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BS, the Blue Nation Review walks hand-in-hand with News Bin.
Speaking of misleading suck-ups, Andrew Sorkin conjures repulsive elitist arguments that support the sponsors of his famed "Dealbook"
No problem, fuagf. Just a quick answer to that pabulum from a Hillary Clinton backed bogus "news" site.
Carol Costello(CNN) ignores the truth on her own news show. Has to ask Nomiki Konst to dumb it down for her
Yes, Bernie Sanders Knows Something About Breaking Up Banks
Bernie Sanders probably knows more about breaking up banks than his critics give him credit for.
The Daily News on Monday published an interview with him that led some commentators to say he didn’t know how to break up the country’s biggest banks. Downsizing the largest financial institutions is one of Mr. Sanders’s signature policies, so it would indeed raise questions about his candidacy if he had little idea of how to do it.
In the interview, with The Daily News’s editorial board, Mr. Sanders does appear to get tangled up in some details and lacks clarity. Breaking up the banks would involve arcane and complex regulatory moves that can trip up any banking policy wonk, let alone a presidential candidate. But, taken as a whole, Mr. Sanders’s answers seem to make sense. Crucially, his answers mostly track with a reasonably straightforward breakup plan that he introduced to Congress last year.
Here are the most relevant parts of the exchange.
Daily News: Now, switching to the financial sector, to Wall Street. Speaking broadly, you said that within the first 100 days of your administration you’d be drawing up...your Treasury Department would be drawing up a too-big-to-fail list. Would you expect that that’s essentially the list that already exists under Dodd-Frank? Under the Financial Stability Oversight Council?
The Daily News may be referring here to the contents of Mr. Sanders’s bill. The legislation says that, in no more than 90 days, the Financial Stability Oversight Council, a high-level regulator set up by the Dodd-Frank Act of 2010, would have to draw up a list of firms that appear to be too big to fail. Then steps would be taken to break them up.
The Daily News comes back to the mechanics of breaking up the banks.
Daily News: Okay. Well, let’s assume that you’re correct on that point. How do you go about doing it?
Mr. Sanders: How you go about doing it is having legislation passed, or giving the authority to the secretary of Treasury to determine, under Dodd-Frank, that these banks are a danger to the economy over the problem of too-big-to-fail.
Mr. Sanders’s recognition here of the need for legislation is significant. Many banking experts say that Congress would need to pass a new law to give regulators the explicit authority to introduce direct caps on bank size. The Federal Reserve has introduced many measures since the financial crisis of 2008 that have created incentives for banks to shrink — and many banks are declining in size.
But senior officials at the Fed believe that Congress would need to do more. Neel Kashkari, the president of the Federal Reserve Bank of Minneapolis, favors extra measures to tackle too-big-to-fail banks and is working on a plan to do this. “Ultimately Congress must decide whether such a transformational restructuring of our financial system is justified in order to mitigate the ongoing risks posed by large banks,” Mr. Kashkari said in a recent speech.
The problematic word for Mr. Sanders in his answer above is “or.”
It suggests he believes that the secretary of the Treasury, using powers already given under Dodd-Frank, can press the banks to break up even without new legislation. This might be an option he’d take if Congress refused to pass new breakup legislation. Under Dodd-Frank, the Fed could in theory raise its capital requirements to such a high level for the largest banks that they quickly decide to break themselves up. But such a path might face stiff legal resistance. As a result, Mr. Sanders’s apparent suggestion that the Treasury secretary could act unilaterally might betray a weak grasp of Dodd-Frank. Or he may simply be confused about what it contains.
Daily News: But do you think that the Fed, now, has that authority?
Sanders: Well, I don’t know if the Fed has it. But I think the administration can have it.
It makes sense for Mr. Sanders to hedge here about the Fed. The Daily News asks if the Fed has that power “now.” As we have seen, the Fed currently has a lot of power but maybe not all the power it might require to break up the banks without facing serious legal challenges from the financial industry. And Mr. Sanders is also correct that an administration can obtain that power — that is what his bill is for.
Daily News: Well, it does depend on how you do it, I believe. And, I’m a little bit confused because just a few minutes ago you said the U.S. President would have authority to order...
Sanders: No, I did not say we would order. I did not say that we would order. The President is not a dictator.
Daily News: Okay. You would then leave it to JPMorgan Chase or the others to figure out how to break it, themselves up. I’m not quite...
Sanders: You would determine is that, if a bank is too big to fail, it is too big to exist. And then you have the secretary of Treasury and some people who know a lot about this, making that determination. If the determination is that Goldman Sachs or JPMorgan Chase is too big to fail, yes, they will be broken up.
Mr. Sanders is mostly cogent here. This is more or less how a breakup would work under his legislation. Doing what he outlines here would be far easier if Congress passed his breakup bill, or something like it. Mr. Sanders is on shaky ground if he thinks it would be easy to slash the size of the banks with Dodd-Frank alone. But, taking the interview as a whole, as well as his past positions, that does not appear to be the path he favors.
by Peter Eavis APRIL 5, 2016
http://www.nytimes.com/2016/04/07/upshot/yes-bernie-sanders-knows-something-about-breaking-up-banks.html
Why the Banks Should Be Broken Up
Bernie or no Bernie, 'Times' columnist Paul Krugman is wrong about the banks
By Matt Taibbi April 8, 2016
Paul Krugman wrote an op-ed in the New York Times today called "Sanders Over the Edge." He's been doing a lot of shovel work for the Hillary Clinton campaign lately, which is his right of course. The piece eventually devolves into a criticism of the character of Bernie Sanders, but it's his take on the causes of the '08 crash that really raise an eyebrow.
By way of making a criticism of the oft-repeated Sanders charge that the big banks need to be broken up, Krugman argues that banks were not "at the heart of the crisis."
This is Krugman's assessment of who was responsible:
"Predatory lending was largely carried out by smaller, non-Wall Street institutions like Countrywide Financial; the crisis itself was centered not on big banks but on 'shadow banks' like Lehman Brothers that weren't necessarily that big."
Forget about the Sanders-Clinton race, because it's irrelevant to the issue. Krugman is just wrong about this.
The root problem of the '08 crisis lay in a broad criminal fraud scheme in the mortgage markets. Real-estate agents fanned out into middle- and low-income neighborhoods in huge numbers and coaxed as many people as possible into loans, whether they could afford them or not.
Those loans in turn were bought up by giant financial companies on Wall Street, who chopped them up into a kind of mortgage hamburger. Out of this hamburger, they made securities. These securities were then sold to institutional investors like pension funds, unions, insurance companies and hedge funds.
In the typical scenario, the investors buying these toxic mortgage securities weren't told how risky the merchandise was. Many thought they were investing in AAA-rated real estate, when in fact they were buying up the flimsy home loans of part-time janitors, manicurists, strawberry pickers, people without ID or immigration status, and so on.
There were two major classes of victims in this scheme: homeowners and investors. About five million people went into foreclosure after the crash, and investor losses globally ran into the trillions. It was an unparalleled event in the annals of white-collar crime.
Virtually the entire financial industry had a hand in this. The ratings agencies were complicit because they blessed a lot of these mortgage securities with high ratings when they knew they didn't deserve them. Companies like AIG had a role because they created a kind of pseudo-insurance for these mortgage securities that disguised the risk they posed.
And Krugman is right that companies like Countrywide and First Century, the sleazy "mortgage originators" who sent teams of over-caffeinated real-estate hustlers into neighborhoods offering crooked loans, were primarily responsible for a lot of the street-level predatory lending.
But Krugman neglects to mention the crucial role that big banks played.
The typical arc of this scam went as follows: Giant bank lends money to sleazy mortgage originator, mortgage originator makes lots of dicey home loans, the dicey home loans get sold back to the bank, the bank pools and securitizes the loans, and finally the bank sells the bad merchandise off to an unsuspecting investor.
The criminal scenario that was most common was a gigantic bank buying up huge masses of toxic loans from a Countrywide or some other fly-by-night operation and knowingly selling this crap as a good investment to some investor.
We chronicled an example of this in "The $9 Billion Witness," the story of JP Morgan Chase whistleblower Alayne Fleischmann, who lost her job after trying to stop the bank from selling a parcel of bad mortgages. JP Morgan Chase ended up saddled with a $13 billion settlement after it admitted to making "serious misrepresentations" to mortgage investors.
What's so baffling about Krugman's column is that there is a massive amount of documentary evidence outlining this behavior, committed by virtually every major bank in America. There was a $7 billion settlement paid by Citigroup, which incidentally is the company that Bill Clinton originally repealed the Glass-Steagall Act to create. Citi admitted to hawking merchandise that violated their own internal credit guidelines.
Citi also bilked investors out of huge sums, and we know a great deal about its behavior because it too had a whistleblower, named Richard Bowen. Bowen sent the SEC over 1,000 pages documenting "fraud and false representations given to investors."
There were virtually identical billion-dollar settlements involving Bank of America, Goldman Sachs (which is now a bank holding company, remember) and Morgan Stanley (ditto).
Wells Fargo's settlement is another blunt repudiation of Krugman's point, because in the case of Wells, the bank itself was engaging in predatory lending at the street level, not just selling crappy mortgages to investors.
Wells had to pay $175 million to settle charges of overcharging 4,000 minority homeowners in a case that saw evidence come out that the bank specifically targeted black customers (referred to in one office as "mud people") for "ghetto loans."
Let's not forget also that not only were the big banks intimately involved in the signature fraud of the era — the creation and repackaging of toxic mortgage loans — they were also involved in wide-ranging foreclosure abuses.
Companies like Bank of America, Citi, Wells Fargo and Chase ended up being stuck with an additional $25 billion settlement just for the tawdry document-fudging "robosigning" scheme that helped accelerate the foreclosure crisis.
And did Krugman miss the other headlines from this era? Did he miss HSBC being nailed for laundering hundreds of millions of dollars for Central and South American drug cartels? How about the money-laundering scandals involving Chase, the British Bank Standard Chartered, the German Commerzbank AG and others, in which banks washed cash for crooks and rogue states?
And did he miss the LIBOR rate-rigging scandal that forced the likes of Barclays, UBS, Rabobank, the Royal Bank of Scotland, and Deutsche Bank to pay massive settlements for manipulating interest rates? How about the Forex manipulations that led to still more settlements for the likes of Goldman, BNP Paribas, HSBC and Barclays?
Krugman would likely argue that all those little things like laundering money for narco-terrorists, monkeying with world interest rates, and systematic cheating in the currency markets had nothing to do with the crash.
He would technically be correct in this. But the entire argument for breaking up the banks, which incidentally didn't originate in the Senate with Bernie Sanders or even Elizabeth Warren but with Ohio's Sherrod Brown and then-Delaware Sen. Ted Kaufman, was conceived with the idea that leaving over-large banks intact invited not only the potential for future bailouts, but future regulatory problems.
As MIT economist Simon Johnson pointed out in 2010, these institutions have become so big that they can confront and defy the government. Moreover the failure to punish the banks for the great mortgage frauds of the crisis years left all of these companies with the knowledge that the authorities were afraid to aggressively enforce the law, for fear of disrupting a fragile economy.
When UBS and HSBC escaped with slap-on-the-wrist settlements for the LIBOR and money-laundering offenses, respectively, Sherrod Brown redoubled his efforts to break up the banks, insisting that these episodes proved these companies were now too big to be regulated. By 2013, Brown said, it was clear that "these megabanks are out of control."
The call to break up the banks is not some socialist clarion call to end capitalism. (Well, it might be from Bernie, but not from everyone.)
In fact, it's just the opposite. The lessons of the crash era are that these megabanks have grown beyond the organic controls of capitalism. They were so big and so systemically important in '08 that the government could not let them go out of business.
This alone was an argument for breaking them up. The banks emerged from '08 with the implicit backing of the federal government. They became quasi-state entities, almost immune to failure. Not just Bernie Sanders worried about this. Voices as diverse as Louisiana Republican David Vitter and Krugman's own New York Times editorial board have argued for hard caps on bank size.
What's happened in more recent years, with LIBOR and the money-laundering scandals and Forex and the London Whale episode and so on, is that these firms also proved too "systemically important" to regulate and prosecute. They grew too big not only for capitalism, but for criminal law.
When a company is not only too big to fail, but too big to prosecute, it's too big to exist. Krugman may believe otherwise, but he shouldn't pretend that others – including his own paper – don't have legitimate concerns.
http://www.rollingstone.com/politics/news/why-the-banks-should-be-broken-up-20160408
Krugman's credibility is more untenable. I realized he was full of shit when he left out derivatives and swaps.
It's now plain to see that Krugman is very biased in favor of HRC, suggests he is begging for a place in her cabinet. But first he needs correcting:
~ Robert Reich
Ordinarily I wouldn’t pick on a particular columnist but I respect Paul Krugman. Also, his perch at the New York Times gives him broad influence – especially just two and a half weeks before the important New York State primary. But his piece today (which I’ve attached) is shot through with errors.
1. The biggest Wall Street banks did indeed precipitate the crisis on Wall Street in 2008 because of their gambling in newfangled financial instruments and fancy derivatives even they didn't understand.
2. Their size did make a difference because they were so interconnected with other financial entities both in the U.S. and around the world that they were "too big to fail." Today's biggest Wall Street banks are much bigger than they were in 2008.
3. Size also has a bearing on their political influence. The reason the Glass-Steagall Act was scotched by Bill Clinton's administration, and the Clinton administration wouldn't agree with the CFTC to regulate derivatives, had a lot to do with the influence of Wall Street over the Clinton administration and over Congress. The political power of the biggest players on the Street is even larger today – as evidenced by their capacity to whittle back significant parts of Dodd-Frank in the regulatory process.
4. Breaking up the biggest banks isn’t a radical idea. In fact, many experts – including the current president of the Federal Reserve Bank of Minneapolis (who’s a Republican and a former executive of Goldman Sachs), and the former head of the Federal Reserve Bank of Dallas -- have called for exactly this.
5. Bernie's other ideas -- for a single-payer plan, and for free tuition at public institutions of higher education – are sensible, and also backed by many experts. It’s well-established that a single-payer plan would be far less costly and deliver far better care than our own system, which is based on private for-profit insurers. As to free tuition in public universities, we were well on the way to this goal in the 1950s and 1960s. It was and is a logical extension of free K-12 education.
6. Finally, the current brouhaha over who's "qualified to be president" was arguably started by Hillary Clinton. Personally, I think neither she nor Bernie should be calling the other unqualified, but to blame Bernie for this exchange is simply incorrect.
https://m.facebook.com/story.php?story_fbid=1193897777289483&id=142474049098533
A bank is way too big when they can put depositor's money into their trading pot.
His campaign on Tuesday released a statement on how a Sanders administration would take on the issue, also stating that he and rival Clinton "have very different points of view on how to reform Wall Street and the largest financial institutions in this country." The statement reads, in part:
break them up just for shits and giggles?
Why be silly.
I saw the Barney Frank/Robert Reich debate... Reich was right!
as he has said they already should be broken up
And that, they should! And I think you know this to be true - C and BofA should have been already broken up, and JPM should never have been allowed to go commercial!... Obama should have stepped up to the plate. I think that was on Bernie's mind. That's what he was having trouble saying, imo.
About Bernie's interview...
Reporters Who Haven't Noticed That Paul Ryan Has Called for Eliminating Most of Federal Government Go Nuts Over Bernie Sanders' Lack of Specifics
Dean Baker Published: 05 April 2016
The Washington press corps has gone into one of its great feeding frenzies over Bernie Sanders' interview with New York Daily News. Sanders avoided specific answers to many of the questions posed, which the D.C. gang are convinced shows a lack of the knowledge necessary to be president.
Among the frenzied were the Washington Post's Chris Cillizza, The Atlantic's David Graham, and Vanity Fair's Tina Nguyen, and CNN's Dylan Byers telling about it all. Having read the transcript of the interview I would say that I certainly would have liked to see more specificity in Sanders' answers, but I'm an economist. And some of the complaints are just silly.
When asked how he would break up the big banks Sanders said he would leave that up to the banks. That's exactly the right answer. The government doesn't know the most efficient way to break up JP Morgan, JP Morgan does. If the point is to downsize the banks, the way to do it is to give them a size cap and let them figure out the best way to reconfigure themselves to get under it.
The same applies to Sanders not knowing the specific statute for prosecuting banks for their actions in the housing bubble. Knowingly passing off fraudulent mortgages in a mortgage backed security is fraud. Could the Justice Department prove this case against high level bank executives? Who knows, but they obviously didn't try.
And the fact that Sanders didn't know the specific statute, who cares? How many people know the specific statute for someone who puts a bullet in someone's head? That's murder, and if a candidate for office doesn't know the exact title and specific's of her state murder statute, it hardly seems like a big issue.
There is a very interesting contrast in media coverage of House Speaker Paul Ryan. In Washington policy circles Ryan is treated as a serious budget wonk. How many reporters have written about the fact this serious budget wonk has repeatedly proposed eliminating most of the federal government. This was not an offhand gaffe that Ryan made when caught in a bad moment, this was in his budgets that he pushed through as chair of the House Budget Committee.
This fact can be found in the Congressional Budget Office's (CBO) analysis of Ryan's budget (page 16, Table 2). The analysis shows Ryan's budget shrinking everything other than Social Security and Medicare and other health care programs to 3.5 percent of GDP by 2050. This is roughly the current size of the military budget, which Ryan has indicated he wants to increase. That leaves zero for everything else.
Included in everything else is the Justice Department, the National Park System, the State Department, the Department of Education, the Food and Drug Administration, Food Stamps, the National Institutes of Health, and just about everything else that the government does. Just to be clear, CBO did this analysis under Ryan's supervision. He never indicated any displeasure with its assessment. In fact he boasted about the fact that CBO showed his budget paying off the national debt.
So there you have it. The D.C. press corps that goes nuts because Bernie Sanders doesn't know the name of the statute under which he would prosecute bank fraud thinks a guy who calls for eliminating most of the federal government is a great budget wonk.
http://cepr.net/blogs/beat-the-press/reporters-who-haven-t-noticed-that-paul-ryan-has-called-for-eliminating-most-of-federal-government-go-nuts-over-bernie-sanders-lack-of-specifics
What do you know about the "Blue Nation Review"?... do you think it was born into the same nest as "News Bin"?
Well then, that's not so bad.
LOL! ... Ernie's 7 putt from 3 ft. was special. I don't know if that's ever been done before... I'm glad I missed it.
You ruined it for me.
My DVR is running 30min behind...
Just saw Angel lay some sod over a penalty shot... he was going along pretty good until THAT hole.
I like the way Scott Piercy is recovering.
Stevie couldn't help Adam thru the wind, today. Jason Sobel thinks that 76 is the highest round in Stevie's career.
Day, Stenson, Scott, Rose, Matsuyama... 278
Thanks
Looks like Bernie bought himself another primary!
$44 million raised in March... that's got to be some kind of record.
Cruz better enjoy basking in the glow of this win and endorsement from Scott Walker, who has done little as governor except hurting poor people, screwing academia and unions in Wisconsin... republicans love him for it.
How so, sideeki?
Interesting... does anyone in their right mind think that rule is going to change?
Why not? From what I read, that rule was added to keep out Ron Paul in 2012.
F6 -- see http://www.huffingtonpost.com/adam-nicholas-phillips/doomsday-savior-how-paul-ryan_b_9474788.html
http://prospect.org/article/paul-ryan-gop%E2%80%99s-next-presidential-nominee
(also):
Here’s how Paul Ryan becomes the next president of the United States
02 Apr 2016
With the odds increasing that the GOP is looking at a contested convention in Cleveland — with front-runner Donald Trump’s missteps and unforced errors finally catching up to him — all Republican eyes are looking at the pool of candidates to head the ticket in his place
A likely choice? Recycling 2012 GOP vice presidential nominee Paul Ryan — who has more than one path to the White House.
Republicans are looking for someone – anyone — to take the lead, and with Texas Sen. Ted Cruz unpopular with colleagues in both the Senate and the House, Ryan would be an oasis of calm following a primary season that has turned into a circus.
According to poll guru Nate Silver, there is a 63 percent chance that the GOP will not pick a candidate on the first ballot, which is bad news for Trump, and good news for a more palatable candidate like Ryan who recently took over the House Speaker spot.
According to Ryan, “I’ve been really clear about this. If you want to be president, you should run for president. We should select our nominee from among the people who are running for president. Clear and simple. So no, I am not going to be the president. I am not going to be the nominee.”
He added, “I am not going to become the president through Cleveland.”
Well, yes and no.
Let’s say that Ryan grudgingly acquiesces for “the good of the party” and accepts the nomination.
With Trump not entirely ruling out a third party run should the nomination be “stolen” and handed to Ryan, and with a growing faction of Bernie Sanders’ voters saying #BernieOrBust, it is possible that voting might splinter in such a way that no candidate garners enough electoral votes to win.
According to the U.S. Constitution, if no candidate receives a majority of electoral votes, the House of Representatives elects the president from the three presidential candidates who received the most electoral votes with each state delegation getting one vote.
A likely candidate: the guy at the Speaker’s podium in a GOP controlled House — giving Ryan two shots to win.
Farfetched? Not in a primary season that saw the dramatic rise of a democratic socialist from Vermont and a bullying New York businessman running a campaign based upon insults.
https://www.rawstory.com/2016/04/heres-how-paul-ryan-becomes-the-next-president-of-the-united-states/
There has been some talk about such a scenario. One is that Ryan accepts the nomination at a contested convention, Trump goes third party, and then you have Hillary/Bernie. There is a good chance no candidate would get 270 electoral votes, and the House of Representatives would then choose the president.
What about a scenario where the house republicans choose the the next president?
Patrick Reed
Thanks. Too bad for you and Willet... Console yourself with a great match-up tomorrow, McIllroy and Na !
It looks like Rickie has no chance at all, since the other two in the pool halved. Wish I was wrong.
Well, maybe not - if Dufner loses the next two and Rickie wins out...
Will MacKenzie for the PRO, thanks
That's a great ad!
It would play well on the networks, especially Fox.
You nailed him!
Nice coup, hanibal. I'm sure that chart just tore his heart out!
Which makes a good pivot to Bernie's tirade about inequality:
Note that this is a gross income number that doesn't include any tax withholding or other deductions. Disposable income would be noticeably lower.
Latest Hypothetical Annual Earnings: $35,924, Down 13.2% from 44 Years Ago
If we multiply the hypothetical weekly earnings by 50, we get an annual figure of $35,924. That's a 13.2% decline from the similarly calculated real peak in October 1972. http://www.advisorperspectives.com/dshort/updates/Employment-Wages-and-Hours-since-1964
I agree. He's seems to have enough money to stay in to the end. The "pathological liar" is a good label and should stick.
Keep your fingers crossed... she's walking in a minefield of misfortune
Fowler for WGC
They loved Kasich at AIPAC. Lots of standing ovations. He moistened a lot of fannies with that speech!
You make it sound like Bernie has a 5 to 1 fundraising lead over Hillary which is far from the truth.
It's been reported that Hillary raised $30 million in February to Bernie's $43 million. But OpenSecrets show Hillary's combined fundraising is $211,894,470 to Bernie's $96,357,503.
The more I hear about the Golden State the more I find myself pulling for Popovich and the old-school Spurs to save us from these Warriors!