^I think there is a problem with the conspiracy theory, big corporations just as happily wipe out each other, but yes interesting clips:)
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^I think there is a problem with the conspiracy theory, big corporations just as happily wipe out each other, but yes interesting clips:)
AIG again.
They got bailed out for 85 billion but that wasnt enough and that number grew to 150 Billion late November. Now they are back at the trough saying they cant sell of any units becuase nobody is bidding.
Its rumoured that they may post a 60 Billion 4th quarter loss next week, shares are currently 63 cents. Less hope nobodys got any AIG in their 401ks.
full story
In comparison, Canuck PM Harper (Conservative) just told the CBC (the country's mouthpiece media -- but always libbie -- and a Crown corp, like a GSE) to FO when it asked for more money this year. "Our ad rev is down!" they cried. Tough sh*t, the PM said. It's the way of the markets, deal with it. (I paraphrase, of course.)
. . . andQuote:
Originally Posted by Jet Gorgon
:)Quote:
Originally Posted by Jet Gorgon
Obama Works His Magic on the Market
Every time he opens his mouth about his plans for the economy…
https://teakdoor.com/images/smilies1/You_Rock_Emoticon.gif
Last November 3, the Dow Jones was at 9,320. Then a Marxist punk was elected President of the USA. At close today, the Dow was at 7,182. That's a drop of 18.59 points per day since the election. At this rate, it will hit zero in 386 days — just over a year.
Here's a New York Times article worth posting in it's entirety. Normally I'll post just enough info and a link so the originator of the article gets some props, but this article is worth saving here. You'll see that the democrats had their say in the forging of the bill. Democrat Senators Dodd and Schumer both from states with big financial institutions wanted a realignment of regulation. And Bill Clinton wanted the Community Reinvestment Act folded into the bill making it's way through Congress. Sorry, folks the entire blame for the repeal of the Glass-Steagall Act does not lay at Phil Gramm's feet. In this saga Gramm is portrayed as mean and miserly and Clinton is Sir Galahad.Quote:
Originally Posted by Milkman
The Democrats were a part of it.Quote:
Originally Posted by larvidchr
The Republicans were a part of it.
Private Mortgage lenders were a part of it.
Banks.
Borrowers.
I've researched it quite a bit. The only argument is to try to level which particular groups above was more, or the most complicit.
That....is a waste of time, IMO.
October 23, 1999
Agreement Reached on Overhaul of U.S. Financial System
Related ArticlesThe Lobbying: Behind the Banking Bill, Years of Intense Lobbying
The Impact: As an Era Ends, Finance Industry Enters Unknown Territory
News Analysis: Big Gains by Gramm in Diluting Lending Act Issue in Depth
Leading Up to the Decision on Banking Reform By STEPHEN LABATON
https://teakdoor.com/images/imported/2009/02/952.jpgASHINGTON -- The Clinton Administration and top Republican lawmakers reached an agreement early Friday to overhaul the financial system, repealing Depression-era laws that have restricted the banking, securities and insurance industries from expanding into one another's businesses.
The deal was announced about 2 A.M. after a compromise was reached over the measure's effect on lending rules for the disadvantaged, the source of months of partisan bickering between the White House and Senator Phil Gramm, the Texas Republican who heads the banking committee.
It concludes decades of attempts to rewrite banking laws to catch up with a marketplace that has already experienced broad consolidations and the rise of financial conglomerates offering bank and brokerage accounts as well as insurance.
While these conglomerates have found ways around the old rules, those rules had made it expensive and at times impossible to expand into new lines of financial services.
For instance, the nation's largest financial services company, Citigroup, would have been forced to sell some of its insurance operations as part of the $72 billion merger last year between Citibank and Travelers Group without either the legislation or a waiver from regulators.
With such situations in mind, the banking, insurance and securities industries spent more than $300 million in 1997 and 1998 alone on a combination of donations to political candidates, soft money contributions to political parties and lobbying.
The legislation will more easily enable financial companies to offer corporate clients a full range of services, from traditional loans to investment banking services, like public stock offerings. And for consumers, it paves the way for financial supermarkets, which will be able to offer one-stop shopping for an array of services, all under one roof. The measure is also expected to clear a path for a new and bigger wave of corporate deal-making as more companies consolidate.
White House officials withheld final approval of the agreement until aides could see the measure's language. But the officials indicated Friday night that, with broad support from Democrats in Congress, the measure was all but certain to be signed by President Clinton. As such, it will be one of the most significant pieces of legislation to be written by the White House and the 106th Congress, which began its term considering whether to remove Clinton and has had a bitter relationship ever since.
"When this potentially historic agreement is finalized," Clinton said in a statement, "it will strengthen the economy and help consumers, communities and businesses across America."
Treasury Secretary Lawrence H. Summers said in an interview, "At the end of the 20th century, we will at last be replacing an archaic set of restrictions with a legislative foundation for a 21st-century financial system." The measure, he added, "would provide significant benefits to the national economy."
Senator Gramm said the measure "is the most important banking legislation in 60 years."
Gramm's counterpart in the House, Representative James A. Leach of Iowa, said that he expected a final bill to be brought to the House and Senate floors later this month.
While the measure is likely to enjoy broad bipartisan support, it has also been criticized. Some lawmakers and privacy groups say the legislation does not adequately protect consumers and will allow financial companies to share and sell private information about customer accounts. Other critics worry about the further consolidation of the financial services industry.
The legislation repeals the Glass-Steagall Act, or, as it is formally known, the Banking Act of 1933, which broke up the powerful House of Morgan and divided Wall Street between investment banks and commercial banks. It also makes significant changes to the Bank Holding Company Act of 1956, which had restricted what banks could do in the insurance business.
The Glass-Steagall Act was enacted after the stock market crash of 1929 and the ensuing banking crisis and Great Depression. On the day it was signed, along with the National Industrial Recovery Act and other measures, President Franklin D. Roosevelt called the package "the most important and far-reaching legislation ever enacted by the American Congress."
The idea behind Glass-Steagall, named for the two lawmakers who wrote it, was that confidence in America's financial house could best be restored if bankers and brokers stayed in separate rooms. Such a separation, it was thought, achieved two purposes.
First, it would reduce the potential conflicts of interest between investment banking and commercial banking that were thought to have contributed to the speculative frenzy in the stock markets. Under the 1933 Banking Act, commercial banks could receive no more than 10 percent of their income from the securities markets, a limit so restrictive that most simply abandoned business on Wall Street.
Second, it would provide a safe harbor for the money of ordinary Americans by enabling them to put their money in accounts that were protected by deposit insurance and insulated from more speculative investments like stocks. (The 1933 act also established the Federal Deposit Insurance Corporation, which now insures bank deposits up to $100,000.)
Over time, Federal judges and regulators chipped away at the Glass-Steagall Act and other restrictions on cross-ownership of banks, insurance companies and securities firms, enabling, for instance, Citibank to merge with Travelers last year to form Citigroup, the world's largest financial services company. But large hurdles remained that have discouraged the expansion by banks into new businesses.
The breakthrough in Friday's legislation came in a backroom meeting at the Capitol soon after midnight, when a group of moderate Senate Democrats -- led by Christopher Dodd of Connecticut and Charles E. Schumer of New York -- forced a compromise between Gramm and the White House over the legislation's effect on the Community Reinvestment Act, a 1977 anti-discrimination law intended to encourage lending to minorities and others historically denied access to credit.
Dodd, whose state is home to the nation's largest insurance companies, and Schumer, with strong ties to Wall Street, have long sought legislation to repeal the Glass-Steagall Act. Both men said in interviews Friday that they moved to strike a compromise after it became apparent that the legislation might be killed, as it was last year by Gramm, over the debate about the Community Reinvestment Act.
Gramm had maintained that he did not want anything in the bill that would expand the application of the Community Reinvestment Act because it was, he said, unnecessarily burdensome to banks. He had sought a provision that would exempt thousands of smaller banks from the law. He also wanted a provision that would expose what he has described as the "extortion" committed by community groups against banks by requiring the groups to disclose any special financial deals the groups extract from the banks.
But the White House found that provision unacceptable and had its own ideas about community lending. It wanted the legislation to prevent any bank with an unsatisfactory record of making loans to the disadvantaged from expanding into new areas, like insurance or securities.
The (Clinton)White House had insisted that the President would veto any legislation that would scale back minority-lending requirements. Four days of intense negotiations between Summers, Gene Sperling, the President's top economic policy adviser, and Gramm, while moving the two sides closer, failed to resolve the differences.
Such was the state of play Thursday evening when Gramm decided to force the issue by having the House-Senate conference committee vote on his proposed compromise, which the White House had already rejected for failing to block banks with bad lending records from expanding to new businesses.
When Gramm's measure was defeated by one vote, it quickly became clear that there would be no law unless Gramm could get some Democrats to break from the White House.
But (Clinton) Administration officials had spent all day making sure that the Democrats remained solidly against the measure until their concerns about the Community Reinvestment Act could be worked out.
After receiving calls from executives of some of the nation's leading financial companies, Dodd and Schumer began trying to work out a compromise. An agreement was quickly reached on the issue of banks and expanded powers -- no institution would be allowed to move into any new lines of business without a satisfactory lending record.
The lawmakers bogged down on Gramm's insistence that all community organizations disclose to the regulators what benefits they get from banks. Some Democrats expressed the fear that Gramm's proposal would require the Boy Scouts to file reports with the regulators.
Ultimately, the following provisions were drawn up and both the White House and Gramm said they could accept them:
¶Banks will not be able to move into new lines of business unless they have satisfactory lending records.
¶Community groups will have to make disclosures to regulators about certain kinds of financial deals with banks that they have pressed to make loans under the Community Reinvestment Act.
¶Wholesale financial institutions, a new kind of business that takes large, uninsured bank deposits, cannot be affiliated with commercial banks.
¶Small banks with satisfactory or excellent track records of lending to the underserved would be reviewed less frequently under the Community Reinvestment Act. As a practical matter smaller banks are reviewed about every three years. The deal struck today allows all rural banks and banks with less than $250 million in assets to undergo examination once every five years if their last exam resulted in an "outstanding" grade and every four years if they last scored "satisfactory."
For more than 20 years, Congress has tried unsuccessfully to rewrite the nation's financial services laws and repeal Glass-Steagall, particularly as many other industrial nations had no similar restrictions on their banks. But until recently, the three main industries affected by the legislation -- banks, securities companies and insurers -- had competing interests and were able to lobby any legislation to a standstill.
That all changed in recent years as the lines between the industries began to blur and it became more broadly acknowledged that a deregulation of financial services could be beneficial to insurers, bankers and securities firms alike. Once the three industries rallied around the legislation, they became a formidable political force, raising millions of dollars for lawmakers and pressing both Republican leaders in Congress and the White House for new legislation.
While there was plenty done during the Clinton years to produce the housing disaster, the red team did not turn back the clock once they took control of not only the White house but congress as well. At the very least they also shoulder the blame for being complacent.
That being said the sub-prime mess is only one piece of the puzzle. Lowering the lending standards allowed the ball to get rolling, but the derivative market allowed the ball to grow to a mammoth size. And there again both parties stood by and allowed that part of the financial market go unchecked and basically unregulated until it collapsed.
It will be interesting to see how Larry Summers and Tim Gietner proceed from here on. Back in the day they were part of the "minimize market regulation" team. Now they are part of the "I love intervention" team. There is an interesting artical in Newsweek specifically about Summers change of hart. Too bad his change of hart came only after the market collapsed - funny how that always seems to be the case:
The Reeducation of Larry Summers | Newsweek Business | Newsweek.com
While I am in agreement that there was insufficent regulation as it relates to the derivative market and that the lending regulations were too soft. My biggest fear at this stage is that we turn to over regulation and in the process stymie our ability to grow our way out of our current mess - and thus prolong the current down market.
Related, but on a different track: here is a Gerald Celente interview.
YouTube - Gerald Celente warns of the next US Great Depression. PART 1
Here another interview from 2007: prescient.
YouTube - Gerald Celente Predicts '08 Panic
Here's more of Gerald Celente and the American economy. Here, he describes his history, biography, and his career in Researching Trends, and also corroborates his records of past predictions.
YouTube - Gerald Celente on The Alex Jones Show"Economic Armageddon"1/6
https://teakdoor.com/images/smilies1/You_Rock_Emoticon.gifQuote:
Originally Posted by Spin
The Gramm-Leach-Bliley Act, which repealed the Glass-Steagall Act signed into law by President Clinton. He could have vetoed it.Quote:
Originally Posted by GooMaiRooI'm thinking that your post is some sort of parody of the brainwashed Foxbots on this forum, right? If so, good job and please disregard my comments.Quote:
Originally Posted by larvidchr
The Republican-led repeal of the Glass-Steagall Act in 1999 allowed deregulation of US banks. What followed was a flood of CDOs, credit default swaps and mortgage loans to anyone who could breathe (regardless of color). The rest is history.
The last time I checked, the US Senate had one African American and two Hispanics, 3% of the total Senate. To blame the downfall of the world economy on America's colored underclass is so illogical from so many angles that it's probably not deserving of comment. But, if you were to take a wild guess as to who controls Washington and had to choose between Wall Street lobbyists and poor colored folks, which answer would be more accurate?
He also signed the Commodity Futures Modernization Act, which exempted credit-default swaps from regulation. He could have vetoed it. In 1995 Clinton loosened housing rules by rewriting regulations of the Community Reinvestment Act, which put added pressure on banks to lend in low-income neighborhoods.
Under the CRA banks wishing to branch out into other fields, ie, insurance and securities, had to have a certain percentage of these type of loans on their books. It was part of the deal which allowed for diversification. The Federal government set the playing field, other businesses besides banks, ie, mortgage and loan companies followed the lead set by the banks and the feds.
Banks, savings and loans, mortgage companies, et.all, could have remained conservative with their lending but then they would have missed out on the killing the feds were encouraging. Shareholders of publicly held companies wouldn't put up with conservative investments when there was so much money to be made. The federal government set the pace by getting involved with regulations which required the banks to make sub prime loans. The mortgage and loan companies followed their lead.
The derivatives and the default credit swaps are related to the government policy of forcing banks to make highly risky loans. They are sold as insurance instruments which help to limit risk. The risk being those institutions heavily involved in high risk loans not being able to meet their obligations. Which is what happened the institutions couldn't meet their obligations.
I don't see how the players and Congressional over site committees can say they didn't see the fall coming. Granted they didn't know when but they knew it was coming why else did the derivatives and credit default swaps market go wild if their wasn't a sense of heightened risk in the air?
I'm not sure but I think agency regulations can be rewritten without Congressional approval, although agencies are subject to Congressional oversight committees. So Clinton could bypass the Republican Congress by having regulations rewritten in-agency.Quote:
In 1995 Clinton loosened housing rules by rewriting regulations of the Community Reinvestment Act, which put added pressure on banks to lend in low-income neighborhoods.
Starting on Monday, March 2, the economic reports for February, will be released. Ouch.
Quote:
The recession tightened its grip on U.S. businesses and consumers in February, according to economists, who are predicting the largest one-month job loss in almost 60 years.
"Pink slips continue to fly," said Meny Grauman, an economist for CIBC World Markets.
With output still falling at a dizzying rate, most companies are shedding unneeded workers and cutting back the hours of those remaining. Strapped by debt and seeing their paper wealth evaporating, many consumers are spending as little as they can.
"The economic patient is still in critical condition, with little medication to relieve the pain," wrote economists Brian Bethune and Nigel Gault of IHS Global Insight. "We will have to bite the bullet."
The first week of the new month brings two of the most important economic indicators: the ISM index and the nonfarm payrolls report. Both are expected to be very grim news.
I'll add a brief video of US housing prices. And also a recent comment (which may only be political) by Obama.
Comments and opinion?
YouTube - Glenn Beck's heart-stopping housing chart
Just to reiterate: Your mortgage is not my problem...:)
Here is a Jim Rogers interview.
He notes Bernanke being consistently wrong, and how Sec. of Treasury Geithner is more of the same, as Geithner used to be head of the NY Fed, which oversaw Wall St.
YouTube - Jim Rogers 'I would urge you to be prepared' (01.Mar.09)
If you're a US taxpayer, it is your problem:)Quote:
Originally Posted by Boon Mee
As it happens it has become the whole Worlds problem :(Quote:
Originally Posted by Spin
.Quote:
Originally Posted by Milkman
The Federal Reserve Bank of New York DOES NOT oversee wall street !
.
^ Who does? Can you please inform me and Jim Rogers.
How does it not? If not, who does? SEC?
Pardon my ignorance.
This is exactly what Rogers said. He needs to be corrected, and so do I for parroting.
TIA.
I think he's right about farming.
^ The SEC provides the Street's rules and regs.
^ "Sometimes", but lets not go there 'eh?:)
^True, they haven't been doing a very good job. NASD and FINRA also do reg biz.
This article is longer that posted and is worth a brief scan. The process of job-losses are continuing.
Link & Entire: http://www.nytimes.com/2009/03/04/bu...t.html?_r=1&hpQuote:
Job Losses Show Breadth of a Recession
By DAVID LEONHARDT
March 3, 2009
What does the worst recession in a generation look like?
https://teakdoor.com/images/imported/2009/03/94.jpgInteractive Map The Geography of a Recession
It is both deep and broad. Every state in the country, with the exception of a band stretching from the Dakotas down to Texas, is now shedding jobs at a rapid pace. And even that band has recently begun to suffer, because of the sharp fall in both oil and crop prices.
Unlike the last two recessions — earlier this decade and in the early 1990s — this one is causing much more job loss among the less educated than among college graduates. Those earlier recessions introduced the country to the concept of mass white-collar layoffs. The brunt of the layoffs in this recession is falling on construction workers, hotel workers, retail workers and others without a four-year degree.
The Great Recession of 2008 (and beyond) is hurting men more than women. It is hurting homeowners and investors more than renters or retirees who rely on Social Security checks. It is hurting Latinos more than any other ethnic group. A year ago, a greater share of Latinos held jobs than whites. Today, the two have switched places.