First Homeland Security, now this...

[DeepIron]

http://news.bbc.co.uk/2/hi/business/7322107.stm
http://www.reuters.com/article/ousiv/idUSN2836557720080331
http://money.cnn.com/2008/03/31/news/economy/paulson_regulation/index.htm?cnn=yes

This kind of stuff bugs me:

The Fed would become "market stability regulator" - allowing it to examine the books of any financial institution deemed to potentially threaten the stability of the financial system. The overhaul will see a new organisation set up to take over the role of the five separate banking regulators. A body to regulate business conduct and consumer protection is also likely to be proposed. The key to success in capitalism is competition, not more Federal regulation. Businesses "make it or break it" by being more competitive, more savvy and more in tune with consumers. If a business can't make it and they fold, then they should fail and be replaced by another business that can succeed. It's evolution in the marketplace and it's what makes the marketplace a stronger system.

Bailing out failed and failing businesses only prolongs the practices that put them in dire straits in the first place. Why fear bad business decisions, like the sub-prime lending fiasco, when Uncle Sam will be there to bail them out?

Besides, I'm for less government intervention and not more...:up:

Now, if they want to take on Health Care, THAT'S a different story.... ;)

[seafarer]

I don't know...:hmm: If the financial sector ever actual did demonstrate that it could, in fact, operating with intelligence, integrity and forethought, I might agree. But they seem to often act as greed-blinded idiots without even a grade school education or a lick of common sense, I say police the snot out of them. When they grow up and act like responsible business adults, maybe then let them out of the corner to play unsupervised.

P.S. And why, after the mortgage fiasco (wholly predictable, IMO) do we still see all sorts of ads offering "guaranteed" credit to people who simply SHOULD NOT GET LOANS! And why is that when companies like CountryWide go flop due to piss-poor and imbecilic management, the top dogs walk away with millions?

They don't just need to be highly supervised, they need to flayed and then watched by someone with a cattleprod to their back and liberal allowance to use it whenever they see a lender about to do something stupid.

[DeepIron]

Be careful, it begins with that, and then one day you wake up in a communist country !That's what concerns me really. I'm not alarmist or conspiratorially inclined, but "great storms are announced by the slightest of breezes" and I'm more cautious these days when the government wants to do more to "protect" me both externally and internally.

[Tchocky]

Wheh?

Lax financial regulation was one of the main causes of the current mess.

[DeepIron]

Wheh?

Lax financial regulation was one of the main causes of the current mess.Hmmm... I can't agree with that completely. True, the Fed needs to overhaul the system as it's archaic, but not to the extent they'd like to IMO. It's a free enterprise system and the responsibilty of both sellers and consumers to be savvy enough to make "decent" decisions. If the Fed stepped in to say, cap profits (like they won't do with the oil companies BTW) what's the use of having an economy based on capitalism? You'd always know that you were going to "hit the ceiling" due to Federal interventions.

It's a statement like this: "...deemed to potentially threaten the stability of..." that really bother me because it looks like a loophole for the Fed to exploit when they see the need. Seems like we're adapting our Foreign Policy to our Economic... ;)

[Sailor Steve]

I don't know...:hmm: If the financial sector ever actual did demonstrate that it could, in fact, operating with intelligence, integrity and forethought, I might agree. But they seem to often act as greed-blinded idiots without even a grade school education or a lick of common sense, I say police the snot out of them. When they grow up and act like responsible business adults, maybe then let them out of the corner to play unsupervised.
Supervised/unsupervised by whom? That's the problem I have: either you have freedom or you don't. Government oversight should be limited to condemning and convicting corporations that willfully hurt consumers. Stupidity is one of the real freedoms. Not to mention the fact that government has proven itself less capable of self-regulation than any private corporation.

They don't just need to be highly supervised, they need to flayed and then watched by someone with a cattleprod to their back and liberal allowance to use it whenever they see a lender about to do something stupid.
Again, exactly who in government is qualified to do this flaying. If anyone needs it, it's the ones you expect to provide it.

[Tchocky]

I think it's totally logical. If a credit/debt-trading institution expects to be rescued by the Fed (like Bear Stearns), it should be expected in return to follow federal guidelines that make the probability of needing rescue lower.

EDIT - I see that the banks affected by this are only those already regulated, ie, not the ones that have been causing problems recently.

*thinks*

[DeepIron]

Supervised/unsupervised by whom? That's the problem I have: either you have freedom or you don't. Government oversight should be limited to condemning and convicting corporations that willfully hurt consumers. Stupidity is one of the real freedoms. Not to mention the fact that government has proven itself less capable of self-regulation than any private corporation.Right on! Who watches the watchers? It wouldn't be long before "special interests" started applying pressure for regulators to "stifle Company A to Company B's benefit"... It's already an old practice in Wash DC now...

[seafarer]

Supervised/unsupervised by whom? That's the problem I have: either you have freedom or you don't. Government oversight should be limited to condemning and convicting corporations that willfully hurt consumers. Stupidity is one of the real freedoms. Not to mention the fact that government has proven itself less capable of self-regulation than any private corporation.Right on! Who watches the watchers? It wouldn't be long before "special interests" started applying pressure for regulators to "stifle Company A to Company B's benefit"... It's already an old practice in Wash DC now...

Well, when the "watchers" are the government, then we, the supposedly informed and engaged voters, watch the watchers. That's how a democratic system is supposed to work, at least in theory (always keep in mind that you get the government you vote for, or fail to vote for if you abstain).

And one factor the Feds are considering I am in favor of. Lending banks need to be required to operate on less of a margin and have more actual cash reserves on hand. Bear Stearns was far to strung out, with nothing to back up their business when the cash calls came in.

[Platapus]

My biggest concern is who does the FED represent?

It is a quasi-public quasi-private (what ever the hell THAT means) system of organizations with little oversight run by rich people who want to get richer.

I have no doubt the Fed is willing to expand their powers, but who are they working for?

The American people or bank stockholders?

What may be good for General Motors may be good for America, but is what is good for the Fed, good for the people?

[DeepIron]

I have no doubt the Fed is willing to expand their powers, but who are they working for? The American people or bank stockholders?Hmmm, lemme think about that while I stand in line here waiting to have my wool sheared.... ;)

[Platapus]

With respect to the American People, I fear that the Fed is a service type organization.

The same way a bull services a cow

[DeepIron]

With respect to the American People, I fear that the Fed is a service type organization.

The same way a bull services a cowReminds me of a story...
One day a Young Bull and an Old Bull were standing on a hillside looking down at a whole herd of fine young heifers grazing on a field of grass below them. The Young Bull said excitedly to the Old Bull, "Let's RUN down and scr*w a few of them!" The Old Bull slowly turned his head, looked patiently at the Young Bull and said quietly, "No, let's WALK down and scr*w them all."

What does this story have to do with the thread. Absolutely nothing. Enjoy!:up:

[JetSnake]

Be careful, it begins with that, and then one day you wake up in a communist country !


Actually it began decades ago with the public school systems. They have dumbed the educational system down to a point that the kids graduating want socialism. Then they go to higher education where their liberal professors continue the liberal agenda.

[XabbaRus]

But say banks are allowed to fold because of idiotic managemet what about customers who have money in that bank. Do you still agree to a federal insurance scheme where customers of teh bank are garunteed to be able to get their money should the bank fold. As with all institutions it is the big creditors who get the share first and f**k the little guy who thought his money would be safe. I think the system works quite well in the UK, Northern Rock not withstanding. They were idiots offereing 110% mortgages by borrowing money etc. The rest of the British banks are OK AFAIK.

[mrbeast]

Be careful, it begins with that, and then one day you wake up in a communist country !


Actually it began decades ago with the public school systems. They have dumbed the educational system down to a point that the kids graduating want socialism. Then they go to higher education where their liberal professors continue the liberal agenda.

Don't really understand how 'dumbing down kids' makes them 'want socialsim'.

Considering that socialist politcal-economic theory is pretty complex I'd say that the opposite would be true.

[TteFAboB]

Islam is the answer. No interest, no problem.

Considering that socialist politcal-economic theory is pretty complex I'd say that the opposite would be true.

You assume they are given theory, and not propaganda.

[mrbeast]

Islam is the answer. No interest, no problem.

Considering that socialist politcal-economic theory is pretty complex I'd say that the opposite would be true.

You assume they are given theory, and not propaganda.

I'm not assuming anything, I didn't say that they were taught anything about socialism.

I just wondered why kids would suddenly want socialism because they were dumbed down?

[Zayphod]

Wheh?

Lax financial regulation was one of the main causes of the current mess.Hmmm... I can't agree with that completely. True, the Fed needs to overhaul the system as it's archaic, but not to the extent they'd like to IMO. It's a free enterprise system and the responsibilty of both sellers and consumers to be savvy enough to make "decent" decisions. If the Fed stepped in to say, cap profits (like they won't do with the oil companies BTW) what's the use of having an economy based on capitalism? You'd always know that you were going to "hit the ceiling" due to Federal interventions.


It's like this:
All us USA people know the game of football. We know the rules, and we know why the rules are there.

If all the players know the rules, and why they're there in the first place, do we need a referee? Why should there be one? Everyone knows how to play, and what the rules are, so why should anyone have to toss that little flag at all?

Someone has to watch the children play, and make sure the rules are enforced. Failure to do so results in a mess. When all games are played perfectly, no one needs to worry about the rules. Until that happens, expect someone to have to watch over the kids as they play, ensuring that all the rules are enforced.

Just my 2¢. :know: