One area where I have been utterly disappointed in the Obama administration has been it's failure to address the banking issues that led to much of the economic disaster. Dodd-Frank was passed and was touted as a fix but I don't think any serious person considers that to be true today. More than a few serious economists have warned that banks are engaging in many of the same practices that led to the crisis. This is one are that I do not have a great deal of informational knowledge of the situation so if some of you come from the banking world, maybe you can shed more light on the subject. That said, I would have liked to at least seen the larger banks broken up. I don't know that arrests are in order because much of what these guys did is perfectly legal; or at least that is my understanding of it. We just need to make adjustments so it doesn't happen again. Your thoughts?
Nothing has changed. I have said from the get go the financial bailout was necessary but only if they followed through with plans to stop too big to fail. They have not.
I tend to agree that the banks have no real limits. I would like to see some for of the Glass-Stegall act reinstated and brought up to fit today's circumstances. As recently as the late 1980s investment banks were not corporations but partnerships where the leaders of investment banks actually owned the banks and trades risked their personal wealth (read Michael Lewis's Money Ball). Today the leaders of the banking corporations have little if any personal risk in the performance of the companies. Find a way to make them personally responsible for a banks actions and losses and you would see much less risk taking. As long as leaders corporate and government face essentially zero risk of loss we will see risky and lawless actions.
Until someone goes to jail, nothing will change and if the stunts they have pulled the last decade doesn't get someone locked up, then what will?
I don't blame Obama so much on this. The Financial Institutions have there grip on the nutsack of the economy. For the bad that they do....they have the money to distribute to all of us. Obama can fuck with health care and rich people but the Institution is above all of that. I will say that getting a house today is much more complicated than 12 years ago. The shit I went through, with the verification of every dime I have to get in my new house, was nothing like 2001.
This pretty much sums up my thoughts on the bailout too. I was convinced of it's necessity at the time but also believed that it should have been accompanied by law to prevent such practices from happening again. The latter part of the statement never happened. If this isn't proof enough that Washington is bought and paid for then I don't know what is.
That is my exact reason for opposing the bailout. For a market to work, bad actors need to be allowed to fail. The banks should never have been rewarded for being terrible and making shitty loans. We never needed laws to protect us from big banks. We needed functioning markets where banks who take stupid bets to make a quick profit go out of business. We got Dodd-Frank which contains shitloads of tedious regulations that do nothing but create inefficiencies for the banks, and increase costs for consumers while offering no real protections.
