In an article published on Alternet (Jan 4, 2012) Les Leopold wrote about the steps we (the people, the regulators, Congress) could and should take to get control of finance system back from the financial speculators and the predatory investment banks that support them. “These banks and those who run them are living off the rest of us and have no intention, ever, of suffering through the ups and downs of capitalist rewards and losses. When you run the casino, it’s always payday for the house.”
How to Really Overhaul Wall Street
I put this question to Marshall Auerback, global portfolio strategist for Madison Street Partners, a Denver-based fund management group, and a fellow for the Economists for Peace and Security. Here’s his brilliant wish list:
1. Banks should only be allowed to lend directly to borrowers and then service and keep those loans on their own balance sheets.
2. Banks should not be allowed to have subsidiaries of any kind.
3. Banks should not be allowed to accept financial assets as collateral for loans.
4. Banks should not be allowed to lend off shore.
5. Banks should not be allowed to buy (or sell) credit default insurance.
6. Banks should not be allowed to engage in proprietary trading or any profit-making ventures beyond basic lending.
7. Abandon “too-big-to-fail” and “systemically important” doctrine in favor of a “too-big-to-save” and “systemically dangerous” approach. They should be broken up, so that they are not “too big to fail.” Guarantee the deposits and punish the shareholders.
Break the power of finance once and for all. Amen!
Filed under: Current Events, Economics & Finance, Modern History | Tagged: "too-big-to-fail", banks, credit default insurance, Economists for Peace and Security, financial speculators, insurance, Les Leopold, Marshall Auerback, plutocracy, proprietory trading, Wall Street |