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Volcker Rules

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Posted on Feb 2, 2010
Volcker
AP / Gerald Herbert

President Barack Obama with Economic Recovery Advisory Board Chairman Paul Volcker in the Oval Office last March.

By Robert Scheer

Finally President Barack Obama has come to his senses on financial regulation. His endorsement of what he calls the “Volcker Rule” for once puts him squarely on the side of ordinary Americans as opposed to the banking bandits who have so thoroughly fleeced the public.

The proposal from former Federal Reserve Chairman Paul Volcker basically involves restoring the spirit, if not the letter, of the 1930s Glass-Steagall banking regulations to prevent another Great Depression. It means separating the activities of commercial banks, entrusted with the deposits of ordinary folks, from the antics of the financial high rollers who are presumably dealing with wealthier and more knowledgeable investors. Commercial banks were intended to be heavily regulated and insured by the government to protect the savings of unwary citizens. Less risk-averse investors and the firms that handled their funds could fend for themselves, and if there was a collapse there would be no innocent victims requiring a government bailout.

This setup worked splendidly for more than six decades, until the rules were changed to permit the merger of the two types of banking activity, which never would have happened had President Ronald Reagan renamed Volcker as head of the Fed back in 1987. To reappoint Volcker would have been the logical move given his spectacular record in taming inflation, which he brought down to 3.6 percent after it had risen to 11.3 percent thanks to the energy crisis of 1979. Reagan went with Alan Greenspan instead because of their shared ideological fervor for unfettered free markets. But the repeal of Glass-Steagall required bipartisan support, and that eventually came with the presidency of Bill Clinton, who reappointed Greenspan and his fellow free-market ideologues Robert Rubin and Lawrence Summers to head the Treasury Department. They joined forces with the Wall Street lobby, and as a result Glass-Steagall was repealed in 1999 when Clinton signed the law eliminating it.

Unfortunately, and despite the collapse of the banking system brought about by the shenanigans of the “too big to fail” conglomerates permitted in the new deregulatory environment, Obama has wasted the last year and trillions of taxpayer dollars bailing out Wall Street without putting significant new rules in place to govern reckless behavior. Only now, with the economic disaster bankrupting the government, has he turned to Volcker for leadership. And in testimony Tuesday before the Senate Banking Committee, Volcker offered the essential justification for needed banking legislation:

“The basic point is that there has been, and remains, a strong public interest in providing a `safety net’—in particular, deposit insurance and the provision of liquidity in emergencies—for commercial banks carrying out essential services. There is not, however, a similar rationale for public funds-taxpayer funds—protecting and supporting essentially proprietary and speculative activities.”

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Investment houses would still be permitted to play freely at the Wall Street casino, but they would have to pay the consequences of their own failure. In the event that the largest of them approached collapse, the government would still step in—not to save them but to dispose of the body in a way that did not endanger the health of others. As Volcker put it, when it would come to dealing with the impending collapse of an investment giant: “The mandate is to arrange an orderly liquidation or merger. In other words, euthanasia, not a rescue.”

Euthanasia was applied to Lehman Brothers but not Goldman Sachs, which was allowed to suddenly jump over the wall to become a commercial bank and thus eligible for TARP funding and many billions more from the government.

The biggest banks, whether originally commercial or investment banks, are now screaming their predicted pain at the prospect of new regulations—and no wonder. An analysis of the five top banks affected, led by Goldman Sachs, shows they stand to lose $13 billion in revenue next year if the proposed regulations pass, according to Bloomberg. But there is hope for at least some bipartisan support for the restoration of a wall separating these two very different sorts of banking activities, as indicated by a bill co-sponsored by Sens. John McCain, R-Ariz., and Maria Cantwell, D-Wash., to explicitly restore the safeguards of Glass-Steagall. 
     
Please don’t let your eyes glaze over on this issue as a matter of arcane economic regulation. It’s the ballgame as far as breaking the death grip of Wall Street over our economy. The projected $1.6 trillion deficit is only the first installment on decades of crippling debt that will pile up because of the irresponsibility of a radically deregulated banking system. This should be the only reminder we need that little else matters in the way of public policy discussion as long as Wall Street bleeds us dry.

Click here to check out Robert Scheer’s book,
“The Great American Stickup: How Reagan Republicans and Clinton Democrats Enriched Wall Street While Mugging Main Street.”


Keep up with Robert Scheer’s latest columns, interviews, tour dates and more at www.truthdig.com/robert_scheer.



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By jonathonk99, February 7, 2010 at 2:55 pm Link to this comment

Repealing Glass-Steagall is a good thing, no doubt.  But a lot of things look great
on paper but never amount to squat in reality:  Enron’s balance sheet or the
American Recovery Act etc.  For right now our politicians are putting on a show AS
IF they actually care about campaign finance.  It’s like a chronic smoker that keeps
promising he will kick the habit… Behind closed doors it will most likely be
another story (aka business-as-usual) and we’ll keep passively breathing in the
second hand fumes (aka financing global terrorism & elite tyranny).  But for right
now all we can do is wait and see if they really believe what they say.  My guess is
they care far too much about their careers to actually stand by what they are
saying at the present moment.

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By liecatcher, February 6, 2010 at 10:20 pm Link to this comment

Look how many years it took Elizabeth Edwards to
accept the fact that husband John Edwards was a
lying scoundrel.
We the people have seen & heard more than enough
from Bush3 to know for certain that he’s a villain.
Unlike Elizabeth, we have no recourse. But for
Mammon’s sake, let’s stop pretending that he
is any different from previous predators or that
someone else “advising” him will change things.
Bird of prey flock together & we are their prey.
So let’s not allow Robert Scheer’s progressive’s
blindness to reality to affect our judgement.

Report this

By TAO Walker, February 6, 2010 at 4:21 pm Link to this comment

A possible ‘answer’ to Gerard’s (rhetorical?) question below, about what it all “goes to show,” is that, even if “Volcker Rules” (in place of fear?), CONfusion reigns and MONEY is still god.

Hokahey!

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By gerard, February 5, 2010 at 8:41 pm Link to this comment

The course this string has taken reminds me of nothing so much as a string of Chinese firecrackers.  One of us came along somewhere with a stick of lit punk and dropped it on a dry wick and bang! bang! bangety-bang!  They all went off in all directions.  Religion, philosophy, politics, personal attacks on people connected with government, especially Obama, foreigners, God, Satan, past Presidents.  Just goes to show ya—but what?

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By bogi666, February 5, 2010 at 2:37 am Link to this comment
(Unregistered commenter)

glider, concerning Christian96 comments,the One World Ssytem, which is Global Capitalism, is in the Bible As for the Mark of the Beast he’s a bit too general though. The Beast is the system, the One World System of global capitalism. This means those who have the “Mark of the Beast” are those, the One Worlders, complicit in the system and will realize the consequences described in the Bible. The Beast, One World Global Capitalism, and its Worshippers, will be cast into the lake of fire, destroyed, but will reappear, for a short time,only to be Terminated once and for all. To his credit 96 has the courage to use Biblical references before the prediction happens and not like those real phony pretend christians ministers who declare after an event that the event was predicted in the Bible.

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By ardee, February 5, 2010 at 2:21 am Link to this comment

Woulda,Coulda,Shoulda

Christianity establishes the true values for humans.

If one actually read history instead of ( or even in addition to) the New Testament, one quickly finds ample evidence that religion ( all of them really) has provided a platform for the worst abuses in our sad little history.

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By srelf, February 5, 2010 at 12:59 am Link to this comment

Waiting for a “white knight” is a real problem we have as Americans. Volker isn’t
one, Obama isn’t one. Really, it’s a fantasy to begin with. We are the white (sorry
for the racist term) knights! Get on your own damned horses, now!

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By glider, February 4, 2010 at 11:20 pm Link to this comment

Christian96,

It is an absolute requirement for the POTUS to publically confirm his belief and his moral foundings in Jesus Christ.  Pretty much ditto for the COTUS AND SCOTUS.  Yes, I agree that most Christians do not follow the teachings of Christ.  Nevertheless, Christianity has utterly failed to provide Western Civilization with strong moral guidance.  Hey but maybe after 1000+ years of failure you still have some reason to think this is the best path forward for mankind?

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By christian96, February 4, 2010 at 10:40 pm Link to this comment

Truedigger3——You made the comment “This is a
socio/political site and not a religous site.”
You obviously don’t know much about politics, humans,
and Christianity.  Politicians are humans.  Humans
think and behave according to a set of values.
Christianity establishes the true values for humans.
If politicians had been following Christian values,
i.e. denying self, concern for poor people, love,
worship of God rather than money, etc., we wouldn’t
find ourselves in the mess we are in today.  The
same can be said for bankers and business persons.
Since you don’t know much about politics, humans and
Christianity, what do you know something about?

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By ofersince72, February 4, 2010 at 5:24 pm Link to this comment

Christian…. Then why worry yourself with politics?

Who is cutting whose head off?

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By truedigger3, February 4, 2010 at 5:24 pm Link to this comment

Christian96 wrote:
“By the way, the Bible also relates that whoever accepts the mark for buying and selling will be cast into a lake of fire”
___________________________________________________

When will be the time when you come to your senses and stop hallucinating and spouting that drivel.
This a socio/political site and not a religious site.

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PatrickHenry's avatar

By PatrickHenry, February 4, 2010 at 3:36 pm Link to this comment

Yeah christian96, I read that somewhere too.

http://weeklyworldnews.com/headlines/15536/new-10-commandments-theory/

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By christian96, February 4, 2010 at 3:18 pm Link to this comment

For those of you who ridicule the Bible you should
know that over 2,000 years ago the Bible predicted
a time when there would exist a one-world-gov’t
who would require a mark in your right hand or
forhead before you can buy and sell.  Looks like
we are rapidly approaching fulfillment of that
prophecy.  By the way, the Bible also relates that
whoever accepts the mark for buying and selling will
be cast into a lake of fire.  Those who don’t receive
the mark will have their heads cut off.  I wonder
who on earth could still be cutting people’s heads
off?  Get ready folks.  It’s going to get real
interesting and scary.  Forget the scary movies.
Reality will make the movies look like Mickey Mouse.
The real leaders of this system will be Lucifer and
his angels working through people who have sold their
souls over to Lucifer.  Ouch!

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By Related Article:, February 4, 2010 at 2:50 pm Link to this comment
(Unregistered commenter)

What Getting Dumped by My Girlfriend Taught Me About Being Dumped by Obama

http://www.truthout.org/what-getting-dumped-my-girlfriend-taught-me-about-being-dumped-obama56648

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By TAO Walker, February 4, 2010 at 2:01 pm Link to this comment

Ever the voice of sweet reason here, Gerard nevertheless regularly winds-up at a semantic
DEAD END.  He does it again below by CONfusing the Human social qualities he feels are essential to DOING “the right thing” with actually knowing exactly what that “right thing” is….or what exactly it would be “right” with respect-to.

He’s hardly alone, though, in thinking his working assumptions about the ‘condition’ his CONdition is in are not only correct, but pretty much the accepted ‘norm’ for everyone else.  For example, he and many others go on incessantly about “the eCONomy” without ever bothering to look at the damned CONtraption with a view to its actual effects on our Living Arrangement.  So it is commonly assumed that the “unintended side-effects” of its operations here are merely electro-mechanical glitches, structural deficiencies, and/or ‘pilot error.’

It’s easy to see why those caught-up in the thing are so reluctant to even consider the possibility it is doing exactly what its owner/operators got it up-and-running to do, in the first place.  This despite the fact that would be the ‘firing solution’ demanded by applying Occam’s Razor to the ‘problem.’
Maybe that’s the reason even our tame Sisters and Brothers’ve known for some time now just where that road paved with “good intentions” inexorably takes those who travel on it….and why their so desperately looking for an off-ramp.

Those on The Tiyoshpaye Way are not burdened with insoluble questions of “right” and “wrong”....anymore than all our Relations in the Hoop of our Mother Earth’s Living Arrangement have to agonize over fulfilling the organic function given to them in it.  Except for our self-declared ‘divine’ tormentors, in fact, domesticated Humans are the only Beings here who get tied-up in these Gordian knots.  Here in these latter-days, that’s looking more-and-more like one giant hangman’s noose, and one of these nights some poor fool is going to kick the stool they’re teetering-on out from under the bunch of ‘em.

Hell of a note…..

Hokahey!

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By Samson, February 4, 2010 at 1:56 pm Link to this comment

You know things are bad when the Democrats get points from liberals for bringing back Ronald Reagan’s fed chief.

Economists from the left, like Reich or Gailbreath get shut out, but these fools bring back Ronald Reagan’s bank chief and then try to promote as a great thing for the left.  Sheeesh!

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By Jon Dixon, February 4, 2010 at 11:39 am Link to this comment
(Unregistered commenter)

Thank you dcampbell.

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By BOGI666, February 4, 2010 at 11:27 am Link to this comment
(Unregistered commenter)

The term “free markets” really mean FLEECE MARKETS, the fleecing of the American taxpayers through the government for the CORPORATE AND WEALTHY WELFARE KINGS.These “KINGS” along with their congressional partners in crime believe that society and government exist for the BENEFIT of the CORPORATIONS which results in a criminal dysfunctional system which is obviously the case now. A functional capitalist system is when the capital markets serve society, and is a functional system. Their is enough corruption for Wall St. just in serving the system that serves society’s needs. As for socialism, the mostly ignorant Americans don’t even know the difference between soicalism and communism[Sovietism] which is when the government owns the means of production.The definition of socialism is never provided, except in conjunction with a tirade of popaganda nonsense. As for President O’Bushama I didn’t vote for him because I discerned that he was all platitudes and fluff. When he selected his Clintinesque cabinet I know I was right.

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By felicity, February 4, 2010 at 10:45 am Link to this comment

Naturally Wall Street is screaming bloody murder at the prospect of their illegal activities (fraud, extortion…) being curtailed.  Their brothers in crime, the Mafia, scream bloody murder too when the government threatens to limit their profits by reining in their illegal practices.

Of course, the former have managed to bribe the government into legalizing their fraud, extortion… while the latter, alas, often end up in some maximum security prison for the rest of their adult lives. Who says justice is blind?  Someone who doesn’t live in today’s America.

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By ofersince72, February 4, 2010 at 7:49 am Link to this comment

Screw Glass-steg…...I believe that i am starting
to agree with REPUBLICANS….No regulations on
Wall Street at all…...It’s a crap game.
Only thing is,,,don’t make it socialism for the rich
No bailouts….You invest with a bunch of crooks
and lose , shame on you big guy…

If we are stuck with a crap game for an economic
system…let it be that…buyer beware….
Just don’t give your Ivy friends taxpayer money
when they fail….screw the regulations.
A complete “free” (chuckle,chuckle) market.

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By christian96, February 4, 2010 at 7:46 am Link to this comment

If Bill Clinton was responsible for the continued
merger of the two banking systems why is he still
being considered for global leadership positions?
Perhaps the answer is obvious.  He does not represent
the common man but is a puppet for the wealthy ruling
class.

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PatrickHenry's avatar

By PatrickHenry, February 4, 2010 at 4:24 am Link to this comment

By glider, February 3 at 11:58 pm #

I agree with your view that reinstating Glass-Steagall would be a good first step…

Report this

By cala, February 3, 2010 at 11:18 pm Link to this comment
(Unregistered commenter)

i DID NOT VOTE FOR OBAMA AND I AM A DEMOCRAT SINCE 18 YRS OLD.
I HAVE LOST FAITH IN DEMS SINCE MOST EVERYONE HAD NO BACKBONE TO BE CALLED UNAMERICAN IN THE FACE OF BEING LABLED JUST THAT IN THE FACE OF GOING TO WAR WITH A COUNTRY THAT DID NOTHING TO AMERICA.
i THOUGHT CLINTON ADMINISTRATION WAS GREAT THE ONLY DECENT THING WAS BALANCE THE BUDGET. BUT AFTER THE ECONOMIC COLLAPSE I UNDERSTAND CLINTON SIGNED THIS DEATH SENTENCE TO BRING DOWN THE GLASS-STEAGALL. BOY WHAT A WAKEUP CALL DEMS ARE JUST AS BAD AS THE WAR MONGERING REPUBLICANS. WHAT A SAD STATE OF AFFAIRS FOR THE COUNTRY THAT I LOVE.

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By gerard, February 3, 2010 at 10:41 pm Link to this comment

Capitalists make tons of money and throw a few crumbs to their workers, ordinary citizens and charity.  Republicans favor capitalists because they believe the myth that anyone in America can get rich if they engage in private enterprise, work hard, and/or are lucky, none of which is true. Most capitalists get rich either through inherited money or by a refined form of theft involving gambling with other people’s money.

Democrats believe these same myths but tend to be more humanistic and sympathetic to those who don’t win within the system or who fail by accident.They are what can be called modified capitalists.

Ordinary people join one or the other party, either because they think they can become rich or because they doubt it and want to be associated with the ideas of humanism, justice, equality etc. 

Third party people are generally motivated more by doubt than by belief.  They want the present economic system either modified and made more humane, or changed to some more democratic, socially just system.  They usually don’t openly support classic socialism because of lack of knowledge or irrational fear of China/Russia/Marx/Lenin etc. but they bend in the direction of wanting more social justice. They have trouble running candidates because people generally support one of the major parties by a combination of habit and herd inclinations.

Millions of people don’t even bothere with politics or any party affiliation because they don’t know what is going on, don’t want to know,or can’t understand, are embarrassed to ask, and nobody tries to help them.

Nothing can change in America under these circumstances.  No matter which major party wins, no major changes can occur because of the majority allegiance to capitalism no matter how faulty it is.

Third party politics requires a huge amount of personal effort both because of lack of funding but also because it is difficult to change people’s political affiliation due to of distrust and suspicion. It is also hard to engage people who feel “out of it” or “not interested.”

Yet the country is in such a decadent situation due to mismanagement and concentration of power that a high risk exists of change for the worse—either chosen by doing nothing, or caused by doing the wrong thing or by happenstance.

Ergo:  The present system is at the end of its rope, but those who are dissatisfied are reluctant to assume the burden of organizing opposition.  If drift wins out, capitalism will become more oppressive and millions of people will suffer. 

Almost nobody knows what to do, but doing nothing is not an option.  Doing the wrong thing is dangerous.
Doing the right thing depends upon group conscience, willingness to learn, cooperation, and peaceable actions.

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By ofersince72, February 3, 2010 at 10:19 pm Link to this comment

Liecatcher ...thankyou for the beautiful poem
i enjoyed it very much…thankyouTaotoo

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By dcampbell, February 3, 2010 at 9:48 pm Link to this comment

Restoring Glass Steagall is the right way to go.  If they call it Volker rules,
fine.  The essential restoration is important.  Both political parties helped
repeal Glass Steagall. The corporate Democrats and Joe Lieberman were
enablers.
Until they restore something like Glass Steagall, investing is little more
than a casino. And, the House wins.
Several prior comments seem to be more interested in denouncing Obama
than finding a solution.  Read Stiglitz, Free Fall, and Krugman, and Prins.
If you are going to debate economics, readers will have to do more than
repeat uninformed chants. This is serious business. Sit down. Read a book
( or 5), prepare yourself for the coming battle. ( Mother Jones, 1914).

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By johnqeniac, February 3, 2010 at 9:26 pm Link to this comment

Sorry, I no longer trust obama any more than the other losers. why should we trust this 180 deg turn from corporate whore to pitchfork-wielding populist? he behaves like a child. piss on him.

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By rbrooks, February 3, 2010 at 9:10 pm Link to this comment
(Unregistered commenter)

That would be the banking bandits still running his economic team, right?

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By glider, February 3, 2010 at 7:58 pm Link to this comment

By PatrickHenry, February 3 at 6:54 pm #

“All of Volkers regs didn’t prevent Bernie Madoff.
http://blog.ockhamresearch.com/index.php/tag/volker/”

Well yes, regulations are no guarantee particularly if they are not enforced or laced with loopholes by political corporatists.  But the author of your link offers no solution except possibly removing FDIC protections to increase the pain on the people to make Banks more responsible.  Libertarian half-truth garbage.  It ignores the fact that Glass-Stegall did a great job protecting the public from the Banksters for over 60 years.  That is your proof that regulation can work even though it does not suit your agenda.  Please address that point before pooh poohing effective regulation versus faux regulation.  Ironically reinstating Glass Stegall is the one thing that can not happen now since it is clear that Bankster profits are put above the risk of our financial collapse by our corporatist “representatives”.

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By liecatcher, February 3, 2010 at 5:53 pm Link to this comment

A wise observer,TAO Walker, said:
“The only difference between the Wall-Streeters and
and their career-official enablers,
and all the sheeple they’ve fleeced, is those damned
fools’re going to be devoured
and die “rich”....for whatever that’s worth. HokaHey!

I don’t know what it’s worth. I used to say that the
good news is that there is enough
room in hell for all these evil miscreants; the bad
news is that that won’t get there soon enough.
Of course, for the Satanists, hell is home.
Some animals who have such a strong will to
live that they will gnaw off a leg to escape
from a trap. Those with the economic means & wisdom
to see America’s enslavement coming
have probably moved on to better places. The sheeple
just go from one day to the next using
whatever chemicals it takes to cope,& wait. IMO, at
this stage in the predatory cycle, it’s too late
for the truth to set us free.
Whether the MASTERS OF THE UNIVERSE are cremated,
embalmed, frozen or devoured
by maggots won’t change a thing. Just look at how
many generations of the Bush Crime Family
have been preying. “The evil that men do lives after
them…”

HOKA HEY! — “Hold Fast! There is always more !”
In the context of battle hoka hey meant, “it is a
good day to die.
Hóka Hey! Hóka Hey! is a poem by Bette Wolf Duncan
about a Crow Indian brave
who is about ready to go into battle and to die for
his people.

http://www.charlierussell.org/hokahey.htm

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Liquor Store Larry's avatar

By Liquor Store Larry, February 3, 2010 at 4:32 pm Link to this comment

If it’s true is a great thing but I have lost respect for Obama. It is a travesty that McCain suggested reinstating Glass-Steagall before Obama woke up and took a whiff and I can’t take it as an act of altruism under the circumstances. Obama’s refusal to “get it” with the banks sweeping across the country like Locusts consuming private property makes George HW Bush’s amazement at a “grocery store scanner” look like small potatoes! He is smart enough to have understood this before getting bitchslapped and if he was not stonewalling because he is stupid which he is not, that leaves only sinister!

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By doublestandards/glasshouses, February 3, 2010 at 3:20 pm Link to this comment
(Unregistered commenter)

I have a feeling that all the editors at TD are
grasping at straws to come up with something they can
support Obama on.

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By freepressmyass, February 3, 2010 at 3:17 pm Link to this comment
(Unregistered commenter)

Ok, so ilet’s say someone goes in to rob a bank. But in lieu of threatening the teller with a gun, he hands her a withdrawl slip requesting $200,000 in cash.
Holding up a bank in spirit, if you will.
A guaranteed failure.

The teller isn’t gonna hand over one penny.
They WILL laugh in the face of such a moron, though.

Which is what this Obama/Volker toothless piece of “in spirit” crap warrants.
A big laugh in his face.

Obama is just so insulting at this point, it’s discusting.

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PatrickHenry's avatar

By PatrickHenry, February 3, 2010 at 2:54 pm Link to this comment

All of Volkers regs didn’t prevent Bernie Madoff.

http://blog.ockhamresearch.com/index.php/tag/volker/

A weapon of financial mass destruction.  The question is who wields it?

Still alot of holes to be plugged with regulations protecting our 401K, Pensions and annuity monies.

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By ofersince72, February 3, 2010 at 2:21 pm Link to this comment

Its the ecology stupid

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By Big Jess, February 3, 2010 at 2:08 pm Link to this comment
(Unregistered commenter)

Just can’t do it, can you Mr. Scheer?—Accept that President Pinocchio is spinning more shit.

At the same time that he’s extolling the Volker Rule, he’s praising the hopelessly watered-down bill coming out of the House.

Our only hope is that eventually, people in positions of influence such as you, Mr. Scheer, will get off the fence, stop trying to find good in the Pinocchio administration where there is none, and lead the campaign to force the Dems in Congress and the WH to defy their corporate bosses and enact real reform. That’s gonna take Vietnam War era type massive, prolonged demonstrations. Hoping that anything less will accomplish the goal is delusional wishful thinking.

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By thebeerdoctor, February 3, 2010 at 1:41 pm Link to this comment

prole’s historical analysis is the most accurate on this thread.

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By gerard, February 3, 2010 at 1:38 pm Link to this comment

With the enormous animus deliberately built up over the years against even the word “socialism”—let alone the honest consideration of what it means or might be made to mean—it’s no surprise that tinkering with capitalism is all that seems possible.
  A little regulation here, a bit of restraint there, and crank ‘er up again and see what happens.
Nobody cares enough to risk their reputation by talking about greed and whether it can be prevented under capitalism—about gross inequity, dehumanizing injustice, endemic poverty, needless lifelong pain and suffering, ignorance and resentment—even when things are going well, mind you!
  It’s as though capitalism is some kind of a golden cow we have to bow down to and permit ourselves to be trampled and, as the Bible says, “shat upon.”  (I love that! How is that verb declined, anway?  Is the pluperfect tense “shut”? Or is it capitalism that is pluperfect?  (Oh, well, excuse me.  I’m just not up to these arcane harangues on how not to disturb the status quo for fear that the quo ante will be even worse than the quo pro.)

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By Basoflakes, February 3, 2010 at 1:31 pm Link to this comment

Woa, Obama listening to Volker and Joint Chief of Staff Mullen calling for end to DADT.  These are finally some good things to report.

Obama first needs to dump Geithner, Summers and Bernanke, the architects of the recession, then put Glass-Steagul back in affect.

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By bozhidar balkas, vancouver, February 3, 2010 at 1:20 pm Link to this comment
(Unregistered commenter)

Until a certain point of time; let’s say, 15k yrs ago; probably living in small groups of let’s say, several hundred people,we had to have been very interdependent and living in an idyllicly structured society.

In short, in order to survive and increase in numbers, everybody had be ab equally valued and needed.
However, some people began to teach people that that was wrong way to live and that some people were more valuable and thus shld lead others.
It may have taken millennia to convince people that some people were more valuable than others.
At the same time the ‘teachers’ began to amass ever greater weatlh-power.

And to this day people evaluate people with money as wiser and deserving of our trust to lead us.
For vast number of people the fact that some were richer or much richer,proved for all times that indeed those people were smarter and more capable.

I assert that all ills that befell us for the last 10k yrs had been caused by dividing people into more-and less valuable people.
During all that time only a few people cast the widest look possible.

They espied that the wider the look the wiser one is. Pols, clergy, `educators` msm collumnists usually cast the narrowest look possible.

And what an odd person saw, he or she cld see with naked eye. No schooling was needed to see that the wicked structure of society since ca 10 k yrs had waged one mn wars; alllowed slavery, torture, abuse, oppression, and iniquities of all kind.

To conclude! If we do not set up or begin to set up an idyllic society -not in an utopian sense- we will always roll that proverbial rock up the hill, only to see it roll farther dwn than ever before. tnx

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By prole, February 3, 2010 at 12:45 pm Link to this comment

“Finally President Barack Obama has come to his senses on financial regulation”…but Obamaphile Scheer still has yet to come to his senses about his political idol. As even an unabashed Obama apologist like Scheer is forced to admit, “Obama has wasted the last year and trillions of taxpayer dollars bailing out Wall Street without putting significant new rules in place to govern reckless behavior.” So why did the light bulb go on in Obama’s pointed head?
  Scheer can perhaps provide a clue to this, as he points out the obvious, “Only now, with the economic disaster bankrupting the government, has he turned to Volcker for leadership.” The so-called ‘Volcker Rule’ is a pared-down version of banking regulations that were repealed once before a few years ago; and these new proposed regulations can just as easily be repealed once again in the near future, when the heat dies down and there’s another ‘regime change’ in Washington. This is not a constitutional amendment. “In testimony Tuesday before the Senate Banking Committee, Volcker offered the essential justification for needed banking legislation”…but it’s not at all clear that the legislation will even be passed by congress, as Committee Chairman Dodd cautioned, afterward. It does, at least, provide showy Obama with a welcome photo-opp with the newly reminted Volcker, if nothing else. Behind the scenes, Larry Summers & Co. are still pulling the strings. The glitzy appointment of the new Economic Recovery Advisory Board Chairman wasn’t coupled with the sacking of the old director of the National Economic Council. Both Volcker and Summers – like Obama and Scheer - serve the same general corporate interests, they just have different ways of going about it.   
  Even Volcker may not exactly be without his political risks, either. According to the bipartisan Scheer, the loathesome Reagan should have “renamed Volcker as head of the Fed back in 1987. To reappoint Volcker would have been the logical move given his spectacular record in taming inflation, which he brought down to 3.6 percent after it had risen to 11.3 percent thanks to the energy crisis of 1979.” Volcker’s “spectacular record” in taming inflation in the early eighties consisted of steadily ratcheting up the prime rate to close to 20% (it was 19.5% in Apr.’80), to it’s highest levels in history, setting off one of the worst recessions of the post-war era and with it, a “spectacular record” of unemployment for “ordinary people” thanks to Volcker. It also led to the defeat of Jimmy Carter in the 1980 election and a “spectacular record” of corporate welfare and foreign jingoism by the ‘illogical’ Ray-gun – which Scheer’s new-found hero Volcker did nothing to stand in the way of. No wonder faux populist and stealth corporate caretaker Obama suddenly finds Volcker so useful, as well as Obama publicist and faux populist muckraker, Scheer. “This setup worked splendidly for more than six decades”…i.e. the two-party system where different members of the ruling class get to debate which methods work best to further the corporate state and its shylocks.
  “Please don’t let your eyes glaze over on this issue as a matter of arcane economic regulation. It’s the ballgame as far as breaking the death grip of Wall Street over our economy”…and the two-party system in making it possible. Volcker’s grip is as deathly as Summers.

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By TAO Walker, February 3, 2010 at 12:29 pm Link to this comment

Robert Scheer is so insistent here on “....breaking the (illusory) death grip of Wall Street over (the) economy,” that he doesn’t even notice that the real need is to break the death-grip of “the eCONomy” (which is itself entirely make-believe in its essential nature) over the increasingly miserable half-lives of billions of actual people suffocating inside it.  He has plenty of company in that thoroughly institutionalized ignorance, though.

CONvincing homo domesticus that the Ground of their existence lies in some CONtrived CONtraption (like an eCONomy), rather than in the Whole Natural Living Arrangement that still engenders and nourishes them, and keeping them semi-CONsciously CONfined to the damned thing for ten thousand years now, has been the objective of the tormentors all-along.  It is their method-of-choice for making Earth into a “global” feedlot/fear-factory catering to their refined cannibal appetites. 

Never-mind “....who’s coming to dinner?”  The only ‘issue’ on our tame Sisters’ and Brothers’ plate oughta be who IS dinner. 

Today, as the titanic apparatus of command-and CONtrol self-destructs all around them, however, its self-CONdemned inmates are reduced to a panicky mob yelling desperately for somebody to do something to keep it afloat a little longer.  Paul Volcker is just the latest supposed-to-be ‘savior’ du jour (A year ago it was Barack Obama hisownself, remember.) to be paraded before “....your huddled masses” by a professional class already up to their own wagging chins in the same sea-of-despond where so many others are already well “under-water,” their virtual world-o’-hurt turned “upside-down.”

The only difference between the Wall-Streeters and and their career-official enablers, and all the sheeple they’ve fleeced, is those damned fools’re going to be devoured and die “rich”....for whatever that’s worth.

HokaHey!

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By liecatcher, February 3, 2010 at 12:02 pm Link to this comment

Volcker Rules Posted on Feb 2, 2010 By Robert
Scheer
Hey Robert Scheer:
Ever since you spent your hard earned money on the
Obama campaign,  you’ve lost
your objectivity & are still trying to cross the
Obama hope bridge to nowhere.

Having Paul Volcker advise the President is like
letting a
pedophilic priest become a boy scout leader, or
letting a
Rockefeller determine energy policy.

And endorsing:  “The mandate is to arrange an
orderly liquidation or merger.
In other words, euthanasia, not a rescue.” is not
only sugar coating the fecal
vomiting, but is inexcusable.
Remember Robert Scheer, birds of prey flock together.

Former North American Chairmen: of the TRILATERAL
COMMISSION
PAUL A. VOLCKER (1991-2001) Honorary North American
Chairman
DAVID ROCKEFELLER (1977-91) Founder and Honorary
North American Chairman

Paul Volcker is a former chairman of the Federal
Reserve Board, he was a major
player in the Reagan era in spearheading financial
deregulations, which ended in
major bankruptcies, junk—bond mergers and
acquisitions, and climaxed with the
1987 Black Monday stock market crash.

“Investment houses would still be permitted to play
freely at the Wall Street casino,
but they would have to pay the consequences of their
own failure. In the event that
the largest of them approached collapse, the
government would still step in—not to
save them but to dispose of the body in a way that
did not endanger the health of others.
As Volcker put it, when it would come to dealing
with the impending collapse of an
investment giant: “The mandate is to arrange an
orderly liquidation or merger.
In other words, euthanasia, not a rescue.”
“This should be the only reminder we need that little
else matters in the way of
public policy discussion as long as Wall Street
bleeds us dry.”

And Paul Volcker will get every drop of our blood, while he continued to privatize profits & socialize losses.

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By Hank, February 3, 2010 at 12:00 pm Link to this comment
(Unregistered commenter)

After all the dollar horses are gone, close the corral.Leave the vault open and unguarded lose 4 trillion and then crow that it’s closed now dad gumit.Laugh or cry…..........

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By jsper, February 3, 2010 at 11:43 am Link to this comment

Such cynicism from the readers!
At least it’s a first step! A little late in coming, but hey, what in congress gets done on a dime? This ain’t the corporate world!
Meanwhile, did anyone think those asking questions of Volker in congress yesterday, sorry, reading questions prepared by their staff, has a clue what they were discussing???
There lies the problem in my mind. These people are almost totally illiterate in investment banking situations that need to be thoroughly understood.

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By ForeignAffairs, February 3, 2010 at 11:41 am Link to this comment
(Unregistered commenter)

What is the difference between “The Volcker Rule” vs. McCain and Cantwell’s bill to restore the Glass-Steagall act?

What are the loopholes?  What are the pros and cons?  What drive’s Obama’s preference to endorse one over the other?  What would a side-by-side comparison look like? 

If Obama highly values bipartisanship, why is he not supporting the McCain-Cantwell version? 

Kudos to Robert Scheer, as always, for emphasizing the vital importance of separating commercial vs. investment banking.

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By ofersince72, February 3, 2010 at 10:56 am Link to this comment

thats why they can’t wait to start trading C02
on the stock market…....does anyone believe
that idea is for anything but scamming money on
Wall Street?

CO2 on the stock market and no one is laughing

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By ofersince72, February 3, 2010 at 10:52 am Link to this comment

The S&L only cost us a trillion on that one.

anyway,  our whole economic system is based on
the military industrial complex no matter what
regulations appear to do. It has stunk forever
and will continue tooo.  The money earned from this
debt we keep incurring buyes cell phones and other
junk.
There is no rationalizing this economic system
with or without its dumb regs that never work anyway
All three of the Bush brothers had their hands deep
in the S&L scandel.  It washed any politcal career
Neil would have had…We still elected his younger
brothers to political office.
Just where does NAFTA fit into this…OH, it doesn’t
Don’t bring those embarrassing trade agreements up.
Nobody has a JOB. We don’t even know what the real
unemplyment figure is. We got one for blacks , one
for whites, one for hispanics,  one for women.
That this article is even being debated by well
read intelligent beings is amazing to me.

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By mikel paul, February 3, 2010 at 10:33 am Link to this comment
(Unregistered commenter)

Heads will not roll. The faces may change, they always do, and will. You don’t give the
keys to the medicine cabinet to the users. If you want a war to end, you refuse to
participate. The drug, money. Integrity is sadly in short supply. Humanity, the simple
choice ‘to care’ for each other has never seen such an enemy as it sees today. When
enough people have ‘had enough’, and their very breath is the cost, then and only then,
will there be change to believe in. Refuse to participate.
peace

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By thebeerdoctor, February 3, 2010 at 10:16 am Link to this comment

I guess the Hulkster will turn green when I point out that where in the hell did you think that a journalist offering up an opinion is not going to be challenged? So you are of the mind that a journalist can not report the facts and get to the bottom of something and reveal what is wrong. Obviously you would dismiss Ida Tarbell for her reporting on the practices of Standard Oil. Have you ever heard the word muckraking, or is that too harsh for your journalistic sensibilities?
Again, another cheap shot at my consulting profession. I am sober enough to see what a propaganda piece of shit this article actually is. So Volcker is in charge is he? So what is that cat Bernanke doing over at the Federal Reserve?
Scheer’s opinion is so silly as to be laughable.

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By RdV, February 3, 2010 at 10:14 am Link to this comment

“Finally President Barack Obama has come to his senses on financial regulation”

  How can you be such a sucker?
You would think people would know better by now. You would think they would realize since the moment Obama was elected, what his true motivation and agenda was. How can anyone buy Obama’s anti Wall Street pitch, when everyone knows that it was cynical posturing after the kick in the ass he got in MA. He intends to re-regulate as much as he intends to stop torture.
Is it just some want so much to believe or are in denial because the reality that Obama is continuing Bush policy is just too terrible to confront. Better to face up to it now and deal with it and build momentum for a movement. Otherwise, mark my words, Obama will continue to dismantle the hard won safety net as time passes, and tinker around the edges while mouthing the right words and progressive continue to advocate for him just needing more time. Talk about voting against your own interests.
Quit being a sucker.

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By djnoll, February 3, 2010 at 9:54 am Link to this comment

I can only hope that Volcker actually does create a difference in the economic policies of this administration sufficiently to offset the damage that Bernanke will continue to do.  But my comment is actually addressed to Samson:  You have posted this list several times to indicate that Obama was bought and paid for by the banking interests of this nation.  Well, I took the time today to total up your list, and then divided it by the total number of dollars raised by his campaign, you know what?  It only accounts for about 2% of the total number and amounts of donations Obama received.  The remaining 98% was from Democrats and Independents who believed that they were actually having a voice.  The problem is that the DNC and the Clintons who worship money from corporations had much larger percentages of contributions to their campaigns than did the President, and they are the ones who are controlling this nation’s purse strings.  In fact, until his nomination and his meeting with Clinton to stop the splitting of the party at the convention, Mr. Obama’s presidential campaign did not take corporate donations.

Too often we blame this president for what the members of Congress from the DNC are doing, or more specifically, not doing.  When Reid and Pelosi refuse to “be dictated to by this White House” (January 2009) when they were so willing to be dictated to by the Bush White House, this president has a problem.  The corporate DNC that has taken over this presidency, much to the distress of his original supporters still on staff, has done all it can to support the ineptitude of the Congressional Democrats in their cowardice and corporate pandering.  When they allow people who have limited knowledge of what Main Street Americans are suffering to dictate to them what their agenda will be, despite being in the minority, then they should not be in Congress. 

It is time to remove corporate politicians, and religious ones as well, from our Congress and put in those who will support a true change in how our government works, starting with regulating the banks, the insurance industry, and enforcing anti-trust laws on any corporation that is seeking to control any aspect of our economy, from energy to retail to finance. 

It is time for reform, and it starts this election cycle with putting up strong individuals who will stand up to the lobbyists and speak truth to power when necessary, and not knuckle under to media propagandizing or special interests over the rights and interests of the American people.

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By glider, February 3, 2010 at 9:49 am Link to this comment

Well this is mildly encouraging.  At this stage it is just posturing in response to poll reading.  However, I will keep an open mind.  Let’s see the new rules and a resulting strong reduction in the dangerous “innovative” derivatives market volume before getting excited.  Otherwise this is just manipulation of public opinion.  Remember, if you can not measure it, it does not exist.  I suggest Obama and crew does not have the guts or will to truly go against these interests benefiting his bottom line.  But heh, prove us realist doubters wrong.

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By Old Geezer Pilot, February 3, 2010 at 9:46 am Link to this comment
(Unregistered commenter)

You are too kind, Hulk2008, to call them robber barons.
At least the real robber barons left behind a treasure
trove of infrastructure - oil, railroads, steel mills,
huge factories… and they did it without any bailout
money from the government.

What have these thieves left us? NOTHING, except a huge
bill for our grandkids.

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By Hulk2008, February 3, 2010 at 9:33 am Link to this comment

Kudos to Mr. Scheer - and to his consistency of opinion.  Bob has been decrying the way the robber barons have been left in charge for a solid year. 

And kudos to bozh for your analysis.  Any President has limited influence since Congress only listens to lobbyists and the Supreme Court only listens to itself. Republicans are already rejecting Volcker’s suggestions even though many of them embraced them while Geitner’s methods were holding sway. 

thebeerdoctor, back to your beer ... you’ve over-tippled -  burp !  FYI “journalism” does allow opinion pieces like this.

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By Samson, February 3, 2010 at 9:32 am Link to this comment

Wanna know how this is going to turn out?  Read this list.  http://www.opensecrets.org/pres08/contrib.php?cycle=2008&cid=N00009638.  Goldman Sachs paid almost a million dollars for the right to run the economy.  Like Obama is really going to stiff them just when he’s making all those dialing for dollars calls for the 2010 elections.
————————————————-
Barack Obama (D)
Top Contributors

“This table lists the top donors to this candidate in the 2008 election cycle. The organizations themselves did not donate , rather the money came from the organization’s PAC, its individual members or employees or owners, and those individuals’ immediate families. Organization totals include subsidiaries and affiliates.

Because of contribution limits, organizations that bundle together many individual contributions are often among the top donors to presidential candidates. These contributions can come from the organization’s members or employees (and their families). The organization may support one candidate, or hedge its bets by supporting multiple candidates. Groups with national networks of donors - like EMILY’s List and Club for Growth - make for particularly big bundlers.

University of California   $1,591,395
Goldman Sachs   $994,795
Harvard University   $854,747
Microsoft Corp   $833,617
Google Inc   $803,436
Citigroup Inc   $701,290
JPMorgan Chase & Co   $695,132
Time Warner   $590,084
Sidley Austin LLP   $588,598
Stanford University   $586,557
National Amusements Inc   $551,683
UBS AG   $543,219
Wilmerhale Llp   $542,618
Skadden, Arps et al   $530,839
IBM Corp   $528,822
Columbia University   $528,302
Morgan Stanley   $514,881
General Electric   $499,130
US Government   $494,820
Latham & Watkins   $493,835”

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By msgmi, February 3, 2010 at 9:05 am Link to this comment
(Unregistered commenter)

Mr. Paul Volker is the last Fed Chairman who kept the financial ship on a balanced keel of fiscal responsibility. As he pursues to initiate some regulatory restrictions, Wall Streeters are getting nervous that a regulatory policy will doom the markets. Even business media gurus such as Larry Kudlow et are adament that Volker’s ideas are not in the best interest of economic growth and stability. The Wall Streeters on MSNBC decry regulatory policies and speak in unison as if the financial bubble never happened

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By bozh, February 3, 2010 at 8:55 am Link to this comment
(Unregistered commenter)

Since US is governed by super rich people who also own banks, all any prez can do is make promises.
US presidents had always been only a part of US visible governance.

Other visible parts of US governance such as judiciary and congress being even stronger than any WH.
The invisble part of US governance being by far stronger than the former three.
tnx

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By ofersince72, February 3, 2010 at 8:17 am Link to this comment

someone said this was irresponsible journalism
that was nice.

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By mithunaveda, February 3, 2010 at 8:07 am Link to this comment
(Unregistered commenter)

propaganda at best. smile and say “cheese”

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thebeerdoctor's avatar

By thebeerdoctor, February 3, 2010 at 7:54 am Link to this comment

Robert Scheer should be ashamed of writing such a stupid article. He violates the law of actual journalism, not just the spirit.

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By johannes, February 3, 2010 at 7:46 am Link to this comment

To Ourobourus,

I have my gold buying information from the YouTube site, ” the dumping of the dollar and the buying of gold “, it could be tru, vu the hardening situation between the USA an China.

Salutation.

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By truedigger3, February 3, 2010 at 6:57 am Link to this comment

Scheer wrote:
“The proposal from former Federal Reserve Chairman Paul Volcker basically involves restoring the spirit, if not the letter..”
_____________________________________________________
Here we go again.!  Why the spirit and not the letter.  Here we have the beginning of backtracking ,  obfuscation and bullshitting
Team Obama has a long accomplished record of make-believe bullshitting without any real substance.
Team Obama has a long history of talking the talk and walking in the opposite direction or sitting on their asses and doing nothing.
I will believe it when I see it.  That means I will believe it when a law is passed with iron clad articles that reinstate Glass-Steagall.  That law should closely and tightly regulate derivative and short selling of stocks.
No more default credit swap for third parties who are not party to the transaction insured. Those CDS were the primary reason behind the almost
Collapse of the financial system.
No more bundling of mortgages and selling them to third parties. That practice encouraged fraud and very loose to nonexistent lending practices.
As they say the proof is in the pudding and I am VERY VERY skeptical.

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By Hank from Nebraska, February 3, 2010 at 6:51 am Link to this comment

We need much more than just a return to Glass-Steagall (in fact and not just in spirit).  We also need renewed regulation of the normal banking business (credit card fees, lending procedures, disclosure requirements, employee incentives, etc.), basic anti-trust enforcement to stop the mergers that have produced the large banks, bans on complex financial instruments that have no obvious benefit for anyone except the issuers, centralized exchanges to replace the secretive over-the-counter bond, foreign exchange, and derivatives markets (to the extent that these markets are needed at all), and a financial transaction (Tobin) tax to reduce the casino element of the financial market.
In the meantime, let’s not put all out hope in Volcker.  One old guy cannot solve this huge problem that is costing each American household tens of thousands of dollars.  The real problem is getting any kind of reform through a thoroughly corrupt Senate Finance Committee.  I am not sure we can even talk about hope when it comes to this barrier.  More likely, we’re not yet done getting hosed.

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By Doug Wilson, February 3, 2010 at 6:24 am Link to this comment
(Unregistered commenter)

It’s a tree - Don’t focus on it. The Forest is the money factory - Always has been. Countries cannot simply print money - because they want to. People in the business of government want things, so the Fed prints money, congress signs “The Public” on the payee line. That kind of childish nonsense can’t, hasn’t and won’t work. Doesn’t matter who hosts the show or who the producers, set designers, enraptured contestants and so on. The system is foul and designed to create a debt slave world populace. The only option is to not participate - period.

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By Kay Johnson, February 3, 2010 at 5:49 am Link to this comment

“The proposal from former Federal Reserve Chairman Paul Volcker basically involves restoring the spirit, if not the letter, of the 1930s Glass-Steagall banking regulations to prevent another Great Depression.”—Robert Sheer

Ardee: I was going to write a very similar comment. I still recall when Carter appointed Volker Fed Chairman. Thanks for your perspicacity.

Remember the 1980s? If you don’t, I highly recommend William Greider’s book, The Secrets of the Temple. All of a sudden, Volker is everyone’s darling liberal? I’ll be pleased to say I’m wrong when the time comes, but until then, I’m a skeptic!

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By no mans land, February 3, 2010 at 4:52 am Link to this comment

Murray Hill for congress!

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By Inherit The Wind, February 3, 2010 at 4:47 am Link to this comment

Wow! A Scheer article I can’t poke one single hole in or disagree with a single point!

My only question is: Is Volcker REALLY in charge? Summers thinks HE is and has been the one cutting Volcker out of any influence for the last year—and we’ve seen the results.

So…it was 1987 that Reagan, getting ALL the credit for Volcker’s work, put in Greenspan, who, by 1992 cost HIS new President, George H.W.Bush, his re-election to the Clinton mantra of:
“It’s the ECONOMY, Stupid!”

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Ouroborus's avatar

By Ouroborus, February 3, 2010 at 4:36 am Link to this comment

johannes, February 3 at 8:25 am
Why the Chinees governement, push their citizen to
invest in gold.
========================================
They don’t. The Chinese have historically always bought
and valued gold. I live in Asia and trust me; nobody
has to push Chinese to buy gold. Chinese New Year is
coming and it’s the time more gold is bought than at
any other time of the year. smile

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Ouroborus's avatar

By Ouroborus, February 3, 2010 at 4:27 am Link to this comment

miller, February 3 at 7:18 am
This was not caused by the “irreponsibility of a
radically deregulated banking system.”  This was a
failure of ethics.  This was a failure of mores. This
was about greed.  To call it ‘irresponsibility’ is to
candy-coat this debacle.
==========================================
Spot on! I remember those days; Boeing quit building
airplanes because their raw materials, bought on
credit, we’re @ 21% interest. Volcker let the chips
fall where they may and the bubble burst and Carter
got pilloried (unfairly) and everything went back to
the level of pre bubble. The morally bankrupt
traitors of today sold us out lock, stock, and
barrel. There should have been prosecutions,
hangings, and major jail time for these modern day
robber barons. Eff em all!
I walked away from Banks 20 years ago; credit unions
rule.

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By johannes, February 3, 2010 at 4:25 am Link to this comment

They, that is the USA governement and China know much more as we do.

Why the Chinees governement, push their citizen to invest in gold.

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By Steve E, February 3, 2010 at 4:08 am Link to this comment

Yeah right, typical Obama. After giving away the farm to his corporate friends we
get the old bait and switch. Now the big show to make people believe he has seen
the great “white light”. After reading this article I can see some “great change”
believers are still in tow. The Peace Prize winner just the other day signed a
massive military budget to continue funding imperialistic endeavors. This guy has
got all the angles covered for simpleton consumption.

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By ardee, February 3, 2010 at 3:30 am Link to this comment

The proposal from former Federal Reserve Chairman Paul Volcker basically involves restoring the spirit, if not the letter, of the 1930s Glass-Steagall banking regulations to prevent another Great Depression.

So then, we are now so desperate for change that we cling to such as the “spirit of the law” rather than continuing to hope for actual legislation? Sorry, Mr. Scheer, methinks you are as desperate for good news as are we all.

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By miller, February 3, 2010 at 3:18 am Link to this comment

This was not caused by the “irreponsibility of a
radically deregulated banking system.”  This was a
failure of ethics.  This was a failure of mores. This
was about greed.  To call it ‘irresponsibility’ is to
candy-coat this debacle.  The elimination of Glass-
Steagall gave the ‘financial services’ industry a
license to steal….unfettered.  I am glad to see
Volcker working with Obama now.  Volcker took some
politically unpopular steps in the late seventies and
early eighties to break inflation. At that time he
had the spine to ‘do what it takes’.  I hope that he
has the backbone to do it again, and that Obama
allows him to.

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By Miko, February 3, 2010 at 1:55 am Link to this comment
(Unregistered commenter)

Greenspan wasn’t a free-marketer; if he was, he would have refused to be associated with the Federal Reserve.

“Too big to fail” corps are explicitly a product of regulation; in an unregulated environment, they would have failed long before they got to that size.  If the page-count of the Register doesn’t prove that we’ve never had serious deregulation in this country, the existence of today’s government-dependent mega-corporations surely does.

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By Hammond Eggs, February 3, 2010 at 12:39 am Link to this comment

There is just as much chance that Obama’s embrace of “The Volker Rule” falls into the same category as “Hope” and “Change You Can Believe In”.  Wait to see what actually happens before you breezily assume that Obama has, at last, seen the light.

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