Obama's Financial Reforms are tepid, at best

Obama's reforms amount to tepid reform "around the edges," as JOE NOCERA writes in today's NY Times: Only a Hint of Roosevelt in Financial Overhaul

What we really need are State Banks like North Dakota has, where all the state's revenues are funneled into the bank, free of Wall Street influence, to be redistributed to the rest of the state's banks, and loaned out at reasonable rates for mortgages and farm loans (loaning to farmers was the major reason this banking system was set up in the first place in 1919). Loaning money this way - the way banks have for hundreds of years - means the banks have 'skin in the game' so it is in their interest to ensure their customers do not default. The system of aggragating loans into CDOs and CLOs ensures just the opposite: that loans will be made, quickly packaged up and sold to investors (mostly naive of the true risks). When the underlying loans go bust, as they are, the banks won't be on the hook financially, though they do still get to collect the collateral houses. By the way, the legality of a bank collecting the house for a loan they no longer have on their book, or even have title to, has been successfuly challenged in a number of cases, and foreclosures have been prevented that way. People should know their rights and not simply move out when a foreclosure notice comes due.

Getting back to North Dakota (ND). ND has 4% unemployment, a surplus(!), of over $1 Billion (in a state with only 641,000 people) and virtually no home mortgage defaults. The bank is flush with cash and is run conservatively the way most community banks are still run (remember, there are 8500 banks in the country; only about 100-200 are a problem, and only 19 pose systemic risk; the too-big-to-fail gang.)

In addition to every state getting its own bank, acting independently of Wall Street and the investment bank community, we need to rerequire capital ratios that simply won't let banks become too big to fail - investors are NOT going to put all their money into a single one of anything, no matter what the derivative instrument. If we went back to 10:1 asset to liability ratios, a JP Morgan could never have 92 Trillion in Derivatives, as it does now - they would need almost 10 Trillion in assets first, and that's just not going to happen; the entire asset base of JP Morgan is probably 1/10th of that, and that's only if they sold off everything down to the light bulbs. In essence, they'd have to go bankrupt.

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http://www.opednews.com/articles/Obama-s-Financial-Reforms-by-Scott-Baker-090618-624.html

I am very sorry to say, but reality is reality.

:hi: Skittles.

that when people identify themselves to pollsters as "conservative", generally, what they mean is that they are fiscal conservatives who would like the government to function in the vein of North Dakota.

IBTC! (In before the cheerleaders).

It can't really be called "reform", and it certainly is NOT the "re-regulation of Wall Street".
It is pretty much business as usual with a few small adjustments.

Most bothersome is the assignment of MORE power to The Fed, a shadowy, secret, private organization/Corporation of Millionaires/Billionaires with close ties to the Banking Industry. The Fed is immune from public oversight and accountability. In fact, The Fed is even immune from Congressional Oversight (not that our current Congress would provide any effective oversight).

The solution to our problems is MORE accountability to The Public and Transparency....NOT less.

If he goes too far. He can't do whatever he wants.

Who else is saying this?

Do you think that's why he isn't even TRYING to stick his neck out?