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Thread: Bernie Sanders To Introduce Bill To Break Up The Big Banks

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    Re: Bernie Sanders To Introduce Bill To Break Up The Big Banks

    Quote Originally Posted by Chomsky View Post
    And we could always threaten to unleash the ultimate 'accountability punitive measure': "So, you want a socialist solution to your failures? Get your act together or we'll nationalize you"!

    I agree, we could control this with proper regulation - the problem is: the regulators are owned by the regulated!

    That's a big problem ...
    When you can just order around and split up business in any way you damn well please exactly why would you officially announce a government takeover? All you have to do is control it and let people believe property is owned by the people.

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    Re: Bernie Sanders To Introduce Bill To Break Up The Big Banks

    Quote Originally Posted by Thrilla View Post
    it doesn't neccessarily mean lettign them fall, though that is an option..... another option might be bailing them out with certain terms to be guarateed ( which we didn't do in this last fiasco)
    there are lots of firms that would cause great pain to our economy if we allowed them to fail, but no one is callign to break up GM or Ford..or GE... or any of the big firms..... targeting banks is simply populist claptrap.
    There are clearly huge firms in the US outside of finance, but I don't think the fall of any of them would be as disastrous as the banking system. Partly because of the reasons you state, that it is so incestuous. If Google/Apple/M$/Exxon went under the ripples would be huge but not on the scale of the banking crisis. GM did go under and though there was some public assistance it hardly triggered a 2010 crisis. At the end of the day these companies sell their own product, banks do not.

    Quote Originally Posted by Thrilla View Post
    the aim isn't to kill them off or drive them into poverty.. it's to change the behavior....
    if that dude was a billionaire before, leaving him with a 100 million is probably still a good punishment.... banishing him from his tradecraft would be a nice addition, though.
    I think he's banished in all but name due to his name being dragged through the mud! That said, the wall street 'kingpins', although unemployed, now have ample time to spend their millions on golf and mansions and fast cars. There was nothing much on criminal charges or prosecutions. I understand that these people worked hard to get where they are, but that doesn't excuse them from doing their time.

    Quote Originally Posted by Thrilla View Post
    I tink it would simply mean, in the event of a crisis, that we would have wider and depper problems to address... you have to consider that the entire indutry is incestuous by nature...big banks, small banks, medium banks... they all live and die by each others swords.
    ... and then there is the fact that we would end up with far more firms requiring far more resources to adequately if we split them up.
    I don't think we would decrease any risks by splitting them up...I think the root problems would get worse.

    it's going to take some very smart folks to solve these problems... ideologues shouldn't apply or even pretend to think they have the answers to these very complex issues...even if those "solutions" sound good to the uninformed populace.
    for my money, the solutions are going to come from the banks themselves... they have a vested interests in solving principal-agent problems, and they have the people whom are smart enough to do so....teh federal government, and hte state government, just have ot provide " incentives" for them to do so... incentives like " solve it or spend a ton of time in club fed"
    [/QUOTE]

    More firms would require far more resources to operate. I think that is just a price we have to pay for reduced risk. Whether the risk decreases or not depends on the operating procedures of each of the individual banks. One would hope that with more smaller firms out there only the ones that operate in an overtly risky way will be the ones to go down in the event of a crash, whilst the not so risky ones would stay up. It's a complicated scenario because part of the reason the big firms got so big in the first place is because they were happy to take those risks!

    The solution coming from within the banks is a nice angle I hadn't considered. The finance sector is vacuuming up the smartest college kids left right and center. I do think that the 'incentives' that you speak of may be as difficult to implement as an actual solution!
    "Education is the only thing you can do that will change society. Everything else is just a band-aid." - Jacqueline de Chollet
    "Democracy cannot succeed unless those who express their choice are prepared to choose wisely. The real safeguard of democracy, therefore, is education" - FDR

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    Re: Bernie Sanders To Introduce Bill To Break Up The Big Banks

    Quote Originally Posted by Anomalism View Post
    Bernie Sanders understands that an economy cannot function properly with all of the wealth and power concentrated at the top. He understands that when the people on the bottom are making more money it stimulates the economy. He understands that breaking up monopolies and creating competition is how you make the market healthier. He understands capitalism better than his Republican counterparts.
    The banking sector has literally nothing to do with capitalism.

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    Re: Bernie Sanders To Introduce Bill To Break Up The Big Banks

    Quote Originally Posted by Thrilla View Post
    the thing about anti-trust laws is that they are entirely geared towards enforcing competition between rival firms/industries..... "too big to fail" is NOT a competition problem, nor did the relative size of these firms lead to the problems we had( thier actions, however, did)
    "Too big to fail" may not have caused the problems, but it limited the possible solutions. We had to bail out the big banks to prevent the major consequences to the economy likely to occur of they were allowed to fail. We should not allow financial institutions to get so big that their failure would impact the economy significantly.

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    Re: Bernie Sanders To Introduce Bill To Break Up The Big Banks

    Quote Originally Posted by Hard Truth View Post
    "Too big to fail" may not have caused the problems, but it limited the possible solutions. We had to bail out the big banks to prevent the major consequences to the economy likely to occur of they were allowed to fail. We should not allow financial institutions to get so big that their failure would impact the economy significantly.
    how big... exactly.... is " too big"?

    and why would it matter how big a bank was if its actions were regulated to mitigate systemic risk?

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    Re: Bernie Sanders To Introduce Bill To Break Up The Big Banks

    Quote Originally Posted by Thrilla View Post
    how big... exactly.... is " too big"?

    and why would it matter how big a bank was if its actions were regulated to mitigate systemic risk?
    I don't know where to draw the line for "too bog." That should be done by experts. As we saw with derivatives, excessively risky activities can be legal.

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    Re: Bernie Sanders To Introduce Bill To Break Up The Big Banks

    Quote Originally Posted by Hard Truth View Post
    I don't know where to draw the line for "too bog." That should be done by experts. As we saw with derivatives, excessively risky activities can be legal.
    experts aren't going to set a limit... the experts work for the banks.

    and that's true about derivatives, they were legal ( so much for govt. experts knowing what they are doing, eh?).... and it should, among other things, make you ponder why deriviatives were invented in the first place.

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    Re: Bernie Sanders To Introduce Bill To Break Up The Big Banks

    I remember back in the 80's when they changed the rules to allow interstate banking. Now, apparently we want to go back to the old way. Personally, I think it is a good idea. I would make it optional, though. Change the FDIC rules to exclude interstate banks from deposit insurance. The banks can decide and, obviously, the net result will be fewer interstate banks. They talk about these banks being too big to fail. I think of them as too big to succeed.

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    Re: Bernie Sanders To Introduce Bill To Break Up The Big Banks

    Quote Originally Posted by Nilly View Post
    All I hear from you in this thread is faint bleating about 'socialism', 'Bernie doesn't have a clue' and 'Obama sucks'. Even if the points you are making were even related to OP, you're not even substantiating them. Are you even going to attempt to discuss the actual topic at hand?



    So our options are to either limit the size of these institutions, or implement further regulation as to what they can do (a la Glass Steagal). The problem with just holding them accountable is that we can't hold them accountable because they're too big. If we did hold them accountable, then they would take down half the economy with them, because they're too big to fail.
    Bernie doesn't have a clue.

    I've read through his 12 point plan so I should know.

    The GSEs were far more complicit in creating the Subprime mortgage crisis than any bank was.

    They were the only two Financial entities investigated by the SEC for their involvement in misreporting their massive amounts of debt and profits

    But I never hear leftist and or Sanders rail against their unprecedented level of corruption and thats mainly because they were run and protected by the Democrats.

    Sanders is more of the same. Obama's destructive ideology on steroids and his policies would crater whats left of this already weak economy.

    And Glass Steagal had little to do with the Subprime mortgage crisis.

    2 years before it was passed Freddie. mac guaranteed 380 Million dollars in Subprime backed securities.
    Last edited by Fenton; 05-06-15 at 05:09 PM.

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    Re: Bernie Sanders To Introduce Bill To Break Up The Big Banks

    Quote Originally Posted by Hard Truth View Post
    "Too big to fail" may not have caused the problems, but it limited the possible solutions. We had to bail out the big banks to prevent the major consequences to the economy likely to occur of they were allowed to fail. We should not allow financial institutions to get so big that their failure would impact the economy significantly.
    Funny that, the Bush administration basically said the very same thing about Fannie Mae and Freddie Mac back in 2002.

    Even warned of the systemic economic consequences that could arise from two massive Financial entities not being regulated thoroughly.

    The Banks were bailed out and they paid it back.

    Fannie and Freddie were declared insolvent, and the US took om 5 Trillion dollars of their worthless debt.

    The US FED has taken on another 3 Trillion plus more.

    So 750 Billion in TARP is paid bqck qnd Trillions in GSE securities and loans get piled onto the Treasury.

    And not a word from Bernie about it. He's a Socialist, they have the priorities a little backwards.

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