Obama's Half-Baked Bank Reform

[leave iraq]

For Real Reform, Glass-Steagall Must be Brought Back

"Risk is risk whether it's called propriety trading or comes from the customer-trading business. True systemic risk reduction requires dividing out all trading activities from within a firm that also does deposits and lending. That requires a resurrection of a true Glass-Steagall barrier, not a bunch of stuff that sounds like it gets partly there."

http://www.commondreams.org/view/2010/01/22-2

[Tansy_Gold]

More like half-assed

At least if it's half baked you can put it back in the oven for a while.

If it's half assed, the worst that can happen is you put it back in the oven and it comes out all assed.



TG

[grytpype]

4. Smash the mean banks and distribute their assets to the People!!!!!

I will not stop voting Republican until all the banks are lying in pieces at my feet!!!!!!

:cry::cry::cry::cry::cry::cry:!!!!!

[FreakinDJ]

1. Too much too soon will upset the economic apple cart

[totodeinhere]

8. Too little too late will also do it. n/t

[still_one]

2. You have to start somewhere, and this is a good start. Just look at how wall street is receiving it

[Greyhound]

3. I'm still waiting for anything even remotely reform-like.

I ain't holding my breath.

[KittyWampus]

5. Trying to foment a little more dischord on DU, are you? Obama made the right move with Volcker

[regnaD kciN]

9. 35 posts...

...I'm just sayin'.

[FarCenter]

6. Most lending is done by non-bank financial institutions

Most cash is sitting in non-bank MMFs and short term paper.

So this splitting proposal doesn't solve the problem unless it envisions a significant expansion of commercial banks and a withering on non-bank financial activity. Otherwise, the non-bank financial sector has many players big enough to cause a crisis.

[blogslut]

7. The proposed plan

is intended to stop lending/savings banks from playing the markets as well as limit their size, thus quelling the too-big-to-fail phenomenon:

On Thursday, Mr. Obama proposed a plan that would prevent banks that receive a federal backstop from investing their own money in financial markets—what is known as proprietary trading. He also pushed for new limits on the size and concentration of financial institutions. Both moves echo the Glass-Steagall Act, the Depression-era banking curbs that was repealed in 1999.

link: http://online.wsj.com/article/SB10001424052748704423204575017543560874692.html?mod=WSJ-Markets-MIDDLETopNews

I'm quite pleased with Obama invoking the Volcker rule. However, passage of such legislation is up to congress.

As for your intentions with your post, well...

[Nite Owl]

10. It was an excellent article

As far as a source commondreams--a very long standing and progressive site--is questionable and the Wall St Journal is the 'good' source? Something screwed up about that.