WAY off topic, but I am genuinely interested in what some of you think
Every family of 4 was asked to pay $ 185.00 per month for EIGHT years
to pay back money a Dutch and British bank lost when their investment
in an Icelandic Internet bank went bad during the last economic
Now the way I see it, those two banks made a risky investment and got
burnt. Too bad, so sad, it is the game they play.
Now the banks along with the IMF are pushing parliament for some sort
of repayment by the Icelanders who had not ONE word of say when those
risky investments were made.
It was put up for a vote.
The next paragraphs are from a news-wire along with another comment.
Iceland votes 'no' to debt deal for collapsed bank.
Voters in tiny Iceland defied their parliament and international
pressure, resoundingly rejecting a $5.3 billion plan to repay Britain
and the Netherlands for debts spawned by the collapse of an Icelandic
Iceland defies their parliament? The parliament is supposed to
represent the will of the Icelandic people! Their function is to obey
orders, not issue them!
It is the previous government of Iceland that defied the will of the
people, just like the way the US Congress defied the will of the
people to pass TARP!
International pressure? The only pressure is coming from the bankers,
who have gotten this silly idea into their heads that they can make
bad business decisions, engage in risky, reckless, highly speculative
gambling, pay themselves billions on bonuses when the dice roll their
way and stick the people with the losses when the game falls apart.
The people of Iceland are right to repudiate this debt. They did not
approve of it. They did not agree to it. The debts were not incurred
for the betterment of the people of Iceland!
This is a call to keyboards. Post to the comments section of every
Corporate Media article demonizing the Icelandic people for refusing
the yoke of servitude created for them the concept of Odious debt and
why it applies here!
No deal! They've also got to agree to take all of our Representatives and
then they'll also need a chief executive. We've got one of those (well,he
calls himself that anyway) to spare as well. It's a package deal -- all or
There is never a situation where having more rounds is a disadvantage
On Sun, 7 Mar 2010 12:10:48 -0500, the infamous "Ed Pawlowski"
I agreee with the Icelanders. The banks can stuff it. Bailouts are
wrong. The CEOs and others responsible could be shot for treason if I
Only some? Send our top 525 CONgresscritters (to Holland and
Britain.) Do NOT issue passports and do NOT let them back in our
The blind are not good trailblazers.
-- federal judge Frank Easterbrook
No. But bailing out borrowers and lenders has gone much further than just
what the FDIC does (what is it these days, $100K per account?). Bailouts
are just yet another way to get the people to make people increasingly
dependent on their government.
Also, the FDIC and other regulatory bodies did *such* a good job making
sure Citi, AIG, et al were "well governed" didn't they? I love listening
to big government advocates because their argument essentially boils
down to this: "Because government has intruded upon and generally screwed
up retirement funds, healthcare, banking, education, ... what we really
need is MORE government." It requires an astonishing level of irrationality
to demand more of something that already doesn't work. Apparently, if a little
is lousy a lot will be terrific???
Tim Daneliuk email@example.com
Classic anti-regulation rhetoric, conveniently ignoring that it was
deregulation that allowed the current economic mess to happen. It requires
an astonishing level of dishonesty to pretend that deregulating the
financial sector so they could make increasingly risky bets on unregulated
securities without being sufficiently capitalized if things went wrong was
*really* an example of government intruding on private enterprise.
Bullshit. It was government financing and *guaranteeing* risky behavior that
was responsible for the meltdown. Nothing has changed, so expect another,
bigger, disaster. All Obama is doing is trying to re-inflate the bubble.
Who was guaranteeing loans to people who *obviously* couldn't afford them? Who
made the market for the (in)securities? Talk to Barney, and Chris.
Horsecrap, no govt. forced investment firms to bundle rotten mortgages and
sell them to each other, no govt. compelled S&P or the other rating agencies
to stamp triple-A on securities so complex they didn't know what the hell
they were rating, no govt. forced the banks to award huge bonuses for moving
worthless paper and so on. The financial industry spent hundreds of
millions lobbying Congress for deregulation; they got what they wanted and
in less than a decade we got the worst financial crash in three-quarters of
a century--we're supposed to believe that's just a big old coincidence?
What's more people predicted what it would lead to at the time, that the
coming crash would make the S&L crisis look like a picnic--too bad they
weren't listened to, but everyone was making so much money, what could
possibly go wrong?
Clinton, Republicans agree to deregulation of US financial system
User Forum Topic
Submitted by Ex-SD on September 19, 2008 - 11:04am
A piece of history for those who want to blame all of this mess on Bush. I'm
no Bush lover but facts are facts and here's an article from 1999.
Clinton, Republicans agree to deregulation of US financial system
By Martin McLaughlin
1 November 1999
An agreement between the Clinton administration and congressional
Republicans, reached during all-night negotiations which concluded in the
early hours of October 22, sets the stage for passage of the most sweeping
banking deregulation bill in American history, lifting virtually all
restraints on the operation of the giant monopolies which dominate the
The proposed Financial Services Modernization Act of 1999 would do away with
restrictions on the integration of banking, insurance and stock trading
imposed by the Glass-Steagall Act of 1933, one of the central pillars of
Roosevelt's New Deal. Under the old law, banks, brokerages and insurance
companies were effectively barred from entering each others' industries, and
investment banking and commercial banking were separated.
The certain result of repeal of Glass-Steagall will be a wave of mergers
surpassing even the colossal combinations of the past several years. The
Wall Street Journal wrote, "With the stroke of the president's pen,
investment firms like Merrill Lynch & Co. and banks like Bank of America
Corp., are expected to be on the prowl for acquisitions." The financial
press predicted that the most likely mergers would come from big banks
acquiring insurance companies, with John Hancock, Prudential and The
Hartford all expected to be targeted.
Kenneth Guenther, executive vice president of Independent Community Bankers
of America, an association of small rural banks which opposed the bill,
warned, "This is going to begin a wave of major mergers and acquisitions in
the financial-services industry. We're moving to an oligopolistic
One such merger was already carried out well before the passage of the
legislation, the $72 billion deal which brought together Citibank, the
biggest New York bank, and Travelers Group Inc., the huge insurance and
financial services conglomerate, which owns Salomon Smith Barney, a major
brokerage. That merger was negotiated despite the fact that the merged
company, Citigroup, was in violation of the Glass-Steagall Act, because
billionaire Travelers boss Sanford Weill and Citibank CEO John Reed were
confident of bipartisan support for repeal of the 60-year-old law.
Campaign of influence-buying
They had good reason, to be sure. The banking, insurance and brokerage
industry lobbyists have combined their forces over the last five years to
mount the best-financed campaign of influence-buying ever seen in
Washington. In 1997 and 1998 alone, the three industries spent over $300
million on the effort: $58 million in campaign contributions to Democratic
and Republican candidates, $87 million in "soft money" contributions to the
Democratic and Republican parties, and $163 million on lobbying of elected
The chairman of the Senate Banking Committee, Texas Republican Phil Gramm,
himself collected more than $1.5 million in cash from the three industries
during the last five years: $496,610 from the insurance industry, $760,404
from the securities industry and $407,956 from banks.
During the final hours of negotiations between the House-Senate conference
committee and White House and Treasury officials, dozens of well-heeled
lobbyists crowded the corridors outside the room where the final deal-making
was going on. Edward Yingling, chief lobbyist for the American Bankers
Association, told the New York Times, "If I had to guess, I would say it's
probably the most heavily lobbied, most expensive issue" in a generation.
While Democratic and Republican congressmen and industry lobbyists claimed
that deregulation would spark competition and improve services to consumers,
the same claims have proven bogus in the case of telecommunications,
airlines and other industries freed from federal regulations. Consumer
groups noted that since the passage of a 1994 banking deregulation bill
which permitted bank holding companies to operate in more than one state,
both checking fees and ATM fees have risen sharply.
Differing versions of financial services deregulation passed the House and
Senate earlier this year, and the conference committee was called to work
out a consensus bill and avert a White House veto. The principal bone of
contention in the last few days before the agreement had nothing to do with
the central thrust of the bill, on which there was near-unanimous bipartisan
The sticking point was the effort by Gramm to gut the Community Reinvestment
Act, a 1977 anti-redlining law which requires that banks make a certain
proportion of their loans in minority and poor neighborhoods. Gramm blocked
passage of a similar deregulation bill last year over demands to cripple the
CRA, and bank lobbyists were in a panic, during the week before the deal was
made, that the dispute would once again prevent any bill from being adopted.
Gramm and other extreme-right Republicans saw the opportunity to damage
their political opponents among minority businessmen and community groups,
who generally support the Democratic Party. Gramm succeeded in inserting two
provisions to weaken the CRA, one reducing the frequency of examinations for
CRA compliance to once every five years for smaller banks, the other
compelling public disclosure of loans made under the program.
The latter provision was particularly offensive to black and other minority
business and community groups, who have used the CRA provisions as a lever
by threatening to challenge mergers and other bank operations which require
government approval. In most such cases, the banks have offered loans to
businessmen or outright grants to community groups in return for dropping
their legal actions. These petty-bourgeois elements have been able to
posture as defenders of the black or Hispanic community, while pocketing
what are essentially payoffs from finance capital and concealing from the
public the details of this relationship.
The banks and other financial institutions did not themselves oppose
continuation of the CRA, which they have treated as nothing more than a cost
of doing a highly profitable business in minority areas. Loans tied to the
CRA average a 20 percent rate of return. Financial industry lobbyists
complained that they were being caught in a crossfire between the
Republicans and Democrats which was unrelated to the main purpose of the
The Clinton White House threatened to veto the bill if CRA provisions were
substantially weakened, in response to heavy pressure from the Congressional
Black Caucus and the Reverend Jesse Jackson, whose Operation PUSH has made
extensive use of CRA in its campaigns to pressure corporations and banks for
more opportunities for black businessmen. But eventually the White House
caved in to Gramm, accepting his amendments so long as the program remained
formally in place.
The White House similarly retreated on pledges that consumer privacy would
be protected in the legislation. Consumer groups pointed to the potential
for abuse of financial information once giant conglomerates were created
which would handle loans, investments and insurance at the same time. For
example: a bank could refuse to give a 30-year mortgage to a customer whose
medical records, filed with the bank's insurance subsidiary, revealed a
The final draft of the bill contains a consumer privacy protection clause,
but it is extremely weak, applying only to the transfer of information
outside of a financial conglomerate, not within it. Thus Citigroup will be
able to pass on financial information about its bank depositors to Travelers
Insurance, but not to an outside company like Prudential. Even that
limitation would be breached if there was a contractual relationship with
the outside company, as in the case of a telemarketer which did work for
Citigroup and was given private information about Citigroup depositors to
aid in its telephone solicitations.
Threat to financial stability
The proposed deregulation will increase the degree of monopolization in
finance and worsen the position of consumers in relation to creditors. Even
more significant is its impact on the overall stability of US and world
capitalism. The bill ties the banking system and the insurance industry even
more directly to the volatile US stock market, virtually guaranteeing that
any significant plunge on Wall Street will have an immediate and
catastrophic impact throughout the US financial system.
The Glass-Steagall Act of 1933, which the deregulation bill would repeal,
was not adopted to protect consumers, although one of its most celebrated
provisions was the establishment of the Federal Deposit Insurance
Corporation, which guarantees bank deposits of up to $100,000. The law was
enacted during the first 100 days of the Roosevelt administration to rescue
a banking system which had collapsed, wiping out the life savings of
millions of working people, and threatening to bring the profit system to a
As a recent history of that era notes: "The more than five thousand bank
failures between the Crash and the New Deal's rescue operation in March 1933
wiped out some $7 billion in depositors' money. Accelerating foreclosures on
defaulted home mortgages-150,000 homeowners lost their property in 1930,
200,000 in 1931, 250,000 in 1932-stripped millions of people of both shelter
and life savings at a single stroke and menaced the balance sheets of
thousands of surviving banks" (David Kennedy, Freedom from Fear, Oxford
University Press, 1999, pp. 162-63).
The separation of banking and the stock exchange was ordered in response to
revelations of the gross corruption and manipulation of the market by giant
banking houses, above all the House of Morgan, which organized huge
corporate mergers for its own profit and awarded preferential access to
share issues to favored politicians and businessmen. Such insider trading
played a major role in the speculative boom which preceded the 1929 crash.
Over the past 20 years the restrictions imposed by Glass-Steagall have been
gradually relaxed under pressure from the banks, which sought more
profitable outlets for their capital, especially in the booming stock
market, and which complained that foreign competitors suffered no such
limitations to their financial operations. In 1990 the Federal Reserve Board
first permitted a bank (J.P. Morgan) to sell stock through a subsidiary,
although stock market operations were limited to 10 percent of the company's
total revenue. In 1996 this ceiling was lifted to 25 percent. Now it will be
The Wall Street Journal celebrated the agreement to end such restrictions
with an editorial declaring that the banks had been unfairly scapegoated for
the Great Depression. The headline of one Journal article detailing the
impact of the proposed law declared, "Finally, 1929 Begins to Fade."
This comment underscores the greatest irony in the banking deregulation
bill. Legislation first adopted to save American capitalism from the
consequences of the 1929 Wall Street Crash is being abolished just at the
point where the conditions are emerging for an even greater speculative
financial collapse. The enormous volatility in the stock exchange in recent
months has been accompanied by repeated warnings that stocks are grossly
overvalued, with some computer and Internet stocks selling at prices 100
times earnings or even greater.
And there is a much more recent experience than 1929 to serve as a
cautionary tale. A financial deregulation bill was passed in the early 1980s
under the Reagan administration, lifting many restrictions on the activities
of savings and loan associations, which had previously been limited
primarily to the home-loan market. The result was an orgy of speculation,
profiteering and outright plundering of assets, culminating in collapse and
the biggest financial bailout in US history, costing the federal government
more than $500 billion. The repetition of such events in the much larger
banking and securities markets would be beyond the scope of any federal
You conveniently ignore every part of the formula for disaster showing the
fingerprints of private business. Why is it you can see only the blunders
of govt., why is the reckless greed of business invisible to you?
You're a liar, too. The government *did* force banks to make shady loans and
they *did* guarantee those loans, and buy packaged loans and *guarantee* those
packages. Don't be so damned blind.
<WAY too much bullshit to read, snipped>
Yeah, like call someone a liar while making absurd statements you couldn't
back up if there was a gold medal for so doing. The govt. forced the
investment banks to create securities based on rotten mortgages, the govt.
forced the rating agencies to rate those securities triple-A, the govt.
forced firms like AIG to write unregulated bets on those securities far
beyond what they had the ability to pay off? Pray tell, what documentation
would you like to offer in support of your farcical claim?
Don't trouble yourself pretending you could come up with a coherent answer
if only you weren't so busy. Blowhards like you are a dime a dozen, lots of
loud talk, not a shred of credible backup in sight.
You have to follow the dominos. The Community Reinvestment Act was passed
during the Carter administration, but changes made during the Clinton year
GREATLY expanded (by a factor of over 100) the effect of the act.
For this conversation, banks and lending institutions HAD to make dicey
loans or they would be severly sanctioned. The banks went nuts and said
there's no way we can do this - there has to be some way to add a
substantial amount of security to these obvously bad loans. That's when
Fannie and Freddie got THEIR marching orders. The banks made the loans then
sold the paper to F&F. All this was mandated by the government and driven by
the progressive notion that the poor DESERVE decent housing.
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