Keep on spinning though.

 

[Dont Taz Me Bro]

So what exactly does this financial reform bill do and how will it stop from what happened from happening again? Those are the questions I am looking to be answered. Everybody is either bitching about Republicans opposing it or claiming the bill is bad because it was written by Chris Dodd, but can anybody actually answer the questions I have proposed?

I am still waiting on somebody to comment on the above. All of you who are wetting yourselves over Democrat support and Republican non-support of this bill, do you even know anything about it?

 

[Vast LWC]

So what exactly does this financial reform bill do and how will it stop from what happened from happening again? Those are the questions I am looking to be answered. Everybody is either bitching about Republicans opposing it or claiming the bill is bad because it was written by Chris Dodd, but can anybody actually answer the questions I have proposed?

I am still waiting on somebody to comment on the above. All of you who are wetting yourselves over Democrat support and Republican non-support of this bill, do you even know anything about it?

The part we were arguing over is that the Bill forces Wall Street to create their own bailout fund. That covers part of it at least.

Here's a good part that forces oversight of Derivative trading:

Lincoln unveils tough derivatives regulation bill - The Hill's On The Money

Senate Agriculture Chairwoman Blanche Lincoln, (D-Ark.), unveiled a tough draft bill today to regulate the over-the-counter derivatives market

The measure includes mandatory clearing and trading requirements, real-time reporting of derivatives trades and closes loopholes providing "100 percent transparency" to the unregulated $600 trillion market.

The measure will be marked up Wednesday and will be attached to a financial regulatory reform bill authored by Senate Banking Chairman Chris Dodd (D-Conn.).

The bill also creates a dedicated Consumer Protection Agency to fend off the worst bank abuses of consumers and investors.

There's a whole lot of other stuff in the bill. But of course it's still a work in progress.

 

[AquaAthena]

As usual the Republicans are protecting the thieves on Wall Street.

And it was Phil Gramm who wrote the legislation that caused the collapse, which was caused by a derivative bubble, not the housing industry.

As usual, the Republicans and Libertarians are opposed to a Nanny State, with government taking away our freedoms to "try and fail" one regulation at a time. You are giving them too much power, progressives. Our country will not be better off with them in control. We will become Stepford citizens, with heads hung low, in shame for selling ourselves.

 

[Bern80]

Republicans making a big mistake with their failure to support the general outline of the "Dodd" Financial Regulation bill. The American people want no more AIG's, Bear Stearns, Lehman Brothers,etc.. Ordinary Americans want the Federal Government to step in early with these types of companies and stop their growth, break them up or do whatever is needed to see these businesses don't hurt the economy and cost jobs. The Republicans have not given any persuasive reason to mainstream America to oppose this bill. Their rationale that this bill will encourage financial businesses to be recklass in pursuit of profits because they know the Federal Government will rescue them if they get into trouble is bogus and ordinary Americans can see this because if the Federal government steps into a financial business's life that almost certainly means that financial business's stock price will take a giant hit and no executive of a financial business wants that.



The Republican's stance on this bill makes them look like they are looking out for big financial institutions and their owners interest not the American peoples interests. Republicans have huge momentum going into these mid-term elections, their stance makes ordinary Americans wonder if I support the Republicans am I supporting Bush like Republicans that got us into this recession mess in the first place, Republicans better change their tune quickly on this issue or it will costs a significant number of votes in November. This last two and a half years with this recession has been a nightmare for the American people, the American people want meaningful financial regulation reform they want to see these financial industry problems don't happen again.

Some of these Republican positions on this bill are clearly indefensible. The vast majority of swap (insurance) contracts should be done through exchanges or clearinghouses so if the issuer of a swap defaults, the clearinghouse can pay the debt so there is no ripple financial effect. Many businesses use these swap contracts for extremely important business reason that is to hedge against possible negative events occurring to their business operation - they shouldn't be overpaying for this insurance protection - listing these swap contracts on exchanges will make their prices transparent helping ordinary businesses to get a fair deal. In addition, listing these contracts on exchanges will allow regulators and experts to analyze this market and to sound the alarm if an issuer of these swap contracts is taking on too much risk - so the country can avoid AIG scenarios!

Support a bill that was written by the same asshole that helped along the housing collapse????

Are you fucken high???

The housing collapse happened when mortgages were moved from Freddie/Fannie to Wall Street, where they were literally given away, bundled and then sold as "securities". You guys can't pretend to be ignorant anymore. This is now known to be the facts. It all started with Republican deregulation early in Bush's first term.

Trying to blame it on Barney Frank doesn't work anymore. We know the truth.

No, it started long before Bush, with the CRA under Carter.

 

[Vast LWC]

As usual, the Republicans and Libertarians are opposed to a Nanny State, with government taking away our freedoms to "try and fail" one regulation at a time. You are giving them too much power, progressives. Our country will not be better off with them in control. We will become Stepford citizens, with heads hung low, in shame for selling ourselves.

This point does not even apply in this case.

These companies are essentially committing fraud, though they have been given legal loopholes to do it.

It is the duty of government to protect the citizenry from criminal activity, just as it is their duty to protect us from foreign invasion, and to protect the general welfare of the populace.

These are the reasons why government exists at all.