Remaking the world, financial division
In his continuing effort to remake the world as we have known it, President Obama today laid out “sweeping changes to the way the U.S. government oversees financial markets”, reports the Wall Street Journal, including efforts “to grant new powers to the Federal Reserve to oversee the economy.”
(The official 85-page white paper describing the approach is available here.)
There’s a lot to digest, although some are already condemning the plan for going too far, and others for not going far enough. Among other things, it “includes giving more power to the Federal Reserve to police large, systematically important institutions, allowing the government to break firms apart, implementing new rules for complex instruments and creating a new federal agency to oversee consumer products such as mortgages and credit cards,” says the WSJ.
The plan lists five areas of action:
I. Promote Robust Supervision and Regulation of Financial Firms
II. Establish Comprehensive Regulation of Financial Markets
III. Protect Consumers and Investors from Financial Abuse
IV. Provide the Government with the Tools it Needs to Manage Financial Crises
V. Raise International Regulatory Standards and Improve International
CooperationCooperation
As Obama said in announcing the plan:
“We are called upon to put in place those reforms that allow our best qualities to flourish — while keeping those worst traits in check. We are called upon to recognize that the free market is the most powerful generative force for our prosperity — but it is not a free license to ignore the consequences of our actions.”
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60 comments Add your comment
I Report :-) You Whine :-(
June 17th, 2009
4:30 pm
Excellent, bookman-
In his continuing effort to remake the world as we have known it, President Obama today laid out “sweeping changes to the way the U.S. government oversees financial markets”, reports the Wall Street Journal, including efforts “to grant new powers to the Federal Reserve to oversee the economy.”
Stasi would be proud.
Hey, is this like for future resumes?
Comrade?
They brought it on themselves
June 17th, 2009
4:32 pm
Well, we did try the “give ‘em enough rope to hang themselves and see what they do with it approach” and that did not work out too well for anyone other than the greedy ones at the top that cashed out and left everyone else holding the bags. The sad part is that most of the truly guilty will never be punished.
Paul
June 17th, 2009
4:33 pm
Weren’t the same criticisms leveled against the gov’t’s plans to reign in the Robber Barons?
Obambi's TelePrompter
June 17th, 2009
4:36 pm
creating a new federal agency to oversee consumer products such as mortgages
I nominate it to be headed by Bwarney Fwank!
Joe Matarotz
June 17th, 2009
4:40 pm
Rural Democrats Differ with Barack Obama
Angered by White House decisions on everything from greenhouse gases to car dealerships, congressional Democrats from rural districts are threatening to revolt against parts of President Barack Obama’s ambitious first-year agenda. The conflict with rural Democrats burst into the open at the Capitol last week, when rural and moderate Democrats revolted against the decision to close roughly 3,400 General Motors and Chrysler car dealerships. “If you knock out four dealerships, the ripple effects of that are substantial,” said Rep. Frank Kratovil (D-Md.), who … is co-sponsoring a bill that could force the auto companies to honor their contracts with the rejected dealerships.
Source: Politico
Joe Matarotz
June 17th, 2009
4:41 pm
Greater N.Y. Dealers Demand Halt to GM Store Closings
NEW YORK — The president of the Greater New York Automobile Dealers Association has called for a moratorium on General Motors’ dealership closings and also suggested that store-count reductions do more to harm than help the automaker. “A moratorium on dealership closures would not impact the other financial and structural changes that the automakers are being forced to make, but it would save thousands of small businesses and tens of thousands of jobs,” [stated Mark Schienberg, who heads up the GNYADA.]
Source: AutoRemarketing
Joey
June 17th, 2009
4:42 pm
We won’t look for Jay find anything to criticize in this proposal.
Jay determined yesterday that President Obama’s only mistake, his blatant hypocrisy, is his failure to release the visitors log.
A Pulitzer Journalist for sure.
Copyleft
June 17th, 2009
4:48 pm
Hot damn! It’s great to see the word REGULATION so prominently and proudly used again.
We’ve seen the disasters that come from letting the market “regulate itself,” i.e., it doesn’t. Time to put the grownups in charge, and put the brakes on the incompetence and shortsighted greed of the Wall Street Looter Association.
Bud Wiser
June 17th, 2009
4:48 pm
Obowo won’t talk to Fox News, because they are the only media</i< outlet that doesn’t heel roll over, and slobber profusely with waggly tails at his every new utterance.
More likely because they won’t allow him to prescript any interview, so the teleprompter can be close at hand… Hasn’t the idiot in chief ever heard of audio communications, such as a hearing device planted in his ear, so Soros or whoever pulls his pathetic strings can give the answers to the tough questions?
And just what has been the toughest questions thrown at him my PMSNBC, NBC, ABC, CNN, etc., etc., so far?
Perhaps a recap:
1. What is your favorite color?
2. Other than the obvious, what ice cream flavor would you be?
3. What are you naming your dog?
4. Dos Michele dress like that on purpose? (oops, questioner just hustled out by the new SS)
5. Is that a fly on your sleeve?
6. Are you ever going to let ay of the cracker chasers finally catch you for that first bite?
7. Can we cover that event?
8. Can we be first?
Eddy
June 17th, 2009
4:52 pm
Sadly, the left will celebrate all of these news controls to protect us from???????? Oh by the way, there are already enough controls, departments, etc in place and have been in place for years. The issue is that no one in gov’t does their job. So what’s going to be different now? Just more people added to the gov’t payroll who still don’t do their jobs. Sounds like a plan to me!!!!! Do we count these as “new jobs” or “saved jobs”? Make sure we give the credit correctly, don’cha know.
getalife
June 17th, 2009
4:57 pm
More folks to bribe like after the Enron regulations.
Paul
June 17th, 2009
5:00 pm
Eddy
[[all of these news controls to protect us from????????]]
What happened last fall.
[[there are already enough controls, departments, etc in place and have been in place for years. ]]
Then how did last fall happen?
[[The issue is that no one in gov’t does their job.]]
Sure they did – but what happened, happened because their were no laws or controls to prevent the causative actions. There was, in most cases, nothing illegal that occurred.
[[So what’s going to be different now? Just more people added to the gov’t payroll who still don’t do their jobs.]]
Or, people who will do their jobs, which involves enforcing the new laws and regs so we don’t have a repeat.
They brought it on themselves
June 17th, 2009
5:01 pm
I celebrate the re-birth of the old controls, with appropriate updates, that were broken down and destroyed by the greedy amongst us. Clearly, people need regulations, to protect them from themselves as well as protect others from them. Otherwise, we get what we got over and over and over — an overabundance of greedy stupid thoughtless jerks that care about nothing but their own short-sightedness.
Paul
June 17th, 2009
5:02 pm
Eddy
Pls change [[Sure they did - but what happened, happened because their were no laws or controls to prevent the causative actions.]] to [[Most of them did, but even with those who didn't, it wouldn't have mattered, because there were no laws or controls to prevent the causative actions.]]
They brought it on themselves
June 17th, 2009
5:03 pm
I like the “more people to bribe” thought. Perhaps, we will reach a point where it is cheaper to do the right thing.
RW-(the original)
June 17th, 2009
5:10 pm
Or, people who will do their jobs, which involves enforcing the new laws and regs so we don’t have a repeat.
May I call you Pollyanna or should I stick with Paul? What I want to know is if this new agency will need both a cabinet secretary over one group of people and a czar over another.
booger
June 17th, 2009
5:14 pm
…..effort to remake the world as we know it. And its not difficult to see what kind of world it will be. It will be exactly like Europe was before they started their journey to the right.
Jay, a few weeks ago you commented that some people were stuck in the past, [impling it was conservatives]. You went on to say it was time for a new and progressive approach.
Well, having lived and worked in Europe, I can tell you there is nothing “NEW” about this administrations approach. It is all right out of the 1950s and 1960s European playbook.
Paul
June 17th, 2009
5:21 pm
RW-the original
Whatever makes you happy!
Really, I hope it doesn’t need a whole new layer or Czar. Seems it shouldn’t be all that difficult to just add in to ‘one more thing on the checklist’ to check. Just another type of financial control. And even if it’s just something to get the attention of some of these crooks who’ll know at the highest levels they could face jail time…
allright… I admit… that last part was a bit Pollyanish. Jail time? Nothing a good campaign contribution wouldn’t overcome.
Didja ever wonder – one of the most failure-prone monarchies/dynasties/line of governments in history were the czars, yet that’s the term Pres Obama picked?
AmVet
June 17th, 2009
5:24 pm
The devil is of course in the details.
The criminals on Wall Street, K Street and Main Street are not gonna willingly let go of their ill-gotten cookie jar. Ever. And they know BHO is not going to hold anyone’s feet to fire, much less hold them accountable and culpable for their looting.
We’ll see if this proposed legislation has any teeth to it or not.
And though not from Missouri, show me…
TW
June 17th, 2009
5:33 pm
Business consented to this when they took government money.
By failing to monitor ‘their’ market system, the GOP lost all credibility with regard to economics.
By failing to baby-sit ‘w,’ the GOP lost its claim on military wisdom.
There is no group at greater fault for the impending liberal tsunami than the Republican Party.
They brought it on themselves
June 17th, 2009
5:38 pm
Obama did not pick the word “czar”. He just did not choose to change to something better — “Lord” perhaps. I think that one is in use already. “Prince”. No, that one is already taken. Then again, maybe “czar” is appropriate given that they don’t ever seem to actually accomplish anything. About like the war on drugs. What war?
Wyld Byll Hyltnyr
June 17th, 2009
5:40 pm
The financial industry does not need more regulation; it current has to much regulation that costs too much. The financial industry needs CAPABLE regulators as the current batch are ninkompoops.
Here are two examples, Alphabank in our own backyard and private label MBS securities that are toxic assets on money center bank balance sheets.
Alphabank was regulated by the FDIC from its approval to the day it closed less than 32 months later. The FDIC approved a management team and board of directors that had NO (that means NONE) commercial lending experience which means that the FDIC approved people who were incapable of managing the primary risk at a community bank. The banks assets were more than 90% centered in speculative real estate loans and its deposits were almost 100% hot money, yet the FDIC, on more than one occassion, gave Alphabank its highest rating. Someone, please tell me how more regulation would have changed things when it is so evident that quality regulation could have nipped the problem in the bud while Alpha was small, young, and not at risk.
The Fed regulated money center banks. The money centers put private label MBS securities on their balance sheets with full reliance on NRSRA rating and no idnependant diligence even though a lot of these bonds were heavily concentrated in option arms in soft wood forests of collateral. Worse yet, the Fed sat idly and did not require consolidated financial reporting by while management placed huge mortgage market bets in lightly capitalized SIV’s because management told them that they would not protect the SIV if it got into trouble and thus the inherent risks should not be diclosed.Someone, please tell me how more regulation would have changed things when it is so evident that quality regulation could have nipped the problem in the bud before it roiled all the mortgage and credit markets.
Obama’s new regulatory plan is a stupid, dogmatic plan offered by a stupid, dogmatic partisan hack.
Redneck Convert
June 17th, 2009
5:44 pm
Well, alot of the people on this blog like to be gypped. They like it even better when they’re the ones doing the gypping. If this Obama butts in to what the banks and stock brokers been doing, he’s going to disappoint a whole lot of people. I say leave things alone. Let the banks and the stock cos. and hedge funds make worthless products out of thin air and sell them to stupid and greedy people. Me, I like to see rich people cry when they get wiped out by fraud. One minute they’re big-shot millionaires. The next minute they’re whining and needing to find a job to have enough food to eat. If God had of wanted a bunch of regulations, He wouldn’t of made so many stupid people willing to buy just about anything if they think it will make them a little richer than the next guy.
Anyhow, this Obama needs to keep his hands off of Private Innerprize. Cheating and gypping people is pure American business. And we can’t have politicans getting in the way of God’s Plan. Have a good night everybody.
They brought it on themselves
June 17th, 2009
5:44 pm
Obama’s new regulatory plan is the appropriate step to take in order to restore trust in the financial system and to help prevent future abuses of the system by greedy short-sighted people. Thank God for putting someone in the White House with some common sense and the education needed to do something with it.
getalife
June 17th, 2009
5:48 pm
They are probably coming to the WH to give them loop holes to write to fool the gullible masses.
RW-(the original)
June 17th, 2009
5:54 pm
Paul,
I’m not sure Obama is actually calling them czars anymore, but the latest one he came up with he calls a Special Master. That’s just wrong on too many levels.
Wyld Byll Hyltnyr
June 17th, 2009
6:00 pm
They brought it on themselves 5:44 pm
The regulatory framework to avoid those problems that occurred was in place, the problem wasn’t the regulatory framework, rather, the problem was idiots in the form of bair, Geithner, Dougan, and the OTS knuckledragger.
SpaceyG on Twitter
June 17th, 2009
6:00 pm
The Honorable GHT sends a shout out (and his kind, but low regard) to the right-wingnutters of Bookman’s Bog. Enjoy!
http://www.amazon.com/Idiot-America-Stupidity-Became-Virtue/dp/0767926145/ref=sr_1_1?ie=UTF8&s=books&qid=1245255454&sr=8-1
(They’re holding my Twitter name hostage. I was told I had to post this comment or I’d never get it back. Obviously, I negotiate with terrorists.)
Tie Quan Doe
June 17th, 2009
6:01 pm
they brought it on themselves@4:32pm-”sad part most of the truly guilty will never be punished”. Hmmm let me guess,those meanie rich. Could’nt be bozo’s that were supposed to be overseeing,or could’nt be John Q Public that took advantage of “slack” regulations. There is plenty of blame to go around,not just attack one group. Sad to see the “weak” & “mindless” playing the blame game. But those who choose to play it’s easy,right?
Tie Quan Doe
June 17th, 2009
6:10 pm
they brought it on themselves@5:44pm-”thank god for putting someone in the WH with common sense & ed to do something with it” MY GOD SON!!!!Get YOUR NOSE OUT of the MANS A*S!!!!How can so many be so easliy led? I’ve read the term hear many times,but never have I seen a more rewarding applicant-I Dub Thee King SHEEP!!!!!!!!
They brought it on themselves
June 17th, 2009
6:20 pm
Wyld Byll,
Perhaps you can start by telling me all about the regulations in place regarding credit default swaps or what defines a “bank” or if there is only one agency that all so-called “banks” or other lending institutions must work through or if all “banks” have uniform requirements regarding capital or leveraging. Of course, that is just for starters.
Tie Quan Doe,
Aside from the so-called educated CEO’s and other executives that were at the helm of these brokers and other banks and AIG that will never be punished (some of the truly guilty), I was also thinking about this guy named Phil Gramm, for one. He personally introduced the legislation in Congress that made sure that derivatives were completely outside the realm of any regulation or oversight. Have you heard of him. He went to work for UBS. He was also John McCain’s financial adviser back during his campaign. Fortunately he did not make it into the executive branch. Thank God for miracles.
josef nix
June 17th, 2009
6:26 pm
Am Vet–
“The devil is of course in the details.”
I’ve looked at, have not studied, the document which, for a “change,” is fairly readable. That was a relief . However, you are right on target here. Already I can hear Mussorgsky as background music.
Tie Quan Doe
June 17th, 2009
6:26 pm
They brought it on themselves-If you read my response,you would have noticed that I said there was plenty of blame to around.But to play the blame game and not include all involved is disingenuous at best.But like I said,for some it’s easy. And for others in a sick way it makes them feel better.
Big Brother
June 17th, 2009
6:26 pm
[[Clearly, people need regulations, to protect them from themselves as well as protect others from them.]]
Will you feel the same when the long-reach of those regulations infiltrate your private and personal business?
Tie Quan Doe
June 17th, 2009
6:28 pm
Tbiots-Oh by the way,yes I have heard of scum ball Phil Gramm
They brought it on themselves
June 17th, 2009
6:34 pm
Tie Quan Doe,
I did not know that I had to provide a comprehensive list in order to make a statement. Besides, I did not want to have to include every crooked broker that pushed a loan on someone that he knew could not afford it just so he could collect a commission and that sort of thing. Some people are so picky. But, feel free to expand or elaborate on the guilty and who did what when to whom, etc.
Kamchak
June 17th, 2009
6:36 pm
“MY GOD SON!!!!Get YOUR NOSE OUT of the MAN’S A*S!!!!how can so many be so easily led? I’ve read the term hear[sic] many times,but never have I seen a more rewarding applicant….”
I’ve read these terms “here” and elsewhere many more times.
“weapons of mass destruction”
“the smoking gun is the mushroom cloud”
“fight them there, so we don’t fight them here”
“preemptive strike”
“litres and litres of anthrax, ricin, nerve gas, etc…”
“liberal Hollywood/Ivy League elitists”
“liberal mainstream media”
“finally, a President that I can have a beer with”
You’re kinda late to the ovine party.
josef nix
June 17th, 2009
6:36 pm
Paul–”Weren’t the same criticisms leveled against the gov’t’s plans to reign in the Robber Barons?”
Out there stirring up trouble again, I see!
When this whole melt down mess started, the Unmentionable, something a a history buff, shook his head in bewilderment at what he called the Chicken Little/Aunt Pittypat scenario. “Do they even know who the Robber Barons were and where they came from? No one wanted to hear it when reminded that the Second Reconstruction would have as its natural outcome just what we’ve got here.”
Tie Quan Doe
June 17th, 2009
6:40 pm
TBIOT-No a list is not necessary,but a fair assessment would be nice. Being rich does not automaticaly make one evil. Nor does being poor make one worthless. Nor is every Democrat/Republican corrupt,ignorant,spineless,etc.
Tie Quan Doe
June 17th, 2009
6:43 pm
KamCrap-But I guess the term fits with more than one person here.
They brought it on themselves
June 17th, 2009
6:44 pm
Big Brother at 6:26,
I may or may not feel the same. I guess it depends on whether or not I take it personally, amongst other things. I mean, if I had investors a few years back that were willing to put up a million dollars, then I could have opened a bank myself with absolutely no experience and it would have been perfectly legal. Then, I could have leveraged that seed money to the tune of 20 or 30 to one or more and there would have been no law or regulation to stop me. And, to protect my bank, I could have purchased things like credit default swaps from sound insurance companies like AIG that used sound advice from places like S&P, etc. And, if anything happened to go wrong, I would still walk away with my small fortune while my LLC went under leaving all its investors with nothing. Why do you think there are so many failed banks. The most basic oversight and regulations were gone, stripped away, by request from these banks and others that felt too restrained by rules and regulations. Look where it got us. Of course, one can go too far in either direction. So, we have to make sure that we do not go too far back the other way.
TnGelding
June 17th, 2009
6:45 pm
More “baby steps?”
Light bulb moment: add a checkoff box on Form 1040 to allow taxpayers to get their refund in the form of AAA rated (for now) U.S. bonds. As an incentive the interest earned could be tax free. We’ve got one around here somewhere from 1987 we don’t ever plan to redeem. Our meager contribution to the national debt.
Tie Quan Doe
June 17th, 2009
6:46 pm
It’s nice to see such the “blind” have a place to assemble. I think I’ll retire to a sane sight where there is a smidgen of reason and actual thought process. Good Night SHEEP
I Report :-) You Whine :-(
June 17th, 2009
6:46 pm
Will you feel the same when the long-reach of those regulations infiltrate your private and personal business?
Yeah, it’s like any of these socialist wankers have money, hahahahahaha, give me a freaking break.
Puh leeze.
TnGelding
June 17th, 2009
6:52 pm
AmVet
June 17th, 2009
5:24 pm
I would say not, since the stock markets took it in stride. They actually rallied a little before giving it back.
AmVet
June 17th, 2009
6:52 pm
I actually love this topic.
For the less lucid it is so easy to go all George Orwell.
Well at least talk in absolutist and mindless terms.
Hey wait! This topic is no different that most of the others “discussed” here…
I Report :-) You Whine :-(
June 17th, 2009
6:55 pm
These harpy little socialists that whine about other people’s money are no different wimps and sissies that rode in the back on the covered wagons with the women while the men tamed the Wild West. And the probably blubbered about not having a nice skirt like the women did.
What shame they bring upon themselves, helpless little eunuchs.
eewwww
Wyld Byll Hyltnyr
June 17th, 2009
6:55 pm
They brought it on themselves 6:20 pm
You ask, “…all about the regulations in place regarding credit default swaps or what defines a “bank” or if there is only one agency that all so-called “banks” or other lending institutions must work through or if all “banks” have uniform requirements regarding capital or leveraging.”
The one of the greater mistatements in the liberal agenda is that the swap mkt was unregualtion. Granted these were over the counter contracts that did not flow through a clearing house like NYSE or NASDAQ, but there was regulatory oversight of the swap mkt (in the case of Nation Banks – which is where most of the action was or, in the case of AIGFP, NYIC. The regulatory failure was, once agin driven, by a Pharisee like reliance on the NRSRA ratings and not idependant diligence. For example, the regulators should have asked Citi about the texture and volume of AIGFP’s swap book. The regulators failed to consider a market in which credit costs were present and exposures could daisy chain. I know, a portion of my career was spent running a group that, among other things, underwrote SWAP counterparties. The regulators were asleep at the switch.
learly there is neither one agency nor capital standard for all banks. The many regulatory agency’s are more a qc than structural problem as evidenced by the poor performance of the regulatory agencies in the examples i have cited. A uniform capital standard is meaningless it is the juxtaposition against risk levels and volatilities that matters at the core, and the Obama proposal does nothing to address the issue because it cannot be address through statutory or regulatory structure.
Big Brother
June 17th, 2009
6:58 pm
[[Why do you think there are so many failed banks.]]
Because Barney Frank and Chris Dodd insisted they venture into risky loans. It was from that point that the house of cards began to tumble.
Big Brother to the rescue.
They brought it on themselves
June 17th, 2009
7:02 pm
Yeah, it’s like any of these socialist wankers have money, hahahahahaha, give me a freaking break.
I bet you are one of those “non-socialists” that liked to point a convenient finger at “socialists” such as Soros and Buffet whenever you needed a “socialist” with money to ridicule instead of a “socialist” without money. Give everyone else a freaking break.