Comments on: Are the big banks winning? Thu, 21 Jul 2016 07:57:19 +0000 hourly 1 By: theagitator Sat, 27 Oct 2012 00:56:13 +0000 Obama made a big mistake by not taking these bankers to the woodshed and by appointing Rahm and Geithner who were two banker hacks.

99% of Americans wanted to see justice while the administration gave the bankers more money and failed to punish them.

By: AdamSmith Thu, 25 Oct 2012 06:04:17 +0000 One point should be reconsidered. The article suggests, in support of the theory of Cecchetti and Kharroubi, that America’s fall in manufacturing employment was perhaps due to over-financialization. I quote:
“Whatever the reason, when American finance bulked up in the 2000s, there was a cataclysmic fall in manufacturing employment.”

It seems to me that even without over-financialization, America destroyed its own manufacturing base by signing the NAFTA free trade agreement, and other WTO free trade agreements relating to China, South America and other low-income, impoverished, highly populated regions. Those agreements were lobbied for by large corporations who benefited greatly from outsourcing, even while they smashed America’s middle class.

But, mainly I wanted to say this was a great article by Charles Morris.

A few years ago I read his book predicting the trillion dollar meltdown. An excellent book. Wish now I had acted upon it.

I’m glad this Reuters article appeared.

I’m going to read his new book. He is truly a great writer.

By: 4ever49 Wed, 24 Oct 2012 20:07:11 +0000 “We appear to be on the road to electing one of the syndicate’s inner circle as US President.”

Remains to be seen – if he can truly balance both sides of aisle there may be hope – slim – but a chance. We already know the incumbent is compromised.

By: Sanity-Monger Wed, 24 Oct 2012 19:40:17 +0000 It appears that “too big to fail” should be re-worded as “too big to regulate”. And so we have an international finance system that resembles an organized crime syndicate far more than any kind of legitimate enterprise. And we appear to be on the road to electing one of the syndicate’s inner circle as US President.

By: 4ever49 Wed, 24 Oct 2012 19:12:07 +0000 First you state Dodd-Frank was intentionally tough, but then end the paragraph saying Congress is a poor forum for crafting the details of such legislation. In other words, the US taxpayer got worked over again courtesy of the financial elites from Wall Street and nothing really changed.
It is time for Congress to get off its back side and do something constructive in the way of basic structural change. For openers legislation incorporating a Glass-Stegall like separation between true “banks” who deal in debt and true “investors” who deal in equity should be put in place. Incorporating these two (debt & equity) under the same umbrella has proven to a recipe for disaster.
Way too many assets are tied up in the derivatives markets which produce very little in the way of general economic benefit. These, and credit default swaps (naked bets) need to have exposure to reserve requirements that would allow state insurance regulators to weigh in. This should dramatically reduce the size and influence of this market.
Residential mortgage lending has been an area of particular concern. We drifted away from institutions that understood their local markets in favor of a one size fits all approach. Lending standards as we all know now went into the crapper. These two factors tied to the bundling of mortgage backed security issues coupled with politically driven aspirations of Congress rolled up into the crash of ’08.
The lending capital need of the industry is a constant to be taken into account for whatever structural change is adopted. Looking back, it is obvious that the S&L model did work up to when Congress’s politically motivated modifications quickly led to their demise and the resultant RTC solution. The reason S&L’s worked for as long as it did was its’ tie to the local market and reasonable lending standards. Something approximating this function needs to be resurrected as we go forward.