Donald Trump Plans to Undo Dodd-Frank Law, Fiduciary Rule

JasperL · Feb 8, 2017

cpwill said:
Not only is that untrue, it has become more untrue over the past few decades .

Since when have Republicans/conservatives been concerned with enforcing anti-trust rules, for example?

Regulations are what keep them big :shrug:. That's why they invest so much on purchasing the regulators.

I see this assertion all the time but have never actually read a coherent demonstration of it. Just as an example, the 'fiduciary' rules that the Trump EO apparently struck down arguably actually favor larger entities because of the regulatory burdens of complying with them. But the big banks/Wall Street firms lobbied hard for their repeal... Also, if regulatory burdens pose too heavy a burden on smaller entities, I'm not sure the answer is to ditch them but rather target the capital, etc. requirements on those entities that will require taxpayer bailouts or risk a collapse of the system.

And consolidation isn't just happening with financial firms - it's a feature of the last few decades of the U.S. across at least nearly all industries if not every industry, nearly every sector. And if that is the problem - industries becoming too big and therefore able to consolidate political power - then what is the conservative response to that other than let the market work, when we see what happens when that is the regulatory approach, which is to consolidate/merge into just a few massive firms controlling the vast majority of nearly every sector of our economy.

JasperL · Feb 8, 2017

apdst said:
Who passed and signed CRA? You guessed it, the Democrats.

Yes, and....?

1) When asked, regulated banks told us CRA was a nuisance to the affected banks, who were only a part of the problem, and the vast majority of toxic lending occurred outside areas affected by CRA (i.e. in relatively wealthy suburbs) and by firms not subject to CRA, and CRA loans on average performed far better than other loans in the affected areas.

2) Related, if CRA was such a burden, I'm sure you can show where the affected banks pushed hard for repeal of CRA, or to lessen the regulatory burdens, right? Please show me this effort!

3) Democrats are all powerful and can ram this stuff through with small majorities in Congress, but Republicans when they have power (such as from 1995-2007) are powerless to change any of this? How does that work?

poweRob · Feb 8, 2017

Cardinal said:
Remember when voters rallied to Trump under the banner that financial institutions should be so large and unprepared that in the event of a crisis they could single-handedly destroy the entire economy? And remember when they screamed for financial advisors not to act in their clients' best interests? Yeah, neither do I.

https://www.wsj.com/articles/trump-moves-to-undo-dodd-frank-law-1486101602/

When he said that you must've missed the end part where he said, "j/k lol".

apdst · Feb 8, 2017

JasperL said:
Yes, and....?

1) When asked, regulated banks told us CRA was a nuisance to the affected banks, who were only a part of the problem, and the vast majority of toxic lending occurred outside areas affected by CRA (i.e. in relatively wealthy suburbs) and by firms not subject to CRA, and CRA loans on average performed far better than other loans in the affected areas.

2) Related, if CRA was such a burden, I'm sure you can show where the affected banks pushed hard for repeal of CRA, or to lessen the regulatory burdens, right? Please show me this effort!

3) Democrats are all powerful and can ram this stuff through with small majorities in Congress, but Republicans when they have power (such as from 1995-2007) are powerless to change any of this? How does that work?

And...

https://www.google.com/amp/amp.dail...subprime-loans-to-chicagos-african-americans/

iguanaman · Feb 8, 2017

apdst said:
Who passed and signed CRA? You guessed it, the Democrats.

CRA loans had rather high income qualifications and also had lower than average default rates.

Cassandra · Feb 8, 2017

apdst said:
Of course the Feds weren't going to investigate these banks; the Feds created the bubble. Thousands of people, who wouldn't otherwise qualify for a mortgage, were getting loans...because that was fair.

There is no bright line between government and private enterprise. Look at Trump's cabinetBlaming government as you seem to do, suggests that you think that capitalism can function w/o watch dogs and regulation. If Repubs had the courage of their convictions they would break up the big banks and put a Tobin tax in place. They won't, therefore the current capital requirements are essential for the big banks who will always take unnecessary risks if allowed.

apdst · Feb 8, 2017

Cassandra said:
There is no bright line between government and private enterprise. Look at Trump's cabinetBlaming government as you seem to do, suggests that you think that capitalism can function w/o watch dogs and regulation. If Repubs had the courage of their convictions they would break up the big banks and put a Tobin tax in place. They won't, therefore the current capital requirements are essential for the big banks who will always take unnecessary risks if allowed.

The government created the bubble. That fact isn't debatable.

apdst · Feb 8, 2017

iguanaman said:
CRA loans had rather high income qualifications and also had lower than average default rates.

Here's How The Community Reinvestment Act Led To The Housing Bubble's Lax Lending - Business Insider

JasperL · Feb 8, 2017

apdst said:
And...

https://www.google.com/amp/amp.dail...subprime-loans-to-chicagos-african-americans/

First of all, you're unable to actually debate anything on this subject, which is why you quote me, then ignore every word.

Second, I'm not reading your article to hopefully figure out what your point is. The headline is a beauty, though!

With landmark lawsuit, Barack Obama pushed banks to give subprime loans to Chicago’s African-Americans

It's a right wing emotional response hat trick - Obama! Poor blahs!! Chicago!!

Those dastardly poor inner-city blahs with no power and no political influence, all the time rolling Wall Street in the halls of Congress.... :lamo

apdst · Feb 8, 2017

JasperL said:
First of all, you're unable to actually debate anything on this subject, which is why you quote me, then ignore every word.

Second, I'm not reading your article to hopefully figure out what your point is. The headline is a beauty, though!

It's a right wing emotional response hat trick - Obama! Poor blahs!! Chicago!!

Those dastardly poor inner-city blahs with no power and no political influence, all the time rolling Wall Street in the halls of Congress.... :lamo

Of course you aren't going to read it. It would destroy the Leftist fairy tale land you live in.

SenorXm/Sirius · Feb 8, 2017

Part of me is laughing at how gullible Trump voters were, and are to believe an elitist billionaire business man from Manhattan who loves wall street and big banks would 'drain the swamp' and be a 'populist'. lol

But another part of me is happy.. The banks WILL crash the economy again, which will cause pain and be awful. Because the banks will look at Wall Street like a casino again. But when it crashes, though it will be painful the Republicans will, rightfully, get blamed. And once and for all for the good of the country maybe, just maybe we can get rid of the current GOP and another true 'conservative' party will be formed. Because the current GOP is a disgrace and a joke, especially for Middle Class Americans.

JasperL · Feb 8, 2017

apdst said:
The government created the bubble. That fact isn't debatable.

Frankly any assertion that the bubble was caused by __________ is just nonsense, and it doesn't matter what factor you put on that line.

tres borrachos · Feb 8, 2017

JasperL said:
Yes, and....?

1) When asked, regulated banks told us CRA was a nuisance to the affected banks, who were only a part of the problem, and the vast majority of toxic lending occurred outside areas affected by CRA (i.e. in relatively wealthy suburbs) and by firms not subject to CRA, and CRA loans on average performed far better than other loans in the affected areas.

2) Related, if CRA was such a burden, I'm sure you can show where the affected banks pushed hard for repeal of CRA, or to lessen the regulatory burdens, right? Please show me this effort!

3) Democrats are all powerful and can ram this stuff through with small majorities in Congress, but Republicans when they have power (such as from 1995-2007) are powerless to change any of this? How does that work?

The CRA is still around, and actually it's a bigger burden on banks than it ever was. But the loans actually perform well. And there is no bubble, no housing crisis, no mortgage meltdown today.

I dislike the Democrats as much as the next guy, but the CRA isn't what caused the mortgage meltdown.

And no Republican will ever roll back the CRA nor the Fair Lending Acts. Never. Not even the great and powerful Trump.

apdst · Feb 8, 2017

JasperL said:
Frankly any assertion that the bubble was caused by __________ is just nonsense, and it doesn't matter what factor you put on that line.

It caused itself? :lamo

JasperL · Feb 8, 2017

apdst said:
Of course you aren't going to read it. It would destroy the Leftist fairy tale land you live in.

Right, an article in the Daily Caller is going to open my eyes on this subject, about which I've read several books and probably 500 articles or more.

Nope. The reason I won't read your article is I'm not your research assistant, and so will let you read it, highlight what you think is important, and make your own argument.

iguanaman · Feb 8, 2017

apdst said:
Here's How The Community Reinvestment Act Led To The Housing Bubble's Lax Lending - Business Insider

LOL The only thing the CRA led to is to Republicans blaming their own housing bubble on it with no evidence. GW Bush reduced lending standards and that had nothing to do with the CRA.

So Bush had to, in his words, "use the mighty muscle of the federal government" to meet his goal. He proposed affordable housing tax incentives. He insisted that Fannie Mae and Freddie Mac meet ambitious new goals for low-income lending.

Concerned that down payments were a barrier, Bush persuaded Congress to spend as much as $200 million a year to help first-time buyers with down payments and closing costs.

And he pushed to allow first-time buyers to qualify for government insured mortgages with no money down. Republican congressional leaders and some housing advocates balked, arguing that homeowners with no stake in their investments would be more prone to walk away, as West did. Many economic experts, including some in the White House, now share that view.

The president also leaned on mortgage brokers and lenders to devise their own innovations. "Corporate America," he said, "has a responsibility to work to make America a compassionate place."

And corporate America, eyeing a lucrative market, delivered in ways Bush might not have expected, with a proliferation of too-good-to-be-true teaser rates and interest-only loans that were sold to investors in a loosely regulated environment. But Bush populated the financial system's alphabet soup of oversight agencies with people who, like him, wanted fewer rules, not more.

Bush drive for home ownership fueled housing bubble - The New York Times

JasperL · Feb 8, 2017

apdst said:
It caused itself? :lamo

No, obviously for something as big as a WORLD WIDE DEBT AND RELATED HOUSING BUBBLE that threatened the collapse of the western financial system itself, there are many contributing factors.

fmw · Feb 8, 2017

Cardinal said:
Remember when voters rallied to Trump under the banner that financial institutions should be so large and unprepared that in the event of a crisis they could single-handedly destroy the entire economy?

No, I don't know anybody who voted for that.

And remember when they screamed for financial advisors not to act in their clients' best interests? Yeah, neither do I.

Click to expand...

That makes two of us. But getting rid of Dodd Frank will open up a lot of capital for businesses to use for growth. But you prefer government growth to private sector growth so I can see why you like Dodd Frank.

https://www.wsj.com/articles/trump-moves-to-undo-dodd-frank-law-1486101602/

Click to expand...

Cassandra · Feb 8, 2017

apdst said:
Of course you aren't going to read it. It would destroy the Leftist fairy tale land you live in.

And yet, it is principally the guys in government who, LIKE YOU ,don't believe in government, that allowed that mess to happen. Was anyone more shocked than Ayn Rand's acolyte , Greenspan, when his house of cards fell apart.

cpwill · Feb 8, 2017

JasperL said:
Since when have Republicans/conservatives been concerned with enforcing anti-trust rules, for example?

Anti-Trust laws aren't what has accelerated the pace at which newer competition drives out older, larger, businesses - if anything, Anti-Trust laws are generally anti-competitive devices, designed to bring political pressure to bear to benefit a particular set of companies facing stiff competition they'd rather not match.

Innovation and Competition is what causes turnover, and allows up and coming companies to beat the older giants.

1. US corporations in the S&P500 in 1958 remained in the index for an average of 61 years. By 1980, the average tenure of an S&P500 firm was 25 years, and by 2011 that average shortened to 18 years based on seven year rolling averages. In other words, the churn rate of companies in the S&P500 has been accelerating over time (see top chart above, and examples of the S&P500 churn in the bottom chart).

2. On average, an S&P 500 company is now being replaced about once every two weeks.

3. At the current churn rate, 75% of the S&P 500 firms in 2011 will be replaced by new firms entering the S&P500 in 2027.

4. In 2011, a total of 23 companies were removed from the S&P500, either due to declines in market value (for instance, Radio Shack’s stock no longer qualified as of June) or through an acquisition (for instance, National Semiconductor was bought by Texas Instruments in September).

The same is true for the dreaded top 1% of income earners:

...We also know from income mobility data that a very large percentage in the top 1% are "new rich," not inheritors of fortunes. There is rapid turnover in the ranks of the highest income earners, so much so that people who started in the top 1% of income in the 1980s and 1990s suffered the largest declines in earnings of any income group over the subsequent decade, according to Treasury Department studies of actual tax returns. It's hard to stay king of the hill in America for long...

I see this assertion all the time but have never actually read a coherent demonstration of it. Just as an example, the 'fiduciary' rules that the Trump EO apparently struck down arguably actually favor larger entities because of the regulatory burdens of complying with them.

Thank you - exactly. Regulatory burdens create compliance and complexity costs, which act as a barrier to entry, and protect the position of ensconced large players at the expense of their smaller, newer competitors.

But the big banks/Wall Street firms lobbied hard for their repeal... Also, if regulatory burdens pose too heavy a burden on smaller entities, I'm not sure the answer is to ditch them but rather target the capital, etc. requirements on those entities that will require taxpayer bailouts or risk a collapse of the system.

We don't (yet, yeesh) bail out IRA's.

And consolidation isn't just happening with financial firms - it's a feature of the last few decades of the U.S. across at least nearly all industries if not every industry, nearly every sector. And if that is the problem - industries becoming too big and therefore able to consolidate political power - then what is the conservative response to that other than let the market work, when we see what happens when that is the regulatory approach, which is to consolidate/merge into just a few massive firms controlling the vast majority of nearly every sector of our economy.

And the Corporations are acting all Corporationy in their Corporate Buildings!!!

I think you have this pretty much reversed - the trend for the past few years has been disaggregation. We aren't in the highly corporatist 1950s anymore.

JasperL · Feb 8, 2017

cpwill said:
Anti-Trust laws aren't what has accelerated the pace at which newer competition drives out older, larger, businesses - if anything, Anti-Trust laws are generally anti-competitive devices, designed to bring political pressure to bear to benefit a particular set of companies facing stiff competition they'd rather not match.

Innovation and Competition is what causes turnover, and allows up and coming companies to beat the older giants.

1. US corporations in the S&P500 in 1958 remained in the index for an average of 61 years. By 1980, the average tenure of an S&P500 firm was 25 years, and by 2011 that average shortened to 18 years based on seven year rolling averages. In other words, the churn rate of companies in the S&P500 has been accelerating over time (see top chart above, and examples of the S&P500 churn in the bottom chart).

2. On average, an S&P 500 company is now being replaced about once every two weeks.

3. At the current churn rate, 75% of the S&P 500 firms in 2011 will be replaced by new firms entering the S&P500 in 2027.

4. In 2011, a total of 23 companies were removed from the S&P500, either due to declines in market value (for instance, Radio Shack’s stock no longer qualified as of June) or through an acquisition (for instance, National Semiconductor was bought by Texas Instruments in September).

OK, but just for example, we're talking about finance on this thread and the six biggest firms value increased from 17% of U.S. GDP in 1995 to 64% of GDP in 2010. And overall, the concentration ratio in this country is going up, not down, with an increasing number of industries in which 4 firms make up 50% or more of total shipments: Source

Here's banking:

6a00d83451b33869e2013480033c4a970c-800wi

The same is true for the dreaded top 1% of income earners:

...We also know from income mobility data that a very large percentage in the top 1% are "new rich," not inheritors of fortunes. There is rapid turnover in the ranks of the highest income earners, so much so that people who started in the top 1% of income in the 1980s and 1990s suffered the largest declines in earnings of any income group over the subsequent decade, according to Treasury Department studies of actual tax returns. It's hard to stay king of the hill in America for long...

OK, but I'm not sure how this relates to our topic.

Thank you - exactly. Regulatory burdens create compliance and complexity costs, which act as a barrier to entry, and protect the position of ensconced large players at the expense of their smaller, newer competitors.

You missed the point - the big boys aren't lobbying FOR keeping the regs but for getting rid of them.

We don't (yet, yeesh) bail out IRA's.

???? We don't bail out households either, but that's not the point. As I said, if the regulatory system is too burdensome for smaller banks, a better answer might be to exempt the smaller entities instead of letting the systemically critical behemoths self regulate.

And the Corporations are acting all Corporationy in their Corporate Buildings!!!

I think you have this pretty much reversed - the trend for the past few years has been disaggregation. We aren't in the highly corporatist 1950s anymore.

Evidence for that assertion, please. I've never seen it, and see above....

cpwill · Feb 8, 2017

JasperL said:
OK, but just for example, we're talking about finance on this thread and the six biggest firms value increased from 17% of U.S. GDP in 1995 to 64% of GDP in 2010. And overall, the concentration ratio in this country is going up, not down, with an increasing number of industries in which 4 firms make up 50% or more of total shipments: Source

View attachment 67213678

Here's banking:

Gosh. It's almost as if Dodd-Frank had the effect of shutting down smaller banks, enabling further consolidating of the finance industry.

OK, but I'm not sure how this relates to our topic.

The two are alike.

You missed the point - the big boys aren't lobbying FOR keeping the regs but for getting rid of them.

:shrug: It's a rule designed to limit the ability of low middle income people to get advice.

We don't bail out households either, but that's not the point. As I said, if the regulatory system is too burdensome for smaller banks, a better answer might be to exempt the smaller entities instead of letting the systemically critical behemoths self regulate.

And let predatory evil bankers target the poor by giving them money?

Sent from my XT1526 using Tapatalk

JasperL · Feb 8, 2017

cpwill said:
Gosh. It's almost as if Dodd-Frank had the effect of shutting down smaller banks, enabling further consolidating of the finance industry.

Which graph are you looking at? That one stopped in 2009, and Dodd-Frank passed in 2009. In the 20 years preceding Dodd-Frank the top 3 went from 10% to 40%.... I don't really think a law not in effect caused the consolidation of the finance industry. What happened post 2008 was just more of that straight line UP that you saw pre-Dodd-Frank, unless you have another explanation.

And you said we were in a period of general "disagreggation" but the data that I've seen show the opposite, for banking and the broader economy. Got any evidence for that "disaggregation" claim?

The two are alike.

In that more and more income and wealth are being concentrated in fewer and fewer hands? Yes, I agree, but I don't think that is your point... If you disagree, data please.

:shrug: It's a rule designed to limit the ability of low middle income people to get advice.

No, it's not. Where in the world do you get this crap?

And you're deliberately missing the point. I thought the big boys WANTED these regs to drive out their little competitors but that's not in fact the case. And I've never actually seen a coherent argument making the case that regulations are lobbied FOR by the big boys to create barriers for the upstarts except for a few isolated anecdotes, and I've certainly never seen it by the big banks. Bush appointed a bunch of people committed to the hands off approach for the banking industry, which they LOVED. Etc.

You're making a bunch of assertions with nothing to back them up.

And let predatory evil bankers target the poor by giving them money?

WTF does that mean? First of all, you're not even trying to have an intelligent conversation on this, and if you're serious, it's an amazingly ignorant dismissal of the damage to real people by predatory lenders.

Donald Trump Plans to Undo Dodd-Frank Law, Fiduciary Rule

JasperL

JasperL

poweRob

USMC 1988-1996

apdst

iguanaman

Cassandra

apdst

apdst

JasperL

apdst

SenorXm/Sirius

JasperL

tres borrachos

HoHoHo

apdst

JasperL

iguanaman

JasperL

fmw

Cassandra

cpwill

JasperL

cpwill

JasperL