General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsWarren, McCain introduce bill to bring back Glass-Steagall
Warren, McCain introduce bill to bring back Glass-SteagallBy Kevin Cirilli at The Hill
http://thehill.com/policy/finance/247093-warren-mccain-introduce-bill-to-bring-back-glass-steagall
"SNIP..............
Sens. Elizabeth Warren (D-Mass.) and John McCain (R-Ariz.) are reintroducing legislation to revive the Glass-Steagall Act, which would force big banks to split their investment and commercial banking practices.
Glass-Steagall was first passed in 1933 but repealed during the Clinton administration, leading many progressives to argue that it contributed to the 2008 financial collapse.
Warren and McCain, along with their cosponsors, Sens. Angus King (I-Maine) and Maria Cantwell (D-Wash.), said in a statement that the legislation would make big banks that are "too big to fail" smaller and safer and minimize the likelihood of a government bailout.
The bill, which they first introduced in the last Congress, would separate traditional banking with checking and savings accounts from financial institutions that offer services such as investment banking, which are riskier.
..............SNIP"
Quixote1818
(28,946 posts)done to this country in the past 30 years.
rhett o rick
(55,981 posts)with you, but might add the SCOTUS appointment of Bush to the presidency. To me that was the signal that our democracy was dead.
Springslips
(533 posts)Cheney is older than 30; I doubt the nation could survive with him another 40-50 years.
rhett o rick
(55,981 posts)AngryDem001
(684 posts)Dickard has NEITHER.
rhett o rick
(55,981 posts)hifiguy
(33,688 posts)down to his filthy, rotten, greedy core.
RiverLover
(7,830 posts)Thanks for posting applegrove!
May this time be successful.
applegrove
(118,682 posts)yourout
(7,530 posts)valerief
(53,235 posts)PowerToThePeople
(9,610 posts)Frustratedlady
(16,254 posts)I haven't seen him screaming, "Get off my grass!" lately. He did or said something the other day that was out of character for him. Forget what it was.
Maybe they changed his meds or his good friend Lindsay is too busy for him.
still_one
(92,217 posts)unstable
KarenS
(4,079 posts)Betty Karlson
(7,231 posts)questionseverything
(9,656 posts)we only know the results "fed" to us
this is the best documented case of election fraud in the country
Betty Karlson
(7,231 posts)Or are we now so corrupt that election-rigging is just par for the course when the GOP does it in Arizona?
questionseverything
(9,656 posts)Betty Karlson
(7,231 posts)Kevin from WI
(184 posts)Because he knows that there won't be enough money to fight endless wars if the economy crashes again. He needs the banking system to be stable so he can get back to his favorite hobby of bombing brown people.
SomeGuyInEagan
(1,515 posts)Sadly, it simply would not surprise me if that was an underlying reason that he is behind it. Can't kill if you can't buy bullets or bombs.
hifiguy
(33,688 posts)calimary
(81,310 posts)Frustratedlady
(16,254 posts)I should think by now, McCain would have siphoned off enough money to live nicely the rest of his life. Maybe Lindsay will make him VP if he wins the nomination. What a nightmare that would be.
jmowreader
(50,559 posts)His wife owns the biggest beer distributorship in Arizona. This is the real reason he ran with Palin in 2008 - evangelicals love her, and they threatened to stay home and throw the whole downticket to the Democrats if he didn't give in to them.
I'd put this down as atoning for being in the Keating Five.
ChazInAz
(2,569 posts)Ms. Kirkpatrick is AFTER his his wrinkled behind!
Heck, even I contributed to her.
Reter
(2,188 posts)He just loves war so much sometimes we don't see the good side of him. He's their Joe Liberman.
markpkessinger
(8,401 posts). . . but wait a week.
warmfuzzy
(11 posts)Very true. He'll do one good thing and then seem to have to make for it by doing dumb things.
jwirr
(39,215 posts)call our legislators again.
Updated TOLL FREE Capitol Hill switchboard numbers conveniently located in my sig line below.
navarth
(5,927 posts)mountain grammy
(26,623 posts)PatrickforO
(14,576 posts)of the new bill! I will be doing the same thing.
grahamhgreen
(15,741 posts)msongs
(67,413 posts)Sherman A1
(38,958 posts)This would be a wonderful thing.
Le Taz Hot
(22,271 posts)that Bill CLINTON signed out of existence? Let's see, I believe that helped the BANKERS, didn't it? I believe they have several PAC's ready to donate to various campaigns on both sides (with one exception). Maybe someone should follow the money and see what their bribes, er, I mean, incentives have bought them already.
UTUSN
(70,706 posts)Octafish
(55,745 posts)Since the repeal of Glass-Steagal, they've specialized in all kinds of Wealth Management:
http://financialservicesinc.ubs.com/revitalizingamerica/SenatorPhilGramm.html
It's all legal like.
Le Taz Hot
(22,271 posts)Well, that's a relief.
Octafish
(55,745 posts)What I wrote at the time -- September 2008, Le Taz Hot:
Know your BFEE: Phil Gramm, the Meyer Lansky of the War Party, Set-Up the Biggest Bank Heist Ever.
The Sting
In the best rip-off, the mark never knows that he or she was set up for fleecing.
In the case of the great financial meltdown of 2008, the victim is the U.S. taxpayer.
Going by the lack of analysis in Corporate McPravda, We the People are in for a royal fleecing.
Dont just take my word about the current situation between giant criminality and the politically connected.
[font color="green"][font size="5"]You see, there is evidence of conspiracy. An honest FBI agent warned us in 2004 about the coming financial meltdown and the powers-that-be stiffed him, too.[/font size][/font color]
The storys below. And its not fiction. It is true to life.
The Set-Up
You dont have to be a fan of Paul Newman or Robert Redford to smell a BFEE rat. The oily critters name is Gramm. Phil Gramm. He helped Ronald Reagan push through his trickle-down fiscal policy and later helped de-regulate the nation's once-healthy Saving & Loan industry. We all know how well that worked out: Know your BFEE: They Looted Your Nations S&Ls for Power and Profit.
In 1999, then-super conservative Texas U.S. Senator Gramm helped pass the Gramm-Leach-Bliley Financial Services Modernization Act. This law allowed banks to act like investment houses. Using federally-guaranteed savings accounts, banks now could make risky commercial and real-estate loans.
The law shouldve been called the Gramm-Lansky Act. To those who gave a damn, it was obviously a potential disaster. During the bills debate, the specter of a taxpayer bail-out was raised by Sen. Byron Dorgan of North Dakota, warning about what had happened to the deregulated S&Ls.
Gramm wasnt alone on the deregulation bandwagon. The law passed, IIRC, like 89-9. More than a few of my own Democratic faves went along with this deregulation, get-government-off-the-back-of-business law.
Today we have their love child, MOABfor the Mother Of All Bailouts.
The Mark
In a sting, someone has to supply the money to be ripped off. Crooks call that person the mark or target or mope. In the present case, thats the U.S. taxpayer.
Todays financial crisis seems like a re-run of what happened to the Savings & Loans industry in the late 1980s. Well it is a lot like what happened to the S&Ls. Then, as now, its the U.S. taxpayer who gets to pick up the tab for someone elses party.
Dont worry, U.S. taxpayer. Youre getting something (among several things) for your $700 billion. Youre getting all the bad mortgage-based paper on almost all of Wall Street. Id rather have penny stocks, because if there ever was something of negative value its the complicated notes and derivatives based on this mortgage debt.
When it comes to Bush economic policy, left holding the bag are We the People, er, Mopes. Dont worry, it cant get worse. As St. Ronnie would say, Well. Yes. You see, what the bag U.S. taxpayers hold is less than empty. Its filled with bad debt.
The Mastermind
Chief economist amongst these merry band of thieves and traitors was one Phil Gramm (once a conservative Democrat and then an ultraconservative Republican-Taxus). An economist by training and reputation, Gramm was one of the guiding lights of Reaganomics, the cut taxes, domestic spending, and regulations while raising defense-spending to new heights. In sum, it was a fiscal policy to enrich friends especially the kind connected to the BFEE.
Foreclosure Phil
Years before Phil Gramm was a McCain campaign adviser and a lobbyist for a Swiss bank at the center of the housing credit crisis, he pulled a sly maneuver in the Senate that helped create today's subprime meltdown.
David Corn
MotherJones.com
May 28, 2008
Who's to blame for the biggest financial catastrophe of our time? There are plenty of culprits, but one candidate for lead perp is former Sen. Phil Gramm. Eight years ago, as part of a decades-long anti-regulatory crusade, Gramm pulled a sly legislative maneuver that greased the way to the multibillion-dollar subprime meltdown. Yet has Gramm been banished from the corridors of power? Reviled as the villain who bankrupted Middle America? Hardly. Now a well-paid executive at a Swiss bank, Gramm cochairs Sen. John McCain's presidential campaign and advises the Republican candidate on economic matters. He's been mentioned as a possible Treasury secretary should McCain win. That's right: A guy who helped screw up the global financial system could end up in charge of US economic policy. Talk about a market failure.
Gramm's long been a handmaiden to Big Finance. In the 1990s, as chairman of the Senate banking committee, he routinely turned down Securities and Exchange Commission chairman Arthur Levitt's requests for more money to police Wall Street; during this period, the sec's workload shot up 80 percent, but its staff grew only 20 percent. Gramm also opposed an sec rule that would have prohibited accounting firms from getting too close to the companies they auditedat one point, according to Levitt's memoir, he warned the sec chairman that if the commission adopted the rule, its funding would be cut. And in 1999, Gramm pushed through a historic banking deregulation bill that decimated Depression-era firewalls between commercial banks, investment banks, insurance companies, and securities firmssetting off a wave of merger mania.
But Gramm's most cunning coup on behalf of his friends in the financial services industryfriends who gave him millions over his 24-year congressional careercame on December 15, 2000. It was an especially tense time in Washington. Only two days earlier, the Supreme Court had issued its decision on Bush v. Gore. President Bill Clinton and the Republican-controlled Congress were locked in a budget showdown. It was the perfect moment for a wily senator to game the system. As Congress and the White House were hurriedly hammering out a $384-billion omnibus spending bill, Gramm slipped in a 262-page measure called the Commodity Futures Modernization Act. Written with the help of financial industry lobbyists and cosponsored by Senator Richard Lugar (R-Ind.), the chairman of the agriculture committee, the measure had been considered deadeven by Gramm. Few lawmakers had either the opportunity or inclination to read the version of the bill Gramm inserted. "Nobody in either chamber had any knowledge of what was going on or what was in it," says a congressional aide familiar with the bill's history.
It's not exactly like Gramm hid his handiworkfar from it. The balding and bespectacled Texan strode onto the Senate floor to hail the act's inclusion into the must-pass budget package. But only an expert, or a lobbyist, could have followed what Gramm was saying. The act, he declared, would ensure that neither the sec nor the Commodity Futures Trading Commission (cftc) got into the business of regulating newfangled financial products called swapsand would thus "protect financial institutions from overregulation" and "position our financial services industries to be world leaders into the new century."
Subprime 1-2-3
Don't understand credit default swaps? Don't worryneither does Congress. Herewith, a step-by-step outline of the subprime risk betting game. Casey Miner
CONTINUED
http://www.motherjones.com/news/feature/2008/07/foreclo...
A fine mind for modern Bushonomics. Kill the middle class. Then, rob from the poor to give to the rich.
The Mentor
Anyone whos ever heard him talk knows that Gramm mustve learned all this stuff from somebody. He could never think it all up on his own. He had to have help. Thats where Meyer Lansky, the man who brought modern finance to the Mafia, comes in.
Money Laundering
Answers.com
EXCERPT...
History
Modern development
The act of "money laundering" was not invented during the Prohibition era in the United States, but many techniques were developed and refined then. Many methods were devised to disguise the origins of money generated by the sale of then-illegal alcoholic beverages. Following Al Capone's 1931 conviction for tax evasion, mobster Meyer Lansky transferred funds from Florida "carpet joints" (small casinos) to accounts overseas. After the 1934 Swiss Banking Act, which created the principle of bank secrecy, Meyer Lansky bought a Swiss bank to which he would transfer his illegal funds through a complex system of shell companies, holding companies, and offshore accounts.(1)
The term "money laundering" does not derive, as is often said, from Al Capone having used laundromats to hide ill-gotten gains. It was Meyer Lansky who perfected money laundering's older brother, "capital flight," transferring his funds to Switzerland and other offshore places. The first reference to the term "money laundering" itself actually appears during the Watergate scandal. US President Richard Nixon's "Committee to Re-elect the President" moved illegal campaign contributions to Mexico, then brought the money back through a company in Miami. It was Britain's Guardian newspaper that coined the term, referring to the process as "laundering." 3)
Process
Money laundering is often described as occurring in three stages: placement, layering, and integration.(3)
Placement: refers to the initial point of entry for funds derived from criminal activities.
Layering: refers to the creation of complex networks of transactions which attempt to obscure the link between the initial entry point, and the end of the laundering cycle.
Integration: refers to the return of funds to the legitimate economy for later extraction.
However, The Anti Money Laundering Network recommends the terms
Hide: to reflect the fact that cash is often introduced to the economy via commercial concerns which may knowingly or not knowingly be part of the laundering scheme, and it is these which ultimately prove to be the interface between the criminal and the financial sector
Move: clearly explains that the money launderer uses transfers, sales and purchase of assets, and changes the shape and size of the lump of money so as to obfuscate the trail between money and crime or money and criminal.
Invest: the criminal spends the money: he/she may invest it in assets, or in his/her lifestyle.
CONTINUED...
http://www.answers.com/topic/money-laundering
The great journalist Lucy Komisar has shone a big light on the subject:
Offshore Banking
The U.S.A.s Secret Threat
Lucy Komisar
The Blacklisted Journalist
June 1, 2003
EXCERPT
In 1932, mobster Meyer Lansky took money from New Orleans slot machines and shifted it to accounts overseas. The Swiss secrecy law two years later assured him of G-man-proof banking. Later, he bought a Swiss bank and for years deposited his Havana casino take in Miami accounts, then wired the funds to Switzerland via a network of shell and holding companies and offshore accounts, some of them in banks whose officials knew very well they were working for criminals. By the 1950s, Lansky was using the system for cash from the heroin trade.
Today, offshore is where most of the world's drug money is laundered, estimated at up to $500 billion a year, more than the total income of the world's poorest 20 percent. Add the proceeds of tax evasion and the figure skyrockets to $1 trillion. Another few hundred billion come from fraud and corruption.
Lansky laundered money so he could pay taxes and legitimate his spoils. About half the users of offshore have opposite goals. As hotel owner and tax cheat Leona Helmsley said---according to her former housekeeper during Helmsley's trial for tax evasion---"Only the little people pay taxes." Rich individuals and corporations avoid taxes through complex, accountant-aided schemes that routinely use offshore accounts and companies to hide income and manufacture deductions.
The impact is massive. The IRS estimates that taxpayers fail to pay in excess of $100 billion in taxes annually due on income from legal sources. The General Accounting Office says that American wage-earners report 97 percent of their wages, while self-employed persons report just 11 percent of theirs. Each year between 1989 and 1995, a majority of corporations, both foreign- and U.S.-controlled, paid no U.S. income tax. European governments are fighting the same problem. The situation is even worse in developing countries.
The issue surfaces in the press when an accounting scam is so outrageous that it strains credulity. Take the case of Stanley Works, which announced a "move" of its headquarters-on paper-from New Britain, Connecticut, to Bermuda and of its imaginary management to Barbados. Though its building and staff would actually stay put, manufacturing hammers and wrenches, Stanley Works would no longer pay taxes on profits from international trade. The Securities and Exchange Commission, run by Harvey Pitt---an attorney who for more than twenty years represented the top accounting and Wall Street firms he was regulating---accepted the pretense as legal.
"The whole business is a sham," fumed New York District Attorney Robert Morgenthau, who more than any other U.S. law enforcer has attacked the offshore system. "The headquarters will be in a country where that company is not permitted to do business. They're saying a company is managed in Barbados when there's one meeting there a year. In the prospectus, they say legally controlled and managed in Barbados. If they took out the word legally, it would be a fraud. But Barbadian law says it's legal, so it's legal." The conceit apparently also persuaded the Securities and Exchange Commission.
CONTINUED
http://www.bigmagic.com/pages/blackj/column92e.html
Socialize the risk for Wall Street. Privatize the loss to Uncle Sams nieces and nephews. Congratulations, Dear Reader! Now you know as much as Phil Gramm.
The Diversion
Still, a global financial meltdown sounds like something bad. Making things worse, were hearing that Uncle Sam is broke! Flat busted. Tapped out.
Thats odd, though. We the People see the Treasury being emptied with tax breaks for the wealthy and checks to the companies they own that make money off of war. Want to know how to make a buck these days? Invest in the likes of Halliburton and Northrup Grumman. Anything in the warmongering business connected to Bush and his cronies will weather the downturn or depression.
The Wall Street Journal -- a paper owned and operated by Fox News head, Rupert Murdoch was very quick to promote the crisis, as DUer JustPlainKathy observed. The paper was even faster to pounce on a solution: Whats needed is a safety net for banks. And quick as a wink, they found the answer!
Only the U.S. taxpayer has the wherewithal to prevent the collapse of the global financial system -- a global economic meltdown that would freeze up credit and investment and expansion and prosperity and a return to the Great Depression. Who can be against that?
Oh. Kay. Sounds about right Rupert the Alien agreeing with what Leona Helmsley said: Only the little people pay taxes.
Gramm and McCain also are in favor of privatization. How nice is that?
The Getaway
George Walker Bush and his right-wing pals feel they can get away with this, their latest rip-off the American taxpayers. Who can blame them? When compared to their clear record of incompetence, lies, fraud, theft, mass-murder, warmongering and treason, whats a few trillion dollar rip-off?
Still, it's weird how they act.
They must really think theyll be welcomed with open arms in Paraguay and Dubai and Switzerland.
Going by the welcome the world gave the Shah of Iran, theyre in for a big surprise.
The FBI Guy
Dont say we werent warned. An intrepid FBI agent with something sorely lacking in the rest of the Bush administration, integrity, blew the whistle on the bank thing
FBI saw threat of mortgage crisis
A top official warned of widening loan fraud in 2004, but the agency focused its resources elsewhere.
By Richard B. Schmitt
Los Angeles Times Staff Writer
August 25, 2008
WASHINGTON Long before the mortgage crisis began rocking Main Street and Wall Street, a top FBI official made a chilling, if little-noticed, prediction: The booming mortgage business, fueled by low interest rates and soaring home values, was starting to attract shady operators and billions in losses were possible.
"It has the potential to be an epidemic," Chris Swecker, the FBI official in charge of criminal investigations, told reporters in September 2004. But, he added reassuringly, the FBI was on the case. "We think we can prevent a problem that could have as much impact as the S&L crisis," he said.
Today, the damage from the global mortgage meltdown has more than matched that of the savings-and-loan bailouts of the 1980s and early 1990s. By some estimates, it has made that costly debacle look like chump change. But it's also clear that the FBI failed to avert a problem it had accurately forecast.
Banks and brokerages have written down more than $300 billion of mortgage-backed securities and other risky investments in the last year or so as homeowner defaults leaped and weakness in the real estate market spread.
SNIP
Most observers have declared the mess a gross failure of regulation. To be sure, in the run-up to the crisis, market-oriented federal regulators bragged about their hands-off treatment of banks and other savings institutions and their executives. But it wasn't just regulators who were looking the other way. The FBI and its parent agency, the Justice Department, are supposed to act as the cops on the beat for potentially illegal activities by bankers and others. But they were focused on national security and other priorities, and paid scant attention to white-collar crimes that may have contributed to the lending and securities debacle.
Now that the problems are out in the open, the government's response strikes some veteran regulators as too little, too late.
Swecker, who retired from the FBI in 2006, declined to comment for this article.
But sources familiar with the FBI budget process, who were not authorized to speak publicly about the growing fraud problem, say that he and other FBI criminal investigators sought additional assistance to take on the mortgage scoundrels.
They ended up with fewer resources, rather than more.
CONTINUED
http://www.latimes.com/business/la-fi-mortgagefraud25-2008aug25,0,6946937.story
We were warned and nothing happened.
Repeat: And nothing happened.
They must think We the People are really stupid. Are we supposed to believe that all that $700 billion in bad debt just happened? Where did all that money go? Who got all the money?
Meyer Lansky moved the Mafias money from the Cuban casinos to Switzerland. He did so by buying a bank in Miami. Phil Gramm seems to have done the same thing as vice-chairman of UBS, except the amounts are in the billions.
Who cares? Hes almost gone? Nope. That money still exists somewhere. I have a pretty good idea of where it might be. And George Bush and his cronies are poised to get away with a whole lot of loot.
Who Should Pay for the Bailout
If you are fortunate enough to be one, good luck American taxpayer! Youre in for a royal fleecing. Once the interest is figured into the bailout, were looking at a couple of trill.
The people who should pay for the bailout arent the American people. That distinction should go to the crooks who stole it -- friends of Gramm like John McCain and George Bush and the rest of the Raygunomix crowd of snake-oil salesmen. For them, the Bush administration -- and a good chunk of time since Ronald Reagan -- has not been a disaster. Its been a cash cow.
The above was posted on DU on Sept. 21, 2008. (Check out the responses, lots of info from DUers.) What's changed since then? Nothing near what We the People interested in Justice would have hoped for, certainly.
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x4055207
Le Taz Hot
(22,271 posts)people. I've always admired your tenacity to gather evidence and then present it.
Octafish
(55,745 posts)Truth is: I'm no smarter than anybody, just older -- and I used to be a newspaper reporter.
annabanana
(52,791 posts)what's what and how it got that way . . .
L0oniX
(31,493 posts)hifiguy
(33,688 posts)You have the art of saying a lot with a few words
Octafish
(55,745 posts)Love ya, malaise!
malaise
(269,050 posts)Octafish - wicked graphic 'dat'
awoke_in_2003
(34,582 posts)Rosa Luxemburg
(28,627 posts)and Bill Clinton signed it.
1StrongBlackMan
(31,849 posts)I just hope it can be dragged out until the General Election debates ... since all of the Democratic candidates support the re-instatement and none of the republican's 27 candidates have even spoken to it.
ETA: Sitting Democrats can help their case/cause by introducing similar progressive-type legislation between now and the General Election debates.
LondonReign2
(5,213 posts)I made an admittedly very hasty search and didn't find that, can you provide a link? Thank you
1StrongBlackMan
(31,849 posts)More strenuous banking regulation.
I'm on my phone so I can't drop a link, showing what that would look like.
Further, do you really think she would oppose reinstatement
?
rhett o rick
(55,981 posts)brought back or at least that she wants to see investment banking separated from personal banking.
hifiguy
(33,688 posts)its repeal, I wouldn't be holding my breath, sir.
The Commission gets what it wants from the people who work for it, don't we Mr Luciano?
1StrongBlackMan
(31,849 posts)rhett o rick
(55,981 posts)Steagall? She makes a good speech on how she wants to help the 99% but I can't find where she is willing to raise taxes on the wealthy. In her last speech she said she wants all Americans to do better. Sounds a lot like "rising tides lifts all boats". That's fine for those with boats. She said she wants to reward those companies that invest for a long term gain. That of course means at the taxpayer expense. I would rather she said she would like to punish those companies that move jobs out of the country. She said she wants to subsidize housing for firefighters, etc. That sounds good but unless we change the tax system, it means that the 99% are subsidizing each other.
And re the "debates", I don't trust the DNC to be fair to challengers to their chosen candidate.
1StrongBlackMan
(31,849 posts)I found a lot about more banking regulation; but nothing specific to GS.
But again, I can't she her coming out in opposition to reinstatement. So I say, go sitting Democrats ... more progressive legislation to force issues, please.
LondonReign2
(5,213 posts)than supporting reinstatement of Glass-Steagall. "More strenuous regulation" is completely generic and ultimately means nothing without specifics, which Hillary as a rule of thumb doesn't like to give.
Do I think she would oppose reinstatement? Very much so, that's why I asked for a link. Given that her husband signed the repeal and that her biggest donors would very much be against a reinstatement, I very much doubt she would be in favor.
1StrongBlackMan
(31,849 posts)Supporting "more strenuous banking regulation" is very different than supporting reinstatement of Glass-Steagall.
I suspect that EVERY Democratic candidate will get behind reinstatement, and just about whatever progressive legislation introduced, however vaguely; and, will be full-throated in support of any progressive that makes it out of committee.
Octafish
(55,745 posts)"Yeah. See. Move on!"
From the "DU Told You So Department"...
Parsons Blames Glass-Steagall Repeal for Crisis
By Kim Chipman and Christine Harper - Apr 19, 2012 8:48 PM ET
Bloomberg
Richard Parsons, speaking two days after ending his 16-year tenure on the board of Citigroup Inc. (C) and a predecessor, said the financial crisis was partly caused by a regulatory change that permitted the companys creation.
The 1999 repeal of the Glass-Steagall law that separated banks from investment banks and insurers made the business more complicated, Parsons said yesterday at a Rockefeller Foundation event in Washington. He served as chairman of Citigroup, the third-biggest U.S. bank by assets, from 2009 until handing off the role to Michael ONeill at the April 17 annual meeting.
SNIP...
U.S. Bailout
People have a sort of a notion that well, we can decide thats too big to manage, he said. But it got that way because there was a market need and institutions find and follow the needs of the marketplace. So what we have to do is we have to learn how to improve our ability to manage it and manage it more effectively.
Citigroup, which took the most government aid of any U.S. bank during the financial crisis, has lost 86 percent of its value in the past four years, twice as much as the 24-company KBW Bank Index. (BKX) Most shareholders voted this week against the banks compensation plan, which awarded Pandit about $15 million in total pay for 2011, when the shares fell 44 percent.
CONTINUED...
http://www.bloomberg.com/news/2012-04-19/parsons-blames-glass-steagall-repeal-for-crisis.html
I knew Warren would do something to stop the crooks! McCain seems to think hiding in plain sight will protect his historic role in financial deregulation.
Kevin from WI
(184 posts)From the good old days of the Republican Party. Such found memories... that they wish we would forget. Thanks for posting and the accompanying link.
Octafish
(55,745 posts)Worked like a multi-trillion dollar charm, too. Ask William K. Black who as a federal regulator -- an attorney and forensic economist -- helped send thousands of S&L crooks to prison. Strangely, to those interested in Justice, he was ignored by the past and current administrations.
Black wrote "The Best Way to Rob a Bank Is to Own One." He also coined the term "Control Fraud" to describe how a financial institution's CEOs and COOs could lead banks to financial ruin, but personally profit Big Time.
Remember, this (warning) was written nearly 30 years ago. We have known for a very long time that modern executive compensation plus deregulation created an intensely criminogenic environment that could lead bank CEOs leading accounting control frauds to make epic amounts of bad loans in order to optimize fictional reported income and the CEOs compensation.
SOURCE: http://neweconomicperspectives.org/2012/02/amazing-vanishing-act-accounting.html
PS: You are most welcome, Kevin from WI! The only way we'll restore Justice is to demand it.
Gumboot
(531 posts)... but more often than not, it's facepalm-a-rama.
Kudos where it's due, though. Let's hope this one gets signed through ASAP.
JackInGreen
(2,975 posts)It's about time we got legislation to mend that tear
shaayecanaan
(6,068 posts)the problem wasn't the repeal of Glass-Steagall, the problem was that a bunch of banks were writing mortgages with their eyes shut.
Glass Steagall prevented retail banks from running investment banks on the side. It still does, largely. What Bill Clinton did was allow vanilla banks and investment banks to be held by the one holding company.
The banks that ran into trouble in 2008 (Bear Sterns, Lehmann, Fanny Mae, Freddie Mac, etc) were all banks that were fully entitled to issue residential loans, with or without Glass Steagall. Even if Glass Steagall hadnt been repealed, they still would have hit the wall.
The problem is inherent in banking itself. No one gives a shit which bank that they get their loan from, one bank's money is as good as another.
There are only three ways, therefore, in which a bank can effectively compete or expand its market share. One is by assuming monopoly power, by buying competitors or becoming effectively the only game in town.
Two, by reducing interest rates on loans, to offer people the cheapest deal and attract them away from the competition.
Three, by reducing lending standards, to be able to offer loans to more people.
Number two and number three inevitably lead to ruin (specifically, number two led to the savings and loans crisis during the 80s, and the relaxation of lending standards had a big impact in 2008).
The problem with American banks is not that they are too big, but that they are too small and numerous. They therefore have to enter into genuine competition with each other. Competition leads to winners and losers. Losers typically go broke. Banks going broke is not a good thing.
The countries that have avoided banking collapses are typically those dominated by huge oligopolies (Canada, Australia) that make reliable profits because they prevent genuine competition.
The preferable alternative is that the banking sector is nationalised by the government. Given that the government effectively assumes the risks of the banks anyway, this is really just cutting out the middleman.
Enthusiast
(50,983 posts)Thinkingabout
(30,058 posts)get Congress to accept their responsibilities. Hopefully this will not get derailed.
Recursion
(56,582 posts)The repeal had nothing to do with the 2008 crisis and bringing it back won't prevent another one so nobody really bothered until now. It's a decent symbol but that's all it is. (It doesn't "keep banks from gambling with your money" or whatever this week's catch phrase is.)
hifiguy
(33,688 posts)If the banksters can't gamble with federally guaranteed deposits, you can bet your ass there will be a dramatic reduction in gambling. When Glass-Steagall was around, banks were FORBIDDEN from even affiliating with securites companies. And it is the merger of highly risky and speculative investment banking with "normal" banks that take deposits that was the touchstone for the meltdown. It never could happened if Glass-Steagall had still been in force and enforced.
I'd read some Nomi Prins if I were you.
bigtree
(85,998 posts)Thanks @SenWarren @SenJohnMccain @SenatorCantwell @SenAngusKing for reintroducing Glass-Steagallit's essential in preventing another crash.
Martin O'Malley @MartinOMalley 19h19 hours ago
We must prevent another Wall Street meltdown from bringing down hard-working families. http://omly.us/1HKE5Wb
Raine1967
(11,589 posts)davidpdx
(22,000 posts)emulatorloo
(44,131 posts)Darb
(2,807 posts)Wouldn't be the first time he made political choices with his little head.
brer cat
(24,576 posts)TM99
(8,352 posts)McCain may be a hawk but he has often been rather moderate on other issues.
I respect him for doing this with Warren.
lovemydog
(11,833 posts)And I also agree with Warren and Sanders: break up the big banks!
HoosierCowboy
(561 posts)You can't have war on someone else's dime and win. Now the financial system must be rehabilitated before war can continue.
Simple really...
EndElectoral
(4,213 posts)City Lights
(25,171 posts)I wonder what's gotten into him.
nolabels
(13,133 posts)and nowadays an (r) gets a couple of free passes here and there just because most know those little blurbs never really go anywhere other then just touching base and creating talking points
Stellar
(5,644 posts)Recursion
(56,582 posts)At least it's something, even if it's something entirely symbolic and pointless
Recursion
(56,582 posts)or prevent them from being too big to fail.
malthaussen
(17,202 posts)Although, aargh, now I can't scrub from my mind the image of McCain and Warren in bed together...
-- Mal
lark
(23,105 posts)I didn't know he had any of these left in him,
colsohlibgal
(5,275 posts)The rest of the republican party is such a clown posse enabling McCain to look almost sane compared to them.
KamaAina
(78,249 posts)Can't be. It must be that guy Edwin McCain from South Carolina who had a hit in the wake of Hootie and the Blowfish's success.
SCantiGOP
(13,871 posts)McCain is on the short list of 'less crazy' Republicans.
Rex
(65,616 posts)I love watching the Right go over a cliff over regulations! Poor babies!
Akicita
(1,196 posts)Marrah_G
(28,581 posts)CTBlueboy
(154 posts)we have Democrats in the senate that will oppose it Sen. Chris Murphy of CT , Sen. Schumer of NY just names off the top of my head
libodem
(19,288 posts)Dont call me Shirley
(10,998 posts)Raster
(20,998 posts)The Palin Affair.
Dont call me Shirley
(10,998 posts)rhett o rick
(55,981 posts)He didn't even like her.
Raster
(20,998 posts)It does not matter who brought her or who did or did not vet her, it was ultimately the decision of the McCain campaign and he is John McCain. He was "the decider."
sulphurdunn
(6,891 posts)will never willingly vote for: reintroduction of Glass-Steagall, reducing financial aid to Israel, public financing of federal elections, gun control laws, and significant cuts to the MIC budget.
Uncle Joe
(58,365 posts)Thanks for the thread, applegrove.
warmfuzzy
(11 posts)Surprised McCain's name is on it, but OK. It's about time!
still_one
(92,217 posts)It would be good for sure, but not sure they have the votes, especially in the house
awake
(3,226 posts)are some of the worst things Bill Clinton signed, this is why I am suspect of Hillary and what she might do. The Clinton's are "Republican light" working for Walmart, Tayson food and Wall-street Banksters.
nikto
(3,284 posts)If a politician is against Glass-Steagall protections being re-instated, he/she is a corrupt, bought
little tool of bankster$ and investor-pig$.
If a politician fully supports re-instatemnent of Glass-Steagall protections, he/she is
a sincere servant-of-the-people, and is trying to do what's right for the country on this issue.
That's all.
The distinction is that simple.
This is one of the easiest and clearest issues in recent American History, along with (opposing) TPP.
Raine1967
(11,589 posts)a part of reintroducing this legislation? It's a serious question. Has he ever tried to reintroduce this with other members of the senate? Right now, Sanders is the only one of the three leading candidates running for office that is currently in the senate.
I would LOVE to see it brought back. I know that Clinton has not called for it to be brought back.
I also know that O'Malley has been calling for it to be reinstated for a long time. http://www.dailykos.com/story/2015/03/21/1372360/-Martin-O-Malley-Reinstate-Glass-Steagall-Break-up-the-Banks
1) Replace CEOs at banks who are repeat offenders
2) Appoint people to positions like AG and SEC Chairman who will aggressively prosecute bank criminals
3) Force the banks who break the law to admit their actions and face consequences.
4) Banks must bear the full weight of financial penalties and stop them from deducting their penalties from their taxes
5) Establish a Three Strikes policy - repeat offenders must get their right to operate revoked.
O'Malley concludes with what we most progressives already know:
Its time to put the national interest before the interests of Wall Street.
The future of our economy and Americas middle class depends on it.
I want Glass-Steagall brought back.
elleng
(130,967 posts)If he HAS, you'll be so informed.
Raine1967
(11,589 posts)Shouldn't he be working with Warren on this?
Isn't this the very thing he's running for/about?
I know that if it ever reaches the senate floor he will vote *yes* but I really wish he was the one who introduced it. Sanders does not introduce legislation that is passed. What these two senators are doing is wonderful. It's bipartisan and important
anyway, as I linked above, we have a candidate that would be more than willing too sign this into law because he already proposed it as part of his policy platform.
Thank you senators Warren and McCain!
MFrohike
(1,980 posts)I'm surprised to see him as a sponsor, but not supporting it. For all his faults and we all know they're many, he does have a bit of consistency when it comes to supporting a certain bedrock of federal regulation. He opposed Cheney's gutting of New Deal energy/utility regulation back in 2006, which is something the president can't say.
I'm no fan of McCain but I believe it's best to cheer them when they're right and give them hell when they're wrong.
0rganism
(23,957 posts)much as the GOP hates it, the quickest way to get it out of sight again is pass it through the senate and bury it in a house subcommittee.