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House, Senate leaders finalize details of sweeping financial overhaul

justabubba said:
^ now, there's a solution [/sarcasm]

it's amazing that those who defended dubya seem not to now be able to recognize the meltdown occurred on his watch
the new president is trying to clean up the inherited mess and install some semblance of regulation where there was none
after dicknbush's treasury transferred taxpayer dollars of the wage earner to cover the losses of the wealthy
an amazingly ignorant bunch with the collective memory of an alzheimers patient
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It's Obama's mess now..no excuses, and Obama is making it worse not to mention he's pissing all over the constitution along with all his Marxist minions and in there lays my biggest complaint.
 
RightinNYC said:
Can you tell me exactly what problems existed and how this bill fixed them?
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I think we all know what problems existed, now that the banks had to be bailed out. All that has been discussed at some length. Do you mean to say that you're unaware of the problems that existed prior to the crash of '08?

As for how and whether the bill will fix them, we won't know that until it becomes public. Right now, it has yet to be debated by the full house or senate.
 
Dittohead not! said:
I think we all know what problems existed, now that the banks had to be bailed out. All that has been discussed at some length. Do you mean to say that you're unaware of the problems that existed prior to the crash of '08?

As for how and whether the bill will fix them, we won't know that until it becomes public. Right now, it has yet to be debated by the full house or senate.
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So more government is the answer but don't touch Fanny or Freddy?
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when tarp failed the first time, stocks fell 777 points.
 
the govt nationalized fannie and freddie.
 
ptif219 said:
So more government is the answer but don't touch Fanny or Freddy?
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Now, that's just a stupid response. Why quote me, then come up with an off the wall response like that? Why not just post without a quote, and leave the rest of us wondering what the hell you meant?

That way, we could just ignore you.

Come to think of it, that's a good idea.
 
Dittohead not! said:
Surely, no one is going to argue that financial reform wasn't needed, are they?
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Explain how a lack of regulation lead to the collapse of the housing and financial sectors.

So, are there arguments for or against this particular bill that don't hinge on "Democrats (Republicans) are all a bunch of idiots"?

You know, arguments about what is actually being proposed?
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I would maintain that government policies were the cause of the recent collapse, and that "financial reform" is just another red herring in a long line of red herrings to absolve the government of its involvement in yet another distortion of the market.
 
Dittohead not! said:
Now, that's just a stupid response. Why quote me, then come up with an off the wall response like that? Why not just post without a quote, and leave the rest of us wondering what the hell you meant?

That way, we could just ignore you.



Come to think of it, that's a good idea.
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WHY? The reason is you think this big government take over that protects the democrats Franny and Freddy is good and needed. It will hurt the economy even more.
 
scottsoperson said:
deregulation caused the financial crisis.

Credit Default Swaps: The Next Crisis? - TIME
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1. Credit default swaps are not an example of "deregulation". They were "unregulated", not "deregulated".
2. None of this explains how the use of credit default swaps caused the housing market to collapse, the failure thereof being the impetus being the subsequent collapse of the financial sector.
3. The bottom line: Credit default swaps were just an instrument used to mitigate risk, nothing more. If people had continued to pay their mortgages, the credit default swaps wouldn't have been an issue. They were a symptom of the underlying ailment, not the cause of it.
 
alms said:
Explain how a lack of regulation lead to the collapse of the housing and financial sectors.
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Seriously? You must remember how the lack of regulation led to mortgage brokers giving out "creative" loans to people who could not pay them back, then selling the papers as good investments, don't you? Does the term "toxic assets" ring a bell? That is the sort of thing that happens when banks are allowed to gamble with other people's money. Government regulation should prohibit such practices.

alms said:
I would maintain that government policies were the cause of the recent collapse, and that "financial reform" is just another red herring in a long line of red herrings to absolve the government of its involvement in yet another distortion of the market.
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I'm not sure that the government can be absolved of its involvment, or lack thereof. It was lack of oversight that led to the housing crash and the resulting recession, pure and simple.

I have no idea whether the financial reform that is being proposed is going to solve the problem or not, and you don't either. The particulars are not public as yet.
 
Dittohead not! said:
I think we all know what problems existed, now that the banks had to be bailed out. All that has been discussed at some length. Do you mean to say that you're unaware of the problems that existed prior to the crash of '08?
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No, I'm asking you for specifics about what you understand to be the problems that need to be fixed. In my experience, the vast majority of people who talk about the need to "fix" the financial system don't really have a concrete idea of what that really means.

As for how and whether the bill will fix them, we won't know that until it becomes public. Right now, it has yet to be debated by the full house or senate.
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A version of this bill has already passed both houses - this discussion was just over working out the kinks between the two versions. There's not going to be any more substantial debate over the bill before passage. I'm asking you how it will fix the aforementioned problems that you've identified.
 
Except that it doesn't. Banks and insurance companies are regulated; the credit swaps market is not. As a result, contracts can be traded — or swapped — from investor to investor without anyone overseeing the trades to ensure the buyer has the resources to cover the losses if the security defaults. The instruments can be bought and sold from both ends — the insured and the insurer.

All of this makes it tough for banks to value the insurance contracts and the securities on their books. And it comes at a time when banks are already reeling from write-downs on mortgage-related securities. "These are the same institutions that themselves have either directly or through subsidiaries invested in the subprime market," said Andrea Pincus, partner at Reed Smith LLP. "They're suffering losses all over the place," and now they face potentially more losses from the CDS market.

Indeed, commercial banks are among the most active in this market, with the top 25 banks holding more than $13 trillion in credit default swaps — where they acted as either the insured or insurer — at the end of the third quarter of 2007, according to the Comptroller of the Currency, a federal banking regulator. JP Morgan Chase, Citibank, Bank of America and Wachovia were ranked among the top four most active, it said.



Read more: Credit Default Swaps: The Next Crisis? - TIME
 
alms said:
Explain how a lack of regulation lead to the collapse of the housing and financial sectors.
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Easy. No regulation on banks on verification to get a loan. Banks didn't have regulation over that aspect of their business. Banking regulation deals more with what type of assets they can/must have and what their ratios are.

And there was little regulation on derivatives. AIG had CDS that total liability easily exceeded its total assets and equity. There was no way they could ever pay even a fraction if those derivatives went bad.

I would maintain that government policies were the cause of the recent collapse, and that "financial reform" is just another red herring in a long line of red herrings to absolve the government of its involvement in yet another distortion of the market.
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And you can explain this with actual facts and not partisan propaganda in actual economics terms? Or are you just another person RightinNyc is describing as effectively ignorant?
 
This bill is not enough now Obama wants a tax.

Obama calls for bank tax as next step in reform | Reuters


Obama wants to slap a 0.15 percent tax on the liabilities of the biggest U.S. financial institutions to recoup the costs to taxpayers of the financial bailout.

"We need to impose a fee on the banks that were the biggest beneficiaries of taxpayer assistance at the height of our financial crisis -- so we can recover every dime of taxpayer money," Obama said in his weekly radio and Internet address.
 
ptif219 said:
This bill is not enough now Obama wants a tax.

Obama calls for bank tax as next step in reform | Reuters


Obama wants to slap a 0.15 percent tax on the liabilities of the biggest U.S. financial institutions to recoup the costs to taxpayers of the financial bailout.

"We need to impose a fee on the banks that were the biggest beneficiaries of taxpayer assistance at the height of our financial crisis -- so we can recover every dime of taxpayer money," Obama said in his weekly radio and Internet address.
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Good to see he's still riding that populist horse.

http://www.debatepolitics.com/break.../64139-obama-unveils-proposal-bank-taxes.html

It's going to be entertaining watching him try to explain that the tax is needed because the bank bailout cost us so much money while the Treasury is simultaneously trumpeting how the bank bailout earned us a profit.
 
obvious Child said:
Easy. No regulation on banks on verification to get a loan. Banks didn't have regulation over that aspect of their business. Banking regulation deals more with what type of assets they can/must have and what their ratios are.

And there was little regulation on derivatives. AIG had CDS that total liability easily exceeded its total assets and equity. There was no way they could ever pay even a fraction if those derivatives went bad.



And you can explain this with actual facts and not partisan propaganda in actual economics terms? Or are you just another person RightinNyc is describing as effectively ignorant?
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Banks were forced to give loans to people that couldn't/didn't qualify for them because ****s like Barney Franks and Co. wanted to push "Affordable Housing for All". They used Freddie3 and Fannie as a money shell game to keep the laons going.

It had nothing to do with "lack of regulation" and everything to do with DC dicatating business practices to banks. So now we must endure a "solution" by the same bunch.
 
What law forced banks to give loans to people that could not afford them? Have any evidence to back up such statements?
 
The CRA forced banks to make faulty lending decisions. Fascinating.
 
MrVicchio said:
Banks were forced to give loans to people that couldn't/didn't qualify for them because ****s like Barney Franks and Co. wanted to push "Affordable Housing for All". They used Freddie3 and Fannie as a money shell game to keep the laons going.
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And you are one of the people RightinNYC is talking about. Loud and ignorant.

The CRA loan program had been in existence for years before with such loans being declared profitable by the banks for decades. If the CRA was indeed responsible, we would have seen this happen long before and I mean 1980s. Second, the majority of subprimes were issued by banks not covered by CRA legislation. Third, you are explicitly ignoring how the Bush administration and at the time Republican Congress pushed the ownership society agenda which systematically stripped out obstacles to home ownership. This is why you are a partisan hack. You look solely to bash Democrats without any understanding of what actually happened. Was Barney to blame? Absolutely, but there was a whole host of characters that made the play possible. You being a partisan pretend only that Democrats are to blame. No one forced investment banks to buy the securitized mortgages with leverage. No one forced Moody's to commit massive fraud in its ratings. Much of the problem that actually occurred was because good banking practices were ignored in the pursuit of greed. Furthermore, housing by itself would not have caused this mess. Many managed brokerage firms have gotten whacked because they did not see the connection between the securitized loans and the ridiculous leverage on Wallstreet. Housing by itself is too small a part of the economy to cause this mess. But when investment banks buy the securitized mortgages with debt and the stream of income stops, they still have a liability to cover.

I fully realize you don't understand how this works and I'm willing to give you a pass considering 95% of this forum doesn't either, but stop being an outrageous partisan. Realize you are ignorant and take steps to alleviate that. Or I will make an exception to my signature just to make your life unpleasant.

It had nothing to do with "lack of regulation" and everything to do with DC dicatating business practices to banks. So now we must endure a "solution" by the same bunch.
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Says the person who cannot explain how it actually happened.

It amazes me how people so incredibly ignorant of such topics think they can talk about it to those who have demonstrated time and time again they actually understand.

I see you flat up ignored my part about CDS and asset coverage. Probably because you don't have a clue about what I'm actually talking about
 
Goldenboy219 said:
The CRA forced banks to make faulty lending decisions. Fascinating.
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Two types of research on loan profitability have been conducted, one based on a special survey of banking institutions’ experiences and the other on statistical analysis of standardized reports filed by all banking institutions. The Federal Reserve Bank of Kansas City’s 1995 survey focused on home-purchase lending; its main finding was that CRA-related lending was profitable, but somewhat less so than traditional lending. Statistical analysis of Call Report data, merged with data on home-purchase lending, showed that institutions doing relatively more lower-income mortgage lending are no less profitable than other institutions.
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The Performance and Profitability of CRA-Related Lending

Huh. I'm still amazed how people think the CRA caused this mess when it was enacted in 1977. I'm still amazed people think that a tiny part of the economy could have caused this mess. Apparently they don't seem to understand how purchasing securities that end up being worthless with leverage is a big fat problem. Or how issuing what amounts to specific contractual issurance when you don't have anywhere near the assets to cover a fraction of the potential liability is a problem as well.

No wonder we have bad government. We have idiot, uninformed voters.
 
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