Bad policy followed by unconscionable greed by the banksters. Regulation is required if this is to be avoided, there is nothing wrong with fiscal responsibility and a lot right with it.

The "greed" is required by regulation and called "the fiduciary duty to the shareholder" It is the requirement that the bank find every possible way to make money and do so. Every way, legal or illegal, just make sure you turn a profit doing so. If you don't do this "greed" they will put you in jail. Hence when they conned wall street into credit default swaps, they were just doing their legally mandated job.

Gary I seriously doubt the illegal part, and as an aside I think jail time is appropriate.

Remember, illegal for a corporation is a fine. (we aren't talking armed robbery, just violating a regulation) If the profit is bigger than the fine, and it frequently is, then it makes business sense.

Glass-Steagall worked and we fixed it.

Don't you mean repealed it?

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The 2008 meltdown was the direct result of a harmful combination of government law AND regulation.

That statement is so funny it makes me thinks you're trying to be a comedian.
Corporate greed had nothing to do with the meltdown?
I guess i'll reserve my critical acceptance for the things that Elizabeth Warren
has to say on the 2008 financial crisis, and put what you say in the same category as Glenn Beck,
Rush Limbaugh, and Sean Hannity, the ravings of the lunatic fringe.
I'm sure you'll take that as a compliment.

You're being funny.


Limburger (stinky cheese), Glenn Beck, and Sean Hannity are on air media personalities. Their primary function, especially Limburger's, is entertainment. I have listened to/watched each of them, didn't always agree, got bored with them, and quit listening/watching.

You claim each is 'lunatic fringe'. Uhh... no. Each is quite a bit more mainstream Republican than fringe. You imply that you don't like them. That is fine by me, I don't like them much either. They tend to be more along the lines of Republican mouthpieces. And, as I have said, I am not a Republican.

I, however, am Libertarian, for the most part. Therefore I AM 'fringe', though I would, of course, dispute the lunatic part.

I prefer to listen to entertainment of this sort that has a strong Libertarian element to it. It is more to my liking. If you are going to tar and feather me over following some media figure, at least use the correct ones, please. Then you might even be correct. In this case, you are not.

To make things easy for you, I will tell you a bit about my preferences.

My two favorite 'news media opinion/analysts' are:

Judge Andrew Napolitano http://www.foxbusiness.com/watch/anchors-reporters/judge-andrew-napolitano-bio/

and John Stossel http://www.foxbusiness.com/watch/anchors-reporters/john-stossel-bio/

Both are decidedly Libertarian in their views. Both had their own daily shows on the Fox Business Network until Fox Business decided to cancel Napolitano's show totally (and make him just a guest analyst on other shows) and reduce Stossel's show to only one day a week.

Other personalities on Fox Business I used to enjoy watching:

I would start my day with Stuart Varney (born in the UK, by the way). He was quite entertaining and informative, though more of a Republican than the first two. He had more of an outsider's perspective on US politics and business.

I would also always try to catch Charles Payne and Elizabeth MacDonald's show. They were the two, in my opinion, brightest and most insightful people on that network.

I would also try to catch Melissa Francis's show. She was a former child star on the US TV show 'Little House on the Prairie' who after the show wound up graduating from Harvard with a degree in economics. Her show was somewhat informative as well.

The others on that network I was not too crazy about, and I really do not like the head of that network, Neil Cavuto. He is overly full of himself, in my opinion.

So, if you feel the need to poke fun at me again by linking me with various media personalities, please feel free to use terms such as 'Napolitano Nut-case' or 'Flaming Stosselite'. You might be correct using them about me.

But please, don't link me to those three baboon butts you did again. You will be wrong.

And don't be too quick to dismiss my analysis. After all, betreger, a person that usually disagrees with everything I have to say, said in post 1660548 that

Major pretty much correct IMO, but you omitted Greenspan's admitted incorrect analysis that the banks would self regulate do to self interest. Bad policy followed by unconscionable greed by the banksters. Regulation is required if this is to be avoided, there is nothing wrong with fiscal responsibility and a lot right with it.

So, I am mostly correct, just left a couple of facets out of my analysis, according to betreger.

Anyway, 297902, be well, have fun, and have a good day.

@ Everyone:

As to regulation, I am not, per se, a total foe of Government Regulation. Some Regulations are quite necessary. Things such as the Clean Air Act, and the Clean Water Act, and the Endangered Species Act (and their associated regulations) I don't think any sane person could object to. I certainly don't.

Some level of regulation IS necessary. But, too much of even a good thing can be bad.

Sometimes, the law of unintended consequences bites us all on the behind. And the example analysis I gave about the genesis of the Global Financial Crisis of 2008 and beyond is a PERFECT example of new regulations and changes in old ones, no matter HOW well intentioned, can wind up having highly Harmful Consequences.

And for the record, I DO support the restrictions on activity of banks in areas of investments and insurance contained in Glass-Steagall before President Clinton signed into law their repeal. The, iirc, Gramm-Leach-Bliley Act signed into law by President Clinton on Nov. 12, 1999. The law of unintended consequences once again. Less than 10 years later, the fit hit the shan and this regulatory change had a LOT to do with it, even though Clinton denies it and called the repeal a good thing.

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https://youtu.be/iY57ErBkFFE

#Texit

Don't blame me, I voted for Johnson(L) in 2016.

Truth is dangerous... especially when it challenges those in power.

Bull manure. Some regulations are highly harmful.

Sorry Im not going to respond on what else you wrote. I wasn't trying to start a discussion about the 2008 crisis, I simply used its context as an example, presenting you with two policy options (in reality there were of course much more than just two options) which depending on your political leanings determine whether you consider a regulation harmful or not.

Which is again why this question can't be really answered. Harmful depends on how you think along which principles the world should be organized.

Don't you mean repealed it?

Gary, yes that's how it was fixed.

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Bull manure. Some regulations are highly harmful.

Sorry Im not going to respond on what else you wrote. I wasn't trying to start a discussion about the 2008 crisis, I simply used its context as an example, presenting you with two policy options (in reality there were of course much more than just two options) which depending on your political leanings determine whether you consider a regulation harmful or not.

Which is again why this question can't be really answered. Harmful depends on how you think along which principles the world should be organized.

Uhh... no.

Harmful depends on its RESULTS. And the regulatory (and legal) changes which preceded and led to the 2008 crisis were an unmitigated horror of harmful...

If you need help seeing this, follow the chain of events in reverse.

1. Great economic harm still being felt in 2015.
2. Global financial system almost totally collapsed in 2008.
3. A crisis in liquidity caused great stress in the global financial system.
4. A series of toxic investment failures led to a crisis in liquidity.
5. A slight shift in the economy caused a skyrocketing cascade of failures in these subprime loans as interest rate spikes caused the people to no longer be able to make their payments.
6. A series of bad loans were packaged into derivatives by, among others, Fannie Mae and Freddie Mac. Fannie Mae and Freddie Mac's involvement led to the perception that these loans were safe.
7. The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 and associated regulations required Fannie Mae and Freddie Mac to purchase and securitize subprime home loans made in furtherance of the CRA... Thus unsafe.
8. Financial Services Modernization Act of 1999 and associated regulations removed barriers holding back unsafe bank activities by repealing the protections of Glass-Steagall, thus allowing banks to function as securities brokers and insurance companies.
9. The Community Reinvestment Act of 1977, as amended, and associated regulations forced banks to issue loans to people that would not have qualified under bank underwriting standards before then. People that the banks thought would have trouble paying the loans back. The subprime loans.

OK, one more time, going forwards:

1. The CRA of 1977, as amended, and associated regulations FORCED banks to relax their underwriting standards and give loans to people that would likely have trouble paying them back, frequently by getting creative with interest rate structuring.
2. The FHEFSSA of 1992 and associated regulations FORCED Fannie Mae and Freddie Mac to purchase and securitize these subprime loans, lending the US Government's 'seal of approval' to the perception that these loans were safe.
3. The FSMA of 1999, and associated regulations repealed the protections of Glass-Steagall that restricted a single corporation from combining banking, securities brokering, and/or insurance into a single business. The Glass-Steagall had, up until then, been a good law and regulations stopping the possibility of what happened from happening.
4. To help make up for potiential profit reductions, banks got into the business of securitizing these subprime loans and insuring them (CDSs, etc) themselves.
5. There was an economic hiccup. This led to the creative interest rate structuring that the banks, etc. were forced to do to help make these subprime loans affordable to the poor, to spike the loan payments because of rapidly rising interest rates.
6. Ever increasing numbers of loan defaults on these subprime loans caused bank liquidity to dry up.
7. The shortage of bank liquidity led to the GFC of 2008.
8. The GFC caused a cascade of business failures globally, as well as some SERIOUS economic issues in certain Governments, most notably Greece. The liquidity crisis caused the bond interest rates in a number of nations to spike.
9. We are STILL, years later, cleaning up the mess.

Understand it yet?

I will say it again. Some regulations are HIGHLY harmful, not because some people think so because of their political leanings. Some regulations are HIGHLY harmful because of their RESULTS.

Of course, 'greed' played a part in the mess, to a certain extent. But without these legal and regulatory changes I have listed, the agonizing mess of the GFC would not have been possible.

Therefore, these legal and regulatory changes are HARMFUL.

But then, why were they made?

There was a perceived need for greater home ownership by the poor. A public good. Very laudable.

But the way the Government went about it was... unwise.

Instead of working on ways to help the poor be able to afford home loans on their own, they chose to take a short-cut and force banks to give the poor the loans anyway. The banks, knowing that these loans would probably go into default, covered their butts, and spread the risk around globally, as far and wide as they could.

Again, legal and regulatory changes forced banks to make bad loans, and to spread the risk around in ways that were dangerous to the global economy.

Without these legal and regulatory changes, the banks would not have made these bad loans and would not have been able to spread the risk, much less have had to.

Why is it so difficult for you to admit that some new laws and regulations, and changes to some old laws and regulations can be harmful because of their RESULTS, philosophical and economic beliefs aside?

I am not trying to discuss the 2008 GFC either, I am using its context as an example of regulatory changes that have had harmful results.

Bull manure. Some regulations are highly harmful.

Sorry Im not going to respond on what else you wrote. I wasn't trying to start a discussion about the 2008 crisis, I simply used its context as an example, presenting you with two policy options (in reality there were of course much more than just two options) which depending on your political leanings determine whether you consider a regulation harmful or not.

Which is again why this question can't be really answered. Harmful depends on how you think along which principles the world should be organized.

+ many

To make it more obvious, if your position is to destroy the banks and wall street, the regulations leading the the GFC were great, to bad they didn't go a bit farther. TARP would have been a disaster.

Or, if you don't like what you see, change your perspective.

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Funny how our banks are regulated and funny enough they did not have much to do with the GFC . Didn't effect them at all really other than people thought they would be effected so the Gov gave a bank garrentee on deposits and inter bank loans . To stop people panicking and making a run on the banks .

So regulation can work . (well !!,in some sensible country's that is ! )

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Funny how our banks are regulated and funny enough they did not have much to do with the GFC .

Funny how they didn't have to operate regulated by the Community Reinvestment Act.

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Uhh... no.

Harmful depends on its RESULTS. And the regulatory (and legal) changes which preceded and led to the 2008 crisis were an unmitigated horror of harmful...

Look, I agree with you that the regulatory changes that were made and that allowed the 2008 meltdown to happen were a disaster. But, I draw that conclusion based on my perspective on the situation. So do you.

Those regulatory changes you mentioned? The financial sector lobbied the government HARD to get them. Clearly the banks liked those changes. And even now the financial industry is again lobbying hard to make sure that the regulations that are passed are as small as possible. Because you know, let the free market do its thing, it will sort itself out.

And actually, depending on your perspective, the 2008 meltdown wasn't a disaster at all. A bunch of people have gotten a looooot of money from it. Others consider that such meltdowns are natural in a capitalist system and should be allowed to happen. See my point? Your political perspective determines whether you like certain regulations.

Uhh... no.

Harmful depends on its RESULTS. And the regulatory (and legal) changes which preceded and led to the 2008 crisis were an unmitigated horror of harmful...

Look, I agree with you that the regulatory changes that were made and that allowed the 2008 meltdown to happen were a disaster. But, I draw that conclusion based on my perspective on the situation. So do you.

Those regulatory changes you mentioned? The financial sector lobbied the government HARD to get them. Clearly the banks liked those changes. And even now the financial industry is again lobbying hard to make sure that the regulations that are passed are as small as possible. Because you know, let the free market do its thing, it will sort itself out.

And actually, depending on your perspective, the 2008 meltdown wasn't a disaster at all. A bunch of people have gotten a looooot of money from it. Others consider that such meltdowns are natural in a capitalist system and should be allowed to happen. See my point? Your political perspective determines whether you like certain regulations.

Thank you for agreeing.

Not all the changes I mentioned were lobbied for, but at least one of them was (the 1999 repeal of Glass Steagall). The others? Pushed for by well-meaning politicians wanting to produce a very laudable public good (increases in home-ownership among the poor -- would produce a number of positive effects). They just chose the wrong way to go about it (rather than help the poor to become more wealthy thus able to afford the homes on their own, they chose to force banks to effectively lower their underwriting standards and give a bunch of risky loans, then to securitize these loans and sell them on the derivatives market).

I might surprise you in this, but I think that perhaps the banks have been UNDER-regulated since the early to mid 1980s.

Yes, the political philosophy I adhere to holds that excessive regulation is a bad thing.

But banks... The power to coin money is a legitimate government function in the USA (part of Article I, Section 8). By logical extension, since the banks play a MAJOR role in the increase of the money supply, banks need rather strong regulation by the government, if they are to be private businesses at all.

What we need to regulate, we DO need to regulate... properly. Proper regulation needs to be a slow, rational, and deliberate process, including consideration of all the possibilities of what might go wrong. Trying to affect social change on the back of regulation is perhaps not the wisest course of action.

When regulatory policy is changed on a whim, even when the goal is very much desired, you run great risk of the law of unintended consequences biting a large chunk out of your backside.

Ah, government regulation ....
http://www.theglobeandmail.com/news/world/france-bans-super-skinny-models-in-anorexia-clampdown/article23788903/

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Why do people insist on such quick responses?

Their knee jerks?

"True knowledge exists in knowing that you know nothing." - Socrates

Thus, one claiming to have all the answers and to use the Socratic method cannot be the same person.

---

Capitalize on this good fortune, one word can bring you round ... changes.

Why do people insist on such quick responses?

Their knee jerks?

Or they're elbow jerks? You know, bend the elbow, work out by lifting a pint, then post tirades? :)

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Capitalize on this good fortune, one word can bring you round ... changes.

Why do people insist on such quick responses?

Their knee jerks?

Or they're elbow jerks? You know, bend the elbow, work out by lifting a pint, then post tirades? :)

That would be a pretty quick pint. Might not even have time to take effect. :)

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You know, bend the elbow, work out by lifting a pint, then post tirades? :)

Around here, that is known as a 12oz curl... :P

Thank you for agreeing.

Not all the changes I mentioned were lobbied for, but at least one of them was (the 1999 repeal of Glass Steagall). The others? Pushed for by well-meaning politicians wanting to produce a very laudable public good (increases in home-ownership among the poor -- would produce a number of positive effects). They just chose the wrong way to go about it (rather than help the poor to become more wealthy thus able to afford the homes on their own, they chose to force banks to effectively lower their underwriting standards and give a bunch of risky loans, then to securitize these loans and sell them on the derivatives market).

I might surprise you in this, but I think that perhaps the banks have been UNDER-regulated since the early to mid 1980s.

Yes, the political philosophy I adhere to holds that excessive regulation is a bad thing.

But banks... The power to coin money is a legitimate government function in the USA (part of Article I, Section 8). By logical extension, since the banks play a MAJOR role in the increase of the money supply, banks need rather strong regulation by the government, if they are to be private businesses at all.

What we need to regulate, we DO need to regulate... properly. Proper regulation needs to be a slow, rational, and deliberate process, including consideration of all the possibilities of what might go wrong. Trying to affect social change on the back of regulation is perhaps not the wisest course of action.

When regulatory policy is changed on a whim, even when the goal is very much desired, you run great risk of the law of unintended consequences biting a large chunk out of your backside.

Well I can honestly only say I agree with what you said here :) Ive got nothing to add :P

Funny how our banks are regulated and funny enough they did not have much to do with the GFC .

Funny how they didn't have to operate regulated by the Community Reinvestment Act.
____________

Gary i'm talking about Australian banks they where not affected by the GFC .

We don't have stupid laws like what you have and , why was it not fixed after the savings and loans affair in the late 80's early 90's then , if your blaming that law .

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Kong i herd a Rand Paul is a libertarian !!

But he's backed by the Tea Party and Republicans !!

So what is the difference as it seems to me to be just a fancy name for a Tea Party man or Republican , or as i say another b/s lie to gain votes and confuse the dummy's ??

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Kong i herd a Rand Paul is a libertarian !!

But he's backed by the Tea Party and Republicans !!

So what is the difference as it seems to me to be just a fancy name for a Tea Party man or Republican , or as i say another b/s lie to gain votes and confuse the dummy's ??

LOL...

Senator Rand Paul (R-Ky) is a Republican. Yes, he does give some lip-service to some Libertarian principles, but on the whole supports the Republican party..

The 'Tea Party' is the latest (of several) Republican attempts to co-opt and discredit the Libertarians.

In addition to being a threat to the Democrat party, the Libertarians are a threat to the Republican party as well. The Republicans and the Democrats both are quite happy with their dominance in the '2 major party' system they have devised and implemented here in the USA. Senator Paul's dad, former Representative Ron Paul (R-Tx) was involved in an earlier iteration of this, the so-called 'libertarian wing' of the Republican party.

President Lyndon B. Johnson (D-Tx) had a rather colorful saying on this political practice:

"Better to have them inside the tent pi$$ing out than outside pi$$ing in”

The Republicans, with the delightful approval from the Democrats, have co-opted a lot of Libertarians into the Republican party, over the years. The Republican party leadership, currently Speaker of the House "Boner", throws enough scraps to the Libertarians that have been deluded into joining the Republicans to keep them from leaving, but refuses to undertake ANY meaningful reforms that are central to the Libertarian agenda. Oh, sometimes he puts on a show of trying... but that is all it is, a show.

Since, like the Democrats, the Republicans are authoritarian statists, true Libertarianism is pure poison to them (both).

The Republicans get to control a good chunk of people with Libertarian viewpoints, to keep them from gaining any independent power, and the Democrats get to save effort and only attack just the one group.

The current arrangement is for the Republicans, the Democrats, and the Libertarians is "win, win, lose".

Have I explained it well enough?

Well said MajorKong. Yes, real Libertarians do not consider themselves part of the Grand Old Party (Republican), nor do they support a tax-and-spend gov't like the Democratic party seems to.

Should we call those Libertarians in the Republican party LINOs? :-P