Sunday, January 4, 2009

The End COULD Be a New Beginning...

Take the time to read these two articles in full. The madness of the Wall Street casino and the fatal agony caused by forgetting everything and everyone for money, profit, return MAY provide us a chance to recenter mankind's thinking on what is good for the human race!

Op-Ed Contributors - The End of the Financial World as We Know It -
Incredibly, intelligent people the world over remain willing to lend us money and even listen to our advice; they appear not to have realized the full extent of our madness. We have at least a brief chance to cure ourselves. But first we need to ask: of what? ...
The Madoff scandal echoes a deeper absence inside our financial system, which has been undermined not merely by bad behavior but by the lack of checks and balances to discourage it. “Greed” doesn’t cut it as a satisfying explanation for the current financial crisis. Greed was necessary but insufficient; in any case, we are as likely to eliminate greed from our national character as we are lust and envy. The fixable problem isn’t the greed of the few but the misaligned interests of the many. ...
Op-Ed Contributors - How to Repair a Broken Financial World -
Stop making big regulatory decisions with long-term consequences based on their short-term effect on stock prices. ...
End the official status of the rating agencies. Given their performance it’s hard to believe credit rating agencies are still around. There’s no question that the world is worse off for the existence of companies like Moody’s and Standard & Poor’s. There should be a rule against issuers paying for ratings. Either investors should pay for them privately or, if public ratings are deemed essential, they should be publicly provided.
Regulate credit-default swaps. ... The most critical role for regulation is to make sure that the sellers of risk have the capital to support their bets.
Impose new capital requirements on banks. ... Another good solution to the too-big-to-fail problem is to break up any institution that becomes too big to fail.
Close the revolving door between the S.E.C. and Wall Street. ... As it happens, the most critical job, chief of enforcement, now has a perfect candidate, a civic-minded former investor with firsthand experience of the S.E.C.’s ineptitude: Harry Markopolos.
The funny thing is, there’s nothing all that radical about most of these changes. A disinterested person would probably wonder why many of them had not been made long ago. A committee of people whose financial interests are somehow bound up with Wall Street is a different matter.
Another name for this could be "A Modest Proposal", but this time not ironic and certainly more likely to help eliminate hunger and poverty for the masses.
Let's get started.
(Another hint for assistance: F.D.Roosevelt's FIRST Inaugural Address, from 1933. When you read or hear that today, you will surely notice how little has changed (or was changed back after the reforms FDR introduced to protect people against business).)

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