Volcker, 40 years behind the times
Sunday, February 7, 2010 | jmillny Is this Spam?When asked, Volcker confirmed the debacle wasn't caused by propriety trading and I defy an example of such. This sets the example, GOVERNMENT at best is inept at resolving our Nations problems, it adds to it. Not unlike prohibition and since, the list will cover 2000 pages of such actions of ineptitude by Washington, DC.
I find it mind boggling, from Washington, Cable Media, News print and on and on oblivious that we the people are more to blame for this bubble then any other source, the banks just took unfair advantage of a bankrupt system. No one was paying attention, 4 years ago a home that went for $250,000, in the blink of an eye $500,000. So what did us genius' do, we went to the bank, and what did they do, they gave us a set of knives and a $250,000 loan to buy a car, take out a loan on that car, buy a vacation house take out a loan on that house that went from $150,000 to $500,000, took the family on 14 day cruise along with some diamonds for the miss's.
Back to the banks, no fault to them, they're in the business to make money; some hedge fund dude at the local watering hole half drunk suggests the loan officer sell the mortgage to his/her fund 100% on the dollar, why not, it enabled the bank to repeat the process making the run up in housing even rosier.
The thought of socializing our capital system is only one step closer shuttering out capital infusion in into the economy. What's needed is a new flow of regulation governing limits to borrowing money, capital requirement on banks and a set of standards people must prove as to their financial well being before any loan is authorized? As I see it the major transgression on the banking side was lackadaisical lending and the fact the banks were free to sell the loan, there lies the problem, you book the loan, you keep the loan.
I see no need to break up banks for political advantage with no bottom line to the banks and our nations capital nourishment and need of capital, a viable tool in rebuilding our capital markets and financial health of our country.
