Skip to main content

View Diary: Glass-Steagall Act II -- it's Not (11 comments)

Comment Preferences

  •  I just watched "Hank" on Netflix (7+ / 0-)

    (I confess to have posted some of this comment elsewhere)

    It's a biographical account by Secretary of Treasure Hank Paulson about the financial debacle.

    It's clear to me that it all got started by the repeal of Glass-Steagall.  From then on unregulated banks became increasingly fraudulent by selling securitized sub-prime mortgage packages that were not as secure as they represented.  

    The repeal of Glass-Steagall was voted by a Congress heavily influenced by the banking CEOs.  Money in politics is at the bottom of this disease.  Certainly Congress and POTUS were voted in but the driving force was the financial industry.

    Banks were able to become to-big-to-fail as Paulson states in the film.  Blame the repeal of Glass-Steagall for this too.

    Paulson was CEO of Goldman Sachs before he was appointed in 2006.  The real estate bubble was ready to burst.  And yet he claims ignorance about the dynamics that caused it; securitization of sub-prime mortgage loans.  This is where he looses me.

    Everybody in the front lines of real estate knew what was going on.  My Kennedy shoe shine moment came in 2004 when I met a hair stylist who was buying his 4th house in Palm Springs even though I earned twice as much as he did.

    The corruption of the mortgage financial system was there for all top see.

    Certainly all the large bank and investment bank CEOs and even AIG knew they were fraudulently making billions by selling these securitizized mortgage packages in the US and around the world by lying about their nature and supported by the global reputation of the US financial system.

    Paulson may have saved the day, but it is clear, and he does say it in the film,  that nothing has changed and we face another debacle soon.

    The corruption of Fannie Mae and Freddy Mac CEOs is clear too.  They got fired non too soon.  But I do believe that putting one or more of these corrupt CEOs would go a long way to prevent the next bubble and the next financial debacle.

    But, until we reinstate Glass-Steagall with extra teeth and we get money out of politics à la Citizens United, we are skating on thin ice.

    Daily Kos an oasis of truth. Truth that leads to action.

    by Shockwave on Wed Dec 25, 2013 at 01:39:01 PM PST

Subscribe or Donate to support Daily Kos.

Click here for the mobile view of the site