What needs to be done is to re-establish regulatory control over banking and the financial markets. Congress needs to repeal the "safe harbor" provisions for derivative contracts under title 11. (I would add to the list the like provisions that immunize leveraged buyouts - viz. the "Mitt Romney Special" - as these transactions have a high potential for fraud and abuse and consequential damage to the economy.) Elimination of these safe harbor provisions will force the counterparties to these contracts to disclose their transactions in order to protect the priority of their security interests in bankruptcy. Then, at least, everyone will know the risks and where they stand. As it stands now, these contracts are undisclosed ("off-balance sheet"); and are being used not to hedge risk, but rather to speculate ("gamble") on the financial markets - witness the MF Global Funding bankruptcy, and, more recently the losses sustained by J.P. Morgan Chase. There has to be a clear dividing line between bank investment that is insured, and market trading that is not. (This was the purpose of the Volcker Rule agains proprietary trading by banking institutions.) The problem - which will be the same whoever is elected President - is that Congress lacks the political will to stand up to the banking and market lobbyists; and it is back to business as usual.
In the final analysis, what needs to be done is to get back to an economy that is based on making things rather than making deals.
Did anyone else hear about this?: http://www.thenewamerican.com/usnews...-party-in-1996
Had to get it from FOX, and I don't know if it's true, but it would explain a lot.
"We are Socialists, we are enemies of the capitalistic economic system for the exploitation of the economically weak, with its unfair salaries, with its unseemly evaluation of a human being according to wealth and property instead of responsibility and performance and we are all determined to destroy this system under all conditions."-Adolf Hitler