FINREG Dead?
Courtesy of Karl Denninger at The Market Ticker
"As I have indicated for some time now, my test for the financial regulatory reform bill is whether it will prevent another crisis. The conference committee’s proposal fails that test and for that reason I will not vote to advance it. During debate on the bill, I supported several efforts to break up ‘too big to fail’ Wall Street banks and restore the proven safeguards established after the Great Depression separating Main Street banks from big Wall Street firms, among other issues. Unfortunately, these crucial reforms were rejected. While there are some positive provisions in the final measure, the lack of strong reforms is clear confirmation that Wall Street lobbyists and their allies in Washington continue to wield significant influence on the process.”
Interesting. Note that:
Senator Feingold was one of eight senators to oppose the repeal of Glass-Steagall in 1999. Senator Feingold also opposed the Wall Street bail-out in 2008.
Oh my the balls are still there!
There are times when one Senator with a pair of church-ringers can make a difference. This is one of them.
I have long said that Glass-Steagall, which was all of 37 pages, is more than sufficient to stuff the genie back in the bottle. Indeed, all of Mr. Feingold’s complaints would be addressed by simply reinstating it.
Yes, I know the banks would howl, and claim that "they’d all move to Britain."
Fine. Let ’em.
If you know someone is playing around with the materials to blow up your economy, do you want them to do so in your country or somewhere else? Clearly, we’d prefer to have that happen "somewhere else", right?
Banking should be a utility function. Those institutions that want to play in the capital markets are free to do so, but they should NOT have access toany sort of support whatsoever – not from The Fed, not from Treasury, not from anyone but themselves. If they fail then they go under and everyone holding their paper takes a haircut (or worse.)
All this arm-waving and 2200 pages of legislation is another attempt to pass "you can see what the lobbyists stuck in it after you sign it" crap, just like it was with Health Care.
It is time for Congress to say not no but hell no along with the American people.
This is our nation and our government, and we’re tired of it.
Mr. Feingold has precisely the right idea.
