We can just about shelve any hopes of banking reform from Congress. Barney Frank, Chairman of the House Financial Services Committee said: "I don't think you're going to see that happen" (referring to mandates for financial companies to process their swaps through a clearinghouse).
Frank went on to say that there would be a presumption that standardized contracts would be sent to a clearinghouse but that it would not be an iron clad rule. With the bankers ignoring established rules and doing pretty much what they want, forget about that idea.
CFTC Chairman Gary Gensler, told Congress that clearing "is essential to lowering risk" and should be the norm.
Let's be honest. Without forcing bankers and traders to trade on listed exchanges and clear their trades through a clearinghouse, there is no reform. There is no transparency. We already know that greed supersedes common sense when it comes to the financial sector. Just look at the way the bankers took this economy down with their greed and excess speculation.
What we need is for every banker and trader to place each and every trade on a listed exchange and have each and every trade cleared through a clearinghouse. That data can be put on computers and monitored on a daily basis. Then if someone goes beyond established capital requirements, he/she should be shut down immediately.
This is the way that trading is done in the commodity markets. Why should the bankers be given special consideration? The commodity markets have been operating successfully for over a hundred years without causing the havoc that the bankers wrecked on our economy.
Mr. Frank, listen to Gary Gensler and Mr. Frank don't be afraid to step on the bankers' toes.
Should bankers and traders be mandated to trade on listed exchanges and clear their trades through a clearinghouse?
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Reader Comments (Page 1 of 1)
10-07-2009 @ 9:03PM
Beltway Greg said...
Barney Frank, Barney Rubble, and Barney the Dinosaur. All three are from the stone age. Thanks for sowing the seeds of the next financial meltdown.
10-07-2009 @ 10:31PM
Bobby said...
The problem is the banks told Barney they didn't know how to unravel the intricate mess called "derivatives" they have on their books. Barney capitulated because just like the bills Congress passes,, none of them can even interpret them. Derivatives are like the core of a baseball with layer after layer interwoven. The banks don't understand them,, Congress doesn't understand them & they're only hoping the banks can unwind them without another catastrophe hitting again.
10-08-2009 @ 9:43AM
G said...
Now that Bawney has been told what he thinks, he's good with it.
So much for representative government ... what Bawney represents sure ain't "the people" ... yet the Mo-Rons in his constituency continue to give him the "green light".
"Thinking is the hardest work there is, which is why so few engage in it" - H. Ford
10-10-2009 @ 12:20PM
Mitch said...
Saddest thing is- in finance reform- the best educated and brightest minds in Congress are worthless when it comes to their sworn duty to the American people - to create laws to protect us from harm...... Hell, they can't even vote enough military to win a war in a third world country.
Change is gonna' come.....
10-12-2009 @ 12:38PM
Richard Demontbreun said...
American people must have confidence in our banking system or our economy will not survive. To allow one man, Barney Frank, to allow the banks to use such risky procedures with our money is ludicrous and must be stopped now. Congress must create a new Federal agency to enforce the regulation of banks because the banks are too greedy to enforce themselves and the Treasurey needs a watchdog to prevent the failure of the past from occurring again. The Federal Government must
protect the American public from what has happened in the past. Let's put some teeth in the regulatory functions
and kick Barney Frank and Chris Dodd out of the financial
committee, if not out of office, real soon.
10-13-2009 @ 11:12PM
Stanley King said...
"Capitalism is the astounding belief that wicked men will do wicked things resulting in the common good".