Your Questions About Banking Regulations
John asks…
How will the new banking regulations effect the financial sector job market?
What do you think? Improve it because of increased staffing needs to comply with regulations? Or decrease it because of lower bottom lines?
mikey answers:
Staff levels remain unchanged. The changes don’t really have any effect on it. However you can expect higher fees and new fees to combat the government trying to lower the profit margins.
Ruth asks…
Do you think Barny Franks new banking regulations properly address the problem?
He wants “Too Big to Fail” financial institutions to pay into a reserve fund. While that may calm the fears of some, we still have banking firms that are “too big to fail” operating much the same way as before. Who did Barny write this law for anyway? If the law was any good, wouldn’t the banking industry be screaming bloody murder right now?
Would it be better to actually do something about “too big to fail” companies? Should investment banks, commercial banks and GSEs deemed too big to fail be broken up as if they were monopolies?
mikey answers:
I’m also against the possibility something can be “too big to fail”.
A reserve fund, while better than nothing, and WAY better than using our tax dollars, is not as good as splitting those damn monopolistic companies in two or three pieces.
Maria asks…
Who is responsible for gutting the banking regulations?
it gets tiring hearing all the pubbies complain about irresponsible mortgage borrowing when the problem began with the deregulation of mortgages allowing the scams where the interest shoots up after a few years.
Where can I go to see who deregulated banking and got us into this mess?
mikey answers:
The real question that no one is asking (but should be) is, what ever happened to all the energy brokers who left Enron after its collapse, and why were none of them ever held accountable for the illegal manipulation of the energy markets in California?
Going after the Enron chiefs was not enough. They simply looked the other way at the illegal practices. But meanwhile, those brokers moved on to other sectors, where they used the exact same methodology again.
Some went to the mortgage industry. Some went to the credit industry. Most went to the oil and gas industry. And it’s no coincidence this is where our problems are… Again.
If you want to demand anything from Congress or the presidential candidates, it should be that all of the people involved in these scandalous practices — NOT just the CEO’s and CFO’s — be punished accordingly and appropriately.
Susan asks…
16 months after the avalanche of foreclosures: What banking regulations have Congress come up with?
To keep it from happening again?
mikey answers:
Zero. Zilch. Nada. Nothing.
Which is strange, because the 2008 meltdown was directly attributed to the 1999 Gramm-Leach-Bliley banking deregulation act, which repealed the Depression era Glass-Steagall act.
Democrats claimed this proved the GOP was to blame, because it has Republican Phil Gramm’s name on it (eyeroll).
So, WHY DIDN’T THE DEMOCRAT GOVERNMENT REPEAL IT FIRST THING?
WHY HAVENT’ THE DEMOCRATS REINSTATED GLASS-STEAGALL???????
The FACT is, JOHN MCCAIN has introduced legislation to do exactly that:
http://news.yahoo.com/s/politico/31148
‘Big is bad’ catches on in Congress
“The anger at the nation’s financial behemoths is taking shape in a variety of ways, most notably in a bill from Sens. Maria Cantwell (D-Wash.) and John McCain (R-Ariz.), who are targeting big financial institutions such as JPMorgan Chase and Citigroup.
“The bipartisan duo’s bill would reinstate the Depression-era law that built a wall between commercial banking and the riskier activities of investment banking. The separation — originally set up in the Glass-Steagall Act — was repealed in 1999. ”
IS THIS BEING COVERED IN ANY OF THE MAINSTREAM NEWS MEDIA????
No, of course not.
All anybody can talk about is global warming and health care reform. Both of which are now dead issues.
Well I guess now we have to go back to arguing about gun control, flag burning, and abortion.
We can NEVER discuss anything of substance, can we…
Sandra asks…
What is the name of the international banking regulations adopted after WWII?
mikey answers:
There are many but the most prominent was the Glass Stegall Act which was initiated in 1933 and separated savings and loans from banks and prevented banks from private investments like the brokerage houses . It was repealed by Clinton in 1992 a few weeks before he left office by Executive privelege and has contributed greatly to our problems today. It was prior to WW2 but it was a very big change.
Sarbanes Oxley was a major change in 2002 that changed accounting practices to protect investors from fraudulent accounting practices by corporations.
Good luck
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