How you can have a $55,000,000,000,000 market (in fact nobody can even quantify this figure and estimates vary wildly by the tens of trillions of dollars!) that has no regulation or oversight?
It’s about time our representatives woke up and smelled the coffee — “swaps” is just a legally convenient way of saying “insurance”. It should be regulated, there should be oversight, and there should be a proper capital to back up the bets, particularly given their enormous magnitude.
Let’s hope the reform Barney Frank comes up with is fair, effective and at the same time does not put an unfairly cumbersome burden on business.
Just remember Barney Frank stated Fannie Mae and Freddie Mac were stable just before they went under. Many invested heavily in them because of his remarks and now he claims he didn’t mean what he said. More recently Harry Reid, senator from NV, said he had first hand knowledge an unnamed “major” insurance carrier was nearing bankruptcy and caused carrier stocks to plument. When his office was contacted for further comments from him, they denied he had any first hand knowledge (or any at all) of a major carrier nearing bankruptcy – so why did he say that? Unfortunately, our politicans do not understand finance, insurance etc. well at all and we exepct them to fix anything? We do elect unbelievable idiots and keep doing it so who is responsible? Both of these tools are democrats (I am too but not resident in their states). Soon we will have a democrat for president (that “wants to redistribute the wealth”) and a democrat majority in congress……..
It was the Clinton administration and his democractic congress that removed the regulations enacted after the last depression to prevent just such a market catastrophe. They deregulated and look what happens and to top it off there’s the unregulated CDS … or are the regulations that the dems removed include the CDS biz? In any event – we can thank short sighted, greedy politicians, corporate execs and shareholders for ignoring all the warning signs in favor of short term ‘instant gratification’. I really think that all the politicians in Washington have been there too long and have lost touch with the real world and it’s time for America to replace them all – Republicans and Democrats alike – they’ve forgotten who pays them and that they s/be thinking about what’s right for America as a whole BEFORE there’s a catastrophe. And not just ‘how do I protect my job’. No one we send to Washington ever leaves office a middle class American – they all seem to leave richer – much richer – than they went in and get a fabulous pension paid for by us for the rest of their lives. Not to mention the best health care plan on the planet – also paid for by us.
well, why do we have to look back that far? how long as the current administration been in office? are you going to tell me that it took 12 yrs for this to run of the hook?
i think that you would rather place blame on a democrat instead of republican or even the current congressional leaders. stop trying to place blame on a party. put the blame exactly where it needs to be and that is the current elected officials.
This sort of thing doesn’t happen overnight – it takes time to build to a point where the bottom falls out. This didn’t happen overnight – BOTH parties are to blame. But it was Clinton’s administration that removed the regulations put into place after the last depression to prevent another depression. That removed the barrier and greed took over. And you are assuming that I want to blame the democrats so in fairness I can assume that you’re a democrat wanting to blame anything and everything on republicans and the current administration? Most of the congessman and senators have been in office for decades. BOTH parties are to blame – they’ve ALL been in office too long and seeem to be incapable to think Biparisan. Oh and BTW – a president can’t do much of anything without the Congress and the Senate’s okay.
RS, yeah I know, and I don’t trust him any farther than I can throw him, which probably isn’t very far at all.
Frank, Dodd Clinton and others got us into this mess, 8 years of Republican administration did nothing to fix it, and now we’re supposed to trust them to be the saviors? Hardly.
Let me offer a quote which I suspect will unfortunately become more and more relevant with passing time in light of the current economic crisis and our lack of leadership or government that is truly representative of its people:
“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.”
Very good Matt, it pays to read the Constitution sometimes! It’s clear (to me at least) both parties are responsible for this mess and clearly greed rules. Unfortunately the politicians play to their audiences and keep getting re-elected even when they are clearly incompentent. I have no answers. I’m deeply disappointed that we ,as people, have not come any further than this. Our representatives do put themselves first and do seem to come out of the house or senate much richer than they went in. I know they didn’t earn those riches from their pay so where does it come from? Even Obama is a millionaire several times over – I’ve no objection to people getting richer but how do they that in what is in a generally low paying sector of life? It’s going to take a collective cleansing of politics and business that no one is willing to undertake to truly make the needed changes to avoid this type of mess in the near future. Instant gratification seems so engrained now. Requiring high schoolers to “volunteer” time for social services as Obama proposes isn’t going to change that. Sorry for the rambling, but the flaws are occurring at such basic levels. Unless people are really willing to change their habits we aren’t going to improve our lot in life. People say the newest working generation are even worse about it “all being about them” so am pessimistic about the future – today. :
If the commenters are referrign to the repeal of the Depression-era separation of commercial and investment banking, that came in the Gramm-Leach-Bliley Act that was passed by a Republican Congress and signed by Democratic President Bill Clinton. As in competitive sports, no matter what rules are in place, attentive, engaged referees are needed to make sure competitive pressures don’t distort the game.
Good Comments. Take whatever Mr Frank and Dodd say with a grain of salt. Frank is saying “They” screwed it up, “we” need to regulate. Well, all due respect to these gents, but “they” were the ones responsible for the oversight from a federal perspective and all “this” happened right under “their” noses and on “their” watch. Amazing to see them wash their hands of any responsibilitiy…
Donna, I believe you are only partly right. The regulations were removed under Clinton, but it was the late 1990’s when it occurred and Republicans had full control of the Senate and the House since 1994 if I recall correctly. They are both at fault. Weren’t further regulations removed after 2001 as well?
Is Barney Frank kidding? He is an absolute failure and should resign immediately. He’s not going to reform anything unless “reform” is defined as making Truman Capote’s birthday a national holiday!
Everyone on both sides of the aisle need to go. We need leaders who understand the issues and not worried about getting re-elected!
It has become so lucrative for one to get elected into Congress that for any price they will sell their First Born to yield power in Washington. We need to FORCE Congress to change their lucrative packages of lifetime salaries, benefits, etc just like their counterparts on Wall Street who brought down the investment markets. For once then you would have these low-lifes understand what working in the real world means! We should invoke term limits on Congress just like the President, so we continually get a new perspective on the issues impacting America!
They can stand there and blame one another, but at the end of the day someone needs to be held accountable.
Unfortunately, we have equally poor choices for the most powerful position in the world and that is President of the United States. Neither comes across too knowledgable and compound that with a Democratic controlled Congress and you are destined for continued failure. Send Pelosi and Reid on a one-way ticket to Siberia! I am sure they can get a lobbyist to pay for the excursion to the land of nowhere!
$55 trillion market? When the US GDP is $14 trillion annually? Why are they comparing exposure to the market? That’s like saying the worldwide insurance market is $2 quadrillion dollars. I’d like to know how much big the credit default swap “market” actually is. $100 billion?
Members of the left-wing activist group Association of Community Organizations for Reform Now (Acorn) had a quick and predictable response to this week’s raid of their Nevada offices by authorities investigating a possible massive voter-registration fraud scheme.
The Las Vegas Sun reports that Acorn volunteer Frank Beaty immediately claimed the raid, which removed computers and files from the group’s offices, was a conspiracy designed to prevent the registration of new voters. Acorn’s national chief Bertha Lewis called the raid “a stunt that serves no useful purpose other than [to] discredit our work registering Nevadans and distracting us from the important work ahead of getting every eligible vote to the polls.”
Reverting to the rhetoric of the 1960s voting rights struggle in the South may be politically useful, but it bears precious little resemblance to the reality of Acorn today. The group has constantly faced charges it mistreats its employees and even broke up their internal efforts to unionize their workplace.
Clark County Registrar of Voters Larry Lomax told the Sun that Acorn has been registering voters in Las Vegas since January and “we started having problems with them almost immediately.” His staff met with Acorn and was offered promises that fraudulent registrations would no longer be turned in. “But those controls weren’t sufficient,” Mr. Lomax said.
Indeed, the more his office and that of Nevada’s Secretary of State looked into Acorn’s effort, the more worried they became. Jason Anderson rose to the rank of supervisor in Acorn even though he was a convicted felon. Other employees had served time for identity theft. Another former inmate who worked for Acorn told authorities his co-workers were “lazy crack heads.”
Acorn’s activities are under investigation or suspicion in a dozen states, with one of its workers indicted just last week in Wisconsin. Perhaps the Nevada raid will spur authorities elsewhere to dig down and conclude their investigations by Election Day — before Acorn can do even more damage to the integrity of the vote.
… are the only two explanations for the CDS mess. My largest purchase was my home. Did I know how many nails and screws and pieces of plywood were used? No, however, I did know the basices i.e. the square footage number of bedrooms etc. So I am to believe these smart people on Wall Street and at Fannie and Freddie did not know what they were purchasing, or more importantly who was insuring these purchases for 100’s of billions of dollars? Folks this is not rocket science. Lets say I was buying 200,000,000,000 in CDS. If they were all mortgages at 200,000 each, that would be 10,000 mortgages. With an excel spreadsheet I could easily breakdown each mortgage I purchased to insure with the loan information by FICO, income, market value etc. and come up with a probability on foreclosures and set a rate for coverage. Therefore I believe there are only two explanations – Fraud or Ignorance.
How you can have a $55,000,000,000,000 market (in fact nobody can even quantify this figure and estimates vary wildly by the tens of trillions of dollars!) that has no regulation or oversight?
It’s about time our representatives woke up and smelled the coffee — “swaps” is just a legally convenient way of saying “insurance”. It should be regulated, there should be oversight, and there should be a proper capital to back up the bets, particularly given their enormous magnitude.
Let’s hope the reform Barney Frank comes up with is fair, effective and at the same time does not put an unfairly cumbersome burden on business.
Just remember Barney Frank stated Fannie Mae and Freddie Mac were stable just before they went under. Many invested heavily in them because of his remarks and now he claims he didn’t mean what he said. More recently Harry Reid, senator from NV, said he had first hand knowledge an unnamed “major” insurance carrier was nearing bankruptcy and caused carrier stocks to plument. When his office was contacted for further comments from him, they denied he had any first hand knowledge (or any at all) of a major carrier nearing bankruptcy – so why did he say that? Unfortunately, our politicans do not understand finance, insurance etc. well at all and we exepct them to fix anything? We do elect unbelievable idiots and keep doing it so who is responsible? Both of these tools are democrats (I am too but not resident in their states). Soon we will have a democrat for president (that “wants to redistribute the wealth”) and a democrat majority in congress……..
It was the Clinton administration and his democractic congress that removed the regulations enacted after the last depression to prevent just such a market catastrophe. They deregulated and look what happens and to top it off there’s the unregulated CDS … or are the regulations that the dems removed include the CDS biz? In any event – we can thank short sighted, greedy politicians, corporate execs and shareholders for ignoring all the warning signs in favor of short term ‘instant gratification’. I really think that all the politicians in Washington have been there too long and have lost touch with the real world and it’s time for America to replace them all – Republicans and Democrats alike – they’ve forgotten who pays them and that they s/be thinking about what’s right for America as a whole BEFORE there’s a catastrophe. And not just ‘how do I protect my job’. No one we send to Washington ever leaves office a middle class American – they all seem to leave richer – much richer – than they went in and get a fabulous pension paid for by us for the rest of their lives. Not to mention the best health care plan on the planet – also paid for by us.
well, why do we have to look back that far? how long as the current administration been in office? are you going to tell me that it took 12 yrs for this to run of the hook?
i think that you would rather place blame on a democrat instead of republican or even the current congressional leaders. stop trying to place blame on a party. put the blame exactly where it needs to be and that is the current elected officials.
This sort of thing doesn’t happen overnight – it takes time to build to a point where the bottom falls out. This didn’t happen overnight – BOTH parties are to blame. But it was Clinton’s administration that removed the regulations put into place after the last depression to prevent another depression. That removed the barrier and greed took over. And you are assuming that I want to blame the democrats so in fairness I can assume that you’re a democrat wanting to blame anything and everything on republicans and the current administration? Most of the congessman and senators have been in office for decades. BOTH parties are to blame – they’ve ALL been in office too long and seeem to be incapable to think Biparisan. Oh and BTW – a president can’t do much of anything without the Congress and the Senate’s okay.
RS, yeah I know, and I don’t trust him any farther than I can throw him, which probably isn’t very far at all.
Frank, Dodd Clinton and others got us into this mess, 8 years of Republican administration did nothing to fix it, and now we’re supposed to trust them to be the saviors? Hardly.
Let me offer a quote which I suspect will unfortunately become more and more relevant with passing time in light of the current economic crisis and our lack of leadership or government that is truly representative of its people:
“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.”
Very good Matt, it pays to read the Constitution sometimes! It’s clear (to me at least) both parties are responsible for this mess and clearly greed rules. Unfortunately the politicians play to their audiences and keep getting re-elected even when they are clearly incompentent. I have no answers. I’m deeply disappointed that we ,as people, have not come any further than this. Our representatives do put themselves first and do seem to come out of the house or senate much richer than they went in. I know they didn’t earn those riches from their pay so where does it come from? Even Obama is a millionaire several times over – I’ve no objection to people getting richer but how do they that in what is in a generally low paying sector of life? It’s going to take a collective cleansing of politics and business that no one is willing to undertake to truly make the needed changes to avoid this type of mess in the near future. Instant gratification seems so engrained now. Requiring high schoolers to “volunteer” time for social services as Obama proposes isn’t going to change that. Sorry for the rambling, but the flaws are occurring at such basic levels. Unless people are really willing to change their habits we aren’t going to improve our lot in life. People say the newest working generation are even worse about it “all being about them” so am pessimistic about the future – today. :
If the commenters are referrign to the repeal of the Depression-era separation of commercial and investment banking, that came in the Gramm-Leach-Bliley Act that was passed by a Republican Congress and signed by Democratic President Bill Clinton. As in competitive sports, no matter what rules are in place, attentive, engaged referees are needed to make sure competitive pressures don’t distort the game.
Good Comments. Take whatever Mr Frank and Dodd say with a grain of salt. Frank is saying “They” screwed it up, “we” need to regulate. Well, all due respect to these gents, but “they” were the ones responsible for the oversight from a federal perspective and all “this” happened right under “their” noses and on “their” watch. Amazing to see them wash their hands of any responsibilitiy…
The Republican controlled house and senate passed the bill. Clinton signed it into law. They are all to blame. Bushed would have signed it too.
Donna, I believe you are only partly right. The regulations were removed under Clinton, but it was the late 1990’s when it occurred and Republicans had full control of the Senate and the House since 1994 if I recall correctly. They are both at fault. Weren’t further regulations removed after 2001 as well?
Is Barney Frank kidding? He is an absolute failure and should resign immediately. He’s not going to reform anything unless “reform” is defined as making Truman Capote’s birthday a national holiday!
Everyone on both sides of the aisle need to go. We need leaders who understand the issues and not worried about getting re-elected!
It has become so lucrative for one to get elected into Congress that for any price they will sell their First Born to yield power in Washington. We need to FORCE Congress to change their lucrative packages of lifetime salaries, benefits, etc just like their counterparts on Wall Street who brought down the investment markets. For once then you would have these low-lifes understand what working in the real world means! We should invoke term limits on Congress just like the President, so we continually get a new perspective on the issues impacting America!
They can stand there and blame one another, but at the end of the day someone needs to be held accountable.
Unfortunately, we have equally poor choices for the most powerful position in the world and that is President of the United States. Neither comes across too knowledgable and compound that with a Democratic controlled Congress and you are destined for continued failure. Send Pelosi and Reid on a one-way ticket to Siberia! I am sure they can get a lobbyist to pay for the excursion to the land of nowhere!
Don’t mean to be picky, but that was from the Declaration of Independence, not the Constitution.
Thank you for the correction!
I couldn’t agree more! Now, if we could only get the voting public to see the world thru other than misty, rose-colored “party” glasses.
$55 trillion market? When the US GDP is $14 trillion annually? Why are they comparing exposure to the market? That’s like saying the worldwide insurance market is $2 quadrillion dollars. I’d like to know how much big the credit default swap “market” actually is. $100 billion?
A Smelly Acorn
The ‘voter registration’ racket.
By JOHN FUND
Members of the left-wing activist group Association of Community Organizations for Reform Now (Acorn) had a quick and predictable response to this week’s raid of their Nevada offices by authorities investigating a possible massive voter-registration fraud scheme.
The Las Vegas Sun reports that Acorn volunteer Frank Beaty immediately claimed the raid, which removed computers and files from the group’s offices, was a conspiracy designed to prevent the registration of new voters. Acorn’s national chief Bertha Lewis called the raid “a stunt that serves no useful purpose other than [to] discredit our work registering Nevadans and distracting us from the important work ahead of getting every eligible vote to the polls.”
Reverting to the rhetoric of the 1960s voting rights struggle in the South may be politically useful, but it bears precious little resemblance to the reality of Acorn today. The group has constantly faced charges it mistreats its employees and even broke up their internal efforts to unionize their workplace.
Clark County Registrar of Voters Larry Lomax told the Sun that Acorn has been registering voters in Las Vegas since January and “we started having problems with them almost immediately.” His staff met with Acorn and was offered promises that fraudulent registrations would no longer be turned in. “But those controls weren’t sufficient,” Mr. Lomax said.
Indeed, the more his office and that of Nevada’s Secretary of State looked into Acorn’s effort, the more worried they became. Jason Anderson rose to the rank of supervisor in Acorn even though he was a convicted felon. Other employees had served time for identity theft. Another former inmate who worked for Acorn told authorities his co-workers were “lazy crack heads.”
Acorn’s activities are under investigation or suspicion in a dozen states, with one of its workers indicted just last week in Wisconsin. Perhaps the Nevada raid will spur authorities elsewhere to dig down and conclude their investigations by Election Day — before Acorn can do even more damage to the integrity of the vote.
… are the only two explanations for the CDS mess. My largest purchase was my home. Did I know how many nails and screws and pieces of plywood were used? No, however, I did know the basices i.e. the square footage number of bedrooms etc. So I am to believe these smart people on Wall Street and at Fannie and Freddie did not know what they were purchasing, or more importantly who was insuring these purchases for 100’s of billions of dollars? Folks this is not rocket science. Lets say I was buying 200,000,000,000 in CDS. If they were all mortgages at 200,000 each, that would be 10,000 mortgages. With an excel spreadsheet I could easily breakdown each mortgage I purchased to insure with the loan information by FICO, income, market value etc. and come up with a probability on foreclosures and set a rate for coverage. Therefore I believe there are only two explanations – Fraud or Ignorance.