Obama Touts Reforms After J.P. Morgan Loss

[pickel]

Obama Touts Reforms After J.P. Morgan Loss - WSJ.com

"Without Wall Street reform, we could have found ourselves with the taxpayers once again on the hook for Wall Street's mistakes," Mr. Obama said in his weekly media address. He added: "We've got to finish the job of implementing this reform and putting these rules in place."

Hear,Hear !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! !!!!!!!

[GroundZero3]

38 lawmakers own stock in JP Morgan Chase - POLITICO.com

[The Real Bingo]

LOL. So transparent. Amazing how the politicians talk like they're protecting the little guy, but ignore the fact that the Fed and the politicians forced the bailout on banks in the first place. And, as GZ's link states, they're mainly interested in preserving their own capital.

[Chuckiechan]

Typical - every time a business looses money, someone wants new rules "So it will never happen again". Obama is "compressing" again. The taxpayers are not "on the hook" for anything.

There is a thing in the private world called "risk". It means taking a position with the hope of making money. It is not always guaranteed.

More and more regulations are exactly what we don't need.

Why are there no new rules written to protect Uncle Sugar's Taxpayers from more Solyndras?

BTW, JP Morgan is a good investment. This loss was like 1.5% of their earnings. Not too bad. If you aren't making mistakes from time to time, you aren't doing your job.

[tony_j15]

At one point, trading firms were partnerships and the partners were invested (meaning they had to care about the long term picture). At one time, banks were solely tasked with handling deposits and making loans. They were prohibited from trading with or against "their" own money. At one point, this situation basically couldn't happen. But starting with Reagan and continuing with both Bush'es and Clinton, we have systematically de-regulated banking and caused the situation we now find ourselves in.

Anyone who thinks less regulation is a good thing has had their head up in a location that smells of feces for the past 31 years.

[Chuckiechan]

You want to see the benefits of over regulation? Come to California.

The government insists on regulating everything just because it can, as a result a lot of good things don't get done.

For example - now it takes 20% down to buy a house. The only people likely to have the $40k down for a $200K house are investors buying rentals. Not too many couples starting out can come up with that, so Mr. & Mrs. Six Pack are going to be renting until republicans take over and write some realistic rules.

Sooo, since rules are rules, be need a way around them: You can take a second out to pay off 10% of the 20% down and only actually pay 10% down. So what's the problem? The problem is you have to pay the bank extra fees, suckah! LOL!

And while you are farting around trying to swing the deal, an investor swoops in with the cash and pulls the rug out from under you.

[tony_j15]

No one said there isn't such a thing as over-regulation. All I'm saying is that it is extremely naive to claim that regulation is a bad thing when it comes to banking and the current mess we created by de-regulating them.
I see you'd rather just blather on about your irrational hatred of regulations in general or you would have responded on-topic.

[RicheemxX]

I'm not against regulation where its needed but this is kind of ludicrous. How much regulation can you put in place on a market that is inevitably a gamble. If you are going to regulate their losses can we then regulate their gains as well? Maybe put a stop gap on those and anything over a certain percentage goes to the rest of the free world that hasn't taken the risk of investing?

From what I saw none of their investments where considered "high risk", in fact most look like fairly reasonable risks.

[Chuckiechan]

You can't regulate way every risk in life or in business. That is the point. You have to keep going forward and spend more and more time going around regulations to get things done.

We can't get anything done anymore. That's is a huge problem. That is the main point of my post.

[tony_j15]

I'm not against regulation where its needed but this is kind of ludicrous.

What's ludicrous? Stopping banks from betting against their own investments like we use to?

[Chuckiechan]

You always hedge. It prudent when you are dealing with large sums of money.

[tony_j15]

Define hedge. At one time it did not mean "sell/loan to the client and tell them a market segment will do great then use our own funds to bet the opposite will happen."

Allowing this behavior is unethical and undermines long-term growth.

[Chuckiechan]

First of all, you define "hedge" as it relates to the financial industry. It will do you some good.

Allowing this behavior is unethical and undermines long-term growth.

No it does not. It is risk taking the hopes of reward. All investments have the possibility of going south. You only hear about the bad ones.

You can't legislate out risk.

How were you harmed, BTW?

[tony_j15]

First of all, you define "hedge" as it relates to the financial industry. It will do you some good.

A hedge is a secondary investment taken to offset potential losses from a primary investment. Speaking generally, hedging is good. I own a car, which allows me to earn money by taking me to work and bringing the groceries home. It's an investment. I have hedged that investment with insurance to offset costs associated with the known risks of driving.
Hedging was standardized back in the 1800s to deal with physical goods like grains and precious metals. For those purposes, it works well.
The problem is when banks now hedge on complex derivative packages and actively bet against their clients. This undermines the relationship.

No it does not. It is risk taking the hopes of reward. All investments have the possibility of going south. You only hear about the bad ones.

There is nothing wrong with taking on risk and attempting to profit. But it must be done in an ethical manner. Otherwise, it undermines trust and encourages short-term profiteering at the expense of long-term growth. The financial meltdown was proof of this.
By dis-allowing this sort of predatory behavior, it forces lenders and traders to fully consider the situation they are getting in to and screen much more carefully to focus on the more sure positions. Currently, no one has to give a damn. Make the trade, push the loan, hedge it, and walk away. You're covered either way, regardless of whether something good happens or if it all comes crashing down. This obviously encourages poor behavior.

You can't legislate out risk.

Of course not. But you can minimize the potential for large-scale crashes. Our current one came through de-regulation leading to an over-abundance of risky positions that culminated in a severe recession.

How were you harmed, BTW?

What, so only people who have been slapped in the face by an issue directly are allowed to have an opinion? We've all been economically harmed by the de-regulation that has occurred over the last 31 years.
I've never ridden in an ambulance either, but I've got an opinion on them as well about how they are maintained and how the crews are certified. Is it invalid since I've never had to ride?

[sharder8]

I've haven't ridden in an ambulance yet, but I've got an opinion on them as well about how they are maintained and how the crews are certified. Is it invalid since I've never had to ride?

Little correction there tony . . .

Man, you must live an extremely sedentary lifestyle! By the time I was your age, I'd ridden in an ambulance multiple times.




Harder

[pickel]

By the time I was your age, I'd ridden in an ambulance multiple times.

Harder

Yeah...One of these.....ROTF

[tony_j15]

Little correction there tony . . .

Man, you must live an extremely sedentary lifestyle! By the time I was your age, I'd ridden in an ambulance multiple times.

Grew up a townie. Worst thing to happen is falling off bikes and getting cut up. Or maybe I just have better coordination.

[sharder8]

Yeah...One of these.....ROTF

Maybe . . . but you were one of the inventors and a boyhood friend of Hippocrates.





Harder

[Chuckiechan]

Pickel is pretty special. He was an electrical apprentice under Thomas Edison!

[aldtech]

How were you harmed, BTW?

I lost my house.

Like Tony said, because of deregulation and hedge funds the banks have absolutely no incentive to work with home owners. Mortgage companies (Countrywide) were in the business of making loans to people who clearly cannot afford them by inflating income and hiding debt knowing full and well that if/when the borrowers default on their mortgages the bank would still win because they've hedged against the loan.

In my case my mortgage was a bit of a reach but we were making it. Then came an extended stretch of unemployment which put us behind but we recovered. Then came the great recession which essentially put us under. For three years we tried to work with and fought the bank and at one point, less than 4 hours to a foreclosure auction, we managed to bring the loan up to date. But during all that time and even up to 3 months after saving the house and staying current on the loan (one of the pre-requisites to getting a mortgage adjustment) the bank would not work with us. I was forced to sell my house and successfully did so even in a down market but if I didn't the bank would have eventually gotten the house because my income is not what it was 6 years ago.

While I in essence beat the bank on my mortgage and sold clear from foreclosure 1 1/2 years ago, the bank is still screwing me by stating on my credit report that it was a foreclosure sale. This is what is keeping me from getting back into a house right now.

Through my own personal experience I can most certainly attest to the predatory nature that exists in our mortgage banking system today which IMO is a direct result of deregulation and banks getting it both ways by betting for and against mortgages/loans. This is just my story and while I managed to walk away, on my knees, multiply it by hundreds of thousands if not millions and that is what middle-class Americans have and are going through right now.

Your position of less/no regulation is BS Chuckie. The banks crashed our economy, got paid off by the government through bail-outs then continue to screw Americans by fighting regulation and mortgage restructuring.

/ald