The Obama Adminstration's Handling of Wall Street.

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I should emphasize this with a repeat of the caveat that there must be strong principles that are adhered to, the problem I think with American GAAP was that it just became a set of obstacles for American companies to jump through. contrary to you, MFW, I think most people can be honest if the system they are placed in incentivizes it. you drill in conservatism and reliability, and then back them up with a set of strong rules, then you have a good system. this is in comparison to the United States where they might have had stronger rules...but don't, to my understanding, emphasize the spirit of those rules or the principles behind them. It is also in comparison with Europe and Asia, which are way too loose, and have basically little rules to follow and just a basic set of broad guidelines.

In summation, you think rules-based is just running around hoops. I think pure rules-based with little thought to principle as in the United States might be that, but a principles-backed system with rules is ideal. there you go. also IFRS is the devil to me, as you must well know.

to shift the topic back a bit...

yeah, and if were debating about other topics, you'd see me with a fierce governmental streak when it comes to leveling informational advantages through regulation.

Now, I posited the moral hazard theory before, but I was referring to information asymmetry in general. I guess adverse selection would work best...moral hazard was more me emphasizing that Goldman was doing things under the table hidden from clients, and contrary to stated positions, but if you want to go with market-maker, and buyer-seller with no contractual obligation to the investors, then fine, adverse selection it is.

and that is relevant.

I don't understand how this shields investors. It just makes sure both are on even footing. Will there still be idiots who will buy this crap? Sure. But then, we don't have to bail them out hopefully, because, unless EVERYONE is f**king incompetent, faced with full disclosure, and all the facts, the banking sector will not fall for these tricks again. Or non-disclosure. Or whatever the f**k euphemism you want to put on it.

I am not advocating we compensate stupid investors in any way. In fact, I am rather hoping this discourages bailouts, since whoever gets screwed should be stupid enough to not be heading a major bank "too big to fail" next time, hopefully.

TARP also utterly failed Main Street goals which, I have referenced numerous times, and which goes back to the point of the thread---TARP should have been the time where the Obama Admin. went for "change". Instead, we're left with the TARP overseer admitting it failed in changing the regulatory environment that led to this catastrophe in the first place and, well, Stiglitz puts it best---

No, the elite and powerful had it all, while bankers got nice yields.

I have much more sympathy for the working class that had little to no control of rampant government spending (often targeted with little to no benefit to them). In Portugal's case, they never even had the fiesta...

http://www.globalpost.com/dispatch/news/business-tech/debt-crisis/110425/portugal-bailout-eu-imf

And Ireland was a fine case of balanced budgets---but it represents why you need your head checked if you ever let the banks and their free market gospel run your country unchecked.

which brings me to the next point---

Countries default. It has happened before. It won't happen with the IMF lurking and getting investors out however. but I find it laughable that you deride "stupid investors" and protecting them, then you turn around and say, well, the IMF should protect them because they're risk free...

if they're risk free, why the high credit spread over German bonds? If you're idiotic enough to have invested in an economy as fundamentally bad as Greece or Portugal just because in your little mind you always thought governments would shut up and take bank bailouts up the a**...well you'd be right, since everyone seems to love sheilding investors, no? but you'd sure look stupid if it didn't happen, and someone just defaulted.

of course, though, hindsight is "20/20 for the losers".

 

Please get the f*** out of this thread, if all you're going to contribute is to say you won't contribute. bye! have a good day.

It is more or less the exact same. It is the same crap Soros pulls, but I would not expect you to argue that. anyways, we're done here. the scale might be different, but corruption isn't a zero-sum game, just because one side is getting away with it more, doesn't mean another can't. This isn't partisan land Sam, I'm not concerned whether or not leftists or rightists are doing funky ass s***, I'm concerned about whether PEOPLE and institutions are doing funky ass s***. If you aren't, that's your call, though I won't call you an idiot for holding that belief.

Please get the f*** out of this thread, if all you're going to contribute is to say you won't contribute. bye! have a good day.

now listen, you may not have read the post, but I was hoping you caught the part where I civilly told you bye?

let me reemphasize. forgive me for the harshness, but you've shown you can dish it and take it.

as kindly as possible, please get the f*** out if all you're going to write is that you didn't read what I wrote. you are wasting my time, and yours. I made sure to post it all over just in case you tried to ignore it, as you have with other items and arguments.

It does not make you any lesser of an internet warrior or decrease your e-penis if you were to just leave, and never post again. your arguments will stand, mine will too, so our hypothetical arguments will reach out to our hypothetical audience of whoever the f*** bothers to read this crap.

now, if you wish to argue points pertaining to this thread, feel free to come back, but for now, if all you're gonna say is TL;DR, I'd suggest that you please leave.

have a good night, of not reading.

 

I stopped reading here.

Bye!

 

I acknowledge the following errors---

1-The Goldman case was not as clear-cut as I presumed after some more research and some of the posts here, and so I cannot fault the DOJ's action on it as a "last straw."
2-The DOJ has been subpoenaed and there is nominal movement on prosecutions at least---though more often or not, these result in dropped cases, that may simply be due to the unworkability of current fraud laws, and not to corruption/deliberate action. At this point, debating about this is a matter of conjuncture with circumstantial evidence on both sides, though it needs to be said that others are conjuring their positions just as I am, and I have not seen many shreds of solid proof (mine included). However, for a president that promised so much change, the status quo in of itself and the circumstances of the recession that allowed for the political capital for momentous and noticeable change is sorely disappointing.
3-There has been movement towards regulation, and some of it might be blocked by Republican obstructionism which I despise even more. President Obama has never shown much of a tendency to be a "bully-pulpit" president, so maybe he is merely just timid, and bad at passing bills, rather than in the pockets of the banks. I guess we will have to see in this second term, I have some hope with this regard, but I will be watching closely.

However, I wish to reemphasize the main point of the thread---that up to now, the Obama Administration, whether through intention (which I strongly allege, but which, I must admit, is somewhat secondary to the whole point) or sheer incompetence has utterly failed us in keeping the big banks in check. People here seem content that the banks got away with the biggest financial debacle in decades by paying back loans on a very favorable rate---despite the fact that more or less, the same regulatory atmosphere that led to the recession in the first place still exists, and despite the fact that TARP costs have used wonky math that excluded Frannie and Freddie, and etc.

I am not an expert in this field---far from it. I am just a concerned citizen who wishes that the world I inherit and which I have to work in is not as screwed up as it is now. I use whatever knowledge I have to try to convince others to be just as concerned. that is all.

 

i guess we have to be content with "change" as "compromising with the status quo" instead of well...change? o_0

 

Careful Rhad. Anytime you link possible Obama Admin. actions with their need to raise money from Wall Street, according to some, it's crazy town.

Wall Street in no shape or way affects how the Obama Admin. and Republicans treat financial regulation. no sir. the (little) money they spend is merely reflected in free vouchers to Disney World.

 

http://www.nytimes.com/2011/07/16/b...e-its-effectiveness.html?scp=2&sq=bone&st=cse

Will the President work to stop this outrage?

 

Certainly, on this issue, the Obama Admin. has shown a tendency to bite the American electorate that feeds them votes.

 

By allowing more or less the same regulatory atmosphere that led to the collapse in the first place, which puts America again at the mercies of the same deceptive and unethical individuals who led so many people to joblessness and despair through negligence, and greed.

This was an opportunity for great change, the same change Obama promised the American electorate. Instead, all America got was a watered down Glass-Stegall that isn't even going to be properly enforced, seeing as how the enforcement agency that's responsible for it is being starved of money, and the Obama Admin., to my knowledge, has done nothing to rectify this situation.

 

Obama's "plan" has so far been nothing. I haven't seen a public statement in defense of the S.E.C. TARP had Main Street goals that were essentially abandoned. It's much easier to allege he's working for Wall Street rather than the American people on this issue, especially with the number of bundlers coming in (Corzine surprise!).

It's not an issue of Obama not being able to do anything, it's an issue that he hasn't been trying hard enough, which I guess you can say on many other issues is the truth as well, but especially on this issue. He has so much political capital on this...who doesn't dislike Wall Street these days? It's being squandered, and he's letting the Republicans win out on this one. Of course, that's the most benevolent view of this...i.e, Obama just can't get stuff done. There's also a view (one that I share) that Obama is deliberately being silent on this issue or even working with Wall Street on this one.

Lastly, it's not an issue of "liberal" vs "conservative" as you posit, some of the Republicans (notably Ron Paul) dislike Wall Street's shenanigans even more. It's a question of regulation vs deregulation, and you'll find plenty of supporters of regulation if you look hard enough...just that the President, in my opinion, hasn't been looking hard enough. Because why look? Why bite the hand that feeds you, as Classic put it.