SeriousBull

Obama moves to Financial Reform

Tags: Banks + Deficit + Federal Reserve + financial reform + Justice + Markets + Taxes

Fresh off a setback for healthcare reform due to the loss of the Massachusettes Senate seat to the Republicans, President Obama moved straight on to the aggregious behavior of banks telling them they would have to pay the government back for the bailouts they’ve recieved by paying an extra tax on liabilities held. Since Wall Street has now all become banks under the skirt of the Fed, this tax

applies to Goldman Sachs and Morgan Stanley as well as JP Morgan Chase, Bank of America and Wells Fargo to name the most prominent among the approximately 50 big banks affected.

While the President is right to demand that banks pay back their free lunch program–things like access to Treasury, zero interest rates, forebearance on meeting reserve requirements, and TARP loans–the markets didn’t like the news one bit. But then again, that’s like saying those affected didn’t like it. So what? Well, out come the banker’s wallets to pay financial lobbyist to buy off Congress again. A windfall for everyone except ‘John Q Public’ who has to pay the bill. That’s the problem with regulation and tax, the costs get passed down in the price of goods and services. So if financial reform is to be truly meaningful and have merit, it must not only break up the ‘too big to fail’ banks preventing them from using deposit money to speculate with government guarantees (including FDIC Insurance), but also dole out some persuasive punishment to those who broke the law instead of simply fining shareholders while leaving managment in place. Though that’s unlikely to happen, cudo’s to President Obama for saying what the public demands. Now the public must speak–come November–and get rid of all incumbents. It’s a win-win if we do. We curtail the vote-selling and at the same time limit the growth in unfunded Congressional Pensions. Remember that bargain when you go to the poles. Vote once in your life for less tax and take control. Impose the term limits they won’t vote for. Do it for America to make this country great again!

January 21, 2010 - Economy