Brooksley Born Of The FCIC: “We May Well Still be In A Financial Crisis” - FDL

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Brooksley Born of the FCIC: “We may well still be in a financial crisis”
By: David Dayen
Thursday January 27, 2011 12:27 pm

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In a sometimes contentious call, Financial Crisis Inquiry Commission representatives Phil Angelides and Brooksley Born acknowledged that we might still be in a financial crisis, and that their report should not be seen as the last word on an event that still has the capacity to significantly damage the global economy.

Brooksley Born, who as head of the Commodity Futures Trading Commission under Bill Clinton urged more regulation of the derivatives markets, responded to a question from FDL News on whether we’ve seen the end of the financial crisis. “I do think we are still in somewhat of an economic crisis,” she said. “We may well be in a financial crisis, we don’t know that yet. We don’t know how solvent a number of institutions are.”

Both Born and Phil Angelides, the chair of the commission, described the report as part of an ongoing process of discovery. They had 18 months and around $10 million dollars to come up with a report, one which is sure to be buffered by future litigation, regulatory agency reports and Congressional investigations. They hoped their report would guide future actions, particularly on the hundreds of rules being promulgated by the regulatory apparatus under Dodd-Frank. But Angelides said, “I hope our report is not the last word on this crisis,” particularly because he acknowledged that little, if anything, has changed in the years since the real bubbling up of the crisis at the end of 2008.

Angelides also understood the serious complications that could still arise from MERS and the true ownership of mortgages, and the impact that could have on the system. The FCIC report, on pages 407-408, does go over various aspects of foreclosure fraud and additional lawsuits, including Countrywide v. Kemp, which easily could pose a systemic risk to the financial system. Needless to say, the foreclosure crisis, and its potential for 13 million families to lose their homes before it’s all over, remains a giant sore thumb as well. “Who would have known a system so efficient at creating mortgages would be so hard to unwind,” Angelides said.

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More: http://news.firedoglake.com/2011/01/27/brooksley-born-of-the-fcic-we-may-well-still-be-in-a-financial-crisis/

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