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    Atypical is offline

    And Now Some Words From Bankers And Wall Street

    Hi folks. We just want you to know we don’t need financial reform. Oh sure, we screwed up most everyone’s life in the world recently but that was just a small error. We can’t promise it won’t happen again though. We really like money! But we’re not very concerned because we know you will be frightened enough to bail us out again. You will, won’t you? Of course you will. That’s what good capitalists do because we are wealthy and powerful. We have friends. Senator Durbin said, “the banks own the place”. He’s right! We’re so proud. Anyway, you respect us because we’re obviously smart and you support us because you think some day you could be just like us. That’s imposs…, well, never mind. Just do what we want and let us make money any way we can without concern for you and your finances. Just trust us. It will be okay. We have good plans for your money.

    We know the words “socialism” and “nationalizing” upset you. We accomplished that. We bribed, er, paid a lot of money so we would get our way. And it’s really working. Even the Supreme Court helped. We love the power of uncontrolled capitalism so don't try to alter it or we will....

    So, let’s not waste any more time here, okay? Just stop all efforts to restrict us. Understand? No rules, regulations or restrictions of any kind. We always know better. Remember our slogan; privatize profit, socialize losses. That’s the kind of socialism we like.

    And keep that witch, Elizabeth Warren, in check. Better yet, our republican/democrat friends are going to do that for us. We will stop at nothing and they won’t either. We appreciate our good political friends because they always do what they're told. We have lots of friends and we all work together. For us and nobody else. Greed is good. You agree, don't you?

    Now stop here and don’t read the articles below. We’ll know if you do. We know everything.

    The Assault On Wall Street Reform

    Last weekend, a spokesman for the American Bankers Association -- the banking industry's largest trade group -- explained that the financial services industry is eagerly anticipating conservative control of the House of Representatives. "We had been disappointed with a number of legislative outcomes with the past Congress, and so we look forward to better outcomes with this Congress," he said, adding that "banks expect a corrections bill to peel back some of the financial regulations passed into law this year." Indeed, Wall Street has made no secret of its desire to water down and roll back provisions in the Dodd-Frank financial regulatory reform law, which President Obama signed in July. Dodd-Frank is the most thorough upgrade of the nation's regulatory structure since the Great Depression, and while complete repeal is unlikely due to the President's veto power, the banks are counting on their House Republican allies to weaken the bill in other ways, such as withholding funds or scheduling hearings designed to slow the regulators' rule-making process. Already, the two leading candidates to chair the House Financial Services Committee next year -- Reps. Spencer Bachus (R-AL) and Ed Royce (R-CA) -- have made known their desire to weaken certain provisions, while incoming presumptive House Majority Leader Eric Cantor (R-VA) told CNBC that Republicans intend to deny regulators the funds to implement Dodd-Frank. "The House has the power of the appropriations process and the leverage that comes with that essentially puts us in a position to deny the administration funding for promulgating the regulations," Cantor said.

    DEFUNDING THE CONSUMER BUREAU : House Republicans have reserved their most intense ire for the newly-created Consumer Financial Protection Bureau, which is being headed by consumer advocate and Harvard Law Professor Elizabeth Warren and is the only regulatory agency explicitly tasked with consumer protection. Rep. Jeb Hensarling (TX), one of the top Republicans on the Financial Services Committee, promised to defund the Bureau, which he believes "assaults the liberties of the consumer." But defunding is only an effective strategy for holding back the agency until July 2011, when the Bureau will begin to receive an independent funding stream from the Federal Reserve, so Bachus has proposed changing Dodd-Frank to make the Bureau subject to the annual congressional appropriations process. Giving the Bureau an independent stream of funding is important, as it isolates the Bureau from the whims of Congress and prevents appropriators from pushing a political agenda by threatening funding cuts; the Federal Reserve and the Securities and Exchange Commission have independent budgets for the same reason. Royce, meanwhile, has said that he would revive an amendment of his that was defeated during the regulatory reform debate that would allow banking regulators to veto the agency's rulemaking. "The safety and soundness regulator needs to have a say, needs to have final say in this," Royce said.

    DEFANGING THE REGULATORS : Dodd-Frank delegates much of its authority to regulators, who have the responsibility to craft rules meant to rein in the financial industry's excess, while taking into consideration the necessary role of the industry. Consequently, House Republicans have been targeting these regulators in an attempt to politicize and delay their rule-making activities. Bachus, for instance, sent a letter to the newly created Financial Stability Oversight Council scaremongering about the effects of the Volcker rule, which is meant to prevent banks from engaging in risky proprietary trading with federally insured dollars. Bachus claimed that the rule will "impose substantial costs on the American economy and market participants" with "doubtful" benefits.” But as Nobel Prize-winning economist Joseph Stiglitz noted, "Through the rise of proprietary trading at our nation's banks and the largest non-bank financial firms, firms doubled down on the accumulation of risk, much of it with little benefit to the real economy." Bachus has also said that he wants to weaken the derivatives reform portion of the bill, calling it "overly expansive." The derivatives title of Dodd-Frank sets up exchanges so that derivatives must be traded publicly (like stocks) and employs clearinghouses to ensure that both parties in a derivatives trade have adequate collateral backing it up. What House Republicans will likely aim to do is entice regulators to grant wide exemptions to the exchange and clearing requirements, letting all sorts of activity that is purely speculative continue to be unregulated. Senate Democrats, however, are standing tall against changes in the law. "I don't think that major changes will take place on Dodd-Frank," said Sen. Tim Johnson (D-SD), who will likely chair the Senate Banking Committee next year. "There is not only resistance from the Senate, but the veto is possible, too. So we should focus on realistic solutions to our problems."

    BIG BUSINESS JOINS IN : House Republicans and Wall Street banks are not alone in their fight to weaken Dodd-Frank. The U.S. Chamber of Commerce -- which helped coordinate Wall Street's campaign against financial reform -- announced yesterday that "it is setting up a new unit to scrutinize regulatory efforts of the Obama administration, taking special aim at the health care reform law and financial overhaul legislation." "Regulation is the vehicle by which some seek to control our economy, our businesses and our lives -- and left unchecked, it will fundamentally weaken our nation's capacity to create jobs and opportunity," said Chamber President Tom Donohue. The Chamber has already sued the SEC "over its proposed rule to give shareholders greater rights to nominate candidates to a public company’s board through proxy access balloting"; the rule was initiated as a result of Dodd-Frank. Of course, Wall Street is also very capable of lobbying for its cause itself. As the Los Angeles Times reported, "Lobbyists for banks, hedge funds and other firms have logged hundreds of meetings with federal regulators since the reform bill was signed into law." "In all, regulators have had at least 510 meetings with lobbyists representing 325 organizations since July," the Times found, and "more than 90% of the groups that appear in the meeting logs are banks, hedge funds and other big companies that rely on the financial industry."

    The Progress Report
    Last edited by Atypical; 11-27-2010 at 05:10 PM.

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