Tuesday June 16, 2009, 1:58 pm
This fascism in it's true form.
The government has no place in the private sector.

Tuesday June 16, 2009, 4:23 pm
Unless and until the financial system is reregulated other so-called reforms will not work.

Provided the financial system is recapitalised correctly, and properly supervised, it can regulate itself. This kind of reform needs to be international in character, otherwise bad loans go off shore to where they are not so well regulated.

It is not the institution which needs correct capitalisation so much as the loan.e.g banks which make sub prime loans are not worth guaranteeing, credit unions which do not are.

The safety of any organisation depends upon the quality of its assets and management. Ask General Motors or Lehmann Bros!

Tuesday June 16, 2009, 4:26 pm
Mary, you'll have a worse economic disaster on your hands if we don't get immediate health care reform; we already gie I$rael $10million a day and they all get free health care and free higher education and we haven't even rebuilt New Orleans, while I$rael continue$ to build illegal $ettlements on the American taxpayers' dollar$ ..

It's time the U$A took care of its own citizens ...

High Cost of Healthcare Puts U.S. at Bottom in Overall Quality Among Industrialized Countries

Tuesday June 16, 2009, 5:32 pm
This is BAD!

Tuesday June 16, 2009, 5:47 pm
Wow Mary!
Seriously,that was well said.
Might I ask where you got your information from?I have doing some research but kinda hit a dead end.

My Mom-N-Law use to work in Radio years ago.
And we had a discussion with her this past weekend about Regean's deruglation of everything,and it's effects on American business.
she is a democrat so I was thinking ya know it would end in fight like it always does.but it was really great conversation.
she said before the deruglation radio companies could only own two radio stations at a time and had to do things like free public service annoucements.Things like that.So she is for what the government is doing,but she thinks it's just regulating the private sector.Which it is not.This is way different from regulation.They are actually owning and even determining which companies will succede and which will fail.
so there is a big differences between Regualtion and what is happening.
Which I think everybody Republicans,Conservatives,etc all want regulation.But want to fight the exapansion of government.
And that is what is happening.Expansion of the government at the csot of our freedoms.

Tuesday June 16, 2009, 7:00 pm
Blue Bunting I agree with you. The health care system in the USA seems to be in a mess. Additionally the Social Security System is too. Many factors in these (and other) areas are unfunded; as such they are Ponzi schemes under another name relying on future taxpayers to foot the bill. Future taxpayers are fewer in number and unlikely to be as able to pay as past taxpayers.

Lady Libertarian

Thanks for the compliment! A good source of information on this kind of thing is "The Ascent of Money".

Regulation is not the the same thing as control or lack of freedom. Everyone and everything needs a few basic rules in order to operate effectively. The people of the USA regard themselves as a bastion of freedom, and in order to achieve that goal they have a few basic rules called the US Constitution as amended, the Bill of Rights etc.

In the same way that governments do not need to own things such as radio stations or financial institutions etc., they need to provide basic ground rules, so that operators know what they should or should not do. Then it is up to the operators to operate, and survival of the fittest will take care of things, provided the rules are enforced.

Democracies are not all the same and achieve their goals differently. e.g. the USA is a commercial republic, whereas Norway is a welfare monarchy. Both countries achieve relatively high quality outcomes with their different systems.

Many things run in cycles, and communities frequently decide to deregulate, reregulate etc. Since shortly after WWII much of the international community decided to deregulate. It did so when times were good, basing their actions on the good times lasting without too many blips to the system. Unfortunately such decisions are flawed because efficient regulation takes account of both good and bad times.

Recently many in the international community learnt the hard way that we cannot continue to depend upon the American consumer for our livelihoods.That is because consumption, especially consumption based on debt, runs out sooner or later, usually sooner than any of us would like.

When banks etc. begin lending money long term which customers cannot repay, and deveolp securities based on those bad loans, the system collapses--at least temporarily. It follows that some reregulation is then needed.

Debt is a crucial question at the moment. At least some of it needs to be repaid. Those with money need to lend it to those without it--in a sustainable way. President Obama seems to be attempting to do that.

Given the attitude of the people of the USA his current actions will be a means to correct a temporary problem, not a means to establish government control of everything permanently. Let us all hope it works.

Tuesday June 16, 2009, 7:03 pm
No more socialism, this is scary stuff President Obama is doing, noted Cal

Tuesday June 16, 2009, 7:12 pm
That was great.
And although I agree with on all the aspects of the problem,and even the solution of rereglation.I really don't think that is what the Adminstrations intentions are.I think regulation would be great.Something we need desperately.
But the government should set the regulations and make sure the private sector is doing what it should.But they should control,or bailout corporations and then have the pwoer to say whose fails and whose doesn't.
It's like what is happening with many of these car dealerrships they are closing.Many were making a profit.But GMC has decided toclose them.Why close dealerships that are doing well,cause more unemployment, and just sink the ship they are trying to save.It really makes no sense.

But hopefully it will be temporary.But with all the Czars and things like that it really looks like they are here to stay.

i will totally get that book.Thank you.I appreciate it.
Have a good nite.

Tuesday June 16, 2009, 8:31 pm
I have mixed feelings about this, but I do believe that the credit card companies, such as Chase Bank and Capital One need to definitely be monitored by someone! They have increased interest rates in some cases to 33% per month! It is atrocious. If laws can't be followed, unfortunately government or lawmakers step in and it seems our society and many or our busnesses don;'t seem to be able to stay within the law because they are guided by greed and then historically, we begin the process of government control. It affects all of us, including the honest business people.

Wednesday June 17, 2009, 6:31 am
If there is no regulation, you may as well say there is no law. You can't allow industries to police themselves. It doesn't work and the reasons should be obvious. The government does not need to control anything, but yes there do need to be same regulations in place in order to protect US, the consumers, the citizens whose lives have been ruined in large part due to deregulation and everything that followed. There are no ethics in the corporate world anymore or in most businesses. This is wrong and is most certainly not democratic to not have any rights or say regarding your job. There is no longer any loyalty whatsoever to the individual employee, just the bottom line. It has not always been this way. You think we don't need any government intervention in the corporate world, yet you want them to take control of the medical??? This is hypocritical. It's the medical that is still most likely to be exploited.

Wednesday June 17, 2009, 6:34 am
so I want to pose a question.....

Does everyone agree or disagree that there is a difference between Regulation and Ownership by the Federal Government of the private sector?

If you agree why?

If you disagree why?

And which is it that the government is actually doing?

Wednesday June 17, 2009, 7:09 am
There is a huge difference. Regulations basically are only rules set in place to prevent corrupt practices. The government is not taking over ownership even though it may appear that they are initially just because they are stepping into the waters, taking control when necessary to prevent further disaster and damage.

Wednesday June 17, 2009, 2:06 pm
Very interesting arguments and discussions. My question is: Where do ya'll think the US would be now, if President Obama had not taken steps to shore up the financial; bad boys? Health care reform is so ncessary and yet, I am on SS Disability, I have been thru multiple tests to determine the cause of pain in my L abdomen. Guess what, I don't have the big C, nor do I have colon probs, stomach probs, kidney probs, or anything else because the fact is they don't know. My last Dr. wants to do exploratory surgery, sorry not for me!! Also, Social Security would be ok if the powers that be would have left it alone!!

Wednesday June 17, 2009, 5:33 pm
According to Webster ownership is possession, regulation is governing according to rule, therefore there is a difference between the two thigs.

In a capitalist society governments try to own as little as possible and regulate when necessary.

This current debacle demonstrated that the current regulations were either inappropriate, or ignored.

The solution is to construct regulations which take into account:

1 if an organisation is too big to fail it is too big to exist; and

2 the quality of an organisation's assets is its most important safeguard.

Ownership by governments or anybody else does nothing to help in that regard in the long run, efficient regulation with which people comply does.

New regulations may minimise the impact of the next debacle, they will not prevent it from happening, because there are always smarties who try to work their way round current laws, regulations, and ways of doing things. When they get it wrong we all suffer.

Wednesday June 17, 2009, 5:40 pm
Mary, since RayGun the financial system hasn't been regulated properly, why do you suppose that is?

Wednesday June 17, 2009, 7:16 pm
Blue Bunting

The American financial system became progressively more deregulated since Ronald Reagan in the wrong ways, and those regulations which were in place were not properly enforced. e.g. In 1993 Investment Banks were allowed to become associated with Commercial Banks which had more restrictions upon them than Investment Banks. As Commercial Banks have much less idea about how investment banks work, most importantly that investment banks do riskier business they found themselves in situations with which they did not cope well.

When things are going well deregulation sounds fine, as it is all the time if adequate capital is held. Capital adequacy is having enough money to fund problems; it usually takes the form of reserves of some kind. It is similar to an individual putting something aside for a rainy day.

In good times not enough capital can be put aside, so when the rainy day comes there was no back up. Some results were exit Savings and Loans in the 1980s, Enron 12/2/01, Worldom.Inc 7/21/02, Lehman Bros 19/15/08 Washington Mutual 9/26/08, and GM 6/1/09, another was AIG's mess, to name a few.

Appropriate capital adequacy ratios allow financial institutuions to regulate themselves, provided those ratios are enforced.

How much less damaging do you suppose the sub-prime mortgage debacle might have been if the financiers had been required to put 75% of the loan value into capital adequacy?

Wednesday June 17, 2009, 7:47 pm
Mary, why do RepubliCON$ hate our country?

"Phil Gramm? Wait, what did he do wrong?" Former Senator Phil Graham-- or as he was also known Senator Enron-- did so much wrong it boggles the mind. He pushed through the repeal of Glass-Steagall (banking regulations in place from 1932-1999). He pushed through energy deregulation, and an end to the prevention of oil speculation (which lead to oil speculation and Enron coming into CA and robbing us blind like Bonnie & Clyde). When he left the Senate, he went to work for the United Bank of Scotland as a lobbyist-- but before he left the Senate, he pushed AGAINST banking disclosure requirements that would have made it easier for us to track the money that funds terrorists against our Country.... what did Phil Graham do wrong? The better question since Phil Graham did SO MUCH wrong, is what did he not do wrong, if anything?
http://www.huffingtonpost.com/m.s.-bellows/obama-rapid-response-ad-s_b_127636.html

You and UBS

Swiss bank accounts. Just the term brings with it a mysterious, dangerous air. A place for shadowy assassins to pick up their pay. International agents collecting on acts of extortion. Dusty hordes of Nazi treasure.

However, Swiss giant UBS has admitted to something just as illegal, and a good deal more tawdry. They have been using their operations in the US to lure wealthy Americans into plopping their millions into UBS accounts, where they can evade taxes.

UBS is complaining that, shortly after the Bush administration came to
town in 2001, they signed a get out of jail free card with the IRS; a
contract that authorized UBS to hide their clients' identities as long
as UBS promised they would follow the rules. Now UBS is holding to the
principled position of no-takey-backseys.

As many as 60 Swiss-based private bankers who were not licensed to operate in the U.S. traveled to the United States with encrypted laptop computers to maintain client secrecy and got training on how to avoid detection by U.S. authorities, according to the statement filed Feb. 18.

What would cause UBS to feel that they could operate in such a way? And why would the IRS sign an agreement giving them the status to act as a proxy for the government?

Surely it wasn't because the the man who is now the vice chair for investments at UBS was then a Texas Senator, friend and adviser to Bush, and chairman of the Senate Banking Committee, Phil Gramm.

Let's wind the tape back a bit. In 1999, Gramm pushed through the Gramm-Leach-Bliley Act, which passed on the last day before the Christmas break as an attachment with no debate in either the House or Senate. That bill destroyed most of the protections that had been put in place after the bank failure of the 1930s.


This act repealed part of the Glass-Steagall Act. This may sound like a bunch of Congressperson soup, but the gist of it is that Glass-Steagall was put in place in 1933 to control the rampant speculation that had helped cause the collapse of banking at the outset of the Depression, and to prevent such consolidation of the banks that the nation had all its eggs in one fiscal basket.

Gramm-Leach-Bliley reversed those rules, allowing not only more bank mergers, but for banks to become directly involved in the stock market, bonds, and insurance.

The very next year, Gramm was back again with the Commodity Futures Modernization Act. This bill was passed as an attachment to a "must pass" spending bill on the very last day of the 106th Congress. That bill earned Gramm the position as one of the key players in deregulating derivatives.

"I think we would do well to remember the Lincoln adage that to ask a society to live under old and outmoded laws--and I think you could say the same about regulation--is like asking a man to wear the same clothes he wore when he was a boy." -- Phil Gramm

The CFMA provided protection for such clever creations as the Credit Default Swap, fostered a huge and growing market for derivatives of all types, and explicitly wrote into law the "Enron loophole" that allowed energy traders to manipulate the price and availability of electricity in California a few months later. In exchange, the banks poured more than $1 million into Gramm's campaign coffers.

A year after that, UBS got it's special agreement with the IRS, and a few months later Phil Gramm stepped down from the Senate early to take his spot as a vice-chairman for investment banking with UBS. While still in his position at UBS, Gramm would become a registered lobbyist for additional changes in banking law. In 2007, he became chief economic adviser and co-chair of the campaign for his long time friend, John McCain. Gramm also wrote McCain's economic plan. Had McCain won the election, Phil Gramm might very well be Secretary of the Treasury today, if he was willing to take the pay cut, were it not for a couple of unfortunate comments.


"We have sort of become a nation of whiners. You just hear this constant whining, complaining about a loss of competitiveness, America in decline," the former Texas senator said. "You've heard of mental depression; this is a mental recession."

Gramm was defended for his statements by that favorite non-economist of the right, Amity Shlaes, who is always so dead right in her analysis of the economy.

...to liken the current moment to the Great Depression, or even the early 1980s, as Campaign Economists have, is to whine, just as Gramm said.

However, Americans in general weren't so quick to accept that the misery they were experiencing, and the grim forecast looming over the country, was just in their heads.

Gramm was unrepentant. Just this past summer Phil Gramm sat down for a friendly chat about the economy that he, more than any other single person, helped to create. Though he was proud of his actions, there were certainly things going
on that Gramm didn't like. In particular, he was upset because CEOs and Wall Street bankers were underpaid.

Most of his former colleagues probably can't fathom why Wall Street bankers make tens of millions of dollars in salaries and bonuses each year. How would he justify these fat pay days? "It's simple," he lectures, sounding very much like the Texas A&M economics professor that he was in the 1970s: "In economics, we define labor exploitation as paying people less than their marginal value product. I recently told Ed Whitacre [former CEO of AT&T, who retired with a $158 million pay package] he was probably the most exploited worker in American history because he took Southwestern Bell, which was the smallest of the former Bell companies, and he turned it into the dominant phone company on earth. His severance package should have been billions."

Ladies and gentlemen, Phil Gramm. Exemplar of Republican economic policy and the author of our economy.

If leaders are so completely responsible for corporate success that they deserve all the credit (and money) when a company succeeds, does the same apply when they are abject failures? If so, UBS should send Gramm the bill for leading their investment wing into massive losses.

When they're done, can we send Gramm the bill for our economy?


Permalink


Seeing the Forest: More Republican hatred of America


Last month a Republican governor talked about his state leaving the United States. Now we learn that a Republican Congressman met privately with Chinese Government officials and told them they should not believe the Obama administration's budget numbers. He was asking them to stop lending to the U.S. and dump US dollars, which would result in economic panic and otherwise great harm to our country.

Wednesday June 17, 2009, 7:55 pm
"American Empire Is Bankrupt"

That meeting that Ahmadinejad put off attending for one day? Just "the most important meeting of the 21st Century," per Michael Hudson.


[This meeting]...Monday and Tuesday in Yekaterinburg, Russia, (formerly Sverdlovsk) among Chinese President Hu Jintao, Russian President Dmitry Medvedev and other top officials of the six-nation Shanghai Cooperation Organization. The United States, which asked to attend, was denied admittance. Watch what happens there carefully. The gathering is, in the words of economist Michael Hudson, “the most important meeting of the 21st century so far.”

Hedges opens his essay with this paragraph:

This week marks the end of the dollar’s reign as the world’s reserve currency. It marks the start of a terrible period of economic and political decline in the United States. And it signals the last gasp of the American imperium. That’s over. It is not coming back. And what is to come will be very, very painful (thanks to the RepubliCON crook$ and liar$).

Thursday June 18, 2009, 5:44 am
Blue I think in your zeal to attach blame to a scapegoat you are missing a very important factor.....
This is a two party country and therefore Democrats are just to blame for this crisis as any Republican.

In the 1990's, Barney Frank’s efforts to deregulate Fannie Mae may have been a serious conflict of interest because his lover, Herb Moses, was an executive for Fannie Mae at the time Frank's was on the House Banking Committee, which had jurisdiction over Fannie Mae.



Unqualified home buyers were not the only ones who benefitted from Massachusetts Rep. Barney Frank’s efforts to deregulate Fannie Mae throughout the 1990s.

So did Frank’s partner, a Fannie Mae executive at the forefront of the agency’s push to relax lending restrictions.

Now that Fannie Mae is at the epicenter of a financial meltdown that threatens the U.S. economy, some are raising new questions about Frank's relationship with Herb Moses, who was Fannie’s assistant director for product initiatives. Moses worked at the government-sponsored enterprise from 1991 to 1998, while Frank was on the House Banking Committee, which had jurisdiction over Fannie.

"It’s absolutely a conflict," said Dan Gainor, vice president of the Business & Media Institute. "He was voting on Fannie Mae at a time when he was involved with a Fannie Mae executive. How is that not germane?

"If this had been his ex-wife and he was Republican, I would bet every penny I have - or at least what’s not in the stock market - that this would be considered germane," added Gainor, a T. Boone Pickens Fellow. "But everybody wants to avoid it because he’s gay. It’s the quintessential double standard."


Read the whole thing. There needs to be some serious investigations on this matter.

No wonder Bill Clinton said "I think the responsibility that the Democrats have may rest more in resisting any efforts by Republicans in the Congress or by me when I was president, to put some standards and tighten up a little on Fannie Mae and Freddie Mac."

The point is no longer who is to blame.Because there is a list a mile long and mile wide with names of Republicans and Democrats alike.

The issue now is "How do we fix this,without destroying what America was built on?" ie personal rights,free market.

Thursday June 18, 2009, 3:17 pm
Lady L

You are on the ball.

Blue B

The American Empire is not bankrupt yet.

Everybody where can I find a useful summary of Obama's peopsals for financial reform? Thanks!

Thursday June 18, 2009, 6:40 pm
Mary for non-partisan information concerning the Stimulus,Budget and even Healthcare numbers you can go directly to the Congressional Budget Office.

Let me know what you think.

And I appreciate the comments and the healthy discussion.

Have a wonderful evening=)

Saturday June 20, 2009, 7:39 am
Thanks Lady L