Cantwell Raises Possibility of Glass-Steagall Type Amendment

http://washingtonindependent.com/82793/cantwell-raises-possibility-of-glass-steagall-type-amendment

Cantwell Raises Possibility of Glass-Steagall Type Amendment
By Annie Lowrey 4/20/10 1:30 PM


Speaking today at a news conference on derivatives, Sen. Maria Cantwell (D-Wash.) raised the possibility of proposing an amendment to Sen. Blanche Lincoln’s (D-Ark.) derivatives reform proposal that might force banks to separate their commercial and investment banking functions.

“I’m a purist,” Cantwell said, in response to a question regarding whether she supported the Volcker Rule (a proposal by former Federal Reserve Chairman Paul Volcker to ban “proprietary trading,” effectively banning any bank with federal backing from speculating with its own money). “If you want to take fuel out of the fire, I would also personally say that you should break up the big banks and not have investing and commercial banking in the same bucket. I will offer that amendment on the floor.”

The portions on derivatives trading offer a more specific iteration of that same idea. Section 106 of Lincoln’s derivatives reform proposal bans banks from receiving “federal assistance (including federal deposit insurance, and access to the Federal Reserve discount window)” if they contain desks that trade swaps, one currently unregulated type of derivative.

Cantwell, who did not clarify when asked a follow-up, seemed to indicate that her amendment hopes to go further — preventing banks from forgoing federal backing if they deal not only in swaps, but in any sort of speculative trading. This winter, Cantwell and Sen. John McCain (R-Ariz.) were due to propose a return to the Glass-Steagall rules, rescinded in 1999, that prevented combined commercial and investment banks. But that provision has not made it into the final bill.

I was pissd at Clinton for the longest time over this. He gave in to the repugs.

I also want a copy of this new "economic reform" bill too. There has been such a bill going through the House banking committee over the past year that actually makes taxpayer bailouts a permanent feature of banking, enshrining too big to fail in law.

in the banking sector, but aren't there enough indicators that the Glass-Steagall rules need to be put back in place- pronto, and then some. I'll feel comfortable with whatever Elizabeth Warren or Brooksley Born recommend.

I can't believe it has taken this long to see some action on Financial Reform.....Oh, wait! Elections are right around the corner. Now I understand.

I wonder how many Americans even know what Glass-Steagall is.

Break them up....break up the financial monopolies....break up the FIRE (Financials, Insurance and Real Estate).

As an aside to this Financial Reform Legislation...it has come to my attention that since we have outsourced all of our manufacturing, the US now simply just invents new ways to play with little pieces of green paper...it's nothing productive, but it is a huge part of our economy. It's Financial Wizardry. Oh...and we grow soy beans and corn....and lots of pron comes out of the Valley near LA. That's about it. Good wines from N. CA of course. What else do we do? Sell crap on TV and on eBay. Oh...we make lots of poisonous chemicals.

You can return to your regularly scheduled bankster crimes now.

Seems like a "no-brainer" to me.
Everybody KNOWS that a return to Glass-Steagal is the easiest and best way to address this issue.
Supplemental regulation would need to be tacked on to regulate the new creations (derivatives, etc.), but simply dusting off Glass-Steagal would go a looong way to restoring legitimacy to the Big Banks.

Placing a cap of $100Billion Dollars on the size is also needed.
SEE: Bill Moyers Journal, April 16th, 2010.
Transcript here:
http://www.pbs.org/moyers/journal/04162010/transcript3.html