4/25/10 Reform Is In The Air


No society has ever yet been able to handle the temptations of technology to mastery, to waste, to exuberance, to exploration and exploitation. We have to learn to cherish this earth and cherish it as something that’s fragile, that’s only one, it’s all we have. We have to use our scientific knowledge to correct the dangers that have come from science and technology.

Margaret Mead, Radio excerpt

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Story of the Day:  Sen. Chris Dodd has agreed to an alteration to his legislation, proposed by the Senate Agriculture committee headed up by Sen. Blanche Lincoln, that would ban banks from being in the derivatives business at all.  Word I hear is that the Treasury department is not happy about the deal.

Nice.

Now, this will cost the banks billions in profits, but spinning off the businesses will not destroy them, it will simply move them away from the banks, making them entirely separate entities, so if they fall, they don’t take the banking system with them.

The republicans, though late to the party, now seem to be embracing the concept of financial reform.  Welcome aboard!  It’s nice to see you come to the sane side.  Too bad the only time you ever show up is when public opinion polls are against you’re views, and the only reason you ever visit is for reasons of political expediency.

Mind you I don’t think too many will stick around on the sane side long enough to do any real good.  I am almost certain that the senate republicans will by and large vote tomorrow to block debate on financial reform.  Sens. Vitter, Thune, Kyl, Coburn and the like will vote to block it, I am sure.  There are more than enough republicans in the pockets of big business to put up a serious fight against sanity and financial reform most any day, and tomorrow is not just any day.  It is the day the fight for regulation begins in earnest.  Should be a boatload of fun, and not just a little harrowing.

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Sunday’s 5 news links:

GOP gets smart on financial reform.

Dodd Accepts Ban On Banking Derivatives Business: Dodd adds ban on bank derivatives business to broad overhaul of financial regulations

Obama honors fallen miners, stresses mine safety

Abortion: Nebraska legislation aimed at undoing Roe V. Wade. Nebraska’s new law aims to address fetal pain. And yet, it not only allows some abortions after 20 weeks’ gestation, it also doesn’t require anesthesia for such fetuses.

Mitchell says efforts to renew middle east peace talks ‘productive’

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Sunday’s viddies of the day:  The first viddy today is from today’s “This Week”, with George Will and Paul Krugman talking about banking reform. I can actually sympathize with Mr. Will’s views in this video, but Mr. Krugman is right, if we only regulate “banks” and not businesses that have access to billions of dollars that can act like banks, like money markets, we miss a large swath of the actual “banking” done in America and leave a giant hole for wall street to drive through and make a major mess of things like they have done in past.

The second viddy is from today’s “Face the Nation”  With authors Michael Lewis and Thomas L. Friedman.

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Quote of the day:

There is a certain class of people who prefer to say that their fathers came down in the world through their own follies rather than to boast that they rose in the world through their own industry and talents. It is the same shabby-genteel sentiment, the same vanity of birth, which makes men prefer to believe that they are degenerated angels rather than elevated apes.

William Winwood Reade, The Martyrdom of Man

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Pic of the day: A newspaper clipping (what newspaper I do not know) from 1913, speaking of the signing of the Federal Reserve act the day before Christmas that year. 

A lot of people criticize the Federal Reserve, but I don’t know that you can blame Wilson and the rest of congress in 1913 who passed this into law.  There had been no central bank in the United States for a great many years, and there had been some pretty turbulent financial times, and enough people thought that it would help to have a central bank to help create a cushion for when things got bad in future to make it happen.  A number of plans were discussed, including the Aldrich plan, which gave control of the financial system to private banks.  This being a power of congress, and people being at the time sane, that plan was scrapped.

We have a system that works I guess, but we can do better than this.  I think that since we have almost 100 years of the current system to use as a yardstick to see exactly what has worked and what hasn’t, that we should create a new body for the purpose of acting as a central bank. 

The Fed has too much power.

It is a banking cartel that was established solely to protect larger banks, and that protection actually increased the severity of the current financial crisis, especially with it’s early inability respond to the housing bubble, and lack of help with consumer protection and proper banking regulation. There have also been major fcuk ups, including the now infamous Merrill Lynch merger with Bank of America, where it is clear that Ben Bernanke and Hank Paulson withheld information from Bank of America about the amount of crap that Merrill held.

Go to sleep, you have work tomorrow.  G’night America.

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