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Thread: Elizabeth Warren: 'Too Big To Fail' Is Worse Than Before Financial Crisis

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    Re: Elizabeth Warren: 'Too Big To Fail' Is Worse Than Before Financial Crisis

    Quote Originally Posted by Henry David View Post
    Yes, I understand that. And the reason large financial institutions could do that was because the law that had prohibited such behavior for 60+ years, Glass-Steagall, had been repealed. GS was passed to prevent such behavior, because that behavior is what led to the Great Depression.

    It's kinda like wearing a helmet when engaged in risky behavior. When the helmet is removed, bad things can and will happen.
    Well, my take is that I'm not against the banks doing that. I'm against the banks doing it, losing all their money, and coming back to daddy (Washington) and saying "dad I'm broke, can I have more money?".

    They used money market tools that could make money - could. They should be allowed to use them. They just should be able to regret it too. I prefer that over legislation just simply preventing them from doing it. If the banks continue to be that stupid, then maybe they should fail. Businesses fail all the time. It's a good lesson.

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    Re: Elizabeth Warren: 'Too Big To Fail' Is Worse Than Before Financial Crisis

    Quote Originally Posted by Gipper View Post
    Well, my take is that I'm not against the banks doing that. I'm against the banks doing it, losing all their money, and coming back to daddy (Washington) and saying "dad I'm broke, can I have more money?".

    They used money market tools that could make money - could. They should be allowed to use them. They just should be able to regret it too. I prefer that over legislation just simply preventing them from doing it. If the banks continue to be that stupid, then maybe they should fail. Businesses fail all the time. It's a good lesson.
    I am neither a banker nor an economist, but my understanding of what GS did was to separate investment banking from community banking. An investment bank COULD NOT under GS be involved in community banking, with mortgages and such.

    When the statute was repealed that distinction went away, and it because like a big crap-shoot. Community banks were owned or controlled by the investment banks, and so people's money and equity were thrown into the gambling ring.

    Restoration of GS would simply separate the banks.

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    Re: Elizabeth Warren: 'Too Big To Fail' Is Worse Than Before Financial Crisis

    Quote Originally Posted by TheDemSocialist View Post
    Read more @: Elizabeth Warren: 'Too Big To Fail' Is Worse Than Before Financial Crisis

    This is an outrage. We went the total wrong direction on this. Instead of ending this too big to fail ****, its gotten worse! We need to bring back Glass Stegal. [/FONT][/COLOR]
    And sub-prime mortgages are still out there. Interest only loans are still out there. Did the "financial reform", aka, Dodds-Franks, actually do anything? No? Could that be because despite all the press and the hoopla, the dems didn't actually know jack about what caused and contributed to the failure?
    Only a fool measures equality by results and not opportunities.

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    Re: Elizabeth Warren: 'Too Big To Fail' Is Worse Than Before Financial Crisis

    Quote Originally Posted by Henry David View Post
    …An investment bank COULD NOT under GS be involved in community banking, with mortgages and such.

    Restoration of GS would simply separate the banks.
    I once thought this until I came across this:
    Beginning in the 1970s and 1980s, requests for approval to engage in a greater universe of securities activities were largely granted by the OCC and the FRB, and, in most cases, have been approved by courts. By the time that the GLBA was enacted in 1999, the FRB had authorized certain BHCs and their subsidiaries to underwrite and deal in an array of bank-ineligible securities, including municipal bonds, commercial paper, mortgage-backed securities and other consumer-related securities, corporate debt securities, and corporate equity securities. In addition to underwriting and dealing activities, the FRB also approved other securities activities such as the provision of investment advice,22 the brokering of securities,23 and others. The FRB promulgated the list of permissible nonbanking activities at 12 C.F.R. 225.28(b).
    pg 4
    http://www.fas.org/sgp/crs/misc/R41298.pdf

    It would seem that comingling banking/investments had been enabled long before GS was repealed. Further considering the Federal Reserve’s ability to ‘redefine’ banks abilities I question that the restoration of GS would solve anything…?
    "The fact that we are here today to debate raising America's debt limit is a sign of leadership failure" - 2006 Senator Obama...leadership failure indeed!

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    Re: Elizabeth Warren: 'Too Big To Fail' Is Worse Than Before Financial Crisis

    Quote Originally Posted by DVSentinel View Post
    And sub-prime mortgages are still out there. Interest only loans are still out there. Did the "financial reform", aka, Dodds-Franks, actually do anything? No? Could that be because despite all the press and the hoopla, the dems didn't actually know jack about what caused and contributed to the failure?
    It appears to me that the US Gov't takes the lead in those interest only loans since we never pay back the principal on our debt. Do you think the gov't sets a bad example?

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    Re: Elizabeth Warren: 'Too Big To Fail' Is Worse Than Before Financial Crisis

    Quote Originally Posted by Dickieboy View Post
    I once thought this until I came across this:

    pg 4
    http://www.fas.org/sgp/crs/misc/R41298.pdf

    It would seem that comingling banking/investments had been enabled long before GS was repealed. Further considering the Federal Reserve’s ability to ‘redefine’ banks abilities I question that the restoration of GS would solve anything…?
    A friend and I were discussing this just yesterday.

    Perhaps the events you mention above are what led to the RTC and the great savings & loan debacle of the 80's?

    The S&L crisis, Frank Keating and one of the Bushes, preceded the repeal of GS in time, and may have helped set the stage for the repeal of GS?

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    Re: Elizabeth Warren: 'Too Big To Fail' Is Worse Than Before Financial Crisis

    Quote Originally Posted by Henry David View Post
    Perhaps the events you mention above are what led to the RTC and the great savings & loan debacle of the 80's?
    I don't remember the S&L being engaged in derivatives. IIRC their main issue was making subprime mortgage loans to take advantage of the high interest rates being charged.

    The S&L crisis, Frank Keating and one of the Bushes, preceded the repeal of GS in time, and may have helped set the stage for the repeal of GS?
    Maybe...?
    "The fact that we are here today to debate raising America's debt limit is a sign of leadership failure" - 2006 Senator Obama...leadership failure indeed!

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    Re: Elizabeth Warren: 'Too Big To Fail' Is Worse Than Before Financial Crisis

    Quote Originally Posted by TheDemSocialist View Post
    Well you see the ones calling for Glass-Stegal to come back are the dems..... So your whole post makes no sense.
    How many dems?

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    Re: Elizabeth Warren: 'Too Big To Fail' Is Worse Than Before Financial Crisis

    Quote Originally Posted by MichaelJR View Post
    How many dems?
    A good handful in the progressive wing.


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    Re: Elizabeth Warren: 'Too Big To Fail' Is Worse Than Before Financial Crisis

    Quote Originally Posted by American View Post
    Nope, prior to 2010 they ran the show 100%.
    Actually, if you want to be more accurate, you'd say "prior to early 2011 they ran the show."

    Even more time to do stuff.
    Michael J Petrilli-"Is School Choice Enough?"-A response to the recent timidity of American conservatives toward education reform. https://nationalaffairs.com/publicat...-choice-enough

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