Anonymous wrote:

Anonymous wrote:Actually, derivatives have done a lot for the real economy. They allow airlines to stabilize the price of their fuel and wholesale bakeries the cost of their flour, make farmers and ranchers less susceptible to fluctuations in the prices of the goods they produce, protect businesses that export and/or import from being jerked around by changes in foreign exchange rates, allow banks to make fixed rate loans that real economy borrowers prefer because they are easier for them to manage rather only offering floating rate loans, etc.

The derivatives that did not do well in the crisis were exclusively credit derivatives, actually more of an insurance product purchased almost exclusively by financial institutions, noted early and exploited completely by AEG, which ultimately did not have the wherewithal to make good on all the credit derivatives they sold.

Overall, derivative books are dominated by interest rate and foreign exchange derivatives, and to some extent commodity derivatives. As a percentage of the notional amounts of derivatives, which PP uses, credit derivatives today are actually quite small. It is unfortunate that legislators and the population more broadly are unable to distinguish between credit derivatives and the rest of the derivatives, making it much trickier for banks to offer these latter derivatives to their real economy customers.

If it's playing "hide the marble" with risk, that needs to be far more transparent and far more closely regulated. Clearly credit derivatives turned out to be a huge problem and a very bad idea. Clearly the market was not able to self regulate.

Anonymous wrote:Actually, derivatives have done a lot for the real economy. They allow airlines to stabilize the price of their fuel and wholesale bakeries the cost of their flour, make farmers and ranchers less susceptible to fluctuations in the prices of the goods they produce, protect businesses that export and/or import from being jerked around by changes in foreign exchange rates, allow banks to make fixed rate loans that real economy borrowers prefer because they are easier for them to manage rather only offering floating rate loans, etc.

The derivatives that did not do well in the crisis were exclusively credit derivatives, actually more of an insurance product purchased almost exclusively by financial institutions, noted early and exploited completely by AEG, which ultimately did not have the wherewithal to make good on all the credit derivatives they sold.

Overall, derivative books are dominated by interest rate and foreign exchange derivatives, and to some extent commodity derivatives. As a percentage of the notional amounts of derivatives, which PP uses, credit derivatives today are actually quite small. It is unfortunate that legislators and the population more broadly are unable to distinguish between credit derivatives and the rest of the derivatives, making it much trickier for banks to offer these latter derivatives to their real economy customers.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Barney Frank has done more to reform banking than Bernie has or ever well. Bernie has a completely simplistic understanding of the industry that misses entirely the real issues.

-- a government banking attorney

Pp adding that Gary Gensler, Hillary's banking guy, was an activist regulator at the CfTC post crisis and a super smart guy.

Gensler is 18 year veteran at Goldman Sachs, key player in getti ng otc derivatives exempted from regulation via Commodity Futuresodernization Act. Those are the derivatives that blew up everything.

Have you even taken a second to review his regulatory career? Clearly not. It's like dealing with cavemen, "bankers bad" end of thought process.

He did what Dodd-Frank required. Much of which has already been reversed. He is no Joe Kennedy. He's Hillary's Chief Financial Officer. I read Bernie opposed his appointment to the CFTC where he would oversee the rule writing Dodd-Frank mandated to rectify the damage done by Gensler's success at ensuring the derivatives be exempted. He had banking "genius" Greenspan singing that same tune. Only Brooksly Born fought to regulate the derivatives. But you hadn't finished law school then...

I graduated from kaw school in 1994; thank you. Gensler was one of the most outspoken and activist regulators post 2008 along with Sheila . If Bernie opposed him, just another example of ideological purity getting in the way of good policy.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Barney Frank has done more to reform banking than Bernie has or ever well. Bernie has a completely simplistic understanding of the industry that misses entirely the real issues.

-- a government banking attorney

Pp adding that Gary Gensler, Hillary's banking guy, was an activist regulator at the CfTC post crisis and a super smart guy.

Gensler is 18 year veteran at Goldman Sachs, key player in getti ng otc derivatives exempted from regulation via Commodity Futuresodernization Act. Those are the derivatives that blew up everything.

Have you even taken a second to review his regulatory career? Clearly not. It's like dealing with cavemen, "bankers bad" end of thought process.

He did what Dodd-Frank required. Much of which has already been reversed. He is no Joe Kennedy. He's Hillary's Chief Financial Officer. I read Bernie opposed his appointment to the CFTC where he would oversee the rule writing Dodd-Frank mandated to rectify the damage done by Gensler's success at ensuring the derivatives be exempted. He had banking "genius" Greenspan singing that same tune. Only Brooksly Born fought to regulate the derivatives. But you hadn't finished law school then...

I graduated from kaw school in 1994; thank you. Gensler was one of the most outspoken and activist regulators post 2008 along with Sheila . If Bernie opposed him, just another example of ideological purity getting in the way of good policy.

Were derivatives good policy? Was 14 trillion dollars worth of personal wealth evaporating on Wall Street because of the collapse good policy? I certainly don't think so. Gensler was part of what enabled that.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Barney's just bitter that he never had a shot at the upper chamber.

I think it's more like Barney is like all out of fucks and tells it like it is.

Barney has always told it like it is.

He was one of the most mercurial people in the House when I covered it. Him, Bill Thomas of California, and a couple of others didn't suffer any fools.

He's opinionated and outspoken. But so is Trump. So is your drunk uncle at the family dinner. Doesn't necessarily make any of them right.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Barney Frank has done more to reform banking than Bernie has or ever well. Bernie has a completely simplistic understanding of the industry that misses entirely the real issues.

-- a government banking attorney

Pp adding that Gary Gensler, Hillary's banking guy, was an activist regulator at the CfTC post crisis and a super smart guy.

Gensler is 18 year veteran at Goldman Sachs, key player in getti ng otc derivatives exempted from regulation via Commodity Futuresodernization Act. Those are the derivatives that blew up everything.

Have you even taken a second to review his regulatory career? Clearly not. It's like dealing with cavemen, "bankers bad" end of thought process.

He did what Dodd-Frank required. Much of which has already been reversed. He is no Joe Kennedy. He's Hillary's Chief Financial Officer. I read Bernie opposed his appointment to the CFTC where he would oversee the rule writing Dodd-Frank mandated to rectify the damage done by Gensler's success at ensuring the derivatives be exempted. He had banking "genius" Greenspan singing that same tune. Only Brooksly Born fought to regulate the derivatives. But you hadn't finished law school then...

I graduated from kaw school in 1994; thank you. Gensler was one of the most outspoken and activist regulators post 2008 along with Sheila . If Bernie opposed him, just another example of ideological purity getting in the way of good policy.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People like to say break up the banks because it is a simple solution they can understand. It actually is neither possible nor desirable. Better to focus on areas where there are almost no regulation but tons of money like shadow banking and off book assets, much of which is still related to mortgages . People don't like complexity but the financial world is indeed complex. Pretending it isn't just leads to ineffective solutions.

sorry the math for 30 year mortgages has been around for 400 to 500 years.

it is not that complex. it hasn't changed that much.

any company could do it except regular companies can't borrow at the rates Fannie and Freddie can because of the gov guarantees.

Repeating the same simplistic solution over and over doesn't make it any more,appropriate, sorry. Banks do a lot more than offer mortgages.

Yes, but real estate, either residential or commercial, has almost always played a prominent role in all of our most recent bank hiccups or crises. The math for 30 year mortgages may have been around for hundreds of years, but 30 year mortgages have not. Add to that Americans culturally expect 30 year fixed rate mortgages with free prepayment options. This creates negative convexity that is complex to manage. Securitize these mortgages, and the complexity of the risk management challenge goes up exponentially.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Barney Frank has done more to reform banking than Bernie has or ever well. Bernie has a completely simplistic understanding of the industry that misses entirely the real issues.

-- a government banking attorney

Pp adding that Gary Gensler, Hillary's banking guy, was an activist regulator at the CfTC post crisis and a super smart guy.

Gensler is 18 year veteran at Goldman Sachs, key player in getti ng otc derivatives exempted from regulation via Commodity Futuresodernization Act. Those are the derivatives that blew up everything.

Have you even taken a second to review his regulatory career? Clearly not. It's like dealing with cavemen, "bankers bad" end of thought process.

He did what Dodd-Frank required. Much of which has already been reversed. He is no Joe Kennedy. He's Hillary's Chief Financial Officer. I read Bernie opposed his appointment to the CFTC where he would oversee the rule writing Dodd-Frank mandated to rectify the damage done by Gensler's success at ensuring the derivatives be exempted. He had banking "genius" Greenspan singing that same tune. Only Brooksly Born fought to regulate the derivatives. But you hadn't finished law school then...

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I'm sorry, folks. Sanders hit the nail on the head on two of THE MOST IMPORTANT issues of our day.

1) Iraq war
2) Wall Street and financial regulations

And then there's also climate change, health care, trade, and more.

I think he's off on gun control, because I, personally, would prefer to have Germany's laws in place here, but that ain't never gonna happen...

Again, what does that have to do with the OP? Apparently, Barney Frank feels otherwise, and he tells you this as someone who is mor pe familiar than you with Bernie's career.

Alas, I don't think BF speaks from a position of demonstrated wisdom or effectiveness on these issues. Yes, he got legislation passed. No, that legislation is not sufficient. And, yes, he did fail the American people when there were really only two or three whistle-blowers warning of the crap that was going to hit the fan. And when it did, everyone pretended to be surprised and then pointed the finger at someone else. Poor governance, poor leadership. On this issue. Sorry, that's how I read it.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Barney's just bitter that he never had a shot at the upper chamber.

I think it's more like Barney is like all out of fucks and tells it like it is.

Barney has always told it like it is.

He was one of the most mercurial people in the House when I covered it. Him, Bill Thomas of California, and a couple of others didn't suffer any fools.