While everybody agreed that the health care system was broken with prices too high and coverage too low, nobody likes the proposed solution that came from nearly a year of debating how to fix it. No wonder. Without offering a single answer to the issue of runaway costs, Congress decided to make participation in the broken system compulsory. Ridiculous and Obama took the fall.
Today, Obama spoke of his proposal of an overhaul of regulations prohibiting banks from running proprietary trading operations solely for their own profit and sponsoring hedge funds and private equity funds. He also proposed expanding a 10 percent market-share cap on deposits to include other liabilities such as non-deposit funding to restrict growth and consolidation.
“Never again will the American taxpayer be held hostage by a bank that is too big to fail.”
This proposal will affect trading at major banks such as JPMorgan Chase & Co, Morgan Stanley and Goldman Sachs. Goldman Sachs, which today announced over $13 billion profit for 2009, a record year, voiced doubts on the proposal.
Ending Federal Reserve oversight of Goldman Sachs “has virtually no chance of ever happening, it’s just not something we spend time on,” Goldman Sach’s CFO Viniar, 54, said in a conference call with journalists today. “We’re now regulated by the Fed and I expect we will be on a continuing basis.” “You have global institutions around the world who are set up in a certain way and to put rules in place that roll back the financial system by 10 years I think is going to be a very, very hard thing to do,”
Goldman Sachs and Morgan Stanley, both based in New York, were the two largest security firms before converting to banks in September 2008 during the global financial crisis to gain access to Federal Reserve lending facilities. Today’s proposals raised questions about whether they would opt to revert to securities firms so they could avoid the new rules.
Critics claim that if this proposal freezes or reduces the banks’ ability or willingness to invest, other investors will pull back until other asset managers step in to take up the slack.
On the other hand, how do you justify the struggling economy, taxpayer bailouts and growing bank profits at a time of 10 percent unemployment, as well as a federal deficit that rose to $1.4 trillion last year if no financial reform is being made to prevent history from repeating?
Obama can’t get everything right, but in this case, he has my vote.
Today, Obama spoke of his proposal of an overhaul of regulations prohibiting banks from running proprietary trading operations solely for their own profit and sponsoring hedge funds and private equity funds. He also proposed expanding a 10 percent market-share cap on deposits to include other liabilities such as non-deposit funding to restrict growth and consolidation.
“Never again will the American taxpayer be held hostage by a bank that is too big to fail.”
This proposal will affect trading at major banks such as JPMorgan Chase & Co, Morgan Stanley and Goldman Sachs. Goldman Sachs, which today announced over $13 billion profit for 2009, a record year, voiced doubts on the proposal.
Ending Federal Reserve oversight of Goldman Sachs “has virtually no chance of ever happening, it’s just not something we spend time on,” Goldman Sach’s CFO Viniar, 54, said in a conference call with journalists today. “We’re now regulated by the Fed and I expect we will be on a continuing basis.” “You have global institutions around the world who are set up in a certain way and to put rules in place that roll back the financial system by 10 years I think is going to be a very, very hard thing to do,”
Goldman Sachs and Morgan Stanley, both based in New York, were the two largest security firms before converting to banks in September 2008 during the global financial crisis to gain access to Federal Reserve lending facilities. Today’s proposals raised questions about whether they would opt to revert to securities firms so they could avoid the new rules.
Critics claim that if this proposal freezes or reduces the banks’ ability or willingness to invest, other investors will pull back until other asset managers step in to take up the slack.
On the other hand, how do you justify the struggling economy, taxpayer bailouts and growing bank profits at a time of 10 percent unemployment, as well as a federal deficit that rose to $1.4 trillion last year if no financial reform is being made to prevent history from repeating?
Obama can’t get everything right, but in this case, he has my vote.
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