Because Democrats made compromises on the Financial Reform Bill in the hopes of getting more Republicans to join in and do something, a lot of specifics were left to the regulators. The Republicans, except for those who lived Down East, threw the Democrats the finger. In other words, all the attempts to get Richard Shelby and the rest of the banker’s toadies to support the bill ended up weakening it. So now every detail is being fought over in the myriad groups that are supposed to control some part of the economy.
They didn’t have The Commodities Futures Trading Commission absorbed into the SEC, so there will be turf wars that will last into the future.
Sheila Bair and the FDIC decided banks should hold at least five percent of the credit risk when they come up with a new plan to securitize America into a crisis. Five percent doesn’t seem like a lot to hold onto, but it made the Treasury mad., because Geithner can’t stand to have a woman with guts, like Bair, standing up for important rules. He doesn’t want to have trouble playing footsie with the bankers.
Did you ever wonder how come the bankers hate a guy who kisses their butts?
How come banks didn’t give up the right to lobby when they took the TARP money? (It doesn’t matter, because the Roberts Court would have said it was an unconstitutional restraint on free speech anyway).
I’m trying to figure out what banks really want and all I can see is Adam Smith’s unseen hand. The problem with that is that every year there are a lot less people you can trust to play fair. I knew that every time I gave a test that seventy percent of the people in that room had cheated before. More and more we’re producing individuals with situational ethics. Situational ethics is when you are for anything that will make you money.
In a perfect world, you wouldn’t need cops. But, in the world we live in now, there should be 1,000 State Troopers assigned permanently to Goldman Sachs.