Reaction to financial reform: Elizabeth Warren, Mike Konczal and Bill Black

[ProSense]

Elizabeth Warren:

“No bill that deals with big issues is ever perfect, but the Senate’s Wall Street reform package will go a long way toward preventing the kinds of abusive practices that brought our economy to its knees. Getting to this point was a tough slog, and President Obama and Chairman Dodd deserve a lot of credit for producing a strong bill.”

Mike Konczal:

<...>

The Senate’s consumer protection bureau versus the House’s CFPA is a trade off; the House has a new agency, but there are a lot of carve outs for auto dealers. The Senate version is housed at the Fed and the risk council has a veto over its actions, but is a pretty pure version of what reformers wanted given that.

Derivatives in the Senate is still up in the air. Section 716 would be major change, akin to a 21st Century Glass-Steagall, however it will come under massive lobbying attacks in conference.

Given what they wanted this bill to do in regards to Too Big To Fail — give regulators more legal powers in a crisis, and expand prudential regulatory powers — it’s fairly good. But will that be enough?

Bill Black:

<...>

So, proverbial bottom line: the Senate bill did, in fact, get stronger. And that tells us something very positive about what the Members’ constituents are supporting, because the organized “special interest” effort to weaken the bill was intense. The fact that the strengthened bill is zero for six on dealing with the problems driving these crises shows that the original bill was so weak in all of its fundamentals that even with the marginal improvements it will not address successfully the reasons why we are suffering recurrent, intensifying crises.

[DURHAM D]

1. So in other words -

Its just a microdot of lip gloss on a bunch of pigs.

[Cant trust em]

3. That's not what Warren seems to be saying.

I like her a lot.

[impik]

5. No, you see: Warren is god when she bashes Obama. When she praise him

she's just another sell-out. That's the code here.

[vaberella]

9. +Inifinity. Agreed. n/t

[Go2Peace]

15. It's definitely not what Bill Black is saying. And he is a White Hat too.

[Dappleganger]

26. I will side with her.

She's been brutally honest up to this point and she's given no reason to doubt her knowledge in this area.

[Cha]

2. I saw a poster yesterday say ..they would wait

for Elizabeth Warren's take on this..well, here it is!

[Cant trust em]

4. I really hope that she doesn't get throw under...you know.

[girl gone mad]

7. Sadly, Obama threw her under the bus a long time ago.

:(

[vaberella]

10. When was this and how so. Or is that your general opinion in regards to her various complaints.

In the past that is...

[Dappleganger]

28. He did?

That's news to me, or do you consider any disagreement or failure to follow complete advice 'throwing her under the bus?'

[Dappleganger]

27. That was probably me...

and I'm looking forward to seeing her interviewed again w/her take on it, but if she says it's a good bill then I'm going to support it.

[MindandSoul]

6. Of the three above opinions, I trust Warren the most. . .So, this bill is not "perfect,"

but if she thinks it's a great step in the right direction. . .I'm happy!

[Go2Peace]

14. Why wouldn't you trust Bill Black? He is a white hat and knows this better than Warren.

[NJmaverick]

8. K&R

[Jennicut]

11. Elizabeth Warren gets that even getting this much out of the Senate is a big deal.

Hard to do when most of the Senate is owned by corps. It is a good start.

[ChimpersMcSmirkers]

12. If Elizabeth Warren thinks it's solid then that's all I need to know.

Could it have been better? Yeah, just like everything else in life.

[Faygo Kid]

24. Completely agree.

She's someone I trust. I agree it's imperfect, but the Republicans fought it, so it must have value.

[Go2Peace]

13. People need to read Bill Blacks *entire* comment. He says it will do almost nothing

Here is the whole paragraph:

So, proverbial bottom line: the Senate bill did, in fact, get stronger. And that tells us something very positive about what the Members’ constituents are supporting, because the organized “special interest” effort to weaken the bill was intense. The fact that the strengthened bill is zero for six on dealing with the problems driving these crises shows that the original bill was so weak in all of its fundamentals that even with the marginal improvements it will not address successfully the reasons why we are suffering recurrent, intensifying crises.

[ProSense]

16. Let's start with the Boxer Amendment

To prohibit taxpayers from ever having to bail out the financial sector.

That addresses a major point of outrage.

[TheKentuckian]

17. That's nice but do you really believe they will let a quarter or so of the economy

go through bankruptcy? You really buy that? Six banks control over 60% of the economy and they have been allowed/encouraged to grow even larger. They aren't going to let them go down and will back door bailout through the Fed.

Too big too fail remains too big to exist and allowing the status quo to effectively remain in place means that there is still no incentive to actually invest capital into the economy.
This bill does some really positive things but it is almost pure fantasy to think we have made the required structural changes to prevent another meltdown for similar reasons or to reinvigorate the value of real investment over speculation.

[ProSense]

19. Do you?

"...do you really believe they will let a quarter or so of the economy go through bankruptcy?"

So why do you think they passed the bill?


"Too big too fail remains too big to exist and allowing the status quo to effectively remain in place"

Obviously, you know nothing about the Senate bill:

Derivatives

Mandates exchange trading and clearing for most derivatives, with a limited end-user exemption. Forces federally insured banks to spin-off their swaps desks.

[TheKentuckian]

20. Most meaning a majority rather than a precious few exceptions 30% remains in the wild west

with no enforcement on the 70%. What happens if they refuse to spin off? Who is the cop on this beat? If this organization exists, has it already been captured by the industry and if not what firewalls are up to prevent that from happening? What resources do they have to go toe to toe with these banks?

And no, I certainly don't believe they will go through bankruptcy as I just stated, I believe they will be bailed out through the back door and we'll never be the wiser despite the bill and if they do then one of the other big six will absorb them and move us closer to monopoly.

You buy whatever is sold by the administration and leadership. Care to explain without a cut and paste, using your own thoughts and logic, how these banks are no longer too big to fail when they weren't a couple of years ago and they are larger now?

[ProSense]

21. "I believe they will be bailed out through the back door "

Your entire response is that you don't trust anyone in Congress to do anything.

So what exactly are you expecting?

[TheKentuckian]

22. I don't expect them to do what is logically impossible.

I asked you to explain why the dissolution scam would work in the real world, in your own words and logic, without cutting and pasting and I got silly spin and faith. What is different than two years ago that we can now safely allow one of these institutions to fail? Again, keep in mind they are now all even larger than then.


The only way to get escape velocity from too big to fail is to end it and that means breaking up the big banks and putting caps that would prevent any company from owning such a large percentage of the economy.

I also expected ALL derivatives to be put on exchanges and for blind derivatives to be banned. Logic also would demand that we adjust our tax code to put a heavy preference on investment and to reduce the lure of the casino.

I expected some real serious capital requirements.

I expected ongoing oversight of the Fed.

In other words, I expect sane policy to protect the American people and our economy from destruction and hardship caused by insanity and greed.

[ProSense]

23. "In other words, I expect sane policy to protect the American people "

The Boxer bill protects Americans, but you found a way to negate it by claiming it's bogus, as you have with most of the provisions in the bill.

"What is different than two years ago that we can now safely allow one of these institutions to fail? Again, keep in mind they are now all even larger than then."

The big banks are going to be broken up. The problem was that many were not purely banks, and the FDIC had no jurisdiction. That will no longer be the case.

In fact, this is the first time ever that this issue is being addressed.

[TheKentuckian]

25. Again, I didn't find a damn thing. The problem should be readily apparent

You still have failed to refute my logic. I reckon Whitehouse.org hasn't posted any talking points. Better tell Timmeh and Austin to get busy.

The big banks aren't going to be broken up. That amendment went down in flames and reinstating Glass-Stegall never got a vote. Hell, isn't Volcker even still pending?

Address does not equal solve or even reasonable headway toward solving, it means it had an action and little more and of no guaranteed effect.

[ProSense]

31. "Whitehouse.org "?

Fiction: "The big banks aren't going to be broken up."

Fact: "The Senate legislation, approved on a 59-39 vote, also provides a mechanism for liquidating financial institutions, until recently considered too big to fail, and a council of regulators monitoring threats to the economy."

[TheKentuckian]

34. Are you willfully conflating resolution authority which we have discussed in detail in this very

thread with ending too big to fail or are you legitimately befuddled?

You are once again talking about how this will supposedly be dealt with when it should be crystal clear that I am talking about taking steps to limit and/or reduce the size and functions of these institutions before any of them can meltdown.

[Phx_Dem]

33. They won't be broken up arbitrarily, but they will have the power to break they up

if necessary. Read and learn.

[Dr Morbius]

30. Fixed the link for you.

senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=111&session=2&vote=00130

Yours was missing the "s" in Senate. Passed 96-1, in these partisan days, with three abstentions. One and only nay vote: Kyl of Arizona.

[ProSense]

32. Thanks. n/t

[neildan]

18. I wish Warren could be president.

[Dappleganger]

29. I wish she would take Timmy's place...

she knows what she's doing and putting her in that role would use her talents more effectively.

President, I don't know...it would be a waste of talent to spread someone with her abilities so thin.