Thursday, April 22, 2010

Obama and Financial Reform

Obama and the Democrats are telling lies again. They claim that the current financial legislation will reform the practices of the Wall Street Banksters. The Republicans, unfortunately, contribute to that myth by implying with their opposition that the legislation has significant weight.

In the last crisis, government intervention resulted in several mergers which caused the mega investment banks and commercial banks to become even larger. The current proposed "reform" does nothing to correct that. The OTC derivatives market, which grew from $95 trillion to $600 trillion in a short span of time, is now 95% controlled by our country's five largest banks**. The current proposed "reform" does nothing to correct that either. Most importantly, the current proposed legislation does nothing to separate the regular commercial banks from the Wall Street Bankster investment banks, as did the Glass-Steagall Act. In short, the current proposed legislation does nothing significant; it is designed to appear to be financial reform and protection. It's a fraud.

[** A note on derivatives---
The use of various derivatives can result in accounting fraud by the Banksters, thus allowing them to claim assets that essentially are worthless. The failure of the sub-prime loan market recently was only the trigger for the financial crisis; the basic cause was accounting fraud enabled by the use of some types of derivatives. $600 trillion of derivatives are still out there, and according to Senator Ted Kaufman, the five largest banks hold 95% of those.]

The only sane voice I've noticed regarding this issue is that of Senator Ted Kaufman. For a look at real financial reform (and a blistering criticism of the current package), Google him plus the words "financial reform". This guy seems to understand clearly that Obama, Reid, are just playing at reform; basically, they are protecting the mega banks.

I smell another Obama backroom deal in the making.