Oh hell no
Nobody could have predicted (my emphasis):
Sen. Chris Dodd, D-Conn., released his long-awaited draft of a new financial regulatory reform bill on Monday. It is 1,336 pages long, which means, unless you want to crib from the “factsheet” summary released by the Senate Banking Committee, that it will probably require another couple of hours before the regulation geeks can tell us exactly what is inside this monster. (The early word: The Fed will get more power.)
I’ll let Don Logan supply my initial reaction:
I had a lot of thoughts in the fall of 2008 during the Wall Street meltdown — most of them were unprintable in a fucking family blog such as this piece of shit — but for some reason I never thought to myself, “Gee, if only we’d given Alan Greenspan more power, none of this would have happened!”
Simon Johnson breaks it down in Smart People Speak:
Senator Dodd’s financial reform bill will be introduced in the Senate Banking Committee today. Unfortunately, on the major issue – too big to fail financial institutions that caused the 2008-09 crisis and that will likely trigger the next meltdown – there is nothing meaningful in the proposed legislation.
The lobbyists did their job a long time ago. Treasury sent up a weak set of proposals – Secretary Geithner apparently felt that to do otherwise would be just to seek “punishment” for past wrongdoings; there is too little concern at the top levels of this administration regarding what comes next. And Senator Dodd was pushed hard by various interests to weaken all potentially sensible proposals – including anything that would bring greater transparency and safety to the derivatives market.
I’ll just add: I would rather have no financial consumer protection agency at all than a consumer protection agency housed in the Fed.
Why? Because it would be immoral to give people false assurances that they’re being protected when the Federal Reserve is highly unlikely to seriously crack down on the worst abuses. The last thing consumers need is to see payday loans with 9000% interest rates that have been given a hearty thumbs-up by Helicopter Ben. I was willing to eat a crap sandwich on health care, guys, but not on financial reform. Either do it right or shelve it all together.
Obviously, we need another meltdown. Chris Dodd must think so, anyway.
It just makes it that much easier for the Fed to garnish your wages or social security checks without due process.
“In a security arrangement proposed by Democratic leadership, the Fox Den was put in charge of enforcing a De Carnivorized Zone around the Hen House.”
OT: can anyone recommend a good snark blog?
Oh there’s a surprise, histrionics from Brad. Dude, you need to drink more. Lots more. And Demerol, have some Demerol.
Unfortunately, on the major issue – too big to fail financial institutions that caused the 2008-09 crisis and that will likely trigger the next meltdown – there is nothing meaningful in the proposed legislation.
Well isn’t THAT fucking lovely.
“Remember that crisis that this was supposed to address? Well, we didn’t address it. Oops, our bad! *giggle*”
I hope the people of Connecticut keep this in mind. An employee fucks up this bad, you fire his sorry incompetent ass out the door.
I hope the people of Connecticut keep this in mind. An employee fucks up this bad, you fire his sorry incompetent ass out the door.
He’s retiring.
for some reason I never thought to myself, “Gee, if only we’d given Alan Greenspan more power, none of this would have happened!”
To be fair, Greenspan was also in the exact same spot during the expansion of the middle class during the Clinton years. The pro-derivatives guys are the enemy; not everybody around them needs to be painted with the same brush.
I was willing to eat a crap sandwich on health care, guys, but not on financial reform.
Exactly right. Even shit health care reform provides direct relief to millions. Shit financial reform just leads us in exactly the same direction as before.
To be fair, Greenspan was also in the exact same spot during the expansion of the middle class during the Clinton years.
But he dropped the ball. Giving him more power wouldn’t have done anything if he didn’t see the housing bubble.
I would rather have no financial consumer protection agency at all than a consumer protection agency housed in the Fed.
Considering the Fed is comprised of six or seven of the major money center banks, I agree.
Considering the Fed is comprised of six or seven of the major money center banks, I agree.
Yep. I don’t want the Fed to place a stamp of approval on Collatoralized POG Obligations. Disaster in the making.
“I was willing to eat a crap sandwich on health care, guys, but not on financial reform.”
Right. No health reform = people dying. No financial reform = people wising up and putting their money in small banks, in T-bills, in their mattresses, whatever, and the Masters of the Universe working at Wendy’s.
Giving him more power wouldn’t have done anything if he didn’t see the housing bubble.
Brad, my suspicion is Greenspan saw the bubble, but was powerless to do anything about it, because it would have meant the second collapse of the economy in less than five years (and basically both under Bush).
As early as 2005, Greenspan was talking about the housing bubble. As Krugman points out, here, it was too little and too late, but that doesn’t mean he ignored it prior to this (indeed, he must have devoted some thought to it since he publicly denied it existed).
He had to balance, I think, the short term goal of pumping the economy back up after the twin crises of 9-11 and the dotcom burst with the longer term goal of getting Americans to stop buying sure-fire foreclosures.
He chose poorly, I think we can all agree on at that bare minimum. Had he not decided to pump up Bush’s economy, had he gone against his own advice with respect to deficits, things might have turned out better. Or much worse.
He gambled, and it was the wrong gamble. The question is, was there a right bet to make under those conditions?
Dodd was behind a lot of the deregulation in the first place. This is what’s so frustrating about how America seems to do things. If someone has a hand in how the world economy is run, we wouldn’t fire them if they switched our currency to maple leaves.
had he not gone against his own advice with respect to deficits, I mean.
I think Dodd should maybe listen a bit to his Judiciary Committee colleague Kaufman.
George H. W. Bush (Sr) was apparently much more committed a million years ago to seeking justice for those harmed in the giant Savings & Loan theft spree than anyone would dare consider now.
Apparently Reaganism needed at least another couple decades to bloom into the full stinkflower.
@actor — you’re right he likely did know what was up, which made these remarks all the worse:
http://www.federalreserve.gov/BoardDocs/speeches/2005/20050408/default.htm
Well, Brad, if you’re willing to eat one crap sandwich, why not two? Why not a dozen?
The health care fight is the first act in a long list of important legislation. Since liberal leaders (and, um, you) are willing to be doormats on health care, why are you surprised that Democrats will cave on financial reform, jobs programs, global warming, Iraq, Afghanistan, pretty much everything?
I mean, if you think something is a crap sandwich, yet you’re still willing to advocate for it, why should anyone think you won’t do the same for the next serving, and the next, and the next…?
Oooo another meltdown sounds delicious! I’ll have mine with Munster cheese, please.
Oh, another financial meltdown. Ha! like that’ll happen. Next you’ll be telling me that global warming is a hoax, people in the US don’t have health care and Glenn Beck has a high school diploma. This blog is so funny.
I mean, if you think something is a crap sandwich, yet you’re still willing to advocate for it, why should anyone think you won’t do the same for the next serving, and the next, and the next…?
You miss my point. I was willing to go along on health care just because, even in its current debased form, the Senate bill (with fixes through reconciliation) would be a net plus for most people. But on finance reform I’m not willing to go down that road. No reason to give people a false sense of security through a series of half-measures that don’t address chief problems.
OT: can anyone recommend a good snark blog?
World-o-Crap, when Scott can post.
He chose poorly, I think we can all agree on at that bare minimum. Had he not decided to pump up Bush’s economy, had he gone against his own advice with respect to deficits, things might have turned out better.
He did eventually denounce the Religion of teh Invisible Hand. So, a gold star to him? I guess?
Of course, the problem is, none of his fellow acolytes seem to have paid attention to what he said.
Also? Need moar POOP.
He did eventually denounce the Religion of teh Invisible Hand
If only that were the case, but you see, the Invisible Hand as proposed by Adam Smith included healthy doses of government oversight and regulation, specifically when it came to “too big to fail” scenarios.
Also also, did someone post this in another thread? I can’t be arsed to check: Red State’s Eric Erickson writes that Judge Souter is a “goat f*&king child molester”
Also also also, Erick son of Erick is now a political commentator for CNN.
If only that were the case, but you see, the Invisible Hand as proposed by Adam Smith included healthy doses of government oversight and regulation, specifically when it came to “too big to fail” scenarios.</i.
Well, okay, true. The phrase "invisible hand" is much more interesting to me than "laissez-faire capitalism" or whatever would be more appropriate.
I still don't get how Greenspan was a Rand worshiper with the job he had. Fucking hypocrite.
Ouch. Tag fail!
the Invisible Hand as proposed by Adam Smith included healthy doses of government oversight and regulation
Srsly, are the bankers going to thrown into destitution after some regulation? [It’s rhetorical, Tim]
I mean, if you think something is a crap sandwich, yet you’re still willing to advocate for it, why should anyone think you won’t do the same for the next serving, and the next, and the next…?
Ooooooh!!! Oooooooh!!! (waving hand in air) I know the answer!
It’s because, as D.A. pointed out in his brilliant HCR Ponies vs Shit Sandwiches graph, while the Senate bill, as revised, passed slowly = 2 shit sandwiches, the status quo = 6 shit sandwiches.
He’s retiring.
Oh, WELL, isn’t that adorable.
This is more like the guy who’s quitting leaving a big package of frozen shrimp in a locked and epoxied-shut drawer in his desk.
Wow, I wonder if he’ll get him a job as a financial lobbyist after he leaves.
It’s because, as D.A. pointed out in his brilliant HCR Ponies vs Shit Sandwiches graph, while the Senate bill, as revised, passed slowly = 2 shit sandwiches, the status quo = 6 shit sandwiches.
So why does “guaranteed immortality” only equal 3 sparkleponies?
I wonder if he’ll get him a no-show job as a financial lobbyist after he leaves.
Fixtorz!
After your soul is sold, you don’t have to do much as a lobbyist.
Pere Ubu – check out comments. As D. noted, obviously guaranteed immortality gets 60 ponies but he ran out of space, and anyway, that goes without saying.
So why does “guaranteed immortality” only equal 3 sparkleponies?
It was supposed to = 60 but DA ran outta space.
I’ll let Don Logan supply my initial reaction
Cue Florida Evans for my response.
Actually, I understand, and in fact agree. The health care bill as it stands is better than the status quo. Passing it is better than nothing. Even a crap sandwich at least has seven-grain bread. I just won’t say yum as we eat it.
My argument is more with the negotiating strategy. If liberals always cave and right-wingers always oppose, we will get more and more good bills watered down to half- or even eighth-assed measures, if the bills even pass. Look at Dodd’s bill. He watered it down for Republicans, none of them support it, yet he still pushes the watered-down bill.
Jen, you have the fingers of a mongoose.
So why does “guaranteed immortality” only equal 3 sparkleponies?
Right? And I actually think “guaranteed immortality” should be represented by flutterponies,anyway.
Pere Ubu – check out comments. As D. noted, obviously guaranteed immortality gets 60 ponies but he ran out of space, and anyway, that goes without saying.
Nevermind. I am slow and forgetful.
I want my 60 immortality sparkleponies to have frickin’ lasers.
Jen, you have the fingers of a mongoose.
Well, something’s gotta compensate for having the ass of a hippo…
But Brad, I thought you WANTED everything to collapse faster!
He did eventually denounce the Religion of teh Invisible Hand. So, a gold star to him? I guess?
I am underwhelmed with Greenspan’s late decision to stop masturbating.
something’s gotta compensate
If it isn’t the Right’s excuse for everything!
Today’s public service announcement:
Fuck you Brandi, you’re hideous and everyone hates you.
Jen, you have the fingers of a mongoose.
You know who ELSE has fingers like a mongoose?
DKW’s mom, that’s who.
You know who ELSE has fingers like a mongoose?
One’s that tipynigs nto os godo?
It’s guaranteed immo
trality that gets all the ponies.Wheee, there’s some bad tipnygs.
Anywho, guaranteed immorality. No t, regardless of where you put it. Hoorays for a reason to give up on teabaggers!
bad tipnygs
So naming my new band that.
Ignorant Foreigner Question: Is financial reform subject to Senate filibuster, or is it eligible for reconciliation?
If the former, then it’s fairly clear to me that no meaningful reform is possible. The Republicans will vote against cloture, every time. (Actually, they would vote against cloture on the Omnibus Act to Recognize the Selfless Love of the Mothers of All Republican Senators if a Democrat proposed it.)
I suppose the Democrats could propose genuine regulatory legislation, dare the Republicans to vote against it, then use those votes as a club in November. Unfortunately, that gives the Rs a chance to buy lots of “Senator Moneybags stood firm against the President’s attempt to turn us into Cuba” ads with their bank lobby money, while the Democrats are trying to explain what really happened with ads paid for by selling lemonade on the street corner.
Ignorant Foreigner Question: Is financial reform subject to Senate filibuster, or is it eligible for reconciliation?
Reconciliation is only available to bills that directly impact the federal budget. Reform would not fall under that purview.
Yeah, I’m a tad baffled why they don’t just go for the gusto – it’s not like AIG has oodles of fans on Facebook, or BoA is showing some titty on Stickam or something … everyone despises these bottom-feeding fucksticks with a passion, with good reason.
An awful lot of good people lost much of their life’s savings in the summer & fall of 2008, by “making all the right moves” & playing by the rules – & the soulless scum in designer-label business-suits got away with it scot-free, other than a few stern verbal spankings on CSPAN from the same Congresscritters who enabled them – & gave themselves bonuses for a job well done.
Bending them over for 20 of the Queen’s Best would be electoral dynamite.
The US needs Glass-Steagall back, & that’s just at a bare minimum.
A big part of the problem with banks the size of JPM or C or BAC is that there’s almost no way to take them apart in the midst of a meltdown. The logistics of having people’s money available after a 2 day closure is simply too daunting.
You either have to pull them apart now when there is little pressure, at least as far as deposit taking, checking and savings accounts are concerned or you have to declare a bank holiday across the system for as long as it takes to find other institutions to take over the accounts. Which, given the target’s size, will require 6 or 8 banks, or more, so that the acquirers don’t become too large themselves.
It’s one thing to close a bank a few billion in assets, it’s quite another to take over one that’s several hundred billion as these 3 are. That’s not to mention the international accounts, at least not to mention them in their own language.
A big part of the problem with banks the size of JPM or C or BAC is that there’s almost no way to take them apart in the midst of a meltdown.
Not necessarily. Obama could declare a bank holiday for a week or so. That’s plenty of time to take care of depositors.
Oh. I see you make that point later on.
What would likely happen is, the retail operations would be split off from the commercial banking operations, with the commerce going to the highest bidders and reopened rather quickly. The retail ops would be allowed to do a workout on the deposits. The FDIC would make arrangements with other banks to cover the run on the branches.
There are things other than interest rates that the Fed could have done (deposit and margin requirements, etc).
Right now people say there are bubbles forming because of record low interest rates – the currency carry trade. I bet some of our TARP money is helping people arbitrage their way to the Bahamas.
Fuck you Brandi, you’re hideous and everyone hates you.
Took a whole tube of KY to think up that sparkling repartee, I bet.
No reason to give people a false sense of security through a series of half-measures that don’t address chief problems.
Unless it makes the insurance companies a lot of money.
After all, they’re an important part of the progressive majority that we need to ensure the republicans don’t take all the good donors.
Why pray tell are you willing to eat a shit sandwich on HCR?
Sexy Beast for the win. That movie is the best.
I bet some of our TARP money is helping people arbitrage their way to the Bahamas.
Hush!
And it’s the Caymans…got my eye on a hotel on Seven Mile Beach.